X

Sign up for Equitymaster's free daily newsletter, The 5 Minute WrapUp and get access to our latest Multibagger guide (2017 Edition) on picking money-making stocks.

This is an entirely free service. No payments are to be made.


Download Now Subscribe to our free daily e-letter, The 5 Minute WrapUp and get this complimentary report.
We hate spam as much as you do. Check out our Privacy Policy and Terms Of Use.
Grasim 2QFY04 PAT up 58% YoY - Views on News from Equitymaster
 
 
  • PRINT
  • E-MAIL
  • FEEDBACK
  • A  A  A
  • Oct 23, 2003

    Grasim 2QFY04 PAT up 58% YoY

    Grasim, the largest cement producer in the country, has reported a 6% growth in its topline for the September quarter, over the previous year. While the operating profits of the company have improved by 5%, the bottomline of the company has grown by nearly 58% on the back of improved operating performance and also a robust 82% increase in other income.

    (Rs m) 2QFY03 2QFY04 Change 1HFY03 1HFY04 Change
    Net Sales 11,129 11,772 5.8% 22,484 23,519 4.6%
    Other Income 366 665 81.8% 459 876 90.8%
    Expenditure 8,628 9,066 5.1% 17,529 18,131 3.4%
    Operating Profit (EBDIT) 2,501 2,706 8.2% 4,955 5,388 8.7%
    Operating Profit Margin (%) 22.5% 23.0% 22.0% 22.9%
    Interest 432 403 -6.7% 874 794 -9.2%
    Depreciation 628 684 8.9% 1,252 1,354 8.2%
    Profit before Tax 1,808 2,284 26.3% 3,288 4,116 25.2%
    Extraordinary items (16) 275 (33) 248
    Tax (505) (530) 5.0% 915 1,030 12.6%
    Profit after Tax/(Loss) 1,287 2,030 57.7% 2,340 3,334 42.5%
    Net profit margin (%) 11.6% 17.2% 10.4% 14.2%
    No. of Shares 91.7 91.7 91.7 91.7
    Diluted Earnings per share* 56.1 88.5 51.0 72.7
    P/E Ratio 7.9 9.7
    (* annualised)

    Let us look at how the major divisions of the company performed during 2QFY04.

    VSF: Although the VSF division of the company registered a decline in sales of about 9%, higher realisations and cost optimization measures helped the company to offset decline in volumes. The division operated at 110% capacity, up from 107% a year ago. The company is trying hard to develop novel applications for VSF and it has set up R&D facilities for the same

    Growth Volumes Realisations
    Cement 8% -4%
    VSF -9% 6%
    Sponge iron -3% 36%
    Caustic soda 6% 14%

    Cement: The cement division of the company also saw an increase in sales volumes, which improved by 8% YoY. The realisations however suffered on account of the companyís presence in regions of high demand supply mismatch and fell by 4%. Going forward, we expect the cement division to be the growth driver for the company mainly on account of two reasons. First, the industry is growing at a healthy rate of 8-9% and the secondly, the company will also benefit from the economies of scale and improved realisations as a result of the acquisition of L&Tís cement division.

    Sponge Iron: Riding on the back of improvement in scrap prices globally, the sponge iron division of the company registered an impressive 36% improvement in realisations in 2QFY04 as compared to the previous year. However, the volumes of the company registered a drop of around 3% on account of lower capacity utilisation of around 64% as compared to 70% in the corresponding period of previous year. The outlook for the division looks bright on account of increase in demand in both domestic and international markets. However, the low availability of natural gas and its pricing remains a cause of concern for the company.

    Chemicals: The chemicals division of the company saw both sales volumes as well as realisations improve in 2QFY04. While the volumes of the company improved by around 6%, the realisations registered a rise of around 14%.

    Operating expenses 2QFY03 2QFY04 Change
    Raw materials 2,783 2,907 4%
    % of sales 25.0% 24.7%
    Employee 788 851 8%
    % of sales 7.1% 7.2%
    Power 2,099 2,207 5%
    % of sales 18.9% 18.8%
    Freight 1,188 1,209 2%
    % of sales 10.7% 10.3%
    Finished goods 21 144 580%
    % of sales 0.2% 1.2%
    Other costs 1,749 1,749 0%
    % of sales 15.7% 14.9%
    Total 8,628 9,066 5%

    The stock is trading at Rs 700, implying a P/E of 9.7x its annualised 1HFY04 earnings. We will put up a more detailed review of the performance post the companyís analyst meet.

     

     

    Equitymaster requests your view! Post a comment on "Grasim 2QFY04 PAT up 58% YoY". Click here!

      
     

    More Views on News

    UltraTech: Post-Acquisition Cement Capacity Augmented to 93 MTPA (Quarterly Results Update - Detailed)

    Aug 11, 2017

    UltraTech Cement completed the acquisition of cement plants of Jaiprakash Associates Limited (JAL) and Jaypee Cement Corporation Limited (JCCL) during the quarter ended June 2017.

    Ambuja Cement: Fall in Other Income Drag Bottomline Lower (Quarterly Results Update - Detailed)

    Aug 11, 2017

    While topline witnessed growth on the back of higher cement sale volumes, a 50.5% YoY fall in other income weighed on Ambuja's bottomline during the quarter ending June 2017.

    ACC: Cementing Growth through Capacity Expansion and Favorable Sectoral Developments (Quarterly Results Update - Detailed)

    Jul 20, 2017

    Expanded capacity helped ACC strengthen its market presence in eastern region during the quarter ended June 2017.

    UltraTech: One of the Weakest Quarters in Years (Quarterly Results Update - Detailed)

    May 18, 2017

    Cement demand was weak because of subdued housing demand, volatile cement prices, and rising fuel costs.

    Ambuja Cem: Net Profits zoom up 361% YoY During Jan-March Quarter (Quarterly Results Update - Detailed)

    May 8, 2017

    Stock price jumps up on Ambuja-ACC merger talks...

    More Views on News

    Most Popular

    Demonetisation Barely Made Any Difference to Tax Collections(Vivek Kaul's Diary)

    Aug 7, 2017

    The data tells us quite a different story from the one the government is trying to project.

    Proxy Plays: A Smart Way to Bet on 'Off Limits' Companies(The 5 Minute Wrapup)

    Aug 4, 2017

    The small-cap space is full of small players that are clear proxies to great growth stories and Indian megatrends.

    Should You Invest In Bharat-22 ETF? Know Here...(Outside View)

    Aug 8, 2017

    Bharat-22 is one of the most diverse ETFs offered so far by the Government. Know here if you should invest...

    Signs of Life in the India VIX(Daily Profit Hunter)

    Aug 12, 2017

    The India VIX is up 36% in the last week. Fear has gone up but is still low by historical standards.

    7 Financial Gifts For Your Sister This Raksha Bandhan(Outside View)

    Aug 7, 2017

    Raksha Bandhan signifies the brother-sister bond. Here are 7 thoughtful financial gifts for sisters...

    More
    Copyright © Equitymaster Agora Research Private Limited. All rights reserved.
    Any act of copying, reproducing or distributing this newsletter whether wholly or in part, for any purpose without the permission of Equitymaster is strictly prohibited and shall be deemed to be copyright infringement.

    LEGAL DISCLAIMER: Equitymaster Agora Research Private Limited (hereinafter referred as 'Equitymaster') is an independent equity research Company. Equitymaster is not an Investment Adviser. Information herein should be regarded as a resource only and should be used at one's own risk. This is not an offer to sell or solicitation to buy any securities and Equitymaster will not be liable for any losses incurred or investment(s) made or decisions taken/or not taken based on the information provided herein. Information contained herein does not constitute investment advice or a personal recommendation or take into account the particular investment objectives, financial situations, or needs of individual subscribers. Before acting on any recommendation, subscribers should consider whether it is suitable for their particular circumstances and, if necessary, seek an independent professional advice. This is not directed for access or use by anyone in a country, especially, USA or Canada, where such use or access is unlawful or which may subject Equitymaster or its affiliates to any registration or licensing requirement. All content and information is provided on an 'As Is' basis by Equitymaster. Information herein is believed to be reliable but Equitymaster does not warrant its completeness or accuracy and expressly disclaims all warranties and conditions of any kind, whether express or implied. Equitymaster may hold shares in the company/ies discussed herein. As a condition to accessing Equitymaster content and website, you agree to our Terms and Conditions of Use, available here. The performance data quoted represents past performance and does not guarantee future results.

    SEBI (Research Analysts) Regulations 2014, Registration No. INH000000537.

    Equitymaster Agora Research Private Limited. 103, Regent Chambers, Above Status Restaurant, Nariman Point, Mumbai - 400 021. India.
    Telephone: +91-22-61434055. Fax: +91-22-22028550. Email: info@equitymaster.com. Website: www.equitymaster.com. CIN:U74999MH2007PTC175407
     

    Become A Smarter Investor In
    Just 5 Minutes

    Multibagger Stocks Guide 2017
    Get our special report, Multibagger Stocks Guide (2017 Edition) Now!
    We will never sell or rent your email id.
    Please read our Terms

    GRASIM IND. SHARE PRICE


    Aug 17, 2017 03:37 PM

    TRACK GRASIM IND.

    • Track your investment in GRASIM IND. with Equitymaster's Portfolio Tracker. Set live price alerts, get research alerts and more. Get access now...
    • Add To MyStocks

    GRASIM IND. 5-YR ANALYSIS

    Detailed Financial Information With Charts

    COMPARE GRASIM IND. WITH

    MARKET STATS