Professional Documents
Culture Documents
Performance Review
Q2FY08
27th October 2007
Cautionary Statement
Statements in this Presentation describing the Companys objectives, estimates, expectations or predictions may be forward looking statements within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or implied. Important factors that could make a difference to the Companys operations include global and Indian demand supply conditions, finished goods prices, feedstock availability and prices, cyclical demand and pricing in the Companys principal markets, changes in Government regulations, tax regimes, economic developments within India and the countries within which the company conducts business and other factors such as litigation and labour negotiations. The Company assumes no responsibility to publicly amend, modify or revise any forward looking statement, on the basis of any subsequent development, information or events, or otherwise.
2
25 42 52 63 47 50 50
PBT
(including minority share)
Total Tax Expenses PAT (Before Minority Share) PAT (After Minority Share) EPS (Rs.)
26 41 50 55 48 52 52
PBT
(including minority share)
Total Tax Expenses PAT (Before Minority Share) PAT (After Minority Share) EPS (Rs.)
Q2FY08 Q2FY07 Net Turnover & Op. Income Other Income PBIDT Interest Gross Profit Depreciation PBT
Current Tax Deferred Tax
% H1FY08 H1FY07 Chg. 25 8,037.2 6,400.1 57 185.3 102.6 42 2,636.4 1,867.8 (2) 110.1 108.3 44 2,526.3 1,759.5 10 321.7 290.2 52 2,204.6 1,469.3
--638.5 61.7 462.8 (9.8)
Total Tax PAT Minority Share etc. PAT (after Minority Share) Earning Per Share - Basic and Diluted (Rs.)
63 47 -50 50
55 48 -52 52
TOTAL REVENUE PBIDT Interest Charges Depreciation PBT Total Tax Expenses PAT EPS (Rs.)
25 48 11 16 55 71 48 48
Impressive growth in revenue supported by higher volumes and realisation PBIDT up by 48% despite rising input and fuel costs
Higher operating profit from all business segments Historically highest operating profit by VSF Business, up by 81% Cement Business PBIDT up by 24% Normal operations in Chemical business during the quarter, unlike lower production due to CPP shutdown in Q2FY07 Sponge Iron business aided by higher realisations
TOTAL REVENUE PBIDT Interest Charges Depreciation PBT Total Tax Expenses PAT EPS (Rs.)
27 52 15 15 60 69 56 56
Strong growth in revenue, up by 27% PBIDT up by 52% despite rising input and fuel costs
Higher operating profit from all business segments Cement Business PBIDT up by 27% Normal operations in VSF and Chemical businesses unlike lower production in VSF in Q1FY07 and in Chemical in H1FY07 Sponge Iron business aided by higher realisations Higher other income with increase in treasury income
Q2FY08 Q2FY07 Net Turnover & Op. Income Other Income PBIDT Interest Gross Profit Depreciation Non-recurring Income PBT
Current Tax Deferred Tax
% Chg. 27 43 52 15 54 15 -60
---
Total Tax PAT Earning Per Share - Basic and Diluted (Rs.)
71 48 48
69 56 56
Consolidated
PBIDT Mix
VSF 26% Chemical 3%
(Rs.1,267 Crs.)
Standalone
PBIDT Mix
Sponge Iron Others 4% 3%
VSF 37%
Cement 53%
(Rs.2,519 Crs.)
Chemical 5% Textiles 3%
Cement 51%
(Rs.862 Crs.)
Chemical 5%
9
Financial Highlights
10
FY05 9,292 2,272 880 4,082 9,695 24.5 96.0 6.3 0.86 445 18.2 23.7
Strong Balance sheet ROAvCE increased from 18% in FY05 to 33% in H1FY08 Return on equity at 36% Debt-equity reduced from 0.86 in FY05 to 0.51 in H1FY08
Adjusted leveraging even lower at 0.31
Net Turnover PBIDT PAT (After Minority share) Net Worth Capital Employed PBIDT Margins(%) EPS (Rs.) Interest Cover (x) Debt: Equity (x) Book Value (Rs.) ROAvCE (PBIT Basis) (%) $ RONW (%) *
10,188 13,520 14,719 22.9 113.5 8.7 0.69 527 17.8 23.4 30.4 214.6 14.0 0.65 724 31.0 34.3 33.0 140.7 18.1 0.51 858 32.8 35.6
Strong funding capabilities to support Companys ambitious future growth plans Grasims market capitalisation Rs.322Bn.*($ 8.1 Bn.)
5 years CAGR 62.5%
at
11
FY05 6,229 1,785 886 4,324 6,931 4,569 28.7 96.6 9.6 0.46 472 35.1
FY06 6,653 1,597 863 4,978 7,542 5,190 24.0 94.1 11.9 0.40 543 26.7
FY07 8,608 2,619 1,536 6,226 9,760 7,284 30.4 167.5 17.2 0.47 679 36.9
H1 FY08
Net Turnover PBIDT PAT Net Worth Capital Employed Capital Employed (Excl.
subsidiary Investments)
4,928 1,722 1,011 7,238 10,641 8,081 34.9 110.3 23.2 0.38 789 40.3
Comfortable interest cover Standalone ROCE in H1FY08 at 40.3% Strong funding capabilities to support Companys ambitious future growth plans Grasims market capitalisation Rs.322Bn.*($ 8.1 Bn.)
5 years CAGR 62.5%
at
PBIDT Margin (%) EPS (Rs.) Interest Cover (x) Debt: Equity (x) Book Value (Rs.) ROAvCE (excl.subsidiary
investment) (PBIT Basis) (%) $
$ Capital Employed includes CWIP
(* 30th Sep. 07 )
12
13
New historical high operating profit of Rs.316 Crs., up by 81% Sales volume up by 11%
Upsurge in global VSF demand for comfort fabrics Higher demand for knitted fabrics Supported by 103% capacity utilisation
Realisation up 24%
Strong demand coupled with cost push effect
Operating margins increased considerably to 40% despite increase in prices of key inputs Rupee appreciation and part captive pulp capacity partially offset steep increase in global pulp prices
14
Volume growth to help growth in operating profits Capacity expansion plans from existing 270K TPA to 365K TPA under implementation to meet growing demand
64K TPA brownfield expansion at Kharach (Gujarat) progressing satisfactorily, expected to be operational in Q4FY08 31K TPA expansion planned at Harihar (Karnataka)
15
Production up by 69%
Normal operations during the quarter Q2FY07 was impacted due to shutdown of a captive power plant
Caustic Capacity (TPA) 258,000 Caustic Production (MT) 48,752 Caustic Sales Volumes (MT) 49,634 Net Turnover (Rs. Crs.) ECU Realisation (Rs./MT) PBIDT (Rs. Crs.) PBIDT Margin (%) PBIT (Rs. Crs.) ROAvCE % 108.8 19,298 40.3 37.1% 34.4 45.2%
35 69 65 43 (8) -----
Lower ECU realisations due to reduction in caustic and allied product prices Higher operating profit
Higher volumes Improved power efficiency resulting from conversion to membrane cell
Outlook
Demand supply mismatch in short term with new capacity additions
Realisation to remain under pressure
16
Cement production up by 9%
Higher capacity utilisation at 110%
Grey Cement
Production Sales Volumes* $ Realisation
Mn. MT Mn. MT Rs./MT
3.62 3.60 3,173 4.43 2,727 89,733 92,566 6,850 1,362.0 442.2 32.5% 394.8 44.6%
3.31 3.38 2,822 3.65 2,424 92,766 90,253 6,614 1,139.3 356.0 31.2% 313.8 57.4%
9 6 12 22 13 (3) 3 4 20 24 -26 --
Cement sales volume higher by 6% RMC volumes up by 22% aided by capacity additions Higher realisation pressures setoff by cost
RMC
Sales Volumes Realisation
Lac Cu. Mtr. Rs./Cu Mtr.
White Cement
Production Sales Volumes Realisation Net Turnover $ PBIDT PBIDT Margin PBIT ROAvCE
MT MT Rs./MT Rs. Crs. Rs. Crs. (%) Rs. Crs. %
Steep rise in fuel cost due to increase in imported coal and petcoke prices and higher use of imported coal Higher freight and wage cost
Cement : Outlook
Domestic cement consumption grew by 11% in H1FY08 Demand expected to grow at about 10% in the long term Capacity announcement of around 90 Mn. tons over three years [FY08 - FY10]
If materialises in total as per announced schedule, may result in surplus Prices may come under pressure from end FY09
18
Realisation up by 17% with increase in global scrap prices and freight rate Operating profit improved from Rs.6 Crs. to Rs.30 Crs. led by higher volumes and realisation
Despite increase in cost due to use of expensive alternate fuels and higher iron ore prices
Outlook
Business outlook expected to improve in long term with adequate gas availability, likely by March 08 Uncertainty in Gas pricing remains a concern
19
Capex
20
Capex plans
Capex Summary
Cement
- Kotputli (4.5 Mn. TPA) & Shambhupura (4.4 Mn. TPA) Projects, Rajasthan,(incl. 96 MW TPP) - 2 Nos. Thermal Power Plants (75 MW ) - Grinding unit Dadri, U.P. (1.3 Mn. MT) - RMC Plants (27 Nos., Capacity 6.2 mn. cu. mtrs.) - Modernisation, Upgradation, etc.
Rs. Crores
VSF
- Capacity expansion, Kharach, Gujarat (63,875 TPA) - Modernisation & Upgradation
732
389 343
690
347 343
9,088
7,425
5,460
1,674
22
Q2 FY08 Net Turnover * Other Income PBIDT PBIDT Margin (%) Interest Depreciation PBT Total Tax Expenses PAT after Minority share
* Adjusted for traded sales volumes
Q2 % FY07 Chg. 995.8 12.1 271.0 27.2% 23.7 55.4 191.9 61.9 129.5 21 87 31 -(21) 6 45 51 42
Net Turnover up by 21% led by higher realisation PBIDT up by 31% led by better sales mix and improved realisation Higher stores and spares expenses due to annual maintenance shutdown across the plants PAT up by 42% Capex plans schedule progressing as per
23
% Chg.
Sequentially, domestic realisation up by 4% Current FOB prices: Cement $57/ton, Clinker $47 /ton Export prices to remain higher till FY08
24
Q2 FY08 Production Sales Volumes Realisation (Rs./MT) Net Revenues PBIDT PBIDT Margin Interest Depreciation PBT Tax Expenses Net Profit 1.56 1.43 2,920 41.8 3.7 8.7% 0.2 1.6 1.9 0.4 1.5
Q2 FY07 2.03 2.07 2,738 56.8 10.0 17.7% 0.4 1.5 8.1 0.1 8.0
Production and sales volumes declined due to heavy rains and breakdown of DG set Operating profit decreased as a result Net profit down by 81%, to Rs.1.5 Crs. Performance expected to improve in second half
25
Summary
26
Summary
Grasim A VSF and Cement major
With strong competitive edge Global size operations Consolidating leadership position with strong organic growth pipeline
27
Proposed Cement Projects Proposed Grinding Units Grey Cement plants Grinding Units (G)
B
Shambhupura Jodhpur
Bulk Cement Terminal UltraTech Cement Plants UltraTech Grinding Units (G)
B F P C T S
UltraTech Bulk Cement Terminals Fibre plants Pulp plant Chemical plant Textiles units Sponge Iron plant
Jawad Bharuch F Magdalla (G) Jafrabad Sikka F C Nagda Pipavav Awarpur Raigad Hotgi(G) Navi Mumbai B S
Hirmi
Reddipalayam
Not to scale
28
Thank You
Annexures
Consolidated and Standalone Financial Consolidated and Standalone Profitability Segmental Performance Q2 & H1 FY08 VSF Summary Chemical Summary Cement Summary Sponge Iron Summary Textiles Summary UltraTech Performance SDCC Performance
31
Financial Snapshot
Standalone
(Rs. Crores)
Consolidated
H1FY08 9,197 5,662 2,561 2,001 417 10,641 7,238 2,767 636 0.38 789 769 674 9,695 4,082 500 3,934 1,179 0.86 445 FY05 11,312 6,294 1,958 1,352 652 4,833 514 3,683 1,158 0.69 527 FY06 11,927 6,411 1,773 2,272 858 6,636 859 4,873 1,152 0.65 724 FY07 14,481 8,468 1,922 1,984 549 14,719 7,870 1,059 4,576 1,214 0.51 858 H1FY08 16,512 10,279 1,907 -
FY04 5,802 3,213 2,333 409 349 6,304 3,606 2,065 633 0.57 393
FY05 6,052 3,204 2,362 939 426 6,931 4,324 2,008 599 0.46 472
FY06 6,417 3,307 2,352 1,422 461 7,542 4,978 1,980 584 0.40 543
FY07 7,974 4,593 2,476 2,141 550 9,760 6,226 2,952 582 0.47 679
Gross Block $ Net Block $ Goodwill Cement Subs. Investment Investments Net Current Assets Capital Employed Net Worth Minority Interest Debts Deferred Tax Debt: Equity (x) Book Value (Rs.)
$ Block includes CWIP
10,188 13,520
32
Profitability Snapshot
Standalone
(Rs. Crores)
Consolidated
H1FY08 5,577 4,928 1,722 34.9 56 1,667 483 1,011 110.3 -$
FY04 6,130 5,213 1,504 28.9 154 1,350 298 779 85.0 14.0
$
FY05 7,201 6,229 1,785 28.7 139 1,646 418 886 96.6 16.0
$
FY06 7,638 6,653 1,597 24.0 103 1,494 343 863 94.1 20.0
$
FY07 9,613 8,608 2,619 30.4 112 2,507 691 1,536 167.5 27.5
$
FY05 10,776 2,272 24.5 285 1,988 442 880 96.0 -18.2 23.7 6.3
FY06 11,746 2,337 22.9 218 2,118 403 1,041 113.5 -17.8 23.4 8.7
FY07 15,714 14,106 4,290 30.4 229 4,061 1,092 1,968 214.6 -31.0 34.3 14.0
H1FY08 9,036 7,999 2,636 33.0 110 2,526 700 1,290 140.7 -32.8 35.6 18.1
Gross Turnover Net Turnover PBIDT PBIDT Margin (%) Interest PBDT Total Tax Expenses PAT (After Minority Share) EPS (Rs.) DPS (Rs.) ROAvCE (PBIT Basis)(%) RONW (%) Interest Cover (x)
9,292 10,224
28.9 7.9
35.1 9.6
26.7 11.9
36.9 17.2
40.3 23.2
33
Q2FY08 Q2FY07 Q2FY08 Q2FY07 Q2FY08 Q2FY07 Q2FY08 VSF Chemical Cement Sponge Iron Textile Direct Operations Cement subsidiaries Company as a whole 794 111 1,367 210 88 566 77 1,188 141 85 316 40 442 30 3 831 174 9 356 6 1 546 40.3 37.1 32.5 14.3 3.7 31.2 12.2 31.2 4.1 1.7 295 34 395 21 (0.3) 745
Q2FY07 Q2FY08 Q2FY07 Q2FY08 Q2FY07 157 5 314 (3) (0.1) 473 1,358 304 3,997 481 163 6,303 2,561 1,098 291 2,291 508 124 4,312 2,403 8,463
@
2,519
2,011
862
583
34.5
29.2
775
507
10,641
40.4
36.0
Consolidated
VSF Cement $ Company as a whole$ 904 2,609 3,973 671 2,181 3,186 326 801 1,267 189 637 895 36.5 30.7 32.1 28.5 29.3 28.2 303 694 1,104 169 538 747 1,622 10,203 14,719 1,249 7,480 11,550 79.4 29.0 31.3 59.3 30.1 27.5
$ including minority share @ ROCE calculated after excluding investment in cement subsidiaries & releated income Capital Employed includes CWIP
34
H1FY08 H1FY07 H1FY08 H1FY07 H1FY08 H1FY07 H1FY08 VSF Chemical Cement Sponge Iron Textile Direct Operations Cement subsidiaries Company as a whole 1,502 204 2,782 431 146 1,012 149 2,355 319 142 572 68 933 65 4 1,642 289 27 732 20 3 1,071 38.5 35.1 33.9 15.2 3.1 28.9 18.5 32.6 6.3 1.9 531 57 839 48 (2) 1,473
H1FY07 H1FY08 H1FY07 H1FY08 H1FY07 255 18 648 3 (0.3) 923 1,358 304 3,997 481 163 6,303 2,561 1,098 291 2,291 508 124 4,312 2,403 8,463
@
4,966
3,905
1,722
1,134
34.9
29.3
1,550
984
10,641
40.3
35.0
Consolidated
VSF Cement $ Company as a whole$ 1,722 5,436 8,037 1,196 4,522 6,400 572 1,774 2,636 302 1,414 1,868 33.6 32.7 33.0 25.5 31.3 29.3 525 1,562 2,315 264 1,217 1,578 1,622 10,203 14,719 1,249 7,480 11,550 68.8 32.7 32.8 46.4 34.1 29.0
$ including minority share @ ROCE calculated after excluding investment in cement subsidiaries & releated income Capital Employed includes CWIP
35
1 270,100 25 246,833 21 250,725 49 21 98 -109 24 -2,294.6 85,729 712.3 31.0% 638.4 1,211 57.8%
36
Chemical : Summary
Q2 FY08 Q2 FY07 % Chg. H1 FY08 H1 FY07 % Chg. Capacity Production Sales Volumes Net Turnover Avg. Realisation PBIDT PBIDT Margin PBIT Capital Employed ROAvCE (PBIT Basis) TPA MT MT Rs. Crs. Rs./MT Rs. Crs. % Rs. Crs. Rs. Crs. % 258,000 48,752 49,634 108.8 19,298 40.3 37.1% 34.4 304 45.2% 190,800 28,911 30,072 76.2 21,081 9.3 12.2% 4.8 291 7.7% 35 69 65 43 (8) ---4 -258,000 91,595 92,506 195.1 18,310 68.4 35.1% 56.6 304 37.2% 190,800 59,648 60,784 147.2 20,136 27.2 18.5% 18.2 291 14.5% 35 54 52 33 (9) 152 -211 4 -FY07 258,000 136,685 137,830 313.0 19,444 80.6 25.7% 60.0 304 23.3%
37
Cement : Summary
Q2 FY08 Q2 FY07 % Chg. H1 FY08 H1 FY07 % Chg. Grey Cement Capacity Production Sales Volumes * Avg. Realisation White Cement Capacity Production Sales Volumes Avg. Realisation Net Turnover * PBIDT PBIDT Margin PBIT Capital Employed ROAvCE (PBIT basis)
*Adjusted for traded sales volumes
Mn. MT Mn. MT Mn. MT Rs./MT TPA MT MT Rs./MT Rs. Crs. Rs. Crs. % Rs. Crs. Rs. Crs. %
Mn. MT
-9 6 12
-9 9 13
475,000 475,000 89,733 92,766 92,566 90,253 6,850 6,614 1,362.0 1,139.3 442.2 356.0 32.5% 31.2% 394.8 313.8 3,997 2,291 44.6% 57.4%
-0.13
-- 475,000 475,000 (3) 182,327 175,811 3 177,571 171,396 4 6,636 6,423 20 2,752.7 2,249.3 24 933.3 732.5 -33.9% 32.6% 26 839.4 647.9 74 3,997 2,291 -47.5% 59.3%
-0.06 0.30
-- 475,000 4 364,649 4 367,167 3 6,458 22 4,891.2 27 1,623.0 -33.2% 30 1,448.2 74 3,077 -56.2%
-0.77
38
-- 900,000 18 525,183 12 571,127 35 19 ---(5) -754.3 12,679 85.1 11.3% 50.4 552 9.3%
39
Textiles : Summary
Net Turnover PBIDT PBIDT Margin PBIT Capital Employed ROAvCE (PBIT Basis) Rs. Crs. Rs. Crs. % Rs. Crs. Rs. Crs. % Q2 FY08 Q2 FY07 % Chg. H1 FY08 H1 FY07 % Chg. 85.1 80.8 5 140.5 133.6 5 126 4.3 2.5 69 3.1 1.4 3.7% 1.7% -3.1% 1.9% -(0.3) (0.1) -(2.2) (0.3) -163 124 31 163 124 31 (0.9)% (0.5)% -(3.0)% (0.5)% -FY07 254.8 4.6 1.8% (4.6) 126 (4.2)%
40
Q2 FY08 Q2 FY07 % Chg. H1FY08 Cement Production (Mn. MT) Sales Volume(Mn. MT): Cement-Domestic* Cement-Exports Clinker Total Volumes Realisation(Rs./MT): Cement-Domestic Cement-Exports Clinker Net Turnover * Other Income PBIDT PBIDT Margin % Interest Depreciation PBT Total Tax PAT after Minority Share Earning Per Share, Basic & Diluted (Rs.) * Adjusted for traded sales volumes 3.34 3.15 0.20 0.26 3.61 3,260 3,126 1,934 1,208.2 22.7 355.1 29.4% 18.8 58.6 277.7 93.5 184.1 14.8 -3.00 2.80 0.23 0.57 3.60 2,890 3,205 1,640 995.8 12.1 271.0 27.2% 23.7 55.4 191.9 61.9 129.5 10.4 0.08 11 12 (14) (53) -13 (2) 18 21 87 31 -(21) 6 45 51 42 42 -7.25 6.82 0.43 0.80 8.04 3,195 3,031 1,749 2,575.8 50.2 817.8 31.8% 38.9 115.1 663.9 218.9 444.6 35.7 0.04
H1FY07 % Chg. 6.87 6.28 0.58 1.12 7.98 2,841 2,905 1,581 2,164.3 22.1 659.2 30.5% 46.3 110.4 502.5 162.8 338.6 27.2 0.16 5 9 (27) (29) 1 12 4 11 19 128 24 -(16) 4 32 34 31 31 --
FY07 14.63 13.35 1.27 2.50 17.12 2,934 2,871 1,630 4,781.2 59.2 1,490.8 31.2% 86.8 228.7 1,175.3 388.7 784.9 63.1 0.56
41
Q2 FY08 Q2 FY07 Net Turnover Other Income PBIDT PBIDT Margin % Interest Depreciation PBT Tax Expenses Exceptional Items Net Profit 41.8 1.6 3.7 8.7% 0.2 1.6 1.9 0.4 1.5 56.8 0.9 10.0 17.7% 0.4 1.5 8.1 0.1 8.0
H1 FY08 H1 FY07 116.6 2.5 22.5 19.3% 0.3 3.1 19.0 2.4 16.6 119.3 2.7 22.8 19.1% 0.7 3.1 19.03 (0.1) 19.1
FY07 261.8 4.6 61.0 23.3% 1.2 6.3 53.5 0.1 0.6 54.0
42
Press Release
GRASIM, THE ADITYA BIRLA GROUPs FLAGSHIP COMPANY PERFORMANCE FOR Q2FY 2008 Consolidated Net Profit Consolidated Net Revenue : : Rs.620 Crs. Rs.3,973 Crs. 50% 25%
Net Revenue Gross Profit Depreciation Total Tax Expenses Profit after Taxes Less: Minority Share Net Profit EPS (Rs.)
50% 50%
1,290 141
52% 52%
Grasim, the flagship Company of the Aditya Birla Group, has posted good results for the 2nd quarter ended 30th September, 2007. Cement and Viscose Staple Fibre (VSF), its core businesses, have been the growth drivers. The Chemical and Sponge Iron businesses have contributed as well. Ongoing modernization efforts, upgradation of plants and energy optimization have been instrumental to the growth process. The Company has reported a growth on all the fronts, viz., Revenue, Gross Profit and Net Profit. Revenue was up by 25% at Rs.3,973 crores (Rs.3,186 crores). Gross Profit at Rs.1,213 crores (Rs.839 crores) rose by 44% over the corresponding period. Despite a substantially higher provision for tax expenses, Net Profit grew by 50% at Rs.620 crores (Rs.414 crores).
The Chemical plant put in a better performance during the quarter, Production of caustic soda, which was impacted during the corresponding quarter on account of the shut down of a captive power plant, was higher at 48,752 tons. Sales volumes too were higher at 49,634 tons. Realisations dipped by 8% consequent to the reduction in prices of caustic soda and allied products. Realisations are expected to remain depressed, given the demand-supply mismatch arising out of new capacity additions.
Cement Business
The Cement business performance has been good. While Production recorded a growth of 9% at 3.62 million tons, Sales volumes grew by 6% at 3.60 million tons. The share of blended cement increased from 63% to 68%. Costs remained under pressure due to the steep rise in fuel costs and increased freight rates. The White Cement unit reported a satisfactory performance. Sales volumes were higher by 3% at 92,566 tons.
2
Cement Subsidiaries
UltraTech Cement Limited (UltraTech), a subsidiary of Grasim, too bettered its performance. Sales of cement and clinker were at 3.35 million tons and 0.26 million tons respectively. Net Profit was higher at Rs.184 crores. Shree Digvijay Cement Company Limited, yet another subsidiary, reported a profit of Rs.1.50 crores, vis--vis Rs.8.03 crores in the corresponding quarter.
Cement Capex plan
The Company is expanding its capacity by 10.2 million tons at a total cost of Rs.3,480 crores. To this end, the Company is setting up a. a Greenfield cement plant at Kotputli in Rajasthan (with a split grinding unit at Panipat in Haryana), of a total capacity of 4.5 million tons; b. a new plant at Shambhupura in Rajasthan (with a split grinding unit at Aligarh in Uttar Pradesh) of a total capacity of 4.4 million tons; and c. a grinding unit at Dadri of a capacity of 1.3 million tons. All these projects are progressing as per schedule. The Shambhupura plant is expected to be commissioned by end-FY08 and the Kotputli plant in Q1FY09. This will enable the Company to cater to the growing demand for Cement in the northern region. The capex plans of UltraTech too are in line with expectations. Both the Company and its subsidiary are setting up Ready Mix Concrete plants at various locations in the country. The Companys aggregate cement capacity (including that of its subsidiaries), upon completion of expansion, will stand augmented by 17 million tons at 48 million tons. The additional capacity of around 90 million tons, as announced by the industry, could result in a surplus scenario due to which realisations could be under pressure from end-FY09. However, the growth in demand bodes well for the Companys Cement business.
Outlook
Grasims strong fundamentals, its unrelenting focus on operational excellence, cost optimization, effective financial management, continuous restructuring of business processes, together with its leadership position in the Cement and VSF sectors, augur well for the Company. The prospects for Grasim continue to be bright.
UNAUDITED FINANCIAL RESULTS FOR THE QUARTER ENDED 30th SEPTEMBER 2007 I. CONSOLIDATED RESULTS : Three Months Ended 30th September 2007 Three Months Ended 30th September 2006 Six Months Ended 30th September 2007 Six Months Ended 30th September 2006 Rs in Crores Year Ended 31st March 07 ( Audited )
Net Sales / Income from Operations Other Income Expenditure : - Decrease / ( Increase ) in Stock - Raw Material Consumed - Purchases of Finished Goods - Payment to & Provision for Employees - Power & Fuel - Freight , Handling & Other Expenses - Depreciation - Other Expenditure Total Expenditure Interest Profit before Tax Expenses Provision for Current Tax Provision for Deferred Tax Net Profit Less : Minority Share Add : Share in Profit / (Loss) of Associates Net Profit ( After Minority Share ) Paid up Equity Share Capital (Face Value Rs. 10 per share) Reserves excluding Revaluation Reserve Basic EPS for the period ( Rupees ) Diluted EPS for the period ( Rupees ) II. STANDALONE RESULTS :
3,972.58 83.91
3,185.50 53.43
8,037.23 185.33
6,400.13 102.62
14,178.44 245.64
(64.27) 871.82 23.61 213.75 633.31 461.05 163.10 649.97 2,952.34 54.14 1,050.01 (315.57) (28.96) 705.48 84.53 (0.94) 620.01 91.69
(5.77) 654.62 17.14 173.89 561.45 414.14 148.44 528.19 2,492.10 55.51 691.32 (215.03) 4.17 480.46 66.05 414.41 91.69
(34.07) 1,689.19 33.09 385.37 1,293.07 974.48 321.75 1,245.02 5,907.90 110.10 2,204.56 (638.55) (61.68) 1,504.33 214.14 (0.51) 1,289.68 91.69
(0.71) 1,250.51 43.03 334.89 1,141.23 858.21 290.19 1,007.77 4,925.12 108.36 1,469.27 (462.75) 9.72 1,016.24 166.58 849.66 91.69
33.07 2,821.58 74.83 672.98 2,472.45 1,878.07 609.97 2,181.02 10,743.97 228.64 3,451.47 (1,097.14) 5.07 2,359.40 391.50 (0.40) 1,967.50 91.69 6,538.05
67.62 67.62
45.20 45.20
140.66 140.66
92.67 92.67
214.58 214.58 Rs. in Crores Full Year ended 30th March 2007 ( Audited )
Net Sales / Income from Operations Other Income Expenditure : - Decrease / ( Increase ) in Stock - Raw Material Consumed - Purchases of Finished Goods - Payment to & Provision for Employees - Power & Fuel - Freight , Handling & Other Expenses - Depreciation - Other Expenditure Total Expenditure Interest Profit before Exceptional Items and Tax Expenses Write back of provision for diminution in value of loans Profit before Tax Expenses Provision for Current Tax Provision for Deferred Tax Net Profit Paid up Equity Share Capital (Face Value Rs. 10 per share) Reserves excluding Revaluation Reserve
2,519.23 57.32
2,011.39 50.22
4,965.82 125.06
3,905.11 87.69
8,680.34 209.66
(26.77) 669.78 24.59 143.00 348.57 246.43 87.53 308.62 1,801.75 27.22 747.58 747.58 (223.73) (24.07) 499.78 91.69
(14.45) 535.04 60.59 123.05 280.55 215.40 75.57 278.60 1,554.35 24.52 482.74 482.74 (145.80) 0.90 337.84 91.69
(12.55) 1,297.05 57.81 259.33 672.73 502.57 172.53 591.74 3,541.21 55.69 1,493.98 1,493.98 (429.43) (53.11) 1,011.44 91.69
0.66 998.88 128.76 236.08 545.05 423.10 149.66 526.44 3,008.63 48.28 935.89 935.89 (284.85) (1.30) 649.74 91.69
16.44 2,219.32 321.16 459.40 1,196.14 919.40 317.91 1,139.13 6,588.90 111.84 2,189.26 37.10 2,226.36 (692.38) 1.83 1,535.81 91.69 6,134.46 167.50 167.50 58,509 63.82%
Basic EPS for the period ( Rupees ) 54.51 36.85 110.31 70.86 Diluted EPS for the period ( Rupees ) 54.51 36.85 110.31 70.86 Total Public Shareholding* - Number of Shares (000's) 58,441 58,723 - Percentage of Shareholding 63.75% 64.06% *Total public shareholding as defined under Clause 40 A of the listing agreement(excludes shares held by Promoters and Global Depository Receipt holders)
III. SEGMENT REPORTING - CONSOLIDATED Three Months ended 30th September 2007 Three Months ended 30th September 2006 Six Months ended 30th September 2007 Six Months ended 30th September 2006 Rs. in Crores Full Year ended 31st March 2007 (Audited)
1. SEGMENT REVENUE a b c d e f Fibre & Pulp Cement Sponge Iron Chemicals Textiles Others TOTAL (Less) : Inter Segment Revenue Net Sales / Income from Operations 2. SEGMENT RESULTS a b c d e f Fibre & Pulp Cement Sponge Iron Chemicals Textiles Others TOTAL Add / (Less) : Interest Net Unallocable Income / (Expenditure ) Profit Before Tax Expenses 3. CAPITAL EMPLOYED a b c d e f g Fibre & Pulp Cement Sponge Iron Chemicals Textiles Others TOTAL Unallocated Corporate Capital Employed TOTAL CAPITAL EMPLOYED 1,622.49 10,202.75 480.83 304.41 163.20 525.39 13,299.07 1,423.44 14,722.51 1,249.05 7,480.45 508.38 291.34 124.11 371.47 10,024.80 1,528.77 11,553.57 1,428.47 8,913.85 552.21 304.49 126.17 517.88 11,843.07 1,681.16 13,524.23 302.78 693.70 21.21 34.37 (0.34) 22.84 1,074.56 (54.14) 29.59 1,050.01 168.58 538.23 (2.82) 4.81 (0.13) 14.94 723.61 (55.51) 23.22 691.32 525.06 1,562.25 47.77 56.62 (2.18) 49.01 2,238.53 (110.10) 76.13 2,204.56 263.93 1,217.16 3.02 18.20 (0.26) 27.12 1,529.17 (108.36) 48.46 1,469.27 671.74 2,767.03 50.39 60.05 (4.63) 62.61 3,607.19 (228.64) 72.92 3,451.47 904.03 2,609.02 209.80 111.42 88.33 101.38 4,023.98 (51.40) 3,972.58 670.81 2,180.84 141.34 76.75 84.79 76.16 3,230.69 (45.19) 3,185.50 1,722.03 5,435.70 430.59 203.69 146.26 197.24 8,135.51 (98.28) 8,037.23 1,195.85 4,522.04 318.69 148.55 141.62 144.27 6,471.02 (70.89) 6,400.13 2,725.25 9,957.75 755.79 319.00 270.96 326.93 14,355.68 (177.24) 14,178.44
IV. SEGMENT REPORTING - STANDALONE Three Months ended 30th September 2007 Three Months ended 30th September 2006 Six Months ended 30th September 2007 Six Months ended 30th September 2006 Rs. in Crores Full Year ended 31st March 2007 (Audited)
1. SEGMENT REVENUE a b c d e f Fibre & Pulp Cement Sponge Iron Chemicals Textiles Others TOTAL (Less) : Inter Segment Revenue Net Sales / Income from Operations 2. SEGMENT RESULTS a b c d e f Fibre & Pulp Cement Sponge Iron Chemicals Textiles Others TOTAL Add / (Less) : Interest Net Unallocable Income / (Expenditure ) Profit before Exceptional Items and Tax Expenses Write back of provision for diminution in value of loans Profit Before Tax Expenses 3. CAPITAL EMPLOYED a b c d e f g Fibre & Pulp Cement Sponge Iron Chemicals Textiles Others TOTAL Unallocated Corporate Capital Employed TOTAL CAPITAL EMPLOYED 1,358.26 3,996.78 480.83 304.41 163.20 0.90 6,304.38 4,340.33 10,644.71 1,098.32 2,291.49 508.38 291.34 124.11 1.11 4,314.75 4,152.71 8,467.46 1,210.72 3,076.68 552.21 304.49 126.17 1.21 5,271.48 4,492.67 9,764.15 294.68 394.78 21.21 34.37 (0.34) (0.03) 744.67 (27.22) 30.13 747.58 747.58 156.67 313.75 (2.82) 4.81 (0.13) 0.10 472.38 (24.52) 34.88 482.74 482.74 530.88 839.44 47.77 56.62 (2.18) (0.06) 1,472.47 (55.69) 77.20 1,493.98 1,493.98 254.59 647.90 3.02 18.20 (0.26) 0.07 923.52 (48.28) 60.65 935.89 935.89 638.42 1,448.21 50.39 60.05 (4.63) 2,192.44 (111.84) 108.66 2,189.26 37.10 2,226.36 793.87 1,367.21 209.80 111.42 88.33 2,570.63 (51.40) 2,519.23 565.73 1,187.97 141.34 76.75 84.79 2,056.58 (45.19) 2,011.39 1,501.60 2,781.96 430.59 203.69 146.26 5,064.10 (98.28) 4,965.82 1,012.09 2,355.05 318.69 148.55 141.62 3,976.00 (70.89) 3,905.11 2,327.63 5,172.66 755.79 319.00 270.96 8,846.04 (165.70) 8,680.34
V. 1
NOTES Consolidated Results have been prepared in accordance with Accounting Standard on Consolidated Financial Statements (AS-21), Accounting Standard on Accounting for Investments in Associates (AS-23), and Accounting Standard on Financial Reporting of Interest in Joint Ventures (AS-27) issued by the Institute of Chartered Accountants of India (ICAI). Segments have been identified in line with the Accounting Standard on Segment Reporting (AS-17), taking into account the organisational structure as well as differential risks and return of these segments. Details of products included in each of the above segments are as under: Fibre & Pulp Cement Sponge Iron Chemicals Textiles Others Viscose Staple Fibre & Wood Pulp Grey & White Cement Sponge Iron Caustic Soda & Allied Chemicals Fabric & Yarn Mainly Telecom (in consolidated results)
3 4
No investor complaint was pending at the beginning of the quarter. During the quarter, six complaints were received, all of which have been attended by the Company and no complaints were pending at the end of the quarter. During the quarter the Company has incorporated a new subsidiary "Grasim Bhiwani Textiles Limited" (GBTL).In terms of Company's Shareholders approval, the textile units at Bhiwani have been transferred w.e.f. 1st October,2007 to GBTL, on a going concern basis as slump sale, at a consideration of Rs.83.16 Crs., based on independent valuer's report. The ESOS Compensation Committee of Board of Directors of the Company has, in its meeting held on 23rd August, 2007, approved grant of 218140 Stock options(for equal no. of equity shares of Rs.10/- each of the Company) to the Officers of the Company as per terms of Employee Stock Option Scheme (ESOS), 2006. Previous period's figures have been regrouped / rearranged wherever necessary to conform to the current period's classification. The above Unaudited results for the quarter ended 30th September, 2007 have been reviewed by the Audit Committee of the Board and approved by the Board of Directors at the meeting held on 27th October, 2007. The limited review, as required under Clause 41 of Listing Agreement has been completed by the auditors of the Company and the related report is being submitted to the concerned Stock Exchanges.
For and on behalf of Board of Directors Place : Mumbai Date : 27th October, 2007 GRASIM INDUSTRIES LIMITED
Regd. Office: Birlagram, Nagda 456 331 (M.P.)