Aditya Birla Group firms see sharp drop in Q4 profit
Two other listed firms of the group – Vodafone Idea and Aditya Birla Fashion and Retail – are also going through their fair share of pains.
NEW DELHI: The big guns of over 150-year-old Aditya Birla Group, which contributes heavily to its total income, had a rather displeasing March-ending quarter of the financial year 2023 (Q4FY23).In line with the performance of industry peers, the three firms of the mining-to-cement conglomerate – UltraTech Cement, Hindalco Industries and Grasim Industries – saw a sharp drop in profits, reflecting weak demand. Two other listed firms of the group – Vodafone Idea and Aditya Birla Fashion and Retail – are also going through their fair share of pains. Only Aditya Birla Capital has shown strong performance during the quarter.
“The Aditya Birla Group firms face significant challenges. Hindalco grapples with the uncertainty of China’s economic recovery impacting metal demand and global aluminium prices. UltraTech is burdened by a 2% de-growth in the housing segment, which heavily consumes cement, along with the effects of RERA and slow sales growth. Grasim faces weak demand for textile products, falling chemical prices, and a rise in expenses,” said Sonam Srivastava, founder at Wright Research, an investment advisory firm. Srivastava adds that Hindalco’s revenue is projected to fall in Q1FY24, but its earnings may grow annually. UltraTech’s earnings should see significant growth over the next three years, surpassing the domestic market’s growth rate while Grasim could experience growth in both earnings and revenue, he said.
Q4FY23 Performance: Up to 89% Drop in PAT
As many as 4 firms of the $70 billion Aditya Birla Group reported their Q4 earnings this week. Grasim on Friday reported 88.5% year-on-year (YoY) drop in its Q4 standalone net profit at Rs 93.51 crore even as its revenue from operations rose 4.2% to Rs 6,645.83 crore.“Standalone Q4 PAT was impacted by softening of realisations in Chemicals business compared to the elevated levels of Q4 last year and continued global weakness in Viscose Staple Fibre (VSF) business,” said Grasim whose subsidiaries include Ultratech Cement and Aditya Birla Capital (ABCL). Grasim’s consolidated profit fell 42% to Rs 2,355.67 crore for Q4.
Hindalco on Wednesday posted a 37% drop in consolidated net profit at Rs 2,411 crore in Q4 as against Rs 3,851 crore in Q4FY22. Consolidated revenue for the quarter came in at Rs 55,857 crore as against Rs 55,764 crore in the same quarter last year. “Our diversified business model continues to drive Hindalco’s resilient performance in challenging times. Our copper business delivered exceptional results recording its highest-ever EBITDA, driven by robust market demand, stable operations and higher value-added product sales,” said Satish Pai, MD, Hindalco Industries.
UltraTech Cement, India’s largest cement maker, had last month reported a 36% fall in consolidated net profit at Rs 1,665.95 crore in Q4. Fall in PAT is attributed to rise in energy and raw material prices. Revenue from operations rose 18.4% to Rs 18,662.4 crore in Q4. The Group’s apparel retailer arm-Aditya Birla Fashion and Retail had reported a consolidated net loss of Rs 187 crore for Q4. Aditya Birla AMC net profit fell 14.48% to Rs 135.56 crore during Q4. Amid a fall in PAT of these firms, the group’s financial unit Aditya Birla Capital posted 35% rise in net profit of Rs 608 crore in Q4.
Telecom Biz remains a Concern
Vodafone Idea, an Aditya Birla Group and Vodafone Group partnership continue to report deep losses and a decline in its subscriber base. Its net loss narrowed to Rs 6,419 crore in Q4 from Rs 6,563 crore a year ago. FY23 loss widened to Rs 29,301 crore from Rs 28,245 crore a year ago.
Comments are closed.