MUMBAI, JANUARY 27: Aditya Birla group flagship Grasim Industries has announced a 104 per cent rise in its net profit to Rs 50.93 crore for the third quarter ended December 31, 1999, against Rs 24.8 crore posted in the corresponding period the last fiscal.During the three-month period, sales turnover rose by 13 per cent to Rs 1,058.59 crore, against Rs 936.35 crore last year, while other income fell from Rs 18.77 crore to Rs 17.38 crore."Apart from cement, all our other businesses have done reasonably well. Realisation from the cement business came under pressure due to depressed prices in the eastern and southern markets," Grasim's president and chief financial officer DD Rathi said.Net profit for the nine-month period rose to Rs 184.74 crore, from Rs 120.18 crore. During the period, net sales increased from Rs 2,743.09 crore to Rs 3,176.36 crore.The sharp rise in the net profit, however, failed to prop up prices of the Grasim stock, which closed lower at Rs 390, against Tuesday's closing of Rs 394.Realisation from the cement business, which contributes around one third of the company's turnover, fell by 8 per cent during the third quarter. The realisation from the sponge iron business, on the contrary, increased by 13 per cent, while that from viscose staple fibre grew by a modest 2 per cent.During the third quarter, Grasim improved its capacity utilisation from 82 per cent to 98 per cent, while its sales volumes shot up by 22 per cent."Higher production and turnover volumes, lower costs due to cement integration, saving in operating costs resulting from ongoing modernisation efforts, upgradation of plant energy optimisation coupled with reduction in financing cost through effective fund management enabled the company to perform better," Grasim Industries said in a statement.During the third quarter, total expenditure rose from Rs 797.96 crore to Rs 898.80 crore. Interest charges fell from Rs 75.08 crore to Rs 62.38 crore, while provision for depreciation increased marginally from Rs 56.58 crore to Rs 59.61 crore. The tax liability rose from Rs 0.7 crore to Rs 4.25 crore during the period.For the VSF business, Grasim recorded an 18 per cent growth in production, while the sales volumes shot up by 24 per cent during the third quarter. "This has been primarily due to the improved demand, an upturn in the textile industry, and aggressive marketing efforts," the company said.Sales volumes in the sponge iron business were higher by around 54 per cent, while realisation was higher by about 13 per cent. "The outlook for the business is encouraging, given the rising scrap prices and the fact that the company has emerged as the single-largest merchant producer of sponge iron," Grasim said.
