Grasim July-September Profit up 11.6% On Year on Stronger Chemical Margins, Paints Growth

Grasim Industries Ltd. reported an 11.6% year-on-year rise in net profit to ₹8.05 billion for the September quarter, supported by higher margins in its chemicals business and growing market share in the paints segment, even as pricing pressure weighed on its fibre business. Revenue rose 26% on year to ₹96.1 billion.

The company’s core standalone operations—viscose staple fibre and chemicals—contributed nearly 65% of total revenue, while its new businesses, Birla Opus Paints and e-commerce platform Birla Pivot, made up the remaining 35%.

Revenue from the cellulosic fibre segment inched up 1% on year to ₹41.49 billion, despite lower volumes of 209,000 tonnes against 219,000 tonnes a year ago. The company attributed the growth to firm domestic prices, favourable product mix, and rupee depreciation, even as pricing pressure persisted due to high inventory levels in China. Segment EBITDA fell 29% on year to ₹3.50 billion.

The chemicals business reported a 17% revenue rise to ₹23.99 billion, supported by stronger realisations and lower raw material costs. Caustic soda realisations increased 8% on year to ₹32,979 per tonne, while EBITDA from the segment jumped 34% on year to ₹3.65 billion, driven by higher chlorine derivative volumes and better pricing.

In specialty chemicals, sales volumes rose 34% on year on the back of higher utilisation at the new electrochemical plant, though margins remained under pressure from input costs.

Grasim said its Birla Opus Paints business continued to gain market share, with capacity now accounting for 24% of India’s organised decorative paints industry through six greenfield plants. It spent ₹3.75 billion on the paints business during April–September, taking total investment in the venture to ₹97.27 billion. The company also announced the resignation of Birla Opus Chief Executive Officer Rakshit Hargave.

Its e-commerce venture, Birla Pivot, is on track to meet the revenue target of ₹85 billion by 2026-27, recording 15% quarter-on-quarter growth in the September quarter.

Grasim’s operating margin fell to 4.06% from 4.52% a year earlier, while EBITDA margin declined 200 basis points to 16%. EBITDA for the quarter stood at ₹17.86 billion. Total expenses rose 26.5% on year to ₹99.5 billion, driven by higher input and finance costs.

Capital expenditure during April–September totaled ₹9.41 billion, and the company has planned ₹22.6 billion in capex for 2025-26. Net debt as of September 30 stood at ₹68.61 billion, down from ₹71.53 billion a quarter earlier.

For the first half of 2025-26, net profit rose 2.6% on year to ₹6.86 billion, while revenue climbed nearly 30% to ₹188.33 billion.