India's Grasim Industries Q4 profit plunges 91% on weak demand, chemical prices
BENGALURU (Reuters) - India's Aditya Birla Group-owned Grasim Industries Ltd reported a decline in net profit for the third straight quarter on Friday, as weakened demand for its textile products and falling chemicals prices weighed.
The textile maker's standalone net profit plunged 91.2% to 935.1 million rupees ($11.32 million) in the fourth-quarter ended March 31, from 10.68 billion rupees a year ago.
Prices of chemicals, which is Grasim's second-largest division, including caustic soda have also fallen in the quarter, leading to a nearly 4% revenue drop for the segment.
"The global caustic soda market remain oversupplied with flat demand," the company said in a statement.
Global demand for viscose staple fibre (VSF), a key material in various kinds of clothes, has been on a decline for two quarters in a row, with the segment's revenue inching 0.1% lower.
Grasim had reported a nearly 51% drop in its third-quarter profit in February.
The company also forayed into the paints business during the fourth quarter, saying that construction of six plants is progressing and its research and development facility is operational.
Expenses rose nearly 11% to 66.27 billion rupees due to an over 8% climb in raw material expenses, offsetting the company's more than 4% growth in revenue from operations.
Separately, the company declared a dividend of 10 rupees per share.
Last month, Grasim's unit Ultratech Cement posted a 32.3% drop in fourth quarter profit, while its diversified financial services subsidiary Aditya Birla Capital also reported higher profit.
The company's shares pared some early losses to trade down 0.9% at 1986 rupees after reporting its results.
(Reporting by Varun Vyas in Bengaluru; Editing by Rashmi Aich)