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DCM shriram total revenues were up by 10.6% YoY to Rs 1,448 crore (LY: Rs 1,309 crores). Excluding DAP / MOP, trading of which was suspended in current year, revenue stood higher by 23% YoY. Chloro-Vinyl's revenue stood higher by 14% YoY to Rs 382 crore due to higher Chlor-Alkali volumes from the expanded capacity at Bharuch plant and also because of better PVC realizations. Sugar revenue was up by 179% YoY to Rs 377 crores led by higher sugar & power volumes and better sugar realizations vs. last year.
Q3FY'17 PBIT improved to Rs 169 crores, up 121% YoY (LY: Rs 77 crores). Chloro-Vinyl recorded higher PBIT with higher Chlor-Alkali sales volumes & lower costs (due to better power efficiencies), higher PVC prices. Sugar business recorded higher sugar & power volumes and +ve sugar margins (vs. –ve last year). Rising Coal, Carbon material costs and slower Chlorine & PVC Sales restricted the improvements.
Finance costs stood at Rs 17 crores, up from Rs 15 crores in Q3 FY 16. PAT was up by 124% YoY to Rs 137 crores.
Net Debt as on Dec 31, 2016 stood at Rs. 774 crores vs. Rs 426 crores as on Dec 31, 2015. Increase in net debt was driven by the expansion projects in chemicals and sugar businesses.
Commenting on the performance for the quarter, in a joint statement, Mr. Ajay Shriram, Chairman & Senior Managing Director, and Mr. Vikram Shriram, Vice Chairman & Managing Director, said:
"The company reported healthy earnings growth during the quarter driven by better performance of the Sugar and Chemical businesses.
The company completed the Chlor-Alkali (along with captive power) expansion project at Bharuch (Gujarat). Plant has stabilized and is expected to achieve higher capacity utilization gradually as the market expands. The smaller expansion cum up-gradation project at the Kota plant is expected to be completed by Dec 2017.
The power co-generation up-gradation/expansion project in Sugar business has also been successfully commissioned and has achieved full capacity utilization. Distillery project is on schedule to be commissioned by Dec 2017.
The commissioning of all the above projects will provide stable profit growth and will improve our competitiveness. We continue to focus on ensuring healthy balance sheet, which will enable us to take up consistent growth initiatives over the medium-long term."
Consolidated Performance for the quarter ended December 2016
For quarter ended December 2016, the overall top-line rose 11% to Rs 1448.32 crore. The company operating margins increased 620 bps to 13%. As a result operating profits rose 110% to Rs 188.56 crore.
Purchase of stock in trade as a percentage of net sales (net of stock adjustment) was down 350 bps to 18% while cost of material consumed decreased 80 bps to 35.8%. Employee benefit expenses fell 50 bps to 8% and power and fuel expenses decreased 20 bps to 12.5%. Other expenses fell 50 bps to 9.7% and excise duty expenses rose 60 bps to 4.9%.
Other income rose 7% to Rs 11.56 crore. Interest cost was up 19% to Rs 17.32 crore. Depreciation rose 29% to Rs 30.83 crore. PBT was up 144% to Rs 151.97 crore. The effective tax rate increased to 10.2% from 2.2% owing to which the company's net profit rose 124% at Rs 136.65 crore.
Consolidated Performance for nine months ended December 2016
For nine months ended December 2016, the overall top-line fell 5% to Rs 4408.22 crore. The company operating margins increased 430 bps to 4.3%. As a result operating profits rose 44% to Rs 548.66 crore.
Purchase of stock in trade as a percentage of net sales (net of stock adjustment) was down 1430 bps to 21.5% while cost of material consumed increased 460 bps to 25.5%. Employee benefit expenses rose 160 bps to 9.6% and power and fuel expenses increased 190 bps to 14.1%. Other expenses fell 30 bps to 10.2% and excise duty expenses rose 160 bps to 5.8%.
Other income rose 3% to Rs 32.78 crore. Interest cost was down 25% to Rs 49.78 crore. Depreciation increased 9% to Rs 81.59 crore. PBT was up 66% to Rs 450.07 crore. The effective tax rate was up to 12.3% from 9% owing to which the company's net profit rose 60% at Rs 395.33 crore.
Consolidated Segment Results
Chloro-Vinyl: For the quarter ended December 2016, sales of chloro-vinyl division increased 14% to Rs 382.48 crore representing 26% of total revenues of the company. PBIT increased 9% to Rs 90.92 crore representing 46% of the total PBIT. The capital employed increased 77% to Rs 1053.62 crore representing 43% of total capital employed.
For nine months ended December 2016, sales of chloro-vinyl division increased 8% to Rs 1128.66 crore representing 25% of the total revenues of the company. PBIT increased 13% to Rs 283.99 crore representing 49% of the total PBIT.
Sugar: For the quarter ended December 2016, sales of sugar division increased 179% to Rs 377.1 crore representing 26% of total revenues of the company. PBIT reported a profit of Rs 87.91 crore representing 44% of the total PBIT compared to loss of Rs 1.92 crore in Q3FY'16. The capital employed increased 24% to Rs 687.06 crore representing 28% of total capital employed.
For nine months ended December 2016, sales of sugar division increased 64% to Rs 1049.03 crore representing 23% of the total revenues of the company. PBIT increased 492% to Rs 182.01 crore representing 31% of the total PBIT.
Shriram Farm Solutions: For the quarter ended December 2016, sales of Shriram farm solutions division decreased 34% to Rs 248.44 crore representing 17% of total revenues of the company. PBIT increased 6% to Rs 19.12 crore. The capital employed increased 41% to Rs 454.18 crore representing 19% of total capital employed.
For nine months ended December 2016, sales of shriram farm solutions division decreased 47% to Rs 777.07 crore representing 17% of the total revenues of the company. PBIT decreased 51% to Rs 27.04 crore representing 5% of the total PBIT.
Bioseed: For the quarter ended December 2016, sales of Bioseed division increased 12% to Rs 52.63 crore representing 4% of total revenues of the company. PBIT reported loss of Rs 12.97 crore. The capital employed increased 7% to Rs 444.08 crore representing 18% of total capital employed.
For nine months ended December 2016, sales of Bioseed division decreased 11% to Rs 399.57 crore representing 9% of the total revenues of the company. PBIT increased 53% to Rs 39.59 crore representing 7% of the total PBIT.
Fertilisers: For the quarter ended December 2016, sales of fertilizer division decreased 17% to Rs 189.99 crore representing 13% of total revenues of the company. PBIT decreased 18% to Rs 13.84 crore representing 7% of the total PBIT. The capital employed decreased 21% to Rs 272.52 crore representing 11% of total capital employed.
For nine months ended December 2016, sales of fertilizer division decreased 14% to Rs 534.58 crore representing 12% of the total revenues of the company. PBIT increased 46% to Rs 36.29 crore representing 6% of the total PBIT.
The scrip is currently trading at Rs 276
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