DCM Shriram Consolidated Ltd (DSCL) reported a Rs 60-crore net profit for the December quarter on higher margins in its chloro-vinyl and sugar business. Reduced losses in its rural retail business Hariyali consequent to operational restructuring boosted profits for the quarter.
DSCL had reported a net loss of Rs 25.2 crore in corresponding quarter last year, impacted by payment of the one-time cane arrears of Rs 38 crore.
Topline for the December quarter was down 5 per cent, at Rs 1,342 crore, hit by lower earnings from the fertiliser and Hariyali businesses. However, the decline in earnings was partly offset by a 50 per cent rise in revenues from sugar business on better prices and chloro-vinyl segments.
The DSCL board an interim dividend of 40 per cent or 80 paise on par value of Rs 2 each. The DSCL scrip ended 2.1 per cent lower at Rs 65.15 on the BSE on Friday.
Ajay Shriram, Chairman, DSCL attributed the performance to better margins from chloro-vinyl and sugar business and reduction in Hariyali losses. The company has significantly reduced its Hariyali business as part of restructuring and rationalisation plan and currently operates some 37 units as against 100 in March last year.
“The performance of our agri-input business was impacted by adverse weather conditions, which depressed the product off-take. Nonetheless, we continue to invest in these businesses as we are confident of delivering a healthy performance in medium to long-term,” he said.
Fertiliser sales during the quarter were almost down by 40 per cent at Rs 102 crore, while earnings from farm solutions dropped marginally to Rs 349 crore. The company reported a 17 per cent rise in chloro-vinyl business at Rs 300 crore over corresponding last quarter.
In Fenesta, the building systems unit that manufactures windows and accessories, the company plans to scale up the retail business, Shriram said.