Grasim Industries Ltd. share price target

Grasim Industries (GRASIM) is likely to gain scale in the VSF (increasing capacity by ~58% over FY18-21) and Chemicals (increasing capacity by ~37% over FY17-19) segments by way of capacity addition. VSF demand in India is likely to grow at ~8% over FY17-22 -around 200bp higher than the global growth rate - due to initiatives undertaken by GRASIM (e.g. ingredient branding in the form of 'LIVA'). VSF commands a stable margin owing to the rising proportion (38%) of high-margin specialty fiber in its portfolio and the increasing share of domestic sales (at 77%).

for 2QFY18 (earlier part of the ABNL business). VSF realization uptick drives profits: Volumes increased 5% YoY on a liketo-like basis due to inventory restocking by the domestic value chain. Realization rose 5% YoY, driven by higher global VSF prices. Realization was weaker QoQ due to the impact of GST. VSF margin stood at 22% (+3pp QoQ,...

Grasim is awaiting approvals from NCLT and stock exchanges for the proposed merger of Aditya Birla Nuvo into itself and is expected to be complete by Q2FY18. Grasim is on track in expanding its overall capacity through both brownfield and...

Grasim is awaiting approvals from NCLT and stock exchanges for the proposed merger of Aditya Birla Nuvo into itself and is expected to be complete by Q2FY18. Grasim is on track in expanding its overall capacity through both brownfield and...

Revenue rose by 15.29% to Rs. 2876.13 Cr in Q4FY17 when compared to the previous quarter

Revenue rose by 2.44% to Rs. 8495.36 Cr in Q3FY17 when compared to the previous quarter. Also, it increased by 1.05% when compared with Q3FY16.

Grasim Industries reported another strong quarter, with parent EBITDA margins at 21.5% (177 bps YoY, -70 bps QoQ). Improvement in VSF pricing helped by rupee depreciation and better product mix, drove VSF EBITDA to ~Rs 33/kg, an 18 quarter high.

Grasim Industries reported a strong 2QFY17, with parent EBITDA margins at 21.3% (467bps YoY, FLAT QoQ). VSF continued to deliver, with EBITDA/kg at ~Rs30 (64.5% YoY, 14.6% QoQ). This was driven by both better pricing (Rs 153/kg, 11.6% YoY and 2.6% QoQ) and volumes (124 kT, 9.0% YoY, 2.5% QoQ).

Strong margins led by cost control: Grasim Industries' (GRASIM) standalone 1QFY17 EBITDA rose 90% YoY (+18% QoQ) to INR5.1b, translating into margins of 21.2% (+4pp QoQ, +7.3pp YoY), driven by near-peak utilizations, high pricing and lower energy costs. Revenues grew 25% YoY to INR24b, while PAT stood at INR3.2b (2.5x YoY) led by better margins. VSF encouraging utilization ramp-up and pricing boost: VFS revenues grew 32% YoY to INR16.5b (est. of INR17.6b), led by volume growth of 17% YoY (est. of +25% YoY) and realizations boost of 13% YoY, which translated into (a) margins of 19% (v/s 11% in 1QFY16) and (b) RoCE of high-teens. Realizations boost was attributable to uptrend in prices and depreciation of INR. With commendable ramp-up at the Vilayat plant, overall utilizations stood at 97%.