Grasim Industries (GRASIM) Q2 24/25 earnings summary

Executive summary

• Consolidated revenue grew 11% YoY to INR 33,563 crore in Q2FY25, marking the 16th consecutive quarter of growth, but EBITDA declined 10% YoY to INR 4,042 crore due to lower cement profitability and upfront investments in paints.

• Standalone revenue reached a record INR 7,623 crore for Q2FY25, up 18% YoY.

• H1FY25 consolidated revenue was INR 67,424 crore, with EBITDA at INR 8,802 crore.

• Financial services and B2B e-commerce showed robust growth; cellulosic fibres achieved record sales volume.

• Major developments included a significant acquisition, a subsidiary stake sale, and ongoing regulatory matters.

Financial highlights

• Cement business faced lower profitability due to demand slowdown and price declines, despite capacity additions.

• Chemicals business EBITDA rose 16% YoY, driven by chlorine derivatives and specialty chemicals.

• Financial services saw strong growth: NBFC revenue up 19%, housing finance and life insurance up 42% YoY, lending book up 27% YoY, and PAT up 23% YoY.

• Textile business reported an EBITDA loss of Rs. 17 crore due to high input costs and margin pressure.

• Q2FY25 PAT (owners' share, adjusted) was ₹473 crore, down from ₹1,164 crore in Q2FY24; consolidated net profit for Q2FY25 was ₹1,100.16 crore, down from ₹2,024.05 crore in Q2FY24.

Outlook and guidance

• Confident of exiting FY25 with a high single-digit market share in decorative paints; 85% of project capex spent.

• B2B e-commerce business on track to achieve $1 billion revenue within three years.

• Cement capacity expected to exceed 200 million tons per annum by FY27; 162.4 Mn TPA by FY25, excluding pending acquisitions.

• Segmental reporting realigned to reflect new businesses, with 'Building Materials' now a separate segment.

• No change in optimism for medium- to long-term industry growth despite short-term slowdowns.