Grasim Industry’s Profitability from Viscose Staple Fibre (VSF) Declines Despite Higher Volume Sales
Grasim Industry recorded a growth of 5 per cent in the net revenue till Q3 FY20 from previous financial year. The consolidated revenue till Q3FY 2020 stood at INR 577240 Million whereas the revenue for the same time period in previous financial was INR 54770 Million. Grasim Industry is a part of Aditya Birla Group and is a renowned global producer of Viscose Staple Fibre (VSF). Production and sales of VSF also witnessed a significant increment by 5 per cent and 3 per respectively on yearly basis with its net revenue reaching INR 21940 Million. However, the profitability in Viscose Business for the third quarter declined owing to drop in domestic prices of VSF. The drop in prices was a direct consequence of bearish buying sentiments in international market as the supply exceeded the demand due to several capacity additions in Asia. Moreover, revenues in Caustic Soda and specialty chemicals comprising majorly of Value-added Chlorine products were largely affected by slowdown in demand and rising imports.