DCM Shriram Q3 profit after tax up 38% at Rs 350 crore

DCM Shriram on Tuesday posted a 38 per cent growth in profit after tax (PAT) for the third quarter ending December 31, 2021, at Rs 350 crore compared to that of Rs 253 crore in the year-ago period.

Revenue from operations of the company during the quarter under review grew by 26.5 per cent to Rs 2,730 crore compared to Rs 2,159 crore in the same period of FY21, DCM Shriram said in a statement.

“This quarter was very challenging for our businesses. High and volatile commodity prices along with supply constraints made the operating environment very dynamic for Chloro-vinyl and Fenesta businesses.

“Erratic rains made supply chain management difficult for our agri inputs businesses. We are glad that overall our businesses did well despite these challenges,” DCM Shriram Chairman and Senior Managing Director Ajay Shriram and company Vice-Chairman and Managing Director Vikram Shriram said in a joint statement.

Chloro-Vinyl business witnessed almost unidirectional increase in input costs, especially energy prices, which was led by global factors such as increase in energy demand, supply constraints due to geo-political factors and adverse weather conditions, they noted.

“However, globally the product prices have responded well to the increase in input costs. Operating environment continues to be dynamic. Chemical expansion and downstream projects are facing headwinds from commodity price increase as well as marginal delays due to 2nd and 3rd wave of Covid-19 and extensive rains,” they said.

Sugar season has started well with cane crush levels (till date) higher than last season and during the quarter board has approved investments in sugar business to the extent of Rs 358 crore towards sugar capacity expansion, sugar refinery and additional grain attachment.

“Our cash-flows are healthy which continue to strengthen our balance sheet. For the next quarter we are bracing ourselves for another challenge in terms of the third wave of Covid-19 pandemic,” they added.

Shares of the company on Tuesday closed at Rs 1,013.05, down 4.79 per cent on BSE.