The Hindu Business Line : Aditya Birla Nuvo Q2 net down 38%

Mumbai, Nov. 1 Due to investments in life insurance and BPO businesses, Aditya Birla Nuvo, an Aditya Birla Group company, reported a 38 per cent decrease in its consolidated net profit for the second quarter ended September 30, at Rs 47.8 crore compared to Rs 76.7 crore for the same period last year.

The bottomline in BPO business was hit due to a one-time investment cost of Rs 11.5 crore, weakening of the dollar and cost of funding the acquisition of Minacs. The insurance company faced losses of Rs 83.9 crore due to higher spend on expansion of distribution reach, said Mr Adesh Gupta, Chief Financial Officer.

The loss from break down of the fertilizer plant due to collapse of cooling tower was offset by revenues from the rayon and insulator business, taking the standalone revenues to Rs 917.7 crore from Rs 896.5 crore.

The total net income from operations increased 43 per cent to Rs 3,000.5 crore as compared to Rs 2,092.1 crore for the same period last year. The main drivers for this growth were the telecom business, which grew 55 per cent, the life insurance business, which grew 110 per cent owing to the launch of the new product Birla Sunlife Gold Plus and the BPO business grew by 82 per cent with the launch of three new centres this quarter.

The company’s (including subsidiaries) total capital investment plan is at Rs 1,375 crore, of which around Rs 933 crore will be spent up to financial year 2009. It plans to launch new products in Birla Sun Life Insurance, Birla Sun Life Asset Management Company and insulators business with following an aggressive retail policy for Madura Garments. The company plans to increase capacity in fertilisers and linen fabrics and flax yarn in textiles.

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