Companies

Grasim output to hit pre-Covid level by March: Kumar Mangalam Birla

Our Bureau. Mumbai | Updated on September 14, 2020 Published on September 14, 2020

Grasim Industries, an Aditya Birla group company, has ramped up capacity utilisation to over 75 per cent in the June quarter and expects to be back at pre-Covid levels by next March.

Addressing shareholders at the virtual AGM, Chairman Kumar Mangalam Birla said in the turbulent times, the company had demonstrated extraordinary resilience on account of its diversified business portfolio, inherent balance sheet strength and employees’ support.

Post the outbreak of the pandemic in the last week of March, almost all the plants and corporate offices were shut in compliance with government directives. As the government granted permission to restart partial operations, capacity utilisation in most of the major plants was ramped up to over 75 per cent within the June quarter.

Both the VSF and chemicals businesses are now operating at about 80 per cent of pre-Covid capacity and expected to be back to pre-Covid capacity by Q4 of this fiscal, Birla added.

The fixed cost across Grasim businesses was reduced by 35 per cent, which amounts to savings of ₹256 crore compared to the FY20 quarterly average.

Grasim has recalibrated capital expenditure to ₹1,615 crore as of now while continuing with Vilayat VSF brownfield expansion with revised timelines, he said. The pulp and fibre business forayed into producing special fibre antimicrobial properties.

The chemicals business witnessed an upsurge in demand for chlorine value-added products driven by disinfectants and hygiene-related products, he said.

Grasim has initiated measures to optimise operations across plants, reduce fixed costs and conserve cash. It continues to maintain a very comfortable level of liquidity to navigate this uncertain business environment, he added.

"In the last six months much has changed on account of the pandemic and more change is in the air. After all, we can still not envisage all the changes Covid will leave in its wake," said Birla.

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Published on September 14, 2020
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