Grasim Industries has posted a 17 per cent drop in net profit at ₹679 crore for the quarter ended March 31, compared with ₹818 crore logged in the corresponding period last year.

However, total income was up 8.45 per cent at ₹8,547 crore from ₹7,881 crore a year ago.

The company’s board has announced a dividend of ₹21 a share on a face value of ₹10 each totalling ₹200.32 crore.

A 17 per cent hike in raw material cost from ₹1,674 crore to ₹1,952 crore, besides a 13 per cent rise in fuel cost at ₹1,589 crore, impacted the operating margin. Freight cost was 18 per cent higher at ₹389 crore (₹329 crore).

For the full year, the group’s net profit was down 23 per cent at ₹2,072 crore (₹2,704 crore). Total income increased from ₹28,529 crore to ₹29,901 crore.

Outlook For viscose staple fibre, margins are likely to remain under pressure in the near term due to overcapacity in China, the company said.

For cement, the company felt the demand growth should gradually recover to about eight per cent on improvement in economic environment.

However, the industry is likely to face an oversupply situation till FY-17, with 75 per cent utilisation, and maintaining margins would remain a challenge, the company added.

On Friday, the company scrip on the BSE closed marginally higher at ₹2,625.

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