The Hindu Business Line : Aditya Birla Nuvo Q2 net up 64 pc

Aditya Birla Nuvo, which has business portfolios ranging from textiles and fertilisers to financial services and telecom, has reported 64 per cent increase in net profit for the second quarter of the current fiscal to touch Rs 75.71 crore, as against Rs 45.90 crore in same period previous year.

The company's income from operations rose to Rs 1,962.87 crore (Rs 1,004.02 crore), a jump of 95.5 per cent.

While the revenue of Madura Garments increased by 16.4 per cent to touch Rs 190.22 crore, that of its rayon division increased by 16.8 per cent and carbon black division by 35 per cent to stand at Rs 112.38 crore and Rs 185.57 crore respectively during the quarter.

Rights issue

Speaking to reporters, Mr Adesh Gupta, the company's whole-time Director and CFO, said the company had filed a draft letter of offer with SEBI to raise Rs 780 crore through a rights issue. The price and entitlement of the issue has not yet been decided, but it would be launched by mid-January, he said, adding that the cardinal objective of the issue was to bring down its debt-equity ratio from the current level of 1:3.

Among the company's various divisions, the fertiliser division recorded a fall in profit during the quarter vis-à-vis the corresponding quarter of the previous year on account of disruption in gas supply by GAIL due to the Gujarat floods. The life insurance division also registered a fall in profit as "there was a strain in profits due to aggressive ramp of distribution network."

Mr Gupta said the company was in the process of downsizing the production of synthetic yarn by its Jayashree Textiles and instead focus on linen yarn and worsted products. "We do not see a significant future for synthetic yarn. We will completely move out of the synthetic segment within a year," he said.

Idea IPO

The company will be coming out with an IPO for Idea Cellular next year to help reduce interest burden further. Mr Gupta was however not willing to share details on the possible size of the IPO, stating that it would be finalised by the end of the current fiscal.

He said the company had a capital expenditure programme of Rs 2,500 crore for Idea Cellular, out of which some Rs 700 crore has already been spent. "Idea has commenced commercial operations in Himachal Pradesh and Rajasthan, while services in parts of Uttar Pradesh would be on by this month end. It has also applied for national long distance licenses, for which the letter of intent has already been received," he said.