Birla Corp Q2 Results Review - Higher Costs Dent Performance; Debt Increases Further: Motilal Oswal

Motilal Oswal Report

Birla Corporation Ltd.’s Q2 FY23 performance was below estimate due to lower sales volume (down 4% versus estimate) and higher opex (up 5% versus estimate).

Birla Corp's consolidated Ebitda stood at Rs 940 million versus estimated Rs 1.9 billion and Ebitda/tonne was at Rs 258 versus estimated Rs 496.

Net loss was at Rs 565 million versus estimated loss of Rs 36 million.

Mr. Arvind Pathak has stepped down from the position of Managing Director and Chief Executive Officer, Mr. Sandip Ghose (having a rich experience of 39 years with 13 years in the cement industry), ex. Chief Operating Officer of the company will join from December 01, 2022 and will be the MD/CEO effective January 01, 2023 for a three-year period.

Lower profits in H1 FY23 due to the delay in stabilisation of Mukutban plant lead us to cut our Ebitda estimate for FY23/24 by 17%/8%.

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