DCM Shriram posts subdued performance in sugar business for Q4FY18

DCM Shree Ram Ltd reported subdued numbers for the quarter, while on a YoY basis, the company posted growth across the board. The sugar business of the company witnessed subdued performance due to benign sugar prices in the country. 

The total revenue for the quarter declined by 8.6 per cent YoY and 12.3 per cent QoQ to Rs 1550 crore in Q4FY18 vs Rs.1696 crore in Q4FY17. This was largely due to decline of 31 per cent YoY in sugar business revenues to Rs 379 crore in Q4FY18. However, on a full year basis, the sugar business grew by 24 per cent YoY to Rs 1988 crore in FY18 as against Rs 1601 crore in FY17. 

The EBITDA for the quarter declined by 66 per cent YoY to Rs.70 crore as compared with Rs.210 crore in Q4FY17. Its EBITDA margins for the quarter also declined 790 bps to 4.2 per cent. This was largely due to higher raw material costs for the quarter. However, EBITDA for the full year FY18 grew by 34.2 per cent to Rs.992 crore in FY18 vs Rs.739 crore in FY17, while the margins also expanded by 200 bps to 14.2 per cent in FY18 compared with 12.1 per cent in FY17. 

The bottomline for FY18 grew by 21 per cent YoY to Rs.668 crore as against Rs.552 crore in FY17. On a quarterly basis, the net profit declined substantially by 68.3 per cent to Rs.50 crore in Q4FY18 as compared with Rs 158 crore in Q4FY17. 

The board of directors has recommended final dividend of Rs.0.8 per share on the face value of Rs 2 per share. Further, the company also approved the investment proposal for capacity expansion for replacement of polymerisers plant at Kota facility worth Rs.32.2 crore taking the total capacity to 220 tonnes per day from the current 180 tonnes per day.