DCM Shriram Q1 result: Profit jumps 61% to Rs 253.96 crore

DCM Shriram Ltd on Tuesday reported a 61 per cent increase in its consolidated net profit at Rs 253.96 crore for the quarter ended June on higher income.

Its net profit stood at Rs 157.87 crore in the year-ago period, according to a regulatory filing.

Total income rose to Rs 2,999.90 crore in the first quarter of this fiscal year, from Rs 2,025.11 crore in the corresponding period of the previous year.

Delhi-based DCM Shriram Ltd is into diversified business including manufacturing of chloro-vinyl chemical, sugar, fertilisers and bioseeds.

On the quarterly performance, Ajay Shriram, Chairman & Senior Managing Director, and Vikram Shriram, Vice Chairman & Managing Director, said: "We are witnessing very high inflation levels across the globe after many decades."

"There are supply chain disruptions, prices of key commodities are still elevated, interest rates are rising, currencies across the globe are at historic lows against the US dollar and there is Russia-Ukraine conflict which is continuing. These have led to an uncertain economic environment," they said.

With our strong businesses and balance sheet, Ajay Shriram said the company is well placed to manage these uncertainties.

"Chemicals business has performed well, with cost pressures being more than compensated with increase in volumes and product prices.

"Some softening is likely with the reduction in global demand, however, overall returns are expected to remain reasonable and the cost improvement measures being taken will cushion our margins," said Vikram Shriram.

DCM Shriram said that there are margin pressures in sugar, however, Ethanol earnings are stable.

"We are investing close to Rs 3,500 crore in various projects primarily in chemicals and sugar business which are to be commissioned over the next 12 months and will be funded from internal accruals and debt.

"These projects will increase our scale, forward integration, new product lines along with bringing efficiencies and cost reduction. "Some of these projects are directed towards creating wealth out of waste, building future capabilities and reducing carbon footprint," said Vikram Shriram.