Aditya Birla Nuvo Q3 profit rises 7% to Rs 368 cr

The Economic Times
11 February 2015

Mumbai: Diversified firm Aditya Birla Nuvo has reported a 7% increase in net profit for the third quarter ended December 31, 2014, as improvement in business sentiment boosted prospects of financial services business.

The financial services business posted 30% rise in revenues during the quarter on the back of 53% rise in the lending book, the company said in a release. While the net profit for the quarter stood at Rs 368 crore, the revenues for the quarter grew only 1 % to Rs 6.640 crore. The figures may not be comparable as it includes the revenues from the IT-ITeS business, which was divested in May last year.

The company would have reported a 14% rise in revenues excluding the IT-ITeS business. The net profit, sans the IT-ITeS business, would have been higher 20%. "Net debt reduction during the nine months is led by operating cash profit and net working capital. We have invested $1 billion in the last five years. Going forward, the company will have a capital expenditure and investment plan of about Rs900 crore, towards funding of growth capital requirement in financial services business,” said Sushil Agarwal, chief financial officer, Aditya Birla Nuvo. The company has applied for payments banking licence.

While Aditya Birla Nuvo will be the promoter of the proposed venture with 51 % stake, Idea Cellular will hold the rest 49% which may be increased to 60% after regulatory approvals, the company said.

While the revenues for the first nine months showed a 4% rise to Rs 19,444 crore, the profit for the same period rose 12% to Rs 1,084 crore. The revenue of the fashion and lifestyle business rose 8% to Rs1,676 crore during the quarter. Soft consumer spending and weak festive sales coupled with pricing pressure impacted earnings, said the release.