Grasim vs Maruti Q1 FY24

Grasim's Q1 FY24 consolidated revenue grew 11% YoY to INR 31,065 crore, driven by subsidiaries UltraTech and Aditya Birla Capital, but standalone revenue fell 14% YoY to INR 6,238 crore due to weak realizations in VSF and chemicals. Consolidated EBITDA declined 5% YoY to INR 4,981 crore, while standalone EBITDA dropped 42% YoY to INR 789 crore, impacted by high base effects and pre-operative expenses for new businesses. VSF business showed sequential recovery with EBITDA of INR 390 crore and 90% utilization, though global textile demand remains sluggish. Chemicals revenue fell 21% YoY to INR 2,146 crore amid caustic price declines. Paints business is on track for commercial launch in Q4 FY24, with 2-3 plants expected to be commissioned this year. B2B e-commerce platform Birla Pivot launched with 130+ brands. Risks include continued global demand weakness and potential margin pressure from input cost volatility.

Guidance read

Paints commercial launch in Q4 FY24: At least 2-3 plants will be commissioned this year, with total capacity of 630 million liters. CapEx of INR 5,791 crore in FY24: Includes INR 4,283 crore for paints business; peak debt expected around INR 8,000-10,000 crore gross. Chlor-alkali capacity expansion to 1.5M MT by Q1 FY25: Expansion from 1.3M MT delayed due to monsoon; commissioning expected by Q4 FY24 or Q1 FY25. Epoxy specialty capacity doubling with 12-month ramp-up: New capacity will be commissioned in Q2 FY24; full operational capacity expected in 12 months with 20-25% quarterly increments.

Risk read

Key risks include Global textile demand weakness — Textile exports from India have declined for 12 consecutive months, impacting VSF demand and customer profitability.; Caustic soda price erosion — International caustic prices fell 46% from Oct 2022 to June 2023, with further declines expected due to oversupply from China.; VSF margin pressure from Chinese imports — Cheap viscose yarn imports from China are squeezing domestic spinners' margins, potentially reducing demand for Grasim's VSF.; Delay in chlor-alkali capacity expansion — Monsoon delays pushed commissioning from Q3 FY24 to Q1 FY25, which could impact volume growth..

Promise ledger

Scorecard data is being built as historical quarters are processed.

Maruti Suzuki reported a strong Q1 FY24 with revenue of INR 30,845 crore (+22% YoY) and PAT of INR 2,485 crore (+145% YoY), driven by higher volumes, improved realization, and cost reduction. Domestic sales grew 9.1% to 434,812 units, while exports declined. The company launched three SUVs (Fronx, Jimny, Invicto) and achieved a 20% SUV market share. CNG penetration hit a record 27% with 113,000 units sold. Management announced plans to acquire Suzuki Motor Gujarat (SMG) to integrate production and target 4 million units annual capacity by 2030-31. Pending orders stood at 355,000 vehicles. Risks include ongoing semiconductor shortages (28,000 units lost in Q1) and potential demand slowdown in small cars.

Guidance read

Acquire SMG by March 2024: Board approved acquisition of Suzuki Motor Gujarat shares from SMC, to be completed within FY24 at net book value. Target 4 million units capacity by 2030-31: Production capacity to double from current levels, with 1 million capacity at Kharkhoda and additional 1 million under study. EV launch in next financial year: EV manufacturing facility at SMG will be part of MSIL; launch expected in FY25.

Risk read

Key risks include Semiconductor shortage persists — Electronic component shortages caused 28,000 units of lost production in Q1; limited visibility on supplies.; Small car segment slowdown — Small car share declined to 32% of industry; first-time buyer ratio fell to 40% from 42-44%.; Discounts and inventory pressure — Discounts increased to INR 16,214 per vehicle from INR 12,748 YoY; dealer inventory at 125,000 units (~4 weeks)..

Promise ledger

Scorecard data is being built as historical quarters are processed.