Carborundum Universal net rises 60%

Nov 7, 2011 I Business Line I Chennai

Carborundum Universal has posted a net profit of Rs 660M ($13.6M) for the quarter ending September 30, 2011 — a growth of 60 per cent over Rs 410M ($8.5M) posted during the comparable quarter in the previous year. The turnover went up by 24 per cent to Rs 5.05B ($104.1M) during the period under consideration, from Rs 4.08B ($84.1M) last year.

According to a press release from the company, the growth was driven by the performance of both the domestic and overseas operations. The electrominerals and ceramics business segments recorded a growth rates in excess of 25 per cent.

Abrasives business grew by 15 per cent. Sales for the quarter were Rs 2.08B ($42.9M) as against Rs 1.80B ($37.1) in the corresponding period of last year. While the operations in America, West Asia and Canada continued to be subdued, off-take from user industries in India and Russia continued to be encouraging, says the release. It further adds that the company's Chinese subsidiary registered good growth from a low base. Sterling Abrasives, VAW's Abrasive division and Wendt (India) Ltd in Indian abrasive segment, registered higher growth.

In the case of electrominerals, the company recorded an increase of 25 per cent in sales (to Rs 1.90B ($39.2M), from Rs 1.53B ($31.5M)). Growth in sales was made possible by the encouraging performance of the Indian, Russian and South African operations, the release said.

Profitability of all business segments witnessed good increase. Overseas subsidiaries recorded strong growth in sales, particularly the entities in Russia and South Africa, it added.

The company had sub-divided the equity shares from the current face value of Rs 2 each to Rs 1 each with effect from October 8, 2011. The company sold its entire shareholding in Laserwords Pvt Ltd last week for a consideration of Rs 500M ($10.3M).

It has also established a partnership with an Israeli company for manufacture of ceramic foam-based refractories. The project would be established in CUMI's special economic zone in Kerala.

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