Deepak Nitrite clocks healthy growth; revenues up 22%, PAT 24%
Deepak Nitrite Ltd. (DNL) has reported sustained growth momentum in its standalone financial results for the quarter and half-year ended September 30, 2018, due to its investments in capacity enhancement of key products and significant improvement in the Performance Products segment. Furthermore, international customers are increasingly seeing Indian companies like DNL as a favoured supply chain partner. India’s own established consumption is also growing, creating further opportunities for the company with strong R&D capabilities and broad product portfolio.
Revenues (net of Excise Duty) were Rs. 433.0-crore in Q2FY19, compared to Rs. 356.2-crore reported in Q2 FY18, representing a growth of 22%. All Strategic Business Units (SBUs) – Basic Chemicals, Fine & Speciality Chemicals, and Performance Products – contributed to the growth. EBITDA came in at Rs. 68.9-crore, higher by 28%, as against to Rs. 53.8-crore reported in the same period last year, while EBITDA margins improved by 80 basis points to 15.9%. Despite significant increase in input costs due to rising prices of crude oil and related petrochemical intermediates, the company expanded margins thanks to various cost management initiatives as well as better realisations for some key products that saw higher demand.
“Deepak Nitrite has delivered a strong all-round performance during the quarter under review led by healthy demand in the domestic market. Amidst the backdrop of a challenging business environment characterised by rising trade tensions as well as volatile prices of crude price and related petrochemicals, we have delivered double digit growth of 22% in revenues and 24% in profit after tax,” Mr. Deepak Mehta, Chairman & Managing Director, said. Domestic revenues stood at Rs. 275.02-crore (Rs. 208.8-crore) thanks to a better operating environment led by supply disruptions in China that helped the company to further strengthen its market position for some key products. Revenues from exports came in at Rs. 151.9-crore in Q2 FY19 (Rs. 141.6-crore), higher by 7%. Positive demand traction for some products in the global markets resulted in stable gains in export revenues. Benefit from rupee depreciation also contributed to the momentum.
Phenol & acetone project: regular production soon
Trial runs for phenol and acetone have delivered successful and encouraging results and the product meets global standards and specifications. Customer acceptance has been received and future orders secured. The company expects to achieve regular production status in the very near future.
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