Fertiliser maker Coromandel International Ltd reported a nearly 82 per cent dip in its consolidated net profit for the quarter ended June due to excessive inventory build-up and margin pressures.
The company, part of the Murugappa Group, reported a net profit of Rs 21.42 crore during the quarter against Rs 115 crore in the year- ago period.
During the quarter, its sales rose two per cent to Rs 1,897 crore from Rs 1,854 crore in the year-ago period. Its expenditure was higher at Rs 1812.72 crore against Rs 1660.71 crore in the corresponding period of last fiscal.
Kapil Mehan, Managing Director, said excessive pipeline inventory of DAP and complex fertiliser impacted sales volume and profitability during the quarter.
“However, with active monsoon covering all our key addressable markets, we expect agricultural activity to gather momentum. In this very challenging business environment, we have improved our market share during the quarter,” he said, commenting on the results.
He said during the quarter a Tunisian phosphoric acid manufacturer, with a strategic investment by Coromandel, has commissioned the phosphoric acid plant, which augured well for its expanded capacity at Kakinada.
The company’s shares dropped 3.03 per cent to close at Rs 174.15 on the BSE today.