Mumbai, Jan 27
Tata Chemicals has reported a 22 per cent drop in net profit at Rs 165 crore for the December quarter (on a consolidated basis) against Rs 212 crore in the same period last year, largely to higher fuel and power cost. Sales were up nine per cent to Rs 2,860 crore (Rs 2,622 crore).
Profit before tax from inorganic chemicals was down nine per cent at Rs 106 crore (Rs 116 crore) while the fertiliser component fell 14 per cent to Rs 107 crore (Rs 124 crore). Agriculture inputs were down a tad to Rs 5 crore (Rs 6 crore).
Mr. R Mukundan, Managing Director, said, “We continue to see pressures of increasing input prices. The unfortunate weather events in Australia and Indonesia will put even greater pressure on energy prices. We are working towards price increases to negate this impact.”
The operations at Brunner Mond UK were impacted due to extreme weather conditions in the latter part of the quarter. “With the acquisition of British Salt we have secured the long term supply of brine and also a new business-branded consumer and industrial salt in the UK,” he added.
The company’s power and fuel cost on a standalone basis increased 48 per cent to Rs 154 crore (Rs 104 crore) while freight and forwarding expenses were up 24 per cent to Rs 123 crore (Rs 99 crore).
In the fertiliser sector, while the nutrient-based subsidy is a positive development, the lower benchmark prices set for diammonium phosphate and muriate potash in a hardening price environment is a challenge next fiscal. “We continue to await the new urea policy as well as allocation of gas for doubling our urea capacity at Babrala,” Mr Mukundan said.
Production at Babrala plant was temporarily disrupted up to August 31 due to fault in synthesis converter in the ammonia unit. The company had adequate insurance coverage towards cost of repairs and loss of profits, he said.
The Tata Chemical scrip was down six per cent at Rs 351 on Thursday.