Tata chemicals posts hike in profits sales

Tata chemicals posts hike in profits and sales

9:37 AM, 25th May 2011
Tata chemicals posts hike in profits and sales
R Mukundan, Managing Director, TCL.

MUMBAI, INDIA: Tata Chemicals recorded an increase in net profits to Rs 6.53 billion ($ 145 million), up by 8 per cent, for the fiscal year ended March 31, 2011, compared with the previous fiscal year. Sales increased 16 per cent to Rs 110.6 billion. Its profits from operations stood at Rs 18.64 billion. The company provided an EPS (annualized) for Rs 26.10.


Some of its corporate Initiatives included; initial investment of $ 15 million in the biofuel production in Mozambique on engineering and infrastructure; acquiring 25.1 per cent stake in stream I (1.3 million TPA) at Gabon-based Fertiliser unit for $ 290 million – value accretive and strategic advantages - assured gas supply at fixed price and proximity to port; entering into a technical services agreement with Notore Chemical Industries Limited to optimize and achieve breakthrough performance in the operations of its fertiliser plant; and rebranding of international subsidiaries in UK, USA and Kenya under the Tata Chemicals corporate brand.


For TCL, some of the planned capacity expansions are capacity expansion of SSP capacity at Haldia by 50K TPA at a cost of ~ Rs 11 crore, to be completed by Q4 FY2012. It also plans to expand the soda ash capacity at GCIP - study under progress for increasing capacity by 400K TPA. Another capacity expansion under study is the phos acid expansion along with DAP capacity at IMACID, Morocco, to double capacity along with ~ 1 million TPA DAP capacity. TCL also plans doubling capacity at Babrala, which is currently on hold as it is awaiting policy clarity on gas allocation and pricing.


“Our performance for the quarter and year under review is very encouraging especially considering the strong headwinds in the form of increasing input prices, rising interest rates and natural calamities across many regions of our operations. Our chemicals business has done well on the back of enhanced operations, increased volumes and stable margins,” said R Mukundan, Managing Director, TCL.


“We do see continued growth in our agri business on the back of improved performance of pesticides and the seeds business. However the performance of our fertiliser business needs to be looked at in light of the constraints faced by it as a result of reduction in gas availability and lower subsidies for potash and phosphatic fertilisers,” commented Mukundan.


“Tata Chemicals’ continued focus will be to expand its operations closer to the source of the raw material. The acquisitions of Magadi and GCIP were a step in that direction and as a result our natural soda ash capacity is 60 per cent of total capacity. Our investment in Gabon towards the setting up of a large scale urea facility is another initiative in line with this strategy,” added Mukundan.


Year – on – year performance comparision

  • FY2011 (April 2010 – March 2011) v/s FY2010 (April 2009 – March 2010)
  • Net sales at Rs 110.6 billion compared to Rs 95.44 billion in FY2010, an increase of 16 per cent 
  • Profit from operations at Rs 18.64 billion compared to Rs 18.40 billion in FY2010
  • PBT stood at Rs 11.21 billion, up 20 per cent from Rs 9.33 billion in the corresponding period last year
  • PAT (after minority interest) increased by 8 per cent to Rs 6.53 billion from Rs 6.06 billion


Performance and domestic demand for soda ash and sodium bicarbonate is healthy. Demand is expected to rise by 5 per cent and 14 per cent respectively during FY2012. For the fertilizers segment, phosphatic fertiliser is under pressure due to low subsidy, high input costs. For Rallis India, strong growth in domestic business driven by value added offering to farmers in the last four years, despite the setback due to unseasonal rains. Revenues up by 20 per cent at Rs 1,047 crore and PAT up by 25 per cent at Rs 126 crore for the year ended March 31, 2011.

(C) WOC News 




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