Other income rose 427.66% to Rs 25.75 crore. PBIDT rose 11.08% to Rs 377.6 crore.  Profit before interest, tax and other unallocable items (PBIT) have jumped 10.23% to Rs 352.59 crore.  PBIT of Fine & Speciality Chemicals segment fell 41.50% to Rs 53.23 crore (accounting for 15.10% of total PBIT).  PBIT of Phenolics segment rose 5.63% to Rs 183.61 crore (accounting for 52.07% of total PBIT). PBIT of Basic Chemicals segment rose 46.63% to Rs 68.74 crore (accounting for 19.50% of total PBIT). PBIT of Performance Intermediates segment rose 476.10% to Rs 47.01 crore (accounting for 13.33% of total PBIT). 

PBIT margin of Fine & Speciality Chemicals segment fell from 43.14% to 25.76%.  PBIT margin of Phenolics segment fell from 23.27% to 17.77%.  PBIT margin of Basic Chemicals segment fell from 23.89% to 19.88%.  PBIT margin of Performance Intermediates segment rose from 9.05% to 27.67%.  Overall PBIT margin fell from 25.71% to 20.09%. 

Provision for interest fell 56.69% to Rs 6.8 crore.  PBDT rose 14.37% to Rs 370.8 crore.  Provision for depreciation rose 34.05% to Rs 45.47 crore. 

Profit before tax grew 12.07% to Rs 325.33 crore.  Share of profit/loss were nil in both the periods.  Provision for tax was expense of Rs 82.87 crore, compared to Rs 73.74 crore.  Effective tax rate was 25.47% compared to 25.40%. Net profit attributable to owners of the company increased 11.96% to Rs 242.46 crore. 

Promoters’ stake was 45.69% as of 31 December 2021 compared to 45.69% as of 31 December 2020.    

The operating environment during the quarter was challenging, characterized by rising costs and constraints in supply of inputs. Raw material prices remained elevated together with heightened utility costs including power & fuel.

Commenting on the performance, Mr. Deepak C. Mehta, Chairman & Managing Director, said,

“The world continued its track record of unprecedented volatility in price and availability of commodities like coal, petrochemicals and even inorganics. This tumultuous environment tested the company and management on its judgment, agility and responsiveness to customer concerns. While we work to mitigate short term challenges and focus on operating efficiencies, we are heartened to see record breaking top line performance of both companies on the back of increase in customer dependance on Deepak for uninterrupted supply. Coupled with this strategic impetus, growing Indian demand beckons us to do much more. As new products enter the Deepak family, our strengths of research capability, process intensification and wide product basket help steer us north with confidence.”

For year-to-date (YTD) results analysis

Net sales of Deepak Nitrite has increased 70.20% to Rs 4929.84 crore.  Sales of Fine & Speciality Chemicals segment has gone up 8.99% to Rs 611.01 crore (accounting for 12.20% of total sales).  Sales of Phenolics segment has gone up 95.26% to Rs 3,169.09 crore (accounting for 63.25% of total sales).  Sales of Basic Chemicals segment has gone up 67.43% to Rs 862.19 crore (accounting for 17.21% of total sales).  Sales of Performance Intermediates segment has gone up 69.15% to Rs 367.94 crore (accounting for 7.34% of total sales).  Inter-segment sales rose Rs 19.53 crore to Rs 80.39 crore. 

Operating profit margin has declined from 27.36% to 24.20%, leading to 50.59% rise in operating profit to Rs 1,193.25 crore. Raw material cost as a % of total sales (net of stock adjustments) increased from 51.35% to 60.53%. Employee cost decreased from 6.57% to 4.06%. Other expenses fell from 14.54% to 11.53%. Power and Oil fuel cost fell from 6.33% to 6.20%.  

Other income rose 150.77% to Rs 39.07 crore. PBIDT rose 52.52% to Rs 1232.32 crore.  Profit before interest, tax and other unallocable items (PBIT) has jumped 50.22% to Rs 1,146.98 crore.  PBIT of Fine & Speciality Chemicals segment fell 28.85% to Rs 180.74 crore (accounting for 15.76% of total PBIT).  PBIT of Phenolics segment rose 88.98% to Rs 691.26 crore (accounting for 60.27% of total PBIT).  PBIT of Basic Chemicals segment rose 74.20% to Rs 216.29 crore (accounting for 18.86% of total PBIT).  PBIT of Performance Intermediates segment rose 199.74% to Rs 58.69 crore (accounting for 5.12% of total PBIT). 

PBIT margin of Fine & Speciality Chemicals segment fell from 45.31% to 29.58%.  PBIT margin of Phenolics segment fell from 22.54% to 21.81%.  PBIT margin of Basic Chemicals segment rose from 24.11% to 25.09%.  PBIT margin of Performance Intermediates segment rose from 9.00% to 15.95%.  Overall PBIT margin fell from 26.18% to 22.89%. 

Provision for interest fell 55.03% to Rs 26.98 crore.  PBDT rose 61.15% to Rs 1205.34 crore.  Provision for depreciation rose 38.38% to Rs 133.08 crore. 

Profit before tax grew 64.51% to Rs 1,072.26 crore.  Share of profit/loss were nil in both the periods.  Provision for tax was expense of Rs 272.83 crore, compared to Rs 166.08 crore.  Effective tax rate was 25.44% compared to 25.48%. Net profit attributable to owners of the company increased 64.59% to Rs 799.43 crore. 

Promoters’ stake was 45.69% as of 31 December 2021 compared to 45.69% as of 31 December 2020 . 

Full year results analysis

Net sales (including other operating income) of Deepak Nitrite has increased 3.07% to Rs 4359.75 crore.  Sales of Fine & Speciality Chemicals segment has gone up 30.46% to Rs 763.55 crore (accounting for 17.39% of total sales).  Sales of Phenolics segment has gone up 27.97% to Rs 2,560.50 crore (accounting for 58.31% of total sales).  Sales of Basic Chemicals segment has gone down 18.84% to Rs 763.17 crore (accounting for 17.38% of total sales).  Sales of Performance Products segment has gone down 60.35% to Rs 304.18 crore (accounting for 6.93% of total sales).  Inter-segment sales came down from Rs 63.85 crore to Rs 31.65 crore. 

Operating profit margin has jumped from 24.25% to 28.60%, leading to 21.57% rise in operating profit to Rs 1,247.03 crore. Raw material cost as a % of total sales (net of stock adjustments) decreased from 55.85% to 52.05%. Employee cost increased from 5.16% to 5.65%. Other expenses fell from 14.59% to 13.76%. Power and Oil fuel cost fell from 6.78% to 6.06%.  

Other income fell 38.86% to Rs 21.52 crore. Profit before interest, tax and other unallocable items (PBIT) has jumped 19.51% to Rs 1,183.80 crore. PBIT of Fine & Speciality Chemicals segment rose 90.44% to Rs 333.73 crore (accounting for 28.19% of total PBIT). PBIT of Phenolics segment rose 237.71% to Rs 632.57 crore (accounting for 53.44% of total PBIT).  PBIT of Basic Chemicals segment fell 6.92% to Rs 194.87 crore (accounting for 16.46% of total PBIT).  PBIT of Performance Products segment fell 94.59% to Rs 22.63 crore (accounting for 1.91% of total PBIT). 

PBIT margin of Fine & Speciality Chemicals segment rose from 29.94% to 43.71%.  PBIT margin of Phenolics segment rose from 9.36% to 24.70%.  PBIT margin of Basic Chemicals segment rose from 22.26% to 25.53%.  PBIT margin of Performance Products segment fell from 54.57% to 7.44%.  Overall PBIT margin rose from 23.07% to 26.96%. 

Provision for interest fell 35.41% to Rs 74.2 crore.  Loan funds declined from Rs 1,043.24 crore as of 31 March 2020 to Rs 539.34 crore as of 31 March 2021.  Inventories declined from Rs 394.50 crore as of 31 March 2020 to Rs 382.69 crore as of 31 March 2021.  Sundry debtors were higher at Rs 756.30 crore as of 31 March 2021 compared to Rs 612.72 crore as of 31 March 2020.  Cash and bank balance rose to Rs 33.43 crore as of 31 March 2021 from Rs 31.40 crore as of 31 March 2020.  Investments rose to Rs 189.29 crore as of 31 March 2021 from Rs 2.38 crore as of 31 March 2020 . 

Provision for depreciation rose 9.23% to Rs 152.63 crore.  Fixed assets increased to Rs 2,042.45 crore as of 31 March 2021 from Rs 1,974.18 crore as of 31 March 2020.  Intangible assets increased from Rs 30.07 crore to Rs 41.73 crore. 

Profit before tax grew 29.18% to Rs 1,041.72 crore.  Provision for tax was expense of Rs 265.91 crore, compared to Rs 195.37 crore.  Effective tax rate was 25.53% compared to 24.23%.

Net profit attributable to owners of the company increased 26.97% to Rs 775.81 crore. 

Promoters’ stake was 45.69% as of 31 March 2021 compared to 45.69% as of 31 March 2020 . 

Cash flow from operating activities increased to Rs 999.04 crore for year ended March 2021 from Rs 764.66 crore for year ended March 2020.  Cash flow used in acquiring fixed assets during the year ended March 2021 stood at Rs 209.56 crore, compared to Rs 417.43 crore during the year ended March 2020. 

The scrip is currently trading at Rs 2364