For the 9 mths ended Dec 18, net sales adjusting the Rs 22.5 crore of profit on insurance claim, stood at Rs 1306.05 crore up by 26% YoY. Also the OP for 9 months ended Dec 17 includes Rs 18 crore of profit net of expense towards the profit on insurance claim has been excluded. Thus after considering the said effect, OPM came in at 14.7%, up by around 170 bps. Thus, OP growth stood at Rs 191.70 crore up by 42% YoY. Other income was lower by 55% to Rs 2.34 crore. Interest costs was higher by 13% to Rs 32.93 crore and depreciation was higher by 1% at Rs 39.12 crore. PBT was thus higher by 67% to Rs. 121.99 crore. After considering the EO income of insurance claim money of Rs 3.48 crore in 9 mths ended Dec 18 and Rs 18.33 crore, in 9 mths ended Dec 17, PBT after EO stood at Rs 125.47 crore. Total tax was higher by 57% to Rs 44 crore on YoY. Finally, PAT came in at Rs. 81.47 crore up by 29% YoY.

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

"We are pleased to have sustained our growth momentum in Q3 of this fiscal year with revenues increasing by 23% on a year on year basis. This was due to improved realisations in the domestic market on the back of healthy demand in the end user industries. Favourable shifts in product mix and benefits of operating leverage have propelled PAT higher by 55% yoy.

The turnaround of the Performance Products segment that reported over 50% growth in turnover is heartening. This is an outcome of careful planning and reorientation of focus towards customers and end user industries that are exhibiting steady growth and value the high quality and differentiation in our offerings.

A development to note during the quarter was the commissioning of our Greenfield facility of Phenol and Acetone. I am delighted to share that we have already stabilised this mega plant and consistently achieved above 80% utilisation in a short span upon commissioning. Through rigorous efforts undertaken towards seed marketing, creation of complementary supply chain infrastructure and logistics as well as selection of the right team, we have been able to report positive EBITDA and PBT in the first quarter of commissioning itself. I would like to congratulate the entire team at Deepak Phenolics for seamless planning and execution.

This is just the beginning and I am confident that the several exciting opportunities in downstream intermediates will assist us in further elevating our performance in times ahead".

Other updates

Timely assessment of market demand has enabled the Company to optimise benefit from higher realisations across key products in all segments leading to robust topline growth.

Strong EBITDA performance driven by product mix adjustments, which enabled the Company to benefit from improved realisations in key products. Improved EBITDA supported by cost optimisation efforts undertaken

Domestic revenues stood at Rs. 293.1 crore in Q3 FY19 from Rs. 227.4 crore in the same period last year, growth of 29% Y-o-Y. Domestic revenues registered healthy growth owing to improved realisations and better customer acceptance for the Company's products.

Revenues from exports came in at Rs. 153.5 crore in Q3 FY19 compared to Rs. 139.7 crore in Q3 FY18, higher by 10%. A stable demand environment combined with improved realisations for key products steered the performance during the quarter.

Revenues from the Bulk Chemicals (BC) segment stood at Rs. 204.9 crore in Q3 FY19 compared to Rs. 182.3 crore in Q3 FY18, growing by 12% Y-o-Y. Growth in the BC segment was a result of firm realisations supported by improved product mix.

Revenues from Fine and Speciality chemicals (FSC) segment were at Rs. 148.4 crore in Q3 FY19, higher by 21% compared to Rs. 122.4 crore in Q3 FY18. Capacity expansion for established products and backward integration initiatives have enabled the Company to drive volume growth which, combined with firmer realisations in select products, has resulted in strong growth in topline for the segment.

The Performance Product (PP) segment reported revenues of Rs. 100.1 crore in Q3 FY19 compared to Rs. 66.7 crore in Q3 FY18, representing a growth of over 50% Y-o-Y. Quarterly revenues from the PP segment crossed the milestone of Rs. 100 crore and now contribute 22% of overall revenues against 18% in Q3 FY18. Favourable demand supply trends have resulted in improved realisations driving a solid performance in the PP segment.

Update on Phenol and Acetone Project

Commissioned the Green Field project of Phenol and Acetone

Deepak Phenolics Ltd. (DPL), a wholly-owned subsidiary of Deepak Nitrite Ltd., commenced commercial production at its Mega-Plant of Phenol & Acetone on 1st November, 2018. This facility, aligned with the 'Make in India' initiative of Government of lndia, has capacity to manufacture 200,000 MTPA of Phenol and 120,000 MTPA of its co-product Acetone. This is supported by capacity to manufacture 260,000 MT of Cumene for captive consumption. DPL is well positioned to benefit from strong demand growth in the local market for these products.

The company is ramping up of capacity utilization above 80% already achieved in Q3 contributing to additional turnover of Rs. 321 Crore from manufacturing. Consol. turnover (from manufacturing) at Rs. 778.8 crore vs. Rs. 371.6 crore, up 110% YoY.

Other milestones are:-

Successfully stabilised the plant and ramped up capacity utilisation above 80% during Q3 FY19.

Delivered positive EBITDA and PBT in the very first quarter of plant commissioning

Succeeded in replacing bulk of imports of phenol and acetone in the local market

Succeeded in making pharma grade acetone and also making first export of acetone

Achieved production and despatch of approx. 75% of avg. capacity utilisation showcasing robust logistics

Seed marketing efforts in pre-commissioning phase have firmly established DPL in leadership position

Outlook

The roadmap going forward is encouraging and the Company is well placed to leverage the opportunities present in the chemicals sector. Abundant availability of locally produced Phenol and Acetone will boost the production of downstream intermediates, which will further diversify the product applications and expand the overall market size in the country.

Established business segments are benefiting from the positive demand environment backed by firm realisations. On the back of solid quarter on quarter growth performance in the last several quarters and with increasing market opportunities, Deepak Nitrite is expected to continue its growth momentum.