Incorporated in 1947, Atul (formerly Atul Products) is a part of the Lalbhai Group. It has interests in agrochemical, aromatics, bulk chemicals and intermediates, colours, pharmaceuticals & intermediates and polymers. It is a well-known player in the dyes and dyestuff industry.

Performance for the quarter ended December ’05

The net sales for the quarter ended December’05 recorded a growth of 24% to Rs 234.06 crore. The operating profit was also high by 22% to Rs 29.17 crore. 170 bps decline in raw material consumed to 50.6% and 70 bps decline in manufacturing expenses to 8.5% cushioned the rise in other expense by 280 bps to 10.1%. However, staff cost and power and fuel cost was marginally high by 10 bps and 2 bps to 8.6% and 10.4% respectively.

Substantial rise in other income by 70% to Rs 2.85 crore led to rise in PBIDT to Rs 32.02 crore, up by 25% on y-o-y basis. The rise in interest outgo by 49% to Rs 8.12 crore and marginal increase in depreciation provision by 2% to Rs 7.12 crore made the PBT stand at Rs 16.78 crore, up by 28%.

The spurt in extraordinary income to Rs 58.47 crore which includes profit on sale of trade investments and income from lease termination boosted the PBT after EO by 476% to Rs 75.25 crore. Tax out go was low by 236% to 2.72 crore led by deferred tax which assets to Rs 3.38 crore as against liability of Rs 1.31 crore. Thus finally the PAT stood at Rs 77.97 crore posting a growth of whooping 605% on y-o-y basis.

Performance for the nine months ended December ’05

For the nine months ended December’05, the sales of the company were 23% up at Rs 610.36 crore. However, the operating margins tumbled by 100 basis points to 9.6%. The other income of the company, was high by 55% to Rs 8.08 crore. As a result the PBDIT witnessed a positive growth of 15% to Rs 66.71 crore. The interest burden increased 38% to Rs 22.02 crore and the depreciation charges went down marginally by 1% to Rs 20.58 crore. There was an extraordinary income of Rs 61.20 crore for the period. Coupled was a write-back of deferred tax of Rs 4.30 crore for the period against Rs 3.57 crore during the corresponding previous quarter. These items boosted the PAT by whopping 423% to Rs 88.67 crore.

Segment results:

The company reports its accounting results under two main segments, which are Colours and Specialty & other chemicals

1. Colours: For the quarter, this segment contributed Rs 77.10 crore, almost 31% of the total revenue. The PBIT contribution was down by 35% to Rs 3.72 crore contributing 19% to the total PBIT. Similarly the capital employed also was low by 22% to Rs 157.91 crore. For the nine months period the revenue from this segment recorded growth of 12% to Rs 216 crore contributing 33% to the total sales.
2. Specialty and Other Chemicals: This segment came up with promising results as the revenues grew 25% to Rs 174.58 crore, contributing 69% to the total revenue. The PBIT increased 45% to Rs 16.07 crore accounting for 81% of the total PBIT. Similarly for the nine months period this segment recorded PBIT growth of 41% to Rs 37.63 crore and capital employed stood at Rs 339.45 crore contributing 68% of the total.

The scrip trades at Rs 111.50/- currently.