Capitaline

Results 23-Jul-22

Analysis

Atul

Sales up 37%, OP down 1%

Atul consolidated net sales increased 36.72% to Rs 1476.85 crore in Q1FY23 compared to Q1FY22. Sales of Life Science Chemicals segment has gone up 37.51% to Rs 484.72 crore (accounting for 31.21% of total sales). Sales of Performance & Other Chemicals segment has gone up 40.27% to Rs 1,056.96 crore (accounting for 68.06% of total sales). Sales of Others segment fell 23.40% to Rs 11.26 crore (accounting for 0.73% of total sales). Inter-segment sales rose Rs 40.50 crore to Rs 76.09 crore.

Profit before interest, tax and other unallocable items (PBIT) has jumped 0.29% to Rs 209.74 crore. PBIT of Life Science Chemicals segment rose 61.37% to Rs 79.54 crore (accounting for 37.92% of total PBIT). PBIT of Performance & Other Chemicals segment fell 16.70% to Rs 130.23 crore (accounting for 62.09% of total PBIT). PBIT of Others reported loss of Rs 0.03 crore compared to profit of Rs 3.52 crore.

PBIT margin of Life Science Chemicals segment rose from 13.98% to 16.41%. PBIT margin of Performance & Other Chemicals segment fell from 20.75% to 12.32%. PBIT margin of Others segment fell from 23.95% to 0.27%. Overall PBIT margin fell from 18.66% to 13.51%.

Operating profit margin has declined from 21.86% to 15.77%, leading to 1.34% decline in operating profit to Rs 232.95 crore. Raw material cost as a % of total sales (net of stock adjustments) increased from 47.19% to 49.46%. Purchase of finished goods cost rose from 3.66% to 3.89%. Employee cost decreased from 6.97% to 5.91%. Other expenses rose from 21.54% to 25.57%. Power and Oil fuel cost rose from 8.68% to 10.43%.

Other income rose 21.34% to Rs 35.94 crore. PBIDT rose 1.19% to Rs 268.89 crore. Provision for interest fell 23.79% to Rs 1.57 crore.

PBDT rose 1.38% to Rs 267.32 crore. Provision for depreciation rose 9.32% to Rs 47.29 crore.

Profit before tax down 0.17% to Rs 220.03 crore. Share of profit/loss was 41.75% lower at Rs 1.13 crore. Provision for tax was expense of Rs 57.69 crore, compared to Rs 57.2 crore. Effective tax rate was 26.09% compared to 25.73%.

Minority interest decreased 32.91% to Rs -1.05 crore. Net profit attributable to owners of the company decreased 0.86% to Rs 164.52 crore.

Promoters’ stake was 45.05% as of 30 June 2022 compared to 44.93% as of 30 June 2021 . Promoters pledged stake was 1.50% as of 30 June 2022 compared to 1.50% as of 30 June 2021.

Full year results analysis

Net sales of Atul have increased 36.16% to Rs 5080.89 crore. Sales of Life Science Chemicals segment has gone up 20.45% to Rs 1,465.10 crore (accounting for 27.67% of total sales). Sales of Performance & Other Chemicals segment has gone up 43.38% to Rs 3,759.18 crore (accounting for 71.00% of total sales). Sales of Others segment rose 44.35% to Rs 69.98 crore (accounting for 1.32% of total sales). Inter-segment sales rose Rs 155.26 crore to Rs 213.37 crore.

Operating profit margin has declined from 24.58% to 17.94%, leading to 0.62% decline in operating profit to Rs 911.44 crore. Raw material cost as a % of total sales (net of stock adjustments) increased from 42.25% to 49.17%. Purchase of finished goods cost fell from 4.05% to 3.70%. Employee cost decreased from 8.18% to 6.48%. Other expenses rose from 21.33% to 23.42%. Power and Oil fuel cost rose from 8.16% to 9.65%.

Other income fell 26.20% to Rs 76 crore. PBIDT fell 3.20% to Rs 987.44 crore. Provision for interest fell 1.93% to Rs 9.17 crore. Loan funds rose to Rs 144.17 crore as of 31 March 2022 from Rs 107.98 crore as of 31 March 2021. Inventories rose to Rs 864.12 crore as of 31 March 2022 from Rs 594.14 crore as of 31 March 2021. Sundry debtors were higher at Rs 989.01 crore as of 31 March 2022 compared to Rs 733.23 crore as of 31 March 2021. Cash and bank balance declined from Rs 348.18 crore as of 31 March 2021 to Rs 68.92 crore as of 31 March 2022. Investments declined from Rs 1,361.05 crore as of 31 March 2021 to Rs 1,338.70 crore as of 31 March 2022.

PBDT fell 3.21% to Rs 978.27 crore. Provision for depreciation rose 29.61% to Rs 176.69 crore. Fixed assets increased to Rs 2,025.52 crore as of 31 March 2022 from Rs 1,638.94 crore as of 31 March 2021. Intangible assets stood at Rs 29.14 crore.

Profit before interest, tax and other unallocable items (PBIT) has slumped 5.55% to Rs 779.20 crore. PBIT of Life Science Chemicals segment fell 18.53% to Rs 178.88 crore (accounting for 22.96% of total PBIT). PBIT of Performance & Other Chemicals segment fell 3.07% to Rs 575.89 crore (accounting for 73.91% of total PBIT). PBIT of Others segment rose 116.19% to Rs 24.43 crore (accounting for 3.14% of total PBIT).

PBIT margin of Life Science Chemicals segment fell from 18.05% to 12.21%. PBIT margin of Performance & Other Chemicals segment fell from 22.66% to 15.32%. PBIT margin of Others segment rose from 23.31% to 34.91%. Overall PBIT margin fell from 21.23% to 14.72%.

Profit before tax down 8.33% to Rs 801.58 crore. Share of profit/loss was 12.55% higher at Rs 8.16 crore. Provision for tax was expense of Rs 205 crore, compared to Rs 221.66 crore. Effective tax rate was 25.32% compared to 25.14%.

Minority interest decreased 88.73% to Rs 0.48 crore. Net profit attributable to owners of the company decreased 7.85% to Rs 604.26 crore.

Equity capital stood at Rs 29.61 crore as of 31 March 2022 to Rs 29.61 crore as of 31 March 2021. Per share face Value remained same at Rs 10.00.

Promoters’ stake was 44.94% as of 31 March 2022 ,compared to 44.93% as of 31 March 2021 . Promoters pledged stake was 1.50% as of 31 March 2022 compared to 1.50% as of 31 March 2021 .

Cash flow from operating activities decreased to Rs 231.45 crore for year ended March 2022 from Rs 717.95 crore for year ended March 2021. Cash flow used in acquiring fixed assets during the year ended March 2022 stood at Rs 590.90 crore, compared to Rs 322.54 crore during the year ended March 2021.

An incident of fire occurred on April 20, 2022, in one of the plants at Atul, Gujarat. There was no fatality or injury to any person, and damage was restricted to the affected plant. The company has written off the carrying value of the assets destroyed by fire amounting to Rs 35.08 crore, by including it in other expenses. The company has filed a claim in this regard with the insurance company which is under process.

The Board of Directors in its meeting held on March 25, 2022, had approved a proposal to buy-back fully paid-up equity shares of face value of Rs 10/- each of the company. The buy-back of equity shares through the open market stock exchange route commenced on April 07, 2022, and it was completed on May 09, 2022. The company bought bock and extinguished a total of 73,296 equity shares at an average buy-back price of Rs 9,536.31/- per equity share, constituting 0.25% of the pre buy-back paid-up equity share capital of the company. The buy-back resulted in a cash outflow of Rs 69.90 crore (excluding transaction costs). The company purchased the said shares out of its free reserves and created capital redemption reserve of Rs 0.07 crore equal to the nominal value of the shares bought back as an appropriation from general reserve in accordance with Section 69 of the Companies Act, 2013.

The scrip is currently trading at Rs 8655

Atul : Consolidated Results
Particulars	2206 (03)	2106 (03)	Var.(%)	2203 (12)	2103 (12)	Var.(%)
Net Sales	1,476.85	1,080.20	37	5,080.89	3,731.47	36
OPM (%)	15.8	21.9		17.9	24.6
OP	232.95	236.11	-1	911.44	917.12	-1
Other Inc.	35.94	29.62	21	76	102.98	-26
PBIDT	268.89	265.73	1	987.44	1,020.10	-3
Interest	1.57	2.06	-24	9.17	9.35	-2
PBDT	267.32	263.67	1	978.27	1,010.75	-3
Depreciation	47.29	43.26	9	176.69	136.32	30
PBT	220.03	220.41	0	801.58	874.43	-8
Share of Profit/(Loss) from Associates	1.13	1.94	-42	8.16	7.25	13
PBT before EO	221.16	222.35	-1	809.74	881.68	-8
EO Income	0	0	-	0	0	-
PBT after EO	221.16	222.35	-1	809.74	881.68	-8
Taxation	57.69	57.2	1	205	221.66	-8
PAT	163.47	165.15	-1	604.74	660.02	-8
Minority Interest (MI)	-1.05	-0.79	-33	0.48	4.26	-89
Net profit	164.52	165.94	-1	604.26	655.76	-8
EPS (Rs)*	#	#		204.7	222.2
Notes
* EPS is on current equity of Rs 29.51 crore, Face value of Rs 10, Excluding extraordinary items.
# EPS is not annualised
bps : Basis points
EO : Extraordinary items
Figures in Rs crore
Source: Capitaline Corporate Database

Atul : Consolidated Segment Results
	% of (Total)	2206 (03)	2106 (03)	Var.(%)	% of (Total)	2203 (12)	2103 (12)	Var.(%)
Sales
Life Science Chemicals	31	484.72	352.49	38	28	1,465.10	1,216.37	20
Performance & Other Chemicals	68	1,056.96	753.51	40	71	3,759.18	2,621.88	43
Others	1	11.26	14.7	-23	1	69.98	48.48	44
Total Reported Sales	100	1,552.94	1,120.70	39	100	5,294.26	3,886.73	36
Less: Inter segment revenues		76.09	40.5	88		213.37	155.26	37
Net Sales	100	1,476.85	1,080.20	37	100	5,080.89	3,731.47	36
PBIT
Life Science Chemicals	38	79.54	49.29	61	23	178.88	219.57	-19
Performance & Other Chemicals	62	130.23	156.33	-17	74	575.89	594.16	-3
Others	0	-0.03	3.52	PL	3	24.43	11.3	116
Total PBIT	100	209.74	209.14	0	100	779.2	825.03	-6
Less : Interest		1.57	2.06	-24		9.17	9.35	-2
Add: Other un-allcoable		12.99	15.27	-15		39.71	66	-40
PBT	100	221.16	222.35	-1	100	809.74	881.68	-8

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