By ICN GroupChemical, August 02, 2020
Tata Chemicals sales drops by 9%, still beat estimates
Net profit declines by 68% YoY and stood at Rs. 74 crore
Tata Chemicals Q1 FY2021 income from operations on consolidated basis stands at Rs. 2,348 crore, down by 9% as compared to Rs. 2,584 crore of the corresponding quarter of the previous fiscal. The company had earlier forecasted a 15% drop in its first quarter sales.
PAT reported on a consolidated basis at Rs. 74 crore, down by 68%, as compared to Rs. 231 crore of the corresponding quarter of last year. On a standalone basis, the income from operations was at Rs. 628 crore, as compared to Rs. 719 crore of the corresponding quarter of last year. PAT on a standalone basis was Rs. 109 crore, down by 47%, as compared to Rs. 206 crore of the corresponding quarter of last year.
The company’s results by reporting segment showed income from operations for the Basic Chemistry Products at Rs. 1,672 crore, down by 14% and Specialty Products at Rs. 676 crore, up by 7%.
Commenting on the results, R Mukundan, Managing Director & CEO, Tata Chemicals said, “In Q1, we adapted to the new normal with a consistent focus on product supply, cash position, optimal CAPEX, and calibrated fixed costs to build up and conserve our healthy cash position. During the quarter, there was no material change in the company’s liquidity position, with no borrowings and sufficient credit lines available."
"Soda Ash witnessed good demand from soaps and detergents segments, as they are classified as essential commodities but this was offset by flat & container glass segments through the lockdown period but is slowly returning to normal step forward, our aim is to move soda ash towards value added products in Performance Materials business, consistent growth in Nutrition science and Agri-science Businesses and seeding the Energy science business," aded Mukundan.
Salt manufacturing in Mithapur continues to grow. Production and sales were the highest in the first quarter with no supply disruption through the lockdown. Operations in Mambattu, Nellore (Andhra Pradesh) and Cuddalore (Tamil Nadu) started limited operation in May 2020, following the relaxation of local restrictions and are currently meeting customer requirements.
Nutritional Solutions business witnessed a lower demand off-take, yet received good traction from health focused companies and commenced exports to the South East Asian markets, with encouraging customer response.
Silica Business had good demand in food & non-food grade silica from essential goods segments though demand from tyre and automotive segment were muted.
The company introduced InsperiCo, world’s first branded recycled Cobalt, extracted from recycling lithium-ion batteries contributing to circular economy.
Going forward, focus will be building scale and value in Specialty Chemistry Products.