Meghmani Finechem’s Q3FY23 revenue up 27%; PAT by 11%

The Board of Directors of Meghmani Finechem Ltd has approved the expansion of an additional 45,000 TPA production capacity of CPVC Resin plant at Dahej, Gujarat.

Meghmani Finechem Limited (MFL), India’s leading integrated chemical manufacturer, posted a 27% jump in its revenue for Q3FY23 to Rs 538 crore as compared to Q3 of FY22.

Commenting on the results, Maulik Patel; Chairman and Managing Director, MFL said: “We have witnessed 18% volume growth in Q3FY23 resulting in YoY revenue growth of 27%. Even in this volatile market, we have seen volume growth in all our products and have also grown on absolute basis. The new products that we commissioned in 9MFY23 have started contributing to P&L and we expect that contribution to enhance from Q4FY23 onwards. Revenue contribution from Derivatives & Specialty segment increased to 31% in Q3FY23 vs 25% in Q3FY22.

For CPVC resin, our product is well accepted by all customers and we are expected to reach optimum capacity utilization in Q4FY23. Considering the market size and growth potential, we are increasing our CPVC resin capacity to 75,000 TPA, by adding another 45,000 TPA. As we are ready with basic infra requirement for CPVC resin expansion, we will be able to do this project faster and lower capex compared to our first project. This expansion will further strengthen our integrated complex as Chlorine will be consumed as one of the raw materials in CPVC resin.

MFL board has declared its 1st maiden interim dividend of 25% on face value of Rs 10 (Rs 2.5 per equity share). With our expansion plans, we are moving in line with our long-term vision to become a fully integrated facility company catering to diversified industries and consistent growth.”

The key performance highlights are:

Strategic Update for 9MFY2023:

• MFL is expanding its CPVC Resin capacity to 75,000 TPA by adding further 45,000 TPA. The project is expected to get commissioned by Q4FY24
• MFL board has declared its 1st maiden interim dividend of 25% on face value of Rs 10 (Rs 2.5 per equity share)
• In 9MFY23, MFL commissioned Epichlorohydrin on 1st June, CPVC on 18th July and additional capacity of Caustic Soda on 30th September. All 3 projects were completed within committed timelines and within capex limit. These projects will contribute volume partially in FY23 and fully in FY24
• Expansion projects of Chlorotoluene & its value chain and R&D Centre is moving as per schedule
• MFL acquired 2,89,844.41 sq. m. land in Dahej (close to current complex) for future growth plans
• MFL entered in JV to set up 18.34 MW Hybrid Power Plant to meet energy requirement at the plant

Q3FY23 Operational Highlights (YoY):

• Volume grew from all the products in Q3FY23 led to 18% volume growth on YoY basis
• Caustic Soda & Caustic Potash ECU realization was up 2% & 40% respectively
• CMS sales realization was down 33% and H2O2 sales realization was up 9%

Q3FY2023 Financial Highlights (YoY):

• Revenue grew 27% to Rs 538 crore on account of volume growth and higher realizations from majority products. Revenue contribution from Derivative & Specialty segment increased to 31% in Q3FY23 vs 25% in Q3FY22
• EBITDA grew 18% YoY. Margin continuous to be strong at 31%, though slightly lower on account of high cost raw material compared to realization
• PAT increased 11% YoY to Rs 77 crore

 9MFY2023 Financial Highlights (YoY):

• 9MFY23 Revenue, EBIDTA and PAT has crossed FY22’s full year numbers
• Revenue grew 55% to Rs 1,626 crore on account of 7% volume growth and high realizations
• PAT grew 80% to Rs 277 crore and margin improved to 17% on account of higher realizations vs 15% in 9MFY22
• ROCE and ROE improved to 35% and 46% respectively on account of higher realization and volume growth