Deepak Fertilisers net profit zooms to Rs 24 cr

Deepak Fertilisers and Petrochemicals Corporation Ltd posted a sharp rise in net profit to Rs 23.47 crore for the quarter ended December 31, 2015, as against Rs 1.25 crore in the same period last financial year. The over 18-fold rise in net was mainly on the back of growth in volumes and efficiency in margin of acids and TAN (technical ammonium nitrate) business. Total income during the quarter rose 28 per cent to Rs 1,051.32 crore from Rs 818.48 crore in the corresponding quarter of the previous financial year. Fall in global ammonia prices led to better margins for acids and TAN.

Profit in the chemicals segment nearly doubled to Rs 93.58 crore during the quarter (Rs 44.65 crore last year). However, revenues registered a marginal growth at Rs 722.20 crore from Rs 627.87crore.

China crisis, fall in global commodity prices and forex volatility led to lower margins in IPA as well as other traded chemicals, impacting the company's overall sectoral profitability.

In manufactured fertilisers, the current quarter recorded substantial growth since in the corresponding quarter previous year due to unavailability of domestic gas, the company could not manufacture its flagship product Mahadhan Mahapower. This year, it had switched to LNG to produce Mahadhan Mahapower. As a result, the segment incurred a loss of Rs 1.26 crore during the quarter, as against a loss of Rs 5.01 crore in Q3 FY15. Revenues stood at Rs 408.84 crore (Rs 192.36 crore).

In a release, Sailesh C Mehta, chairman & managing director, said, "We continue to remain optimistic about the resumption of supply of natural gas and are hopeful that the matter will soon be resolved." The domestic gas supply to the company was stopped effective May 15, 2014. However, a division bench of Delhi High court on October 19, 2015, directed the government to resume the supply.