Deepak Fertilisers dips on disappointing Q2 earnings

The stock was down 11% to Rs 178 after the company posted 4.8% YoY fall in profit at Rs 26.96 crore in Q2FY17.

Deepak Fertilisers & Petrochemicals Corporation has slipped 11% to Rs 178 on BSE in intra-day trade after the company reported 4.8% year on year (YoY) fall in net profit at Rs 26.96 crore for the quarter ended September 2016 (Q2FY17), due to lower operational income. The company had posted a profit of Rs 28.31 crore in the same quarter year-ago.

Total income fell to Rs 938 crore in Q2FY17, from Rs 1,095 crore in the corresponding period of the previous year.

Analysts on an average expected profit of Rs 35 crore on revenues of Rs 1,080 crore for the quarter.

The company said it witnessed marginal growth in chemical business, but showed subdued performance in fertiliser because of higher carryover stocks in the county and comparatively lower volumes in Ammonium Nitrate due to seasonal slowdown with delayed and extended monsoons.

The combined negative impact in the fertiliser sector emerging out of the delayed monsoons, inventory build-up from the earlier quarter and sudden price cuts impacted the quarterly performance, it added.

Good rainfalls followed with brisk sales and lowering of raw material costs should help improve the workings of the subsequent quarters, Deepak Fertilisers said in a press release.

At 09:49 am, the stock was down 8% at Rs 183 on BSE as compared to 0.27% decline in the S&P BSE Sensex. A combined 242,608 shares changed hands on the BSE and NSE so far.