Navin Fluorine jumps on robust Q4 performance

Navin Fluorine International spurted 3.49% to Rs 1,616 after consolidated net profit surged 705.5% to Rs 270.09 crore on 9.5% increase in net sales to Rs 276.57 crore in Q4 March 2020 over Q4 March 2019.

Profit was aided by a minimum alternate tax (MAT) credit reversal of Rs 88.2 crore during the quarter. The company had contested receipts on account of Certified Emission Reduction (CER) as capital receipts not chargeable to tax from financial year 2007-08 to financial year 2012-13. During the year, it received favourable appellate orders for some of the aforesaid years.

Accordingly, the company has now recognized MAT credit entitlement of Rs 73.55 crore under section 115JAA of the Act, for which claims have been made. The company has recomputed the tax liabilities for these years and written back excess tax provisions amounting to Rs 141.25 crore for earlier years.

Consolidated profit before tax (PBT) jumped 12.6% to Rs 62.88 crore in Q4 March 2020 as against Rs 55.82 crore in Q4 March 2019. Operating EBITDA jumped 33% to Rs 68.80 crore in Q4 March 2020 over Rs 51.60 crore in Q4 March 2019. EBITDA margin improved to 24.9% in Q4 FY20 as against 20.4% in Q4 FY19. The board has recommended a final dividend of Rs 3 per share. The Q4 earnings were declared post trading hours yesterday, 16 June 2020.

The Government of India announced a nationwide lockdown on 25 March 2020 to contain the spread of the COVID-19 pandemic. Accordingly, Navin Fluorine International had temporarily suspended manufacturing operations at its facilities at Bhestan, Gujarat and Dewas, Madhya Pradesh after taking safe shut down of continuous and batch manufacturing plants. After obtaining requisite permissions, as applicable, from concerned government authorities, the company restarted its operations at both the above facilities from 14 April 2020 in a phased manner. Currently, all the plants manufacturing products for life science and crop science sectors are running to optimum capacities, whereas those for industrial sectors continue to operate at sub-optimum levels.

Navin Fluorine International's management has carried out a detailed assessment of the impact of COVID-19 on its business operations and liquidity position, and on the recoverability and carrying values of its assets for the next one year, including properties, plants and equipments, trade receivables, inventories and investments and is of the opinion that there won't be any significant impact of COVID-19 on its operations. However, the firm will continue to monitor any material changes to future economic conditions, it said.

Navin Fluorine International is one of the manufacturers of speciality fluorochemicals.

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