Balaji Amines tanks 19%, hits 52-week low on weak Q4 results

Hemanth Reddy Gaddam has also resigned as whole-time director & CFO of the company with effect from closing hours on May 2023 to focus on its subsidiary Balaji Speciality Chemicals

Shares of Balaji Amines tanked 19 per cent to hit a 52-week low of Rs 1,872.90 as the company reported weak earnings in Q4FY23 and its CFO Hemanth Reddy Gaddam tendered his resignation. 

The firm's consolidated profit after tax (PAT) fell 57.8 per cent year-on-year (YoY) to Rs 55.21 crore due to lower operational income. The specialty chemicals company had posted PAT of Rs 130.85 crore in the year ago quarter (Q4FY22).

In today's intra-day trade, the stock more than halved or plunged 51 per cent from its 52-week high level of Rs 3,842 touched on September 15, 2022. At 10:02 am; the stock was quoting 12 per cent lower at Rs 2,029, as compared to 0.29 per cent rise in the S&P BSE Sensex. The stock has fallen below its previous low of Rs 1,925.05, touched on March 29, 2022.

In Q4FY23, the company’s total income declined 39 per cent YoY to Rs 476.90 crore as against Rs 785.41 crore in Q4FY22. Earnings before interest, taxes, depreciation and amortization (Ebitda) margin contracted 493 bps to 20.68 per cent. The fall in the operating margin was primarily on account of degrowth in pharma and active pharmaceutical ingredient (API) and agro sector.

The management believes the performance of the company will improve gradually in the coming months, and anticipate a return to growth & margin levels similar to those achieved before the onset of the COVID-19 pandemic in due course, which management think is sustainable.

Revenues from the new commenced plants such as DMC, PG, Ethylamines will start contributing to the company’s top line from coming quarters, which in turn can improve the margin profile of the company from Q1FY24, the management said.

Meanwhile, Balaji Amines informed the exchanges that Mr Naveena Thammishetty Chandra, Mr Kashinath Revappa Dhole, Mr Satyanarayana Murthy Chavali, Mr Amarender Reddy Minupuri and Mrs Vimala Behram Madon have resigned as independent directors of the company from the closing hours on May 20 and Mr. Hemanth Reddy Gaddam has also resigned as whole-time director & CFO of the company to focus on subsidiary company Balaji Speciality Chemicals.

The board has inducted Mrs. Suhasini Yatin Shah, Dr. Uma Rajiv Pradhan, Mr. R. Mohan Kumar and Mr. Adabala Sheshagiri Rao to the company’s board.

Mr. Ande Srinivas Reddy, whole-time director will also take charge as CFO and Mr. Rajeshwar Reddy Nomula has been re-designated as whole-time director, the company said.

Balaji Amines is a leading manufacturer of Aliphatic Amines & Speciality Chemicals in India, specialized in manufacturing of Methyl Amines, Ethyl Amines, Derivatives of Amines and other Specialty Chemicals.