Deepak Fertilisers and Petrochemicals on Friday posted multi-fold increase in net profit to Rs 120 crore for the quarter ending June as sales volumes of isopropyl alcohol, which is used in hand sanitizer, jumped by about 49 per cent year-on-year.
The net profit of the industrial chemicals and fertilisers company stood at Rs 11 crore during the corresponding quarter of 2019-20, Deepak Fertilisers said in a statement.
Total revenues of the company grew by 23 per cent to Rs 1,382 crore during April-June 2020 compared to Rs 1,122 crore in the year-ago period.
The company has made its pilot run of multiple hygiene products based on isopropyl alcohol (IPA) in the B2C markets and going forward, it is expected to open up a value-added product segment for the IPA business, the company said.
IPA revenues of the company increased by 178 per cent y-o-y to Rs 196 crore in the first quarter of FY2021, while its sales volumes increased by about 49 per cent y-o-y.
Improved margins were driven by an unprecedented surge in IPA demand on the back of increased awareness of use of IPA in hand sanitizer and disinfectant along with increase in international IPA prices.
DFPCL also forayed into IPA-based 'Hand Sanitizer' space to combat COVID-19 pandemic in April, the statement added.
COVID-19 pandemic has severely impacted India's economy in recent months although limited impact has been witnessed by the agrochemical industry. Good Rabi harvest and normal monsoon augurs well for the Kharif season. Sowing for key crops such as cotton and soybean improved significantly compared to last year, Deepak Fertilisers Chairman and Managing Director Sailesh C Mehta said.
He said the company continues to progress well both on financial and operational fronts.
Extensive farming and channel connection through digital ATL or BTL initiatives were undertaken during restricted movement conditions. We launched differentiated Bentonite Sulphur with enhanced efficiency under the brand name 'SUPER FAST' and have also moved almost 100 per cent NPK volumes to differentiated grade Smartek in Q1. Our CNB business reported the third consecutive profitable quarter in a row, he said.
He said, IPA demand was encouraging on the back of the continued demand from the pharma sector and additional demand from the hand sanitiser segment.
TAN experienced volume loss on account of decline in demand across segments of Private Coal, Non-Coal Mining, Infrastructure and Explosive Manufacturers. Recent strategic reforms by the government to support the agriculture sector and the mining sector are indeed path breaking.
"This should undoubtedly support the Indian economy in the long term. We are expecting a good Kharif season and accordingly, enhancing its production efficiencies in anticipation to meet the customer requirement, he added.
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