The surge in stock came after the company reported a six-fold jump in the consolidated net profit at Rs 293 crore in March quarter of FY19. It had posted a profit of Rs 51 crore during the same quarter last year.
The company’s operational revenue during the quarter under review rose to Rs 1,888 crore, up 21 per cent from Rs 1,566 crore, on quarterly basis. PBDIT (profit before depreciation, interest and tax) grew five times at Rs 439 crore from Rs 95 crore.
The management said the chemical business, which accounted 36 per cent of total revenue, continues to record strong performance with continuous volumes growth and steady margins.
The company has commissioned additional around 500 tons per day (tpd) Chlor alkali capacity during last 8 months. It is working to add 66 MW power plant by Q3FY20 to achieve cost reduction and add capacity of 700 tpd in Chlor-Alkali capacity with 120 MW of power by March’ 21, it said.
Chlor alkali (caustic soda and chlorine) manufacturing is a part of the chlor-vinyl segment of DCM, along with poly-vinyl chloride (PVC) resins. The company is one of the top three domestic manufacturers of caustic soda, with a total capacity of 1,511 tons per day (tpd) situated at its facilities at Kota (Rajasthan) and Bharuch (Gujarat). Both these capacities have been operating at 90-100 per cent utilisation.
Sustained price realisations, controlled power cost due to captive power plants, and large scale of operations, have ensured a healthy operating margin over the past decade. Given the plans to further augment its caustic soda capacity, and the large economies of scale, the company will maintain its market position and operating efficiency over the medium term, rating agency CRISIL said in rating action on December 31, 2018.