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Deepak Nitrite hits new high in subdued market; stock zooms 97% in 6 months

For Q3FY20, the company's phenol-acetone manufacturing subsidiary Deepak Phenolics clocked record quarterly turnover on the back of high utilization levels.

SI Reporter  |  Mumbai 

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In the past six months, the market price of the company has zoomed 97 per cent, up from a level of Rs 272 touched on Sept 3

Shares of continued their upward journey, surging 6 per cent to hit a new high of Rs 537, on the BSE on Tuesday on expectation that the strong run of earnings growth will continue despite the tailwinds.

In the past six months, the market price of the stock has zoomed 97 per cent, up from a level of Rs 272 touched on September 3. In comparison, the S&P BSE Sensex rose 5 per cent during the period.

has a diversified portfolio of intermediates that caters to the dyes and pigments, agrochemical, pharmaceutical, plastics, textiles, paper and home and personal care segments in India and overseas.

For the October-December quarter (Q3FY20), the company posted a solid performance as the results for all the three segments in their base business remained strong, while the phenol-acetone manufacturing subsidiary Deepak Phenolics, clocked record quarterly turnover on the back of high utilization levels.

Supported by strong volume growth due to production efficiencies and recalibration of product mix, the company’s total revenue during the quarter under review grew 36 per cent year on year (YoY) at Rs 1,120 crore. Consolidated net profit jumped more than three-fold to Rs 157 crore from Rs 48 crore in Q3FY19.

The management said China, which enjoys a dominant position in the market, has been deemphasizing manufacturing of chemicals and high-complexity products. Further, global customers are also seeking to establish operations in alternate other than China for which India is better placed.

Uncertainties caused by the coronavirus are exacerbating the concerns around China. This is a tailwind for the speciality chemical industry and is well placed and endeavours to continue to build upon its success in recent years, it added.

"The company is secure on the raw materials front, since it sources most of its raw materials locally and has a well-integrated facility. It has also undertaken positions to ensure that supply of imported raw materials are covered for the current quarter causing no disturbance to operations as a result of the developments in China," the management said.

At 11:39 am, Deepak Nitrite was trading 3 per cent higher at Rs 521 on the BSE, as against a 0.08 per cent rise in the Sensex. A combined 1.47 million shares have changed hands on the counter on the NSE and BSE so far.

First Published: Tue, March 03 2020. 11:43 IST
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