Tata Chemicals’ net profit doubled in 3Q
Tata Chemicals reported that its net profit more than doubled in the third quarter of the current financial year. The rise was mainly due to higher volumes and a stable price environment.
The net profit for the quarter stood at Rs 221 crore, against Rs 91 crore in the same period previous year. The sales of the company fell 28% to Rs 2,622 crore during the period.
The company said that its net profit includes about Rs 12 crore from crop protection firm Rallis India. The firm was acquired by Tata chemicals in November. It owns 50.06% equity in Rallis.
Managing Director, RK Mukundan said "During the period, the company witnessed demand growth in domestic as well as in international markets. However, there is a marginal pressure on the margins of some products, such as phosphatic fertilizers, due to a fall in global prices."
The company launched a low-cost water purifier called 'Tata Swach'. The segment has rivals such as Hindustan Unilever and Eureka Forbes and the product developed by the research and development division of the company is likely to put the company in a challenging position.
Mr Mukandan outlined that company is planning to revive its expansion programme. The company plans to increase manufacturing capacity for its salt facility by 50% and double the capacity at its urea facility, over the next two years.
The production of salt is to be scaled up to 8 lakh tonne from 5 lakh tonne with an investment of Rs 180 crore. The urea production on the other hand will increase to 2.4 million tonne with an estimated investment of Rs 3,500 crore.
The capital required for these expansion plans have been arranged through internal accruals, indicated Mr Mukundan. The three edible salt brands of the company, Tata Salt, I Skakti and Tata Salt Lite recorded an increase of 20% in sales on a year on year basis.
Shares of the company rose over 5% to close at Rs 297.60 on Bombay Stock Exchange.
