02 Aug , 2022 By : Kanchan Joshi
Shares of Deepak Fertilisers and Petrochemicals Corporation Limited hit upper circuit level of 5% on the BSE for the third consecutive session, hitting 52-week high level, to Rs782 apiece in Tuesday's trading session after its Q1 FY23 earnings announced last week.
Deepak Fertilisers on Friday posted an over three-fold jump in consolidated net profit to Rs435.6 crore in the first quarter ended June quarter on strong sales. Its net profit stood at Rs130.6 crore in the year-ago period. The company's total income increased by over 59% to Rs3,042 crore in the April-June period as against Rs1,908 crore in the same quarter last year.
Its operating EBITDA margins increased to 24.3% in Q1 FY23 from 15.2% in Q1 FY22. The company said that its robust top line growth and margin enhancement primarily driven by the chemical segment.
The company's chemicals Segment contributed about 87% of total segment profits as chemicals revenues doubled to Rs1,771 crore and margins expanded to 41% whereas fertilisers segment revenues grew by 26% from the year-ago period although segment margins were impacted on account of sharp increase in raw material prices.
“We have continued our strong operational performance in Q1 FY 2023 on the back of improved margins in the chemical segment. This persistent business performance is a result of our long-term strategic initiatives, strong market positioning and favourable market conditions," said Deepak Fertilisers' Chairman and Managing Director (CMD) Sailesh C Mehta.
Higher reservoir levels and appropriate monsoon coverage in their core command region is being witnessed. Consumption in the second quarter of this year is expected to increase supported by higher commodity prices for cash crops due to robust climatic conditions, he added.
Mehta also said that long-term growth is expected to be underpinned by change in product mix, head room availability of additional capacities emerging from better operational management and de-bottlenecking along with greenfield expansions.
Deepak Fertilisers and Petrochemicals Corporation Ltd. (DFPCL) is among India's leading producers of fertilisers and industrial chemicals. Deepak Fertilisers shares have given multibagger return of more than 400% in the last two years, meanwhile the chemical stock is up about 95% in 2022 (YTD) so far.
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