DNL began FY24 with a promising performance amidst macro

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05 Aug, 2023, 10:00 IST

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Editor's Synopsis:

Q1 FY2024 (Consolidated):

MUMBAI, India and VADODARA, India, Aug. 5, 2023 /PRNewswire/ -- Deepak Nitrite Limited ('DNL'), one of the fastest growing and trusted chemical intermediates companies in India, announces its financial results for the quarter ended June 30, 2023.

Tribute to Shri C. K. Mehta, Founder & Chairman Emeritus

Performance Takeaways

The Indian chemical industry has been impacted in Q1 FY24 due to China opening up, global destocking of inventory and the Euro zone slowdown. This has led to subdued realizations and impacted volume offtake by customers. To safeguard profitability and market share, the Company adopted several strategies like exploring new customer opportunities, optimizing procurement, driving for valorization opportunities.

In this backdrop, the Company has delivered a commendable performance. For several established products, DNL reported highest-ever production in May 2023 of select products thereby demonstrating solid business resilience, process efficiency and byproduct valorization. Notably, the Company was able to export its key pharma and agro intermediates to China during the last 2 quarters.

The Phenol plant operated at an impressive average capacity utilization of around 135% during the quarter, however it also went into annual maintenance. The Company proactively de-risked its business model by securing assured input supplies, captive power and driving value creation from waste. Moreover, the contracted product supply in all the segments will ensure a clear pathway for sustained growth going ahead.

CMD's Message

Commenting on the performance, Mr. Deepak C. Mehta, Chairman & Managing Director, said, "We entered FY24 on a challenging note while navigating through several global macro-economic pressures and a slower-than-anticipated increase in consumption, leading to modest performance. The chemical industry faced difficulties due to China's opening up and destocking of inventory across the globe. Nevertheless, we remain committed to strengthening our market position and enhancing product portfolio.

In a key milestone, our wholly owned subsidiary, Deepak Chem Tech Limited (DCTL), inked a groundbreaking Rs. 5,000 crore MoU with the Government of Gujarat. This collaboration aims to produce Specialty Chemicals, Phenol, Acetone, and Bisphenol within the state, with the aim to commence the first phase in 2024-2025 and complete the projects by 2026-2027. This is a testament of our focus on import substitution through value-addition.

We are strategically positioned to take advantage of increasing demand and benefit from the country's trend of import substitutions. Exciting projects, such as solvents like MIBK and MIBC among others, approved by the Board, will enable us to capitalize on this trend.

Our noteworthy investment plans reflect our enthusiasm to seize opportunities both in India and worldwide. We are continually diversifying our product offerings by introducing innovative intermediates, expanding our client base and enhancing overall value propositions. With a strong financial position, valuable client relationships, and well-considered growth investments, we are poised to elevate our business proposition."

Key Developments

DCTL signed Rs. 5,000 crore MoU with Government of Gujarat

Awards & Accolades

Performance overview & other highlights

Financial Highlights (Consolidated)

Q1 FY2024 Vs. Q1 FY2023 (Y-o-Y)

Performance Highlights

Segmental Performance – Q1 FY2024 Vs. Q1 FY2023 (Y-o-Y)

Update on Projects

Project Status

The Company is building a world-class R&D centre near Vadodara to solidify its capabilities and expertise across complex chemistries, while accelerating the growth momentum.

Project Status (DPL)

Outlook

About Deepak Nitrite Limited

Deepak Nitrite Limited (NSE: DEEPAKNTR) (BSE: 506401) India's fastest growing Chemical Intermediates company, has a diversified portfolio that caters to the dyes and pigments, agrochemical, pharmaceutical, plastics, textiles, paper and home, and personal care segments and petro derivates intermediates -phenolics, acetone and IPA in India, and overseas. Its products are manufactured across six locations, which are all accredited by Responsible Care. Focusing on a Triple Bottomline principle of People, Planet, Profit, Deepak Nitrite Ltd. deploys globally benchmarked standards & systems, we are now accredited 'Silver Rating' by EcoVadis in 2022, for sustainability initiatives.

SOURCE Deepak Nitrite Limited