Tata Chemicals Ltd's consolidated revenue for the quarter ended December 2018 came in at Rs2,831.7cr, up 10% yoy. However, operating profit for the quarter declined 16.2% yoy to Rs471.2cr. EBITDA margin declined ~522bps yoy to 16.6% in Q3FY19. The adjusted net profit after tax attributable to owners (excluding discontinuing operations and one-time deferred tax credits) stood at Rs247.02cr, marginally up 3.2% yoy. The revenue and PAT are in-line with the estimates. However, the EBITDA missed the estimate of Rs603cr by 22%.
• The EBITDA margin contracted by ~521bps on account of impact of power outage cost coupled with lower operating leverage in India, North America and Europe business. This significantly dragged down the margin of the company during the quarter. However, realization improved in India offsetting inflationary power costs.
• Basic chemistry products – The segment reported a revenue growth of 9.8% yoy to Rs2,141.7cr with decline in EBIT by 35.9% yoy to Rs283.1cr in Q3FY19. The segment EBIT margin declined by ~943bps to 13.2% during the quarter. This was majorly on account of higher fixed and power outage costs across India (PBT down Rs10cr), North America (down Rs20cr) and Europe (down Rs32cr).
• Consumer business reported a robust ~17% yoy increase in revenue to Rs470.9cr. This is on the back of improved sales volumes in Tata Salt, pulses and spices. However, segment EBIT remained flat at Rs59cr with decline in margin by ~271bps yoy to 12.5% on account of higher marketing spends, during the quarter.
• Specialty products - Revenue increased by 8% yoy to Rs429.2cr during the quarter. The segment EBIT stood at Rs9.4cr in Q3FY19 vs. Rs22.1cr in Q3FY19. Plans for Nutritional Solutions and HDS manufacturing facilities are on schedule.
• The flattish adjusted net profit (excluding discontinuing, exceptionals and one-time tax credits) despite a drop in EBITDA is on account of increase in joint venture profit and higher non-operational income.
• Consolidated net debt stood at Rs2,103cr as on December 31, 2018.
Tata Chemicals Ltd ended at Rs646.95, down 10.05 points, or 1.53%, from its previous close of Rs657 on the BSE. The scrip opened at Rs658.30 and touched a high and low of Rs664.20 and Rs641.10, respectively. A total of 6,61,537 (NSE+BSE) shares were traded on the counter. The stock traded above its 200-DMA.
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