Paradeep Phosphates slides as Q2 PAT declines 71% YoY

7 Nov 2022 , 11:25 AM

Net sales increased by 48% year on year to Rs 2,863.69 crore in the quarter ended 30 September 2022. Profit before tax tumbled 70.8% to Rs 68.36 crore in Q2 FY23 as compared to Rs 234.20 crore posted in Q2 FY22. Adjusted EBITDA stood at Rs 188 crore in Q2 FY23. The EBITDA is adjusted for the one time acquisition cost of Goa Plant worth Rs 230 crore. The company recorded production of 216,937 million tonne of N-20 in Q2 FY23 compared with 151,870 million tonne in Q2 FY22. Total expenses jumped 64.45% year on year to Rs 2,801.81 crore during the quarter ended 30 September 2022. Cost of raw materials consumed stood at Rs 2,622.67 crore (up 97.54% YoY) while finance costs was at Rs 72.74 crore (up 5x) in Q2 FY23. The company said that the raw material cost increased in this quarter owing to steep global commodity prices while certain raw materials prices, however, have softened in October. Finance cost have increased due to the increase in subsidies outstanding and currency volatility compared to previous year. Fertilizer demand is expected to remain firm for the commencing Rabi season, given the low stocks and high reservoir levels, the company added. Commenting on the results, S Krishnan, managing director of Paradeep Phosphates said: ?During the second quarter, we have been able to start the Goa Plant operations and all the 3 trains there are fully operational now. Also the completion of the revamp process of the 4 th granulation train at the Paradeep Plant is in advanced stages. Regarding the product mix, our choice to manufacture a higher amount of N-20 and lower DAP this quarter reflects the flexibility of our production trains to adapt as per market demand. However, certain one time expenses and a delay in commissioning the NPK trains at the Goa Plant resulted in higher fixed costs and a consequential impact on EBITDA. Going forward, we believe robust demand experienced in Kharif will continue into Rabi and the industry will benefit from low inventory levels, high reservoir levels and an overall decline in some raw material prices.? Paradeep Phosphates (PPL) is one of Indias largest private sector phosphatic companies, producing a wide range of phosphatic grades. It currently has a total capacity of 3 million MT, of which 0.4 million MT is Urea and the remaining 2.6 million MT is phosphatic fertilisers. Powered by Capital Market – Live News