Delayed subsidy payment causing cash flow probs: Tata Chem
Tata Chemicals today said delay in payment of fertiliser subsidy by the government to the tune of Rs 1,496 crore is putting strain on company's balance sheet.
"The main concerns are the delayed subsidy payment from the government amounting to Rs 1,496 crore, which is causing cash flow problems and putting a strain on company's balance sheet," Tata Chemicals Managing Director R Mukundan told reporters here.
The Centre, which controls prices of some fertilisers, compensates companies through cash payments. Meanwhile, the company today reported a marginal rise in consolidated net profit at Rs 224.07 crore for the quarter ended December 31, compared to Rs 223.78 crore in the same period last year.
The consolidated total income rose by 13 per cent to Rs 4,343.45 crore in the October-December quarter from Rs 3,853.62 crore in the corresponding quarter of last fiscal. "Performance for the quarter under review was under stress due to Magadi (Kenya) and the UK units' performance and phosphates business.
However on the whole, we remain positive on recent fertiliser policy announcements," Mukundan said. Going forward, he said, the company expects the domestic market to continue the growth momentum though there would be pressure on soda ash and fertiliser business.
"We continue to lead the market in the national branded salt category with 66 per cent market share," he added. During the quarter, the company launched 'Tata i-shakti Besan' in the New Delhi market and a direct to customer based offering 'DAL ON CALL' providing free home delivery to customers, he said.
On the government's announcement of the new urea policy, he said, the company is taking steps for expansion of the Babrala plant in Uttar Pradesh and already secured statutory clearances. Tata Chemicals, a part of Tata Group, is a leading manufacturer of chemicals, fertiliser, food additives and is the world's second largest producer of soda ash with manufacturing facilities in Asia, Europe, Africa and North America.