DCM Shriram posted a good set of numbers for third quarter with margins up at 18.5 percent, aided by increase in caustic prices. However, sugar segment remained a drag. Profit after tax was up 57 percent at Rs 213 crore.
The year on year (YoY) revenues for the quarter were up 31 percent at Rs 1783 crore versus Rs 1365 crore. The YoY EBITDA was up 74 percent at Rs 329.
Throwing more light on the numbers and the outlook going forward, Ajay S Shriram, CMD of the company said the chemicals volumes were up 34 percent and they saw a fairly stable pricing in all segment expect sugar.
Overall, each business had a better performance in terms of volumes, he said Shriram.
The company went through a major expansion in Caustic plant in Gujarat wherein they doubled the capacity from 550 tonnes a day to 1100 tonnes a day, he added. The chlor-alkali plant in Gujarat has achieved 100 percent capacity utilisation and similarly, the chlor-alkali plant in Kota is doing well.
Year on year the caustic prices have gone up 45 percent in this quarter and going forward it is difficult to state because commodities keep going up and down, since all products of the company are linked to international prices.
However, demand for caustic soda, chlorine is stable and expect prices to be stable in the next couple of quarters.
He said the cost of production for carbide and PVC went up because of the pet coke ban but that has now been cleared. However, orders from government haven't yet come.
All the agri business are doing well and with government taking proactive steps to improve farm incomes would bode well for the company, said Shriram.
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