Shares of this integrated Indian chemical company jumped around 1 percent in Thursday’s trading session after its subsidiary company commenced its operations.
On a weekly timeframe, the Relative Strength Index (RSI) of the company’s share is ‘50’ indicating that the stock is trading in the ‘neutral’ zone.
With a market capitalisation of Rs. 20,260 crores, shares of Atul Ltd started Thursday’s trading session on a higher note at Rs. 6,848 compared to its previous close of Rs. 6,799. The shares hit a high of Rs. 6,900, gaining around 1 percent and are currently trading at Rs. 6,850 apiece.
Such a positive movement in the share price was observed after the company in an exchange filing announced that its subsidiary company, Atul Products Ltd received the required approval, licences and commenced its operations of 300 tpd caustic and 50 MW power plant situated at the Atul site with an approved investment of Rs. 1,035 crores in a combination of debt and share capital.
On March 13, 2021, Atul Ltd acquired a 100 percent stake in Atul Products Ltd (APL), thereby making the company its subsidiary.
Coming onto the company’s financial statement, the revenue increased marginally by around 1 percent from Rs. 1,182 crores during the June quarter to Rs. 1,192 crores in the September quarter. On a contrasting note, the net profits declined by 11 percent from Rs. 102 crores to Rs. 91 crores during the same timeframe.
The company get revenue from two major segments, primarily from Life science chemicals which contribute 34 percent of revenue and the remaining 64 percent of revenue is contributed by performance and other chemicals. Furthermore, the exports contributed 50 percent of the total sales in FY23.
The company has a strong clientele including some global chemical majors. It has a geographically diversified clientele, having long-term contracts through various marketing subsidiaries abroad wherein it serves about 4,000 customers belonging to 30 diverse industries across 92 countries.
Looking at the company’s important financial ratio, the return on equity stood at 11.13 percent during FY22-23 and the return on capital employed was recorded at 15 percent during the same period. The net profit margin for FY22-23 was recorded at 9.18 percent.
Headquartered in Ahmedabad, Atul Ltd was incorporated in 1975. It is a diversified and integrated Indian chemical company (a part of Lalbhai Group, Gujarat). The products of the company are used in various Industries and come mainly under two segments, Life Science Chemicals and Performance and other chemicals under 9 businesses.
Written By Vaibhav Patil
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