This Tata Group stock deals in the business of manufacturing and exporting basic chemistry and they are into specialty products was down by 5 percent after the company reported Q3FY25 results with net profit turned loss from profit year on year.
Share Price Movement
With a market capitalization of Rs. 23,283.45 Crores, the shares of Tata Chemicals Limited were down by 4.81 percent in the day’s trade touching a day’s low of Rs. 899.40 per share. The stock reiterated from the day’s low and was trading at Rs. 913.95 which is 3.28 percent lower than the previous closing price of Rs. 944.90 apiece.
It has delivered a negative return of 6 percent which has underperformed the Nifty Index in the past year.
Q3YF25 Financial Highlights
The company’s stock was down after reporting financial results for the quarter ending December 2024, Tata Chemicals consolidated revenue from operations has declined by 3.75 percent year on year from Rs. 3,730 crore in Q3FY24 to Rs. 3,590 crore in Q3FY25 and declined by 10.22 percent quarter on quarter from Rs. 3,999 crore in Q2FY25.
The company’s consolidated net profit stood at Rs. 194 crores in Q3FY24 and turned into a loss of Rs. 21 crores in Q3FY25. As compared to Q2FY25, the company’s net profit stood at Rs. 267 crore.
In Q3FY25, The Operating Margin stood at 4.29 percent down from 7.94 percent year on year followed by the Net Profit Margin which stood at negative 0.58 percent down from 5.20 percent a year ago. The Interest service coverage ratio has declined year on year.
Management Commentary
Commenting on the results, R. Mukundan, MD and CEO of Tata Chemicals said “Overall Asia including India continue to experience growth, while other markets including US and Western Europe are witnessing slight decline due to reduced demand for flat and container glass. Company’s overall performance was down as compared to the same quarter of the previous year, mainly due to lower Soda Ash pricing across geographies and higher fixed cost in the US due to plant production outage during the quarter.”
Business Segments
They earn 84.35 percent of the operational revenue from Basic Chemistry Products and 15.64 percent from Specialty Products for the December 2024 quarter. The Basic Chemistry segment contributes higher operating profit and Specialty margins are thin. Further, Finance costs cover more than operating profits thus reducing margins and higher chances of attaining losses on a consolidated basis.
Company Overview
Tata Chemicals Limited is a global leader in sustainable chemistry producing soda ash, sodium bicarbonate, and specialty products for various industries.
Written By Santhosh S
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