Earnings | Deepak Nitrite Ltd. (NSE:DEEPAKNTR): Q3FY23 Results Out; Total Income rise 14% YoY

Deepak Nitrite Ltd. (NSE:DEEPAKNTR) is a chemical manufacturing company based in India. The company operates in three main business segments: Basic Chemicals, Fine and Speciality Chemicals, and Performance Products. Their product portfolio includes a wide range of chemicals such as phenol, acetone, aniline, nitro toluene, and more. The company has a strong presence in both domestic and international markets, with customers in over 30 countries. They have manufacturing facilities located in various parts of India and have invested in R&D to develop new products and improve their existing ones.

Deepak Nitrite Ltd. reported a revenue growth of 16% YoY and flat growth sequentially to 1991Cr in Q3FY23, led by strong volume in both segments. However, EBITDA declined by 11% and grew by 16% QoQ to 315Cr, with EBITDA margin declining by 400 bps to 16% YoY and slightly improving by 200 bps sequentially. PAT declined by 14% YoY & grew by 20% to 209Cr in Q3FY23 v/s 242Cr in Q3FY22. The Advance Intermediates segment grew by 19% YoY & QoQ to `818Cr in Q3FY23, supported by higher demand for key products. However, EBIT margins dropped by 300 bps to 18% YoY due to the increase in input cost and lag effect in passing on the prices to customers. The company recorded the highest ever production of DASDA and OBA in Q3FY23.

The Phenolics segment declined by 31% YoY & up by 24% QoQ to `127Cr in Q3FY23, led by over 100% capacity utilization of the plants. EBIT margins dropped to 11% YoY, owing to moderation in prices of products. The company reported a strong CAGR of 38% in revenue, 63% in EBITDA, and 62% PAT over FY17-FY22. Over the years, the company has successfully diversified into different business segments, newer geographies, and new clients, thus providing a competitive edge over peers. In its next leg of growth, the company expects to introduce downstream products and complex chemistry platforms for which it is already investing a capex of `1500Cr, stretched over the next 2 years.