Deepak Fertilisers and Petrochemicals Corporation (DFPCL) today reported a 36% fall in its standalone net profit at Rs 31.65 crore for the third quarter ended December 31, 2012.
The Pune-based company had posted a net profit of Rs 49.65 crore in the year-ago period.
Total standalone income of the company increased marginally by 4% to Rs 623.35 crore in the third quarter this fiscal from Rs 601.49 crore in the same quarter of 2011-12 fiscal, it said in a BSE filing.
The expenses of DFPCL rose by 11% to Rs 578.80 crore in October-December period of this fiscal compared to Rs 523.55 crore in the same period of previous fiscal.
The company said that its fertiliser sales were impacted due to lower consumption.
"Given the drought conditions, the overall fertiliser consumption in India registered a decline of 43% in Q3 FY'13. However, thanks to its strong brand pull and marketing efforts, DFPCL�s ANP product registered a decline of only 18%," it said in a statement.
Ammonia prices increased 26% on a year-on-year basis during the quarter under review compared to the previous corresponding quarter in FY'12, which had a consequent impact on margins in the downstream chemicals business, it added.
"The Methanol plant also had to be shut down during the quarter under review due to high spot gas prices which rendered the product unviable," it said.
Ammonia prices have begun to soften gradually in Q4 and the company expects to pass on the higher raw material prices in a gradual manner going forward, it added.
On the future outlook, DFPCL Chairman & Managing Director Sailesh C Mehta said the economic environment will improve.
"Overall industry fundamentals, across sectors like mining, in the last nine months have been subdued but this will change in the next few quarters as the Indian economy returns to higher growth levels," he noted.
Mining, infrastructure and agriculture remain key factors in India's growth story, Mehta added.
"Though some margin pressure, especially in the chemicals sector, may remain for another quarter or two, we are confident that our marketing strengths and our product quality will enable us gradually improve margins as we pass on raw material price increases," he said.
The company manufacturers complex fertilisers, speciality chemicals, bio-fertilisers, among other products.
