Chemicals manufacturer SRF Ltd on Tuesday (January 30) reported a 50.4% year-on-year (YoY) decline in net profit at ₹253.4 crore for the third quarter that ended December 31, 2023.
In the corresponding quarter last year, SRF posted a net profit of ₹511 crore, the company said in a regulatory filing. CNBC-TV18 poll had predicted a profit of ₹293 crore for the quarter under review.
The company's revenue from operations declined 12% to ₹3,053 crore against ₹3,469 crore in the year-ago period. CNBC-TV18 poll had predicted revenue of ₹3,184 crore for the quarter under review.
At the operating level, EBITDA dipped 32.1% to ₹566 crore in the third quarter of this fiscal over ₹833 crore in the corresponding period in the previous fiscal. CNBC-TV18 poll had predicted an EBITDA of ₹625 crore for the quarter under review.
The EBITDA margin stood at 18.5% in the reporting quarter compared to 24% in the corresponding period in the previous fiscal. EBITDA is earnings before interest, tax, depreciation, and amortisation. CNBC-TV18 poll had predicted a margin of 19.6% for the quarter under review.
The chemicals business reported a decline of 21% in its segment revenue from ₹1,757 crore to ₹1,394 crore during Q3 of FY24 over the corresponding period last year. The operating profit of the chemicals business decreased 43% from ₹564 crore to ₹322 crore in Q3 of FY24 over the corresponding period last year, SRF said.
During the quarter, the specialty chemicals business continued to face headwinds due to inventory rationalisation by certain key customers, while performing better than in Q2 of FY24. The performance of the fluorochemicals business was adversely impacted owing to seasonally low demand for refrigerants.
In addition, sluggish growth in the agrochemical and pharmaceutical industries adversely impacted the demand for some key industrial chemicals. The company commissioned the PTFE facility and the HFC expansion project during the quarter.
The packaging films business reported a decline of 9% in its segment revenue from ₹1,203 crore to ₹1,091 crore during Q3 of FY24 versus last year. The operating profit of the packaging films business declined 62% from ₹119 crore to ₹45 crore in Q3FY24 over the corresponding period last year
During the quarter, the performance of the packaging films business was adversely impacted on account of substantial supply addition in both BOPET and BOPP film segments, resulting in significant pressure on margins and an overall demand slowdown globally.
The technical textiles business reported an increase of 8% in its segment revenue from ₹426 crore to ₹458 crore during Q3 of FY24 over the corresponding period last year. The operating profit of the technical textiles business increased 101% from ₹34 crore to ₹69 crore in Q3 of FY24 over the corresponding period last year.
The SRF board has approved a second interim dividend at the rate of 36% amounting to ₹3.60 per share. Earlier on July 24, 2023, the board had approved the first interim dividend at the rate of ₹3.60 per share.
The results came after close of the market hours. Shares of SRF Ltd ended at ₹2,223.05, down by ₹23.80, or 1.06%, on the BSE.
