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HomePosts Tagged "Sailesh C. Mehta"
Agribusiness, Agro chems – Fertilizers, Company News, Finance, India

Company’s Crop Nutrition Business (CNB) achieved a remarkable 83 per cent YoY increase in sales volume of manufactured bulk fertilizer, which is highest ever sales.

Deepak Fertilisers and Petrochemicals Corporation Limited (DFPCL), one of India’s leading producers of industrial and mining chemicals and fertilisers, announced its results for the quarter ended September 30, 2024. Company’ s EBITDA Margin improved to 18 per cent compared to 12 per cent year-over-year. Company’s Crop Nutrition Business (CNB) achieved a remarkable 83 per cent YoY increase in sales volume of manufactured bulk fertilizer, which is the highest ever sales.

Commenting on the performance, Sailesh C. Mehta, Chairman & Managing Director said, DFPCL has shown impressive performance in Q2 FY25, achieving a 13 per cent growth in revenue. This growth was primarily driven by the Crop Nutrition business, which experienced an 18 per cent YoY increase in revenue, while the Chemical business grew by 8 per cent YoY despite a lean quarter for the chemical sectors.

“Fertilizer and Chemical businesses acted as a natural hedge, enabling the company to deliver consistent and improved performance.

“There has been a consistent increase in the proportion of revenue from specialty products, along with an overall rise in revenue, driven by the strategic move of transitioning from commodity to specialty,” says Mehta.

The ammonia plant has enabled all our businesses to reap substantial benefits from backward integration, effectively mitigating supply chain risks and price volatility. As a result, we are now able to capture the increases in global ammonia prices within the group.

As India continues to grow, the chemical and fertilizer sectors are poised to thrive. The demand outlook for the Crop Nutrition, Mining Chemicals, and Industrial Chemicals Business is well aligned with India’s growth story, providing strong and positive tailwinds. We are actively working on the execution of the TAN Project and the Nitric Acid Project in Gopalpur and Dahej, respectively, to capitalize on future growth.

Crop Nutrition Business (Fertilisers) Review

In Q2 FY25, manufactured bulk fertilizer has achieved highest ever sales volume of 268 KMT, an 83 per cent YoY increase, driven by improved demand from above-average rains, which led to 102% Kharif crop sowing and positive market sentiment across all regions.

Sales volume of Croptek surged to 37 KMT, reflecting a 70 per cent YoY growth, with continued focus on providing crop-specific solutions for targeted crops, including cotton, soybean, sugarcane, corn, grapes, pomegranate, and banana.

The company has recently launched premium water-soluble fertilizer grades. Sale of specialty fertilizer Bensulf was 9 KMT, up 7 per cent YoY.

Company’s Crop Nutrition Business (CNB) achieved a

Agribusiness, Agro chems – Chemicals, Agro chems – Fertilizers, Company News, Finance, India, Speciality Chemicals

Company registered Profit After Tax (PAT)of Rs 200 crore which is 76 per cent higher on YoY basis.

Deepak Fertilisers and Petrochemicals Corporation Limited, one of India’s leading producers of industrial & mining chemicals and fertiliser announced its results for the first quarter ended June 30, 2024.

In Q1FY25 company delivered revenue Rs.2,281 Crores, marginal decline by 1.4 per cent on YoY basis due to lower commodity prices. Company’s EBITDA margin improved to 20.4 per cent against 12.1 per cent on YoY basis. Company’s PAT was Rs.200 crore which is 76 per cent higher on YoY basis.

During the quarter, sales of manufactured bulk fertilisers was 174 KMT, representing an 11 per cent increase YoY. The company has launched Smartek fertilizer for paddy, pulses, and cotton, along with the Croptek grade for soybean crops. Sales of specialty fertilizer product, Bensulf, amounted to 10 KMT this quarter, reflecting a 51 per cent increase YoY.

Sales of traded specialty fertilisers in Q1FY25 saw an 80 per cent increase YoY. With global prices for water-soluble fertilisers stabilizing, demand has now returned to normal levels.

 With better monsoon, the demand outlook is positive. We are focusing on delivering crop specific and water-soluble fertilizers which deliver higher yield and productivity to the farmer. Additionally, our recent partnership with Israel-based Haifa Group will help to promote high-performance specialty fertilisers.

Segment Performance:

Chemical Segment (Mining and Industrial Chemical) contributed about 57 per cent of total revenue which grew by 5per cent YoY mainly driven by improved demand in TAN business.

Fertilisers Segment contributed 43 per cent of total revenue which was lower by 9 per cent YoY because of delay in monsoon which post July has picked up very well.

Reduction in key RM Prices during Q1FY25 has resulted in lower NSP:  Ammonia 36 per cent YoY; MOP 37 per cent YoY; Gas 7 per cent YoY; while delivering improved overall margins.

Launched Croptek grade for Soyabean Crop and Smartek grade for Paddy-& Pulse.

The National Budget has proposed Duty hikes on Ammonium Nitrate and Duty reductions on the Precious Metals used for Catalysts, both will have a positive impact.

Commenting on the performance, Sailesh C. Mehta, Chairman & Managing Director said, “DFPCL has delivered an impressive performance for Q1FY25, with notable increase in EBITDA margin by 823 bps YoY, up from 12.1 per cent to 20.4 per cent.

The businesses are reaping the benefits of backward integration of Ammonia plant which has helped mitigate supply chain risk as well as price volatility and the benefits are captured within the group.

Also, the strategy of moving from commodity to speciality has been working to sustain and enhance the margins of the businesses.

Mining chemical segment demonstrated robust volume and margin growth supported by stable imported Fertliser Grade Ammoniam Nitrate (FGAN) prices and lower ammonia prices. The proposed duty hike on ammonium nitrate will also help going forward.

The fertilizer business volume was driven by Croptek and specialty fertilizers, providing crop-specific solutions to farmers. Despite delayed monsoon and high inventory of phosphatic fertilizers, volumes slightly declined by 3 per cent YoY. With rains predicted to be above normal, we expect volume growth in the coming quarter, boosted by new launches: Croptek grade for Soyabean and Smartek for paddy and pulses.

Margins of Nitric acid is stable with volumes lower on YoY basis due to extended repair in WNA plant. The IPA business declined by 8 per cent YoY due to the planned shutdown of the plant. Going forward, we expect stable demand in both Nitric Acid and IPA segment.

We continue to maintain sharp focus on operational efficiencies, drive cost optimizations, capacity utilization, and productivity improvements, which will help us navigate through market challenges and remain steadfast in adding value to our shareholders.

Company registered Profit After Tax (PAT)of Rs

Agribusiness, Agro chems – Fertilizers, Agrotech, Collaborations, Company News, India

 The partnership aims to promote high performing Specialty fertilisers to improve quality and productivity of crops in India and other countries.

 Mahadhan Agritech Limited (MAL), formerly known as Smartchem Technologies Limited (STL) and a subsidiary of Deepak Fertilisers and Petrochemicals Corporation Limited (DFPCL), and Israel-based Haifa Group, a multinational corporation and leading global supplier of Specialty Plant Nutrients have entered into an understanding to promote high performing Specialty fertilizers to improve quality and productivity of crops in India and other countries.

“This partnership with Haifa Group is yet another milestone in MAL’s journey towards transforming agriculture in India with customized crop nutrient solutions that deliver balanced and precise Crop Nutrition. Currently, over 6 million hectares of Agricultural land are already supported by drip irrigation systems spread over most states. It encompasses a wide range of crops including Fruits, Vegetables, Sugarcane, and many other field crops giving a ready platform to deploy the Specialty Water Soluble fertilizers.

The MAL-Haifa offerings will support agricultural practices that counter the vicious trend of water scarcity and also hugely enhance Nutrient uptake & Use Efficiency in the plants. This will directly help achieve our Prime Minister’s dream of Doubling the farm incomes. In addition, these initiatives will also help reduce groundwater and air pollution. We believe this collaboration will bring positive change in the agricultural sector, thereby empowering farmers,” said Sailesh C. Mehta, Chairman & Managing Director of DFPCL. This partnership will significantly contribute to speed-up MAL’s journey in the specialty crop nutrient market.

“I am pleased that we have entered into an agreement with Mahadhan Agritech to support Indian Farmers by synergizing our global expertise and resources with MAL’s on-ground expertise, we aim to proactively address the evolving needs of Indian agriculture and farmer preferences by leveraging the latest technologies. Through this collaboration, we will also take special practices and innovations of Mahadhan Agritech to other geographies in the developing world to improve yields and Agri produce and quality,” said Motti Levin, CEO of Haifa Group, Israel.

 The partnership aims to promote high performing

Agro chems – Fertilizers, Collaborations, Company News, India

This agreement is for annual supplies of up to 0.65 million tonnes over a period of 15 years, beginning 2026. 

Deepak Fertilisers and Petrochemicals Corporation Limited (DFPCL), one of India’s leading producers of industrial chemicals and fertilisers, and Equinor, an international energy company headquartered in Norway, have entered into a long-term supply agreement for Liquefied Natural Gas (LNG).

With this tie-up, DFPCL strengthens its value chain with an attractive long-term LNG contract to solidify its value chain from Gas to Ammonia to various downstream Fertilisers, Industrial Chemicals and Mining Chemicals. This end-to-end tie-up shall establish a strong long-term foundation for all of DFPCL’s product segments.

Equinor, erstwhile Statoil, is amongst the established leaders in the oil & gas sector over the last 50 years, with a market cap of USD 75 Billion wherein majority shares are owned by the Norwegian Government.

The agreement signed by Irene Rummelhoff, Executive Vice President, Equinor and Sailesh C. Mehta, Chairman & Managing Director, DFPCL, is one of the largest contracts signed by Equinor with a private sector company in India.

This agreement is for annual supplies of up to 0.65 million tonnes over a period of 15 years, beginning 2026.  The tie-up provides room for trading some LNG parcels in the growing LNG demands in India as well as accommodating DFPCL’s growing captive needs. The LNG will be delivered to the west coast of India. DFPCL is at an advanced stage of tying up the Re-gasification Terminal with the Gas pipeline grid connectivity to its plant’s doorstep already in place.

The LNG agreement also encourages the companies to further collaborate on petrochemicals feedstocks and strategic decarbonization pathways in the future.

“We are very happy to enter into this long-term agreement with Equinor for supply of LNG. This will put on a solid footing Deepak Fertilisers value-chain right from Gas to Ammonia to building block Nitric Acids to downstream Fertilisers, Mining Chemicals and Industrial Chemicals, helping it to absorb Global volatility as well as enhance overall margins.  We also look forward to exploring with Equinor, strategic tie-ups in our Chemical Business, as well as carbon footprint reduction initiatives.” said Sailesh C. Mehta, Chairman & Managing Director, DFPCL.

“I am happy that we have entered into this agreement with Deepak, and it is an example of how we use our position in the Atlantic basin to strengthen our relationship with key players in the growing Indian market. Ammonia is a key building block for the society, being crucial for agriculture and food security. Deepak’s new ammonia plant will provide new, domestic fertiliser supply to India and we are proud to provide its feedstock in the form of natural gas. We look forward to further developing our relationship with Deepak on feedstocks and low carbon initiatives in the future”, says Equinor’s Senior vice president for Gas & Power Helge Haugane.

This agreement is for annual supplies of