Tata Chemicals’ shares tumbled over 4 per cent on February 4, following disappointing Q3 earnings. The company posted a net loss of ₹21 crore for the December quarter, a sharp contrast to the ₹194 crore net profit recorded in the same period last year.
At 10:40 am, Tata Chemicals fell intraday low to ₹901.20 per share on National Stock Exchange (NSE).
Tata Chemicals reported a 3.8% decline in revenue from operations, totaling ₹3,590 crore compared to ₹3,730 crore in the same quarter last year. Operating EBITDA decreased by 19.9% to ₹434 crore in the third quarter, down from ₹542 crore in the prior year. The company posted a net loss, in contrast to a net profit of ₹194 crore recorded during the same period last year.
Tata Chemicals Q3 results highlights
A decline in soda ash prices, coupled with a one-time exceptional loss of ₹70 crore, impacted the company’s profitability. This exceptional loss stemmed from expenses related to employee termination benefits, the decommissioning of plant and machinery, and other closure-related costs following the shutdown of soda ash production at the Lostock plant in Northwich, UK.
The operating margin also shrank to 12.1 per cent in Q3, down from 14.5 per cent in the previous year.
“The 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 costs in the US due to a plant production outage during the quarter,” R Mukundan, Managing Director and CEO, Tata Chemicals said in an exchange filing.
“In the short-term, the current demand-supply adverse situation is likely to persist but should improve and stabilise over the long term driven by growth sectors based on sustainability trends,” Mukundan added.
As of December 31, 2024, the company’s gross debt amounted to ₹6,722 crore, marking a year-on-year increase of ₹810 crore. Meanwhile, net debt climbed by ₹952 crore to ₹5,329 crore, driven by lower EBITDA and increased working capital requirements in the US, Kenya, and India.
