Mumbai: Tata Chemicals on Friday reported more-than doubling in net profit during July-September quarter buoyed by one-off gains helped by sale of investments in some group firms and profits from investments.
The company saw stable sales growth across all segments during the quarter, but expects rising interest rates would impact the sales of soda ash during the rest of the year, the company said.
“There would be some impact in India as sectors like automobile, construction are seeing lower glass demand where soda ash is primarily used,” R. Mukundan, managing director (MD) told reporters at a conference.
A file photo of a Tata Chemicals Limited scientist, photographed in his office in Pune
“Overall, though rising input costs, a depreciating rupee and increase in interest rates continue to exert pressure, our access to low cost resources, combined with efficient operation and distribution will enable us to drive sustainable growth,” Mukundan added.
The Mumbai-based firm’s energy costs for domestic operation rose by about 18% on year, due to costlier coal, he added. It sold its shares in group companies Tata Steel and Tata Motors worth Rs 305.1 million to the parent Tata Sons in the quarter, he said.
The firm also earned Rs 512.6 million as dividends and interest on investments in mutual fund during the same period, boosting the profit.
Tata Chemicals started its branded pulses business last year and expects sales of Rs 1.5 billion, or 15,000 tonnes, from this segment in the current financial year, Mukundan said.
Shares in the firm, valued by the market at $1.7 billion, lost 15.5% so far in 2011, almost as much as what the benchmark index had lost during the same period.
Tata Chemicals shares closed 0.2% lower to Rs 331.00, less than a fall of 0.97% in the 30-scrip benchmark index which ended at 17,192.82.