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Business News/ Markets / Stock Markets/  Q4 result reaction: GSFC stock falls almost 10% as profit drops 89% in the March quarter
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Q4 result reaction: GSFC stock falls almost 10% as profit drops 89% in the March quarter

GSFC's Q4FY24 results saw a steep 89% YoY drop in net profit and a 16.34% YoY decrease in total income. The company cited challenging conditions in the fertilizers and industrial products segments, leading to sales and EBIDTA de-growth.

The stock fell as much as 9.7 percent to its day's low of ₹218.05. Premium
The stock fell as much as 9.7 percent to its day's low of 218.05.

Shares of Gujarat State Fertilizers & Chemicals (GSFC) fell almost 10 percent in intra-day deals on Wednesday after the firm posted weak results for the quarter ended March 2024 (Q4FY24).

The company posted a sharp 89 percent year-on-year (YoY) drop in its consolidated net profit to 24.43 crore for the fourth quarter of 2023-24 on poor sales as against 224.91 crore in the same quarter last fiscal.

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Meanwhile, its total income, as well, fell 16.34 percent YoY to 2,017.46 crore in the quarter under review versus 2,411.56 crore a year earlier. However, the company's expenses also remained lower at 1,993 crore in Q4FY24 as compared to 2,105.74 crore a year ago.

The stock fell as much as 9.7 percent to its day's low of 218.05. It is now over 32 percent away from its record high of 322.45, hit on January 23, 2024. Meanwhile, the stock is still up over 49 percent from its 52-week low of 146.15, hit on August 9, 2023.

In the last one year, the stock has advanced over 44 percent while gaining but lost around 10 percent in 2024 YTD.

The company said FY24 was a challenging year due to external headwinds in fertilisers and industrial products segments.

Read here: BHEL share price cracks almost 8% after Q4 result; what should you do?

It registered sales de-growth of 21 percent and EBITDA the-growth of 51 percent YoY. The fertilizer segment top-line and bottom-line were dampened by steep downward revision in subsidy rates. YoY Fertilizer sales decreased by 2,158 crore (25 percent) in value terms despite an increase by 1.08 Lakh MT (6 percent) in volume terms. 

While raw materials prices softened YoY, it was exceeded by the decrease in subsidy rates, thus squeezing fertilizers EBIT margins from 17 percent to 5 percent. On the Industrial products front, lower sales realization of major products squeezed the top line by 8 percent YoY.

However, with a high net-worth proportion in the overall balance sheet size and long-term debt-free position, the company has a strong financial position to fund its capex plans and wither future shocks.

 

 

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Published: 22 May 2024, 10:42 AM IST
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