The Hindu Business Line : IPCL net up 133 pc

INDIAN Petrochemicals Corporation Ltd reported a 133 per cent jump in profit for the third quarter ended December 31, 2004. The country's second largest petrochemicals producer's net profit was Rs 189 crore or Rs 7.61 a share compared to Rs 81 crore or Rs 3.26 a share, same period last year.

High petrochemical prices during the last quarter, especially in December 2004, contributed to the high profits of IPCL in which Reliance Industries holds 46 per cent stake, according to analysts.

IPCL's net turnover was Rs 2,203 crore (Rs 3,030 crore). The company's trading sales dipped sharply to a mere Rs 3 crore compared to Rs 1,148 crore same period last year. According to a company official, trading sales essentially include products sourced from other companies, especially Reliance Industries and sold to customers. The company does not give this break-up every quarter and the figure is normally disclosed at the end of the financial year. Margins on these sales are nominal, the official said.

The company also saw total expenses fall 38 per cent to Rs 1,533 crore (Rs 2,463 crore), mostly contributed by a 41 per cent drop in raw material costs during the quarter.

Interest costs also dipped 75 per cent to Rs 16 crore (Rs 63 crore) and depreciation was Rs 115 crore (Rs 114 crore). According to analyst with an Indian broking house, the fall in interest outgo could be essentially because of appreciation of the rupee in the last quarter.

For the nine months ended December 31, 2004, IPCL's net profit was Rs 450 crore (Rs 174 crore) while net turnover was Rs 6,397 crore (Rs 6,162 crore).

According to the company, polymer demand in India has fallen by 3 per cent because of high prices and inventory corrections by manufacturers downstream, over the last nine months. IPCL has raised its polymers production by 10 per cent, during the same period.

IPCL stock closed 1.3 per cent higher at Rs 170.65 a share on the Mumbai Stock Exchange on Thursday.

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