Riding on the back of higher demand and lower cost, Phillips Carbon Black Ltd posted a 407 per cent rise in standalone net profit to ₹48 crore for the quarter ended June 30, 2017. The net profit was ₹9.50 crore during the same period last year.

Revenues grew by 33 per cent to ₹637 crore. According to Sanjiv Goenka, Chairman, the profitability improved on account of a slew of internal measures initiated by the company over the past 18 months. With the tyre industry on an upswing, the demand has also been growing steadily over the last one year.

“We have been focussing on costs a lot more. Our capacity utilisation has improved to 98 per cent during this first quarter compared to 90 per cent during the same period last year,” Goenka said at a media conference here on Thursday.

The company expects its performance in the first quarter to be sustainable moving forward. “Usually Q2 is a weak quarter for us in terms of demand, while Q3 and Q4 are pretty strong. Given that our Q1 has been good, we expect the momentum to continue,” he said.

Greenfield project The company plans to go for greenfield expansion and add 1,20,000 tonne capacity. It is in the process of evaluating suitable options including the location of setting up the plant.

“The project is more likely to come up in South India where tyre capacity addition is happening. We are looking at Tamil Nadu, Andhra Pradesh and Gujarat. We might need 70-80 acres for the project,” he said. The plan is likely to firm up by the end of this fiscal.

Brownfield expansion The company also plans to invest ₹300 crore for adding 80,000 tonnes per annum capacity at Palej and Mundra in Gujarat. The expansion will be complete by FY-19, he said.

Phillips Carbon has an installed capacity of 4,80,000 tonnes across its four plants at Durgapur, Kochi, Mundra and Palej.

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