Our Bureau Deepak Fertilisers and Petrochemicals Corporation Ltd (DFPL) has recorded 10 per cent increase in June quarter net profit at ₹37 crore on the back of strong demand. Its income was up 74 per cent to ₹2,226 crore from ₹1,280 crore.

Sailesh C Mehta, Chairman, DFPCL, said based on growing demand, the company plans to invest ₹2,350 crore to enhance additional IPA (Isopropyl alcohol) and TNA (Threose nucleic acid) capacity.

Additionally, he said, to strategically support the total downstream sectors already in operations, the board approved an investment of ₹2,950 crore in an ammonia facility for backward integration.

In addition to the inflows from internal generation, the board has also approved raising of equity up to ₹800 crore in the company through various options of securities towards part funding the capex plan, to ensure prudential leverage norms.

The chemical business reported revenues of ₹1,638 crore (₹811 crore) with revenue from industrial chemicals more than doubling. However, manufactured nitric acid volumes were lower volume.

While trading contributed positively to the bottomline, post the clamp down on buyers’ credit facilities by banks, the interest on working capital increased during the quarter. Going forward, it intends to consolidate its trading business and focus on high-margin products, leading to lower volumes but better profitability, said the company in a statement on Thursday.

The fertilizer segment reported revenues of ₹580 crore (₹462 crore). There were multiple global phosphoric acid and LNG price hikes and a lag in transferring its impact in the new MRPs have led to the underperformance of the segment in the quarter. With technical snags at the facilities of some of the global phosphoric acid suppliers, there have been short supplies of phosphoric acid to the country and to the company, which has also impacted the quarter, it added.