Net profit earned by Deepak Fertilisers and Petrochemicals Corporation Ltd in the first quarter of the current fiscal declined 22 per cent to ₹ 34.72 crore compared to ₹ 45 crore in the same period last year as delayed monsoon affected the company’s business.
The volume drop in fertilisers resulted in marginal shortfall in total income from ₹ 1,127.56 crore in the quarter ended June 30, 2016 compared to ₹ 1,044.87 crore in the same period last year, according to a company release on the first quarter results of 2016-17 announced on Friday.
“Performance of first quarter was severely dampened by delayed monsoon till early July, leading to severe water cuts, which not only impacted production but it also held back farmers on their fertilizer procurements,” the release noted..
Profit before tax dropped to ₹ 47.26 crore in first quarter 2016-17 from ₹ 64.83 in the first quarter of last fiscal.
One reason for lower profits in the first quarter this year is the fact that in the same quarter last year, profits included a non-standard dividend receipt of ₹ 27.5 crore arising out of the sale of Mangalore Chemicals and Fertilisers shares, the release said.
The company is, however, optimistic about performance improving in the second quarter and rest of the year. “With the onset of good monsoon and favorable developments on gas and subsidy, current aberrations are likely to pass over in the balance part of the year. The new NPK facilities are slated to be commissioned in third quarter which will enlarge our holistic basket of micronutrient enriched fertilizers. Also the company’s chemical business will see a strong growth arising out of the nitric acid expansion project,” Sailesh Mehta Chairman and Managing Director, DFPCL, said.