Target: ₹1,340

CMP: ₹1,107.75

Tata Chemicals Ltd (TCL) is the world’s third largest producer of soda ash with manufacturing facilities in Asia, Europe, Africa and North America. It also has a strong focus on consumer, agri and specialty businesses. Consolidated revenue rose 34.2 per cent year-on-year and 14.8 per cent quarter-on-quarter to ₹3,995 crore in Q1 FY23, led by strong performance across businesses and geographies. EBITDA grew 68.8 per cent year-on-year to ₹1,015 crore. PAT jumped 87.2 per cent year-on-year to ₹641 crore.

TCL’s consolidated revenue grew in Q1 FY23, driven by robust demand for soda ash (detergent and glass players), bicarb and salt.

On a geographic basis, India revenue grew 48 per cent year-on-year to ₹1,225 crore on the back of strong demand for specialty products. US revenue grew 34 per cent year-on-year to ₹1,119 crore due to strong export prices and robust demand in the export market. In Q1FY23, TCL prepaid debt of $30 million in the US from its cash accruals.

We remain optimistic about continued soda ash demand across geographies, which will boost the topline. The ongoing global soda ash shortage will further improve realisations through heightened pricing. The management expects the positive momentum to continue in the near to short term and aims to leverage digitalisation for further growth.

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