Tata Chemicals shares under pressure after Tata group firm posts worse-than-expected Q3 results

Tata Chemicals share price NSE, Tata Chemicals Q3 results: Tata Chemicals shares were under pressure on Tuesday, February 6, after the Mumbai-based chemicals manufacturer posted extremely weak results for the October-December period. The Tata group chemical stock weekend as much as 4.4 per cent to Rs 935.3 apiece on NSE, continuing to decline for the fourth session in a row in morning trade. However, the counter settled 1.1 per cent or Rs 10.75 lower at Rs 990vapiece on NSE.

Tata Chemicals Q3 results

After market hours on Monday, Tata Chemicals posted a consolidated net profit of Rs 158 crore for the October-December period, a 60.3 per cent year-on-year fall compared with the corresponding quarter a year ago.

The company's quarterly revenue contracted 10.1 per cent to Rs 3,730 crore owing to lower soda ash volumes and pricing pressure across regions, it said.

Tata Chemicals registered Rs 542 crore in quarterly earnings before interest, taxes, depreciation and amortisation (EBITDA) on a consolidated basis, as against Rs 922 crore a year ago. The quarterly EBITDA was impacted due to volume and price pressures across regions, it said.   

According to Zee Business research, Tata Chemicals' quarterly net profit was estimated at Rs 265 crore, revenue at Rs 3,820 crore, and EBITDA at Rs 750 crore.

Revenue from the Tata group company's basic chemistry products and specialty products segments fell 10.7 per cent and 7.0 per cent to Rs 3,101 crore and Rs 629 crore, respectively, according to a regulatory filing.

Tata Chemicals management commentary 

“The demand environment for soda ash in our domestic markets, as well as international markets, was challenging during the quarter. This was especially so in the container glass and flat glass sectors in Europe and the Americas, which led to a pressure on volumes and prices," said R Mukundan, Managing Director and CEO, Tata Chemicals.

"Our endeavour is to continue to maintain our market share through customer engagement and have steady contribution margins with focus on costs and higher value-added products," Mukundan added. Read more on Tata Chemicals Q3 earnings

Tata Chemicals share price history: Past performance

As of February 6, Tata Chemicals shares had declined more than two per cent the past year, sharply underperforming a 23 per cent rally in the headline Nifty50 index.

During the fiscal third quarter, the chemical stock gained 7.1 per cent while the Nifty50 rose 10.7 per cent.

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