Share price of chemical manufacturing company Deepak Nitrite fell over 9 percent on November 10 after the company posted 31.4 percent year-on-year decline in its consolidated net profit at Rs 174.5 crore for the quarter ended September.
At 12 pm, the stock was quoting at Rs 2087 apiece on the National Stock Exchange, down by 9.22 percent, clocking its worst fall in 2022 so far. The stock has shed 17.3 percent year-to-date.
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The company’s revenue from operations jumped 16.7 percent YoY to Rs 1,961.7 crore from Rs 1,681.4 crore, but its operating performance was poor. Earnings before interest, taxes, depreciation, and amortization or EBITDA fell 30 percent to Rs 270.9 crore and margins contracted sharply to 13.81 percent from 22.99 percent a year-ago.
The company’s phenolic segment revenue declined 4 percent sequentially to Rs 1,284 crore. The segment’s EBIT at Rs 102.6 crore was lower by 53 percent year-on-year and 45 percent quarter-on-quarter. Cost of raw materials jumped 38.4 percent YoY to Rs 1,448.26 crore.
While most analysts will be updating their targets on the stock after its earnings concall, Yes Securities currently has an Add rating on the stock and Motilal Oswal Financial Services has a Neutral rating.
The company saw a dream run in the last two years, largely on the back of China+1 manufacturing theme. The stock has soared over 450 percent from Rs 377 in March 2020.