Chemical stock jumps 12% after reporting 458% YoY increase in net profit

Chemical Company which is the world’s largest manufacturer and exporter of Dyes Intermediate, Dyestuff, and Sulphuric Acid is in focus after reporting its Q3 results.

Stock Price Movement

With a market capitalization of Rs. 816 Crore, the stock of Bodal Chemicals opened at Rs. 65.01 up 2.99 percent from yesterday’s close, and later made a high of 70.59 up 11.83 %. Additionally, the 1 month’s return for the stock is 4 percent, and the past five year’s return is – 20 %. 

Q3FY25 Results

The company reported a 30.98 percent YoY increase in revenue from Rs. 338.55 Crore in Q3FY24 to Rs. 443.46 Crore in Q3FY25. On a QoQ basis, the company reported an increase of 3.45 percent in revenue from Rs. 428.63 Crore in the previous quarter. 

Their Net profit saw an impressive 457.73 percent YoY increase from Rs. 0.97 Crore to Rs. 5.41 Crore for the same period. On a QoQ basis, the company reported a turnaround from Rs. 0.24 Crore loss to Profit.

The Operating Profit Margin for Q3FY25 stood at 6.5 percent compared to 4.1 percent for Q3FY24, and the Net Profit Margin stood at 1.2 percent from 0.3 percent for the same period.

Segment Analysis

The largest share of Bodal Chemicals revenue comes from dyestuff, contributing 34% of the total. Dye intermediates follow closely, accounting for 33%, while chlor-alkali products make up 20%. Basic chemicals contribute 9%, with the remaining 4% coming from other revenue streams. 

Operational Highlights

Revenue from Dye Intermediates stood at Rs.179.20 Crore, which grew by 4% on a QoQ basis, Revenue from Basic Chemicals Stood at Rs. 29.1 Crore, which grew by 24% on a QoQ basis, Revenue from Dyestuffs stood at Rs. 114.4 Crore, a de-growth of 8% on a QoQ basis.

The company states that During the quarter, the overall business has performed somewhat better when compared to the previous Quarter and Better Volume across the divisions, stable and under control raw material prices will help to improve the revenue and margin in the coming days. Management’s relentless controlling measures has helped to sustain the growth in tough times.

Also read: FSN E-Commerce jumps 3% after reporting 100% QoQ increase in net profit

Expansion Plan

The board of directors has decided to establish and operate a new project for salt-free dye production at Unit IV in Vatva, Ahmedabad. The company believes it has identified a promising opportunity in the manufacturing of salt-free dyes, which are widely used in the textile industry.

Potential Recovery in the Chemical Industry

The chemical industry has been underperforming the market benchmarks for the past three years due to inconsistent global & domestic demand, and profit margin pressure because of high raw material prices.

However, there is significant potential for recovery driven by factors such as the China+1 strategy, government policies like, fall in raw material prices, capacity expansions, and new product launches.

About the Company

Bodal Chemicals Limited is a leading Indian chemical company specializing in dyestuffs, dye intermediates, and basic chemicals. Founded in 1986 and headquartered in Ahmedabad, the company serves industries such as textiles, leather, paper, water treatment, pharmaceuticals, and agrochemicals. With a strong presence in both domestic and international markets, Bodal Chemicals offers a diverse product portfolio, including sulfuric acid and chlor-alkali products. 

Written By Abhishek Das

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