Paradeep Phosphates Q3 profit slips 13% despite double-digit revenue growth

Paradeep Phosphates reported a mixed performance for the December quarter (Q3), with profit declining year-on-year even as revenue and operating earnings rose.

The company posted a net profit of ₹182 crore for the quarter, down 13% from ₹209 crore in the year-ago period. Revenue increased 15% to ₹5,748 crore, compared with ₹4,989 crore last year, supported by higher volumes and demand across fertiliser products.

Operating performance showed moderate improvement, with EBITDA rising 7.7% to ₹471.8 crore

from ₹438 crore a year earlier. However, margins narrowed to 8.2% from 8.8% in the corresponding quarter last year, reflecting cost pressures.

Q2 performance and expansion plans

In the September quarter (Q2), Paradeep Phosphates had delivered a stronger set of numbers, which had driven a positive reaction in its share price. The company had reported a 34% jump in consolidated net profit to ₹341.94 crore from ₹255.33 crore in the year-ago period, while revenue from operations surged 49% to ₹6,872 crore from ₹4,619 crore. EBITDA for Q2 rose 29.4% year-on-year to ₹656.48 crore, although margins contracted to 9.55% from 10.98%.

For the first half of the fiscal, revenue from operations increased 46% to ₹11,376 crore, EBITDA climbed 69% to ₹1,313 crore and profit after tax jumped 135% to ₹659 crore.

Following the Q2 results, the company announced a ₹3,600-crore capacity expansion plan aimed at achieving five million tonnes of sales over the next 2.5 years. The plan includes adding one million tonnes of granulation capacity and expanding backward integration of phosphoric acid by 0.5 million tonnes and sulphuric acid by 1.5 million tonnes at its Paradeep and Mangalore units.

Also read: Paradeep Phosphates shares rise 6% on Q2 results, ₹3,600 crore capacity expansion plan

Managing Director and CEO Suresh Krishnan said the merger with Mangalore Chemicals and Fertilisers Ltd expanded the company’s southern presence and unlocked scale benefits, with combined production and sales growing 19% and 30%, respectively. He also noted improved working capital efficiency and a net debt-to-equity ratio of 0.66x.

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Shares of Paradeep Phosphates fell on the NSE, closing at ₹132.69, down 2.09%, on February 2.