PCBL Ltd. share price fell 11% in early trade on Monday after its third quarter net profit declined 37% due to higher interest and depreciation expenses.
The company’s consolidated December quarter revenue from operations increased 21.4% to Rs 2,010 crore compared to Rs 1,656 crore in the same period last year. Analysts’ estimates compiled by Bloomberg projected Rs Rs 2,131.
Net profit fell 37% to Rs 93.1 crore, compared to Rs 148 crore in the year-ago period. The Bloomberg estimate was Rs 109 crore.
On the operating side, Ebitda saw a growth of 14.1%, amounting to Rs 317 crore, up from Rs 278 crore. However, margin contracted to 15.8% from 16.8% in the previous year.
Carbon black sales grew 2% year-on-year, driven by 5% volume growth, but offset by 3% drop in realisations due to weak crude prices.
Export volume growth slowed down due to excess inventory stocking in the third quarter. Domestic customers also deferred some purchases to the next quarter.
PCBL’s long-term growth story backed by diversification of businesses holds merit, but elevated debt levels and a likely turnaround in Aquapharm are key monitorables, brokerage firm Nuvama said in a note. Aquapharm business came under pressure owing to competition from China and tepid demand in the US.
The brokerage revised its rating on PCBL stock to ‘hold’ from ‘buy’ and target price to Rs 397.
