India's Tata Chemicals posts Q3 profit drop on price cuts, weak demand

UPL

05/02/2024 12:44

BENGALURU, Feb 5 (Reuters) - India's Tata Chemicals
 TTCH.NS  reported a decline in profit for the third successive
quarter on Monday, hurt by lower soda ash prices and soft
demand.
    Soda ash, the company's largest business, suffered last year
as falling caustic soda prices made it more appealing than soda
ash for the silicate market, prompting it to cut prices to stay
competitive.
    The segment comprises about two-thirds of its total sales
volume, with the U.S. being its largest market.
    Consolidated net profit fell 60% from the previous year to
1.58 billion rupees ($19 million) in the three months ended Dec.
31.
    The Tata Group-owned company had cut prices of its key
products light and dense soda ash twice last year - by 3%-4% in
April and about 5.5% in August. The combined price cuts eroded
its revenue in the latest quarter.
    Meanwhile, soda ash sales volume fell about 10% in the
quarter, leading to a proportionate decline in total revenue to
37.30 billion rupees.
    Sales of salt, which accounts for about a third of Tata
Chemicals' total sales volume, remained largely unchanged.
    The demand was challenging in the container glass and flat
glass sectors in Europe and the Americas, which led to pressure
on volumes and prices, Managing Director and CEO R. Mukundan
said in a statement.
    Tata Chemicals supplies raw materials to the glass,
detergent, industrial and chemical sectors.
    Last week, larger rival UPL  UPLL.NS  reported a quarterly
loss, hurt by weak demand and destocking issues.

($1 = 83.0120 Indian rupees)

 (Reporting by Varun Vyas in Bengaluru; Editing by Dhanya Ann
Thoppil)
 ((varunvyas.hebbalalu@thomsonreuters.com;))