Tata Chemicals’ second quarter numbers were operationally weaker than estimates with margins in the basic chemistry segment being under pressure.
The company’s nutrition and agri segments did very well though.
R Mukundan, MD & CEO of the company said, “Nutrition segment and agri science have done exceedingly well, they have not had any impact of the COVID. Q1 was good, Q2 continue to be even better. Sequentially the material science has done much better than Q1.”
He further added, “All our units are now running at capacity, there is no demand problem. There are some pricing issues in the market, especially in the export markets, but the broadly India is doing well, US is doing well, UK always did well all through the pandemic. Overall the momentum is positive. All sectors are now beginning to open up and with the news of vaccine and travel getting lifted up, we think we should be back to normal somewhere around Q2 of next year.”
On pricing power, Mukundan said, “As the volumes pick up the pricing power comes back especially the material segment which gets sometimes impacted in terms of pricing powers. So that also should be back to where it is.”
On volume growth in Q3, Mukundan said, “In terms of volumes if you look at the material science the volumes will be almost at par but certainly the prices are lower because the costs have also been cut and some other cost cuts we have passed on to our customers. So in revenue terms I think it will be tad lower, but we should be looking at getting almost even by Q4.”
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