>CHAMBAL FERTILISERS AND CHEMICALS LIMITED. (GEPL)

“Margins dip on inventory losses”

Chambal Fertiliser & Chemicals Ltd (CFCL) came out with its full year results ended 31st March 09 with a rise in net sales of 69% y-o-y to Rs. 45.95 bn as against Rs. 27.2 bn in FY08. The rise in the revenues was mainly led by the shipping division and traded goods segment. The shipping division saw a rise in revenues of 43% y-o-y to Rs. 4135 mn as against Rs. 2890 mn in FY08. The traded goods segment rose to Rs. 15.3 bn up by 351% y-o-y from Rs. 3.4 bn in FY08. On the consolidated front, net sales rose by 74.6% to Rs. 56.4 bn as against Rs. 32.1 bn in FY08. the rise was mainly on account higher sales of phosphoric acid from JV IMACID, which rose by 125% to Rs. 7.6 bn as against Rs. 3.3 bn in FY 08.

CFCL holds fertiliser bonds worth of Rs 3671.5 mn as on March 31, 2009. The company has so far booked MTM losses of Rs 281 mm. The debt on books st increased from Rs. 15 bn in March 08 to Rs. 21 bn as on 31 March 09, which resulted into a higher interest outgo of Rs. 1225 mn up by 33.4% y-o-y from Rs. 918 mn in FY08. The company reported profit after tax of Rs. 2305 mn in FY09 up by 13% y-o-y to Rs. 2038 mn in FY08. During the quarter ended June30, 2008, the company changed its accounting policy to adjust the forex fluctuation on borrowings towards acquisition of fixed assets, to the cost of fixed assets instead of adjusting it to P& L account as was followed during previous year. The current cash on hand stands at Rs. 7 bn. During the year quarter the company informed that Chambal Infrastructure Ventures Ltd, a wholly owned subsidiary
has divested its entire stake in its subsidiary Gulbarga cement Ltd to Zuari Industries Ltd.

Debottlenecking of Urea plant on track
Debottlenecking of Unit-I of the fertilizer plant of the company was completed in March 09. CFCL had to carry out plant shutdown for a period of about 36 days in the month of February and March 09 for the purpose of debottlenecking. Unit – II debottlenecking is currently under process and is expected to be completed by June 09. With this process CFCL would increase its production capacity by 25% and would be make itself eligible for the new urea policy which links the prices of Urea to Import parity price (IIP).

Shipping division continues to perform well
The shipping division continues to deliver good performance with healthy margins. The revenues
from the shipping division rose to Rs. 4135 mn up by 43% y-o-y from Rs. 2890 mn in FY08. The
company is into the Aframax segment and currently has a fleet of five tankers out of which three
tankers are double hull tankers. It has entered into Time Charter contract for three of its double hull tankers and therefore was uneffected from the slump in spot rates.

To see full report: CHAMBAL FERTILISERS