Oriental Carbon and Chemicals (OCCL) Q1 24/25 earnings summary

Executive summary

• Q1 FY24 revenue declined 20% YoY to Rs. 110.4 crore due to lower Insoluble Sulphur sales and reduced acid prices; European demand remained weak.

• EBITDA grew 15% YoY to Rs. 32.6 crore, and PAT increased 9% to Rs. 15.3 crore, reflecting improved margins despite topline pressure.

• Q1 FY25 marked by the demerger of the Chemicals business, now classified as discontinued operations, with the investment segment as the sole continuing operation.

• Exceptional loss of ₹37,494.57 lakhs recognized due to the demerger, impacting reported profits.

• Company is expanding into North America and aims to increase domestic revenue share, leveraging strong demand in the Indian tyre market and global EV trends.

Financial highlights

• Standalone Q1 FY24 revenue: Rs. 110.4 crore (-20% YoY), EBITDA: Rs. 32.6 crore (+15% YoY), PAT: Rs. 15.3 crore (+9% YoY).

• Consolidated Q1 FY24 revenue: Rs. 126.6 crore (-18% YoY), EBITDA: Rs. 35.7 crore (+14% YoY), PAT: Rs. 17.3 crore (+8% YoY).

• Standalone revenue from continuing operations in Q1 FY25: ₹247.92 lakhs, down from ₹304.25 lakhs YoY.

• Standalone loss after tax (including exceptional items) in Q1 FY25: ₹(36,746.91) lakhs vs. profit of ₹1,528.75 lakhs YoY.

• Consolidated profit after tax (continuing and discontinued) in Q1 FY25: ₹817.27 lakhs vs. ₹1,729.80 lakhs YoY.

Outlook and guidance

• Indian tyre manufacturers plan Rs. 5,000 crore investment in FY24, supporting strong demand for radial tyres and insoluble sulphur.

• Global EV production growth is expected to drive demand for specialized tyres and insoluble sulphur.

• Post-demerger, the company will focus on investments and general engineering products as its core segments.

• The demerger is expected to streamline operations and unlock value for shareholders.

• OCCL expects market revival and is targeting untapped geographies, especially North America.