Deepak Nitrite Limited (506401) Earnings Call Transcript & Summary

Good evening and welcome to Deepak Nitrite Limited Q4 and Full Year FY '20 Earnings Conference Call. [Operator Instructions] Please note that this conference is being recorded. I now hand the conference over Mr. Nitin Tiwari from Antique Stockbroking. Thank you, and over to you, sir.

Thanks, Dev. Good afternoon. On behalf of Antique Stockbroking, I welcome everyone to Deepak Nitrite Limited's Fourth quarter Earnings Call. We have with us the senior management team, presented by Mr. Asaikar, CEO; Mr. Upadhyay, CFO; and Mr. Nanda, Senior GM, Finance. I would now hand over the call to management for their open comments, which shall later be followed by a Q&A session. Over to you, sir?

I'm Umesh Asaikar here. Good day, everyone, and a warm welcome to you on Deepak Nitrite's Q4 and FY '20 Earnings Conference Call. I hope everybody is safe at home during this pandemic situation. Do take very good care of your family and yourself. Wishing you all good health and strength during this very different times. I'm sure all of you have glanced through the results documents, which was shared earlier and also uploaded on stock exchanges and our website. I'm pleased to inform you that despite the disruptions by the spread of the COVID-19 pandemic, we have ended FY '20 on a solid note, with strong top line growth and have reported highest PAT ever. Our revenues for the quarter stood at INR 526 crores, up by 8% when compared to INR 488 crores in Q4 of FY '19. We have witnessed volume growth, improved realization while also being able to drive efficiencies in the operations. As a result, EBITDA for the quarter stood at INR 185 crores when compared to INR 111 crores in Q4 of last year FY '19, registering a growth of 67%. This quarter witnessed a substantial reduction in finance costs, and we also benefited from a more favorable rate of tax, which has helped to elevate the profitability. PAT for the quarter stood at INR 116 crores, higher by a resounding 106% when one compares that with INR 57 crores in the Q4 of the earlier year FY '19. Deepak Nitrite has continued to benefit from the favorable developments taking place in the global chemical industry with China deemphasizing its chemical manufacturing and global market players looking to establish supply arrangements in alternate markets including India. We, as a company, will leverage our vast industry expertise to capture the market share. With the global spread of the novel coronavirus we believe there maybe some acceleration in the shift to diversify and derisk supply chains. We believe we're well placed and globally competitive with established operations and high degree of forward and backward integrations. The steadfast focus on ESG protocols makes us a preferred supplier for major global customers. To give you an update on the performance of Deepak Phenolics, the DPL, that is, completed its maiden full year of operations with production volumes close to 200,000 metric tons per annum. That is 100% of capacity utilization. The short -- this is attributable -- this shortfall is -- slight shortfall is attributed to the 10-day shutdown in March 2020 due to the nationwide lockdown to almost reach 100% capacity in its maiden year of operation validates the scale of effort and preparedness backed by the efficient management of complex material logistics. Performance has progressively, including each quarter of the financial year 2020, had the shutdown not been imposed, the volumes and revenues in Q4 would have exceeded the watermark we achieved in quarter 3 of FY '20. Moving on to the operational performance. In Q4 of FY '20, our domestic revenue stood at INR 264 crores as against INR 345 crores in the correspond period last year. The revenue growth was due to the national lockdown, which was imposed by the Government of India. During the quarter, we decided to take advantage of favorable pricing conditions in the global market and to enable this focus more to -- more on volumes and exports. Revenues from exports stood at INR 257 crores in Q4 of FY '20 as against INR 138 crores in Q4 of FY '19, delivering a robust growth of 86% year-on-year. This growth was mainly driven by solid demand for our Finance Specialties and our Performance Products segments in the exports market. Looking at the segment-wise performance in Q4 FY '20, the basic chemicals revenue moderated due to closure of production facilities due to the national lockdown. Revenue growth in the Finance Specialities segment came in at 30% in Q4 of FY '20, owing to strong demand and favorable realizations in our export markets. The Performance Products segment reported a growth of 22%. The Performance Product performance was driven by DNL's initiatives to reorient the mix of geographies and end-user industries. Which resulted in better product acceptance and higher realizations. Leveraging from its backward integrated operations, the company also capitalized on favorable demand supply situation for DASDA caused by disruptions in China. Another key element was that DPL, Deepak Phenolics, started commercial production of isopropyl alcohol, IPA, at its manufacturing facility at Dahej,, Gujarat, effective April 21, 2020. This facility has capacity to manufacture 30,000 metric tons of IPA annually. This is in line with our efforts of getting into value-added derivatives of phenol and acetone through forward integrations. This is the first pace towards achieving that vision. We started resuming production at our plants from mid-April and current capacity utilization across various plants is around 70%. We are observing all requisite precautions for the health and safety of our employees. The logistics and labor availability did face some disruptions. However, this is getting increasingly normalized as we speak. Order inflow from various customers, both domestic and global, remain unaffected. Well, there are deferments which are unavoidable. The company has not witnessed any significant order cancellation due to COVID-19 pandemic. As the best practice, we have also reached up to all our customers with the status of their shipments and tentative delivery time lines throughout this period. Before I conclude, let me share a key development, personal key development. After completing 12 years with Deepak Nitrite, I will be retiring on 31st May 2020. And as approved by the Board of Directors, Shri Maulik Mehta will be elevated to the position of Executive Director and CEO, with effect from 1st of June 2020. I congratulate Mr. Maulik Mehta and wish him luck in driving continued success for our stakeholders. I'm more than happy to be replaced by Maulik. And I'm very confident that he shall drive the company with more enthusiasm, more passion and more vision under Deepak bhai's guidance and take our company to far, far greater heights. I'm sure about this in -- about our Deepak Nitrite. Let me conclude by saying that we remain confident on the agility and nimbleness, nimble-footedness of our business operations and are well positioned to rebound as the operating environment stabilizes. Thank you. I would now hand over to the call -- our call to our Director, Finance and CFO, Mr. Sanjay Upadhyay for his comments. And after that, our new CEO and Executive Director, Mr. Maulik Mehta, shall also speak to you. Please welcome Mr. Maulik Mehta, to his new responsibilities and wishing all the best, god bless. Over to you, Mr. Sanjay Upadhyay, for a while.

Thank you, Mr. Asaikar. We had a wonderful and glorious area with you. While we shall miss you, Mr. Maulik Mehta being an able leader will take the company to new scales. I welcome Mr. Maulik Mehta who takes charge as CEO and ED with effect from 1st June 2020. We wish all the best and happiness to Mr. Asaikar. I request Mr. Maulik Mehta to address this forum briefly before I take you the -- through the financials.

Good afternoon, everyone. Thank you all for joining this call. I'm delighted and fortunate to have this great honor. And it also brings a lot of opportunities and challenges, especially in this current global situation to take the company forward. I assure you all to be working for the company to take it to aforementioned heights and values. Assuming the responsibility that Mr. Asaikar is handing over to me, I am appreciative that I have high shoulders and large shoes to fill. I convey my sincere thanks and gratitude to Mr. Asaikar for taking this company through storied heights. And I shall put all efforts to take our company further, keeping our PPPs of People, Planet and Profit in mind. I hand over now to Mr. Upadhyay.

Thank you, Maulik. Good afternoon, everyone, once again, and welcome to Deepak Nitrite's Q4 FY '20 Earnings Call. Before I'll you through the financial highlights for the quarter and March 2020, let me first all thank Mr. Asaikar for his guidance, support and contribution to the growth of Deepak Nitrite during his tenure. His contribution to the company has been exceptional and it's difficult to summarize in words. I have personally enjoyed working with him. On behalf of Deepak Nitrite's family I wish him continued good health and very best for the future. As you all are aware, this quarter, there is an impact of lockdown from 22nd March. And hence, due to loss of production, which is -- we lost turnover of around INR 50 crores and margin of around INR 30 crores. Hence this quarter's numbers are to be seen in light of this. A quick word on the operating environment, which is changing every few days. The lockdown imposed on our plants have disrupted year-end shipments and result in higher inventory as of closing date. In the initial days, even the banking channels and our customers were getting accustomed to the situation, which led to slightly higher receivable position than anticipated at the end of the year. In recent weeks, our operations as well as those of customers have recommenced -- recommenced, liquidity in the market has improved considerably. Which has helped to move forward with some liquidation of inventory as well as restart of collections from customers allowing an improved capital situation at the current date. Let me assure investors that our liquidity position remains comfortable. We have not opted for moratorium given by the RBI. And we have been serving our date on schedule even during the lockdown. And we have still surplus unutilized working capital funds available with our banks. We are monitoring the situation on a real time basis and will inform all stakeholders accordingly. As you all have seen, our overall borrowing position has been reduced significantly during the year. Now moving to the financial highlights, all the figures are standalone. Total revenue for the quarter stood at INR 526 crores as compared to INR 488 crores in Q4 FY '19. EBITDA came in at INR 185 crores versus INR 111 crore in the corresponding period last year, delivering a strong growth of 67%. EBITDA margin came at 35%. PBT stood at INR 160 crores in Q4 FY '20, higher by 84% when compared to INR 87 crores in the same period last year. Profit after tax for the quarter stood at INR 116 crores as against INR 57 crores in Q4 FY '19, delivering a robust growth of 106% year-on-year. Depreciation for the quarter was INR 21 crores, while the finance was declined by 54% to INR 5 crores in Q4 FY '20. Coming to our segmental performance in Q4 FY '20. Revenue from Basic stood at INR 226 crores against INR 250 crores in Q4 '19. This segment contributed around 42% total revenue. EBIT increased by 30% to INR 56 crores, with EBIT margin of 24.8%. In the Fine and Specialty Chemical segment, the revenues came at INR 158 crores in Q4 FY '20, growing by 30% year-on-year. Fine and Specialty segment contributed 29% of total revenue with an EBIT of INR 50 crores and EBIT margin at 32%. Revenues from Performance Product segment stood at INR 154 crores in the quarter, with strong growth at 22%. This segment contributed 29% total revenues with robust EBIT of INR 75 crores, with a margin of 49% versus 38%, the same period last year. For the quarter under review consolidated turnover stood at INR 1,058 crores. PBT came -- stood at INR 201 crores and PAT at INR 172 crores, respectively. Moving to our balance sheet position. Our total stand-alone debt stood at INR 208 crores. At the end of the quarter, the debt-to-equity ratio on a stand-alone basis was at 0.14 indicating the strength of our strong financial position. On a consolidate basis, debt-to-equity ratio stood 0.69, which is very comfortable. With that I would request the moderator to open the forum for question-answer session.

[Operator Instructions] First question is from the line of Amir Balod from William Fund Advisors.

Congratulations on a great set of numbers. My first question is, if you could just provide -- we've heard some press articles which mention that the DASDA prices, which were ruling at about $17 have cracked down to $4, which contributed to a lot your 49% EBIT margin in the Performance Products segment. So if you can comment on that on how the DASDA and the Performance Products business is likely to perform in the next few quarters, given what has happened to DASDA prices?

See, DASDA, if you remember, we had always been saying that this level is not sustainable, whatever was the level last year. Now unfortunately, on top of it, we have this corona impact. So the demand for DASDA and the end user industry, like, OBA, particularly the paper and this is going down. So DASDA, we have that impact now. DASDA prices have gone down. Earlier, we were saying that new -- it will be a new normal, which was according to $7 to $8, but it has gone down and -- we see it will remain at $4 -- and $4 between $4 to $5 now, but situation is evolving and emerging. Today, nobody can say with confidence what is going to happen. But it's not that we are losing or we are -- the margins are good enough, but not like earlier, of course, not.

So, sir, any sort of guidance you can provide on what sort of margins that we can maintain even with the low prices for the next few quarters?

It is like, if you go 1 year back, same prices were there in the market.

Okay. Just the second question is if you can talk a little bit about Phenolics on what you're seeing with respective demand for phenol? What sort of spreads that -- or crack that you're currently enjoying? And anything on the demand given that some of the end user industries, maybe suffering because of the impact of COVID. Anything on Phenolics that you can provide us guidance making products.

So guidance in the sense, yes. Our phenol demand is slightly down, but acetone is doing well. This year we have started, in fact, we are very proud to say again that during the lockdown, when nothing -- our team worked very hard. We had our contract labor team sitting in our factory. We provided them all accommodations and we saw to it that we will start and commission our plant. You must have seen we commissioned our plant on 21st of April during the lockdown. So that business is certainly doing well. So phenol is slightly low, but that doesn't mean that phenol is not doing it. Phenol is of course doing well. And with acetone and IPA value going on, phenol business is also reasonably doing well. I won't say it's -- down the -- there is nothing to worry about.

Sir, in the IPA, you said, you had mentioned somewhere that is 30,000 tonnes for capacity. What would be the total turnover after the utilization for IPA?

Around INR 300 crores?

INR 100 crores to INR 300 crore.

INR 300 crores, is it?

Yes. Yes, currently. But of course, prices will vary. So...

Okay. And, sir, if I can squeeze in the last question, any kind of CapEx plans with respect to downstream products for phenol as well as further usage of acetone downstream? Anything that has been formalized or finalized?

Of course, we had planned, but now because of the lockdown and shutdown and this corona, we are reworking on everything. So there is a delay in CapEx. I think this is not the right time to talk about more major CapEx, I will come back in the next quarter on this with more clarity.

Next question is from the line of Roshan from Growth Advisors.

So in DASDA, DNL benefited because of environmental crackdown on largest producer in China. So did that play out back or can you provide some idea on that?

Actually, the -- more than that is a demand compression. So once the demand is normalized, we'll see how DASDA emerges again.

So there's no much clarity on that player is back or not.

There is no new capacity has come, that player is back. I think, even China is also, again, working on their plants and this. So let's see how it goes. Today, what we are seeing is DASDA, of course, demand is down and the prices are also low. So I think next quarter, we'll give more clarity on that.

Okay. And my next question is like apart from IPA, what are the other plants in forward integration for downstream derivatives? Through some light on that.

There are plants. As I mentioned, in the earlier question also, there are plants. But I think we'll wait for more clarity because, see, things have gone -- I mean, last couple of months are really, really putting everything on a -- I mean, we have to rethink about our plants and rethink, yes, reaccess, where do we stand. So maybe next quarter will be a better time opportunity to share with you in detail.

I shall come in at this moment. Last, since 24th of March, our efforts, our focus has been completely on very safe shutdowns of our plants, shutting down chemical plants is not a casual matter. It's not a joke. Taking good care of our people, making them slowly, slowly join our manufacturing facilities, observing all norms of social distancing and one by one, stepping up our capacity utilization of every plant. As said earlier, we are at 70% capacity utilization. Some plants operate at 100%, some plants may be operating at 50%. So our whole energies have been sapped by keeping our plants and our people safe. And now we're back keeping them safe while producing. So this is the whole energy has been sapped. So when you ask all these questions, really, we don't know how to answer these questions. If the second wave comes. I'm told it is coming back in Wuhan in China. I really, really don't know. So let's keep questions about future to the next quarter meeting with a lots of clarity.

Sure, sure.

So I hope you understand.

Yes, yes. Sure, sure. So due to lockdown, did you see any challenges in procurement of raw materials? And how is the situation now?

No. I -- we -- in fact, if you see lockdown also, we ran our plant. We started because it falls under essential commodities. Where Mr. Asaikar mentioned, we started our plant in a safe environment and in a phased manner, overall capacity utilization would be around 70%, but some plants having 100% permit. Some started late around 60%, 65%. But we -- no problem on material, no problem on labor. And even logistics, this was a big challenge, but that also we could overcome. So by and large, things are I won't say absolutely but things are reasonably, reasonably good for us.

Okay. And sir...

[Operator Instructions] The next question is from the line of Paras Bothra from Ashika Stock Broking.

This is with regard to IPA. The government has where it has restricted the prices of IPA at INR 69. Can you please throw some light to that that this INR 69 when is stopped at. What is market price ruling? And what is it that you're going to sell for sanitizers? And what other sectors, like, pharma or whatever sectors require the IPA and for the total capacity.

There is a cap on the price when supplied for the sanitizer industry. So some portion of IPA goes to that and some portion of IPA finds application in pharma and others. So pharma prices are different and the government controlled sanitizer prices are different. So it's an average what we are saying.

Average could be looking at the capacity at INR 30,000. So when you say INR 300 crores. So average could be INR 100 per kg is what we can assume?

That's what I said. Now this can be, yes, it can be INR 330 crores also, it can be INR 270 crores. I think nobody can say today what price is tomorrow, it will be. This is on an average, we are saying INR 300 crores turnover.

Okay. And what is the market-wise capacity, if you can say.

Can I complete?

Yes, sorry.

Because tomorrow the price can go down and then kind of INR 100 can become I think INR 70 also. Because IPA how far this remain -- or it can go to INR 120 INR 130. So don't just go by the current estimate of our INR 300 crores, okay?

Okay. And what's the industry capacity here in India? And if you can say any new capacities coming up in the IPA.

See, Indian capacity is 1 lakh. 70,000 I think, total 1 lakh. So we are at 30,000.

Okay. And what is the current price is the last question of IPA in the market?

I said, no? I mean, I cannot be giving you exact price at which -- we have different customers, and we are saying the different markets.

But beyond a point one would not like to disclose information. Because we are in a very competitive world, and this is our intellectual property also, which we would not to disclose. But what is more important is all of you should be very proud of Deepak Nitrite that we consider as a part of our national duty that we got in challenging circumstances, the IPA plant into commercial operations and commercial operations started at a nice level from 21st of April. And your companying used priority to all sanitizer consumers not because government has mandated. Government has put a cap on price. It's not about that. It's about doing the national duty by supplying IPA to sanitizers. So I think let's go beyond financial numbers and talk about things like these things. These are emotions. These are challenging times. So I -- no colleague of mine that the word greedy that won't touche us here in Deepak Nitrite. We do our national duty first. And we're very proud of it. I am very, very proud of it.

Next question is from the line of a Tejas Sheth from Nippon India Mutual Fund.

Mr. Asaikar, it always been good interacting with you. So all the best for your future endeavor. I just one -- have one question. In the opening remarks, you did mention that the demand scenario is not very, very bad. If you could just elaborate on that, that how the global demand environment is. Because we have a substantial share of exports. And any particular sector, which you are seeing some pressure on the demand side at the application level.

Okay. Me being a continual student of business strategy. I love to talk from that point of view. And you should have these kind of perspectives when you take at investment call on any company. Most important Deepak Nitrite has spread its eggs in many baskets. And we have so many application industries as our customer. We just started pharmaceutical industry and sanitizer industry as our customers. So our eggs are spread in all baskets. And therefore, see, we are -- we have some shops. Something goes wrong in one segment, but then that is more compensated and sometimes more than compensated in another segment. So that is -- so that is the reason that we are saying that more or less, we are confident that our customers are doing fine, and there is a good demand for our products. This is point number two. Point number three, except this MSME sector, we don't see any demand compression to that extent. And we have business partnerships with various agrochemical industries and all that. So we don't see any challenges. Your company has tied up its logistics in challenging times very, very well. When it comes to finding out novel, innovative solutions for getting the raw materials to our doors, to reach our materials under challenging circumstances to the ports, finding right ships, changing ports at the last minute, all that we have done. And this working from home was a great experience for all of us because we knew only 3 days in this company. Even today, we know only 3 days. I think yesterday, today and tomorrow. And working from home gives you opportunity to work for practicing 16, 17 hours a day, while enjoying your homely atmosphere. So I think I answered your question. The risk has been reasonably distributed over various business segments, only MSME segment in India is a bit of challenge. We are extremely careful about our debt management, no debt of ours has turned even doubtful as on date. Nothing doubtful, nothing bad, no issues. We are doing -- we are trading very, very carefully.

Just a follow-up on that. On the export side, this whole shift of China to India, are there any more inquiries which you have seen in last 2 months on your diversified portfolio side?

Of course, we do get inquiries and we're working on it. There is nothing. And business is -- see, let me tell you, on all the fronts, as Mr. Asaikar was mentioning everywhere in all the segments, we are doing reasonably well. We keep getting inquiries. We have not seen too much -- I mean, the worry is that demand is going down or business is not doing well. Yes, certain segments, as you rightly asked, like -- for example, I'll give you, supply industry is currently -- because of shutdown and lockdown not doing well or the paper industry not doing well. But the other industries like detergent is doing really well. So these things keep on happening. And I mean, we're not worried on this. So -- by and large things are under control. There is something which is beyond our control, we are trying to mitigate those risks. We have managed well up till now. Whatever we have done at plant, whatever we have done with the customers on raw materials front, on labor front. I mean, things are under control. So by and large, we don't see any big disruptions at our end.

No, no, I was talking more from opportunity point of view. Are there any more inquiries coming from global customers on a larger sourcing for this year?

We are getting inquiries. We are getting inquiries. But, I mean, it will take some time, Tejas.

Okay, okay. Nothing which is very alarming on the demand, on the increase to one side.

Not in a very big way.

Okay. Okay. Just lastly -- just last question. Is there any larger cost measures which you're looking this year to control basically the cash outflow.

Nothing as of now.

Not as such, nothing we do not -- as a company, we are always cost conscious. We do not -- I mean, you people know us well. We do not spend unnecessarily or nothing like that. So not -- nothing significant as such.

I know this type of questions will keep coming, that's why I need to tell something more. There is the going to be GDP compression across the globe, right? But now for chemical industry, Indian chemical industry, generally speaking, this demand compression and GDP degrowth gets compensated by the kind of suspicion and mistrust that people are carrying in their hearts about China. Therefore, if x+y=100 is coming down to 80 or 90, the Chinese portion will take a more hit. And the things will come to the Indian chemical industry. So Indian chemical industry is not going to face post COVID major issue of capacity utilization and all that. Because actually trust factor is going down very badly about China.

Yes, exactly. I mean other chemical companies are talking about this things.

GDP growth will come down. America will degrow and everybody will degrow. India also will degrow. But this demand compression which has happen, that it will be more on China than on rest of the nations, including India.

Next question is from the line of Madhav Marda from Fidelity Investments.

Sir, just want to know the largest industry, end user industry for Deepak Nitrite is color, am I right?

Is?

Colors. Colors and pigments is that the largest industry for us?

Agro.

Larger is agro not colors.

Could you give us the end industry mix for Deepak Nitrite as a whole for our portfolio for the industries we supply to.

We supply to agro. We supply to paper, textile, detergent. And so many segments we can supply.

Pharmaceuticals.

Pharma, glass.

Explosives.

Explosives, pesticides.

Umesh, [Foreign Language] chemicals, water treatment chemicals.

And die and chemicals of course.

Okay. Got it. So the impact were specially mainly on the paper and the textile side and agro and pharma is doing well, right? I think that's the right representation.

Yes, yes. You are right. Even dies is not doing that bad. More or less, as I mentioned, that more or less, our industries are -- end user industries are doing well, except baring few not a major concern as such.

Okay. And just one last question from my side. The -- like you rightly said market share gain for us will compensation for any GDP IT compression. But in terms of prices for our products can they hold up at current level or could we see some pressure coming here.

Of course, in fact, you -- we have not an any price erosion in the first few -- 2 months, and neither we are seeing in future also as on today, except, again, DASDA what we discussed few minutes back. DASDA and of course OBA goes with that.

Next question is from the line of Rohan Gupta from Edelweiss Financial Service.

Sir, with phenol demand is likely to come down significantly because of this fiber industry under trouble. Our acetone production is a by-product on the phenol. So do you see that though there is a significant demand of acetone, which is not affected much. But with the fall in phenol demand it will be different for us to operate our plant?

See, phenol demand down doesn't mean that we are not running our plant at good capacity. Of course, we are running our plant at good capacity. So we -- it's not that the phenol demand is down because of the temporary lockdowns and shutdowns. But in spite of that, we are -- as a company, because phenol is -- we are doing well. Acetol is doing phenol is of course, down. But then note that it is going down to the below 50% or 40% [Foreign Language].

My whole point that phenol and acetone both are co-product. So...

Yes. And extend is -- phenol production is lower than acetone will certainly -- the availability will be low. That is, of course, which will happen. But we are not seeing that much reduction in the production.

As what level, sir, our phenol acetone plant is operating right now, utilization?

See, we started phenol. Now, it's very difficult to say. We started our plant late in April. So today, we are running at around 65%, 70%.

Okay. That's what I was asking. So today it's running at 60%, 65%.

I said 65%, 70%, not 60%, 65%. So it is operating between around 70%, you can say.

Okay. So it's running at 70%. And with the current scenario, do you see that in the month of June, we will be go up 85% something?

Of course, see, [Foreign Language].

If that is in my hand, definitely I'll not...

It is not in my hand. How you find the scene in Kolkata on ease. I mean, this is them to say, no, for anyone...

[Foreign Language] putting another plant in 18 months. [Foreign Language]

Sir, another question that we were definitely looking for the downstream, acetone downstream where you mentioned that definitely there will be some delays. I mean the delays you see that it will be in line of 1 or 2 quarters or...

If you don't -- do think so we start -- we have already started no, IPA.

Yes. So IPA is one, which is coming, any other plant. I'm saying that other companies...

You're talking about your next project.

yes. For second next quarter, retailing.

So next one, of course, we will see. I have been saying this. We have definite plans of going as downstream. There is no doubt on that. Now if you ask me how far we have progressed on this. Today is not the right time to discuss. We'll discuss at an appropriate time, maybe next quarter or quarter after that. We -- but there are plans, so there is no issue on that.

Next question is from the line of Pallavi Deshpande from Sameeksha Capital.

Just 2 question here. One would be on the what would be the capacity utilization there? And in case of phenol, how much is sourced? How much is used in-house or how much is sold out, sir?

You're talking about or phenol.

No, first I wanted capacity utilization.

So goes for, like, phenol only.

70%.

It will be 70%, 75%. The way we have done our phenol plant.

Right. okay. And in terms of this DASDA, like you mention that -- what would be right now China's contribution currently to the global supply, I mean with...

This is, I mean, China's supply it's very difficult to say. But there is a demand compression in -- so I mean, there are not many producers of DASDA. So it's okay. Nothing -- either -- neither they're doing it nor anybody else is doing great.

Right. Right. So what is the -- I mean, in terms of just wanted to understand total industry supply how much is that? And how much would be share of China within the total global supply. It used to be 20%. This largest player who went but...

They were not 20%.

No, is she saying we're 20%.

China she is saying. You're talking about China or Deepak Nitrite?

Yes, the largest player in China who had a fire, its capacity was 20% of total global supply was my understanding. So I just wanted to understand...

DASDA manufacture did not have any fire. I'll just answer this question. I'm not aware of any such fire. However, it's safe to say that there is no new production of -- there's no new producer of DASDA. And at the same time, the market share between the incumbent players, including Deepak remains the same as it was in the preceding 12 months. There's no change to that.

Next question is from the line of Tanvi Jain from Hem Securities Limited.

Congratulations for a very good set of numbers. My one question would be on the rate. I just want a guidance on the overall utilization not for a particular segment. This is not what our capacity should right now working. So including all the segments on a consolation basis. And next would be the second question. Sir, as you started IPA acetone, from the acetone division. And we, say, expecting additional revenue of, say, INR 250 crores to INR 300 crores. So this acetone now used for in-house production to build. So will there be some lesser supply of the new acetone product as it has moved to in-house or with an additional INR 250 crores. So just a bit guidance on that.

See, INR 250 crores, INR 300 crores is what you said is for IPA and not acetone. So I think you -- and acetone of course, don't...

Acetone would be now used for in-house consumption for IPA as it is a downstream...

Yes, yes. Not full acetone. It's not that entire acetone is going for IPA.

1:1, no?

So it is just a portion of acetone going to IPA.

Okay. Any guidance for this to what portion, if you could give us more guidance for that possibly.

And the ratio is 1:1.

Ma'am, we produced 1.2 lakh tonnes of acetone out of that 30,000 tonnes of aceto will be required for IPA plant. The ratio being 1:1.

And, sir, just general guide to overall capacity at which you're working not for any particular segment in general.

I said 75%.

Overall. Okay. Okay.

Next question is from the line of Ankit Gor from Systematix Group.

Such Sir, with regards to more of a only either industry on a DASDA For us this detergent is a larger end user or textile or any other or paper You see recent perspective of often nature do it as a sign of its cost.

Thank you for your question. In the past, paper was a dominant market share out of the 3. However, in the last couple of years, this is decidedly into detergent favor. And the COVID pandemic has actually biased it even further. So we can say that the significant majority is the detergent segment. Which is actually growing much faster than it was 6 months ago. Paper has taken a backseat. Textile was minor anyways and continues to be that in India because a large part of it is from the MSME side.

Right. And so industry know on why prices have fell. This is mainly because OBA plants being closed globally or it is to the end user industry let the textile for the time being?

It is all end user segment driven, paper and textile being more discretionary spending. And paper being very large continuous operations requires significant manpower.

Secondly, my question with regard to power costs and other expenses, which also have reduced quite a bit in this quarter despite better volumes. What would be the basic reason behind that? And could you see this as a sustainable number or any take on that, sir.

See, power cost, of course, it's a variable cost. So if 10 days plant is shut, then power cost will certainly be lower. Otherwise, there are no major in the power cost as such.

Next question is from the line of Rohit Sinha from Emkay Global Financial Services.

First of all, Congratulations for the good set of number. So would it be possible to just share what would be the overall growth in terms of volume or as well as in terms pricing in the overall revenue? I mean how much growth was there for volume, and how much was on those pricing?

Yes, to your -- see, volume growth -- you're talking about last year, right?

Yes, yes. So last year, volume growth was also there, but price was a major this thing. And particularly, DASDA, which you all know, is probably a significant contributor. So of course, there was a volume growth. But then last and shutdowns had impacted that, but price has played the major role. So any number you can quantify? How much would be the volume growth? And I mean 10%, 12%...

There is no segment-wise. It doesn't -- yes, if I give you rough, say, 5%, 7% it doesn't make any sense. Because we already got -- we are in Fine and Specialty, we are in Performance. So if -- then you have to understand each segment and each product rather than just giving you a rough number. So even with calculations will go heavy if you do like that.

Correct. So any color on maybe on the phenolic and overall standalone numbers? Phenolic volume and standalone volume numbers.

First year of INR 100 crores profit. And we almost kept production. So Phenolic has done actually really, really well. First full year operation with INR 100 crores profit in spite of this challenging situation. And I mean top line also around INR 2,000 crores. So reasonably good.

Okay. And how much growth was there in the export market, overall growth number?

You're talking about Deepak Nitrite now?

Yes.

36% to 44%.

Export is around 44% of our total revenue. It has grown, see, because the DASDA is largely excluded. Okay? But this could be -- here, what you're seeing is because of price increase also. But export has really done well and we'll continue to do well there.

Okay. Okay. And...

[Operator Instructions] Next question is from the Advisory.

So did the exports see any impact due to lockdown. I mean is it continuing now or the things are like normalized?

I want the things are normalized. But our business -- touchwood, we are at least doing really good in this. Initially, we lost few days because of lockdown and shutdown. And there were some issues with banks also, the documentation and -- but gradually thing they have settled down. And you will see -- I mean, we will not disappoint you in the first quarter results also, don't worry too much. Of course, it cannot be -- you don't compare it last year as a winner for god sake. [Foreign Language] So -- but we will be reasonably -- we'll be doing well in spite of all the challenging and difficult situations.

Okay. Okay. Yes, all my -- all other questions are answered. And all the best Mr. Asaikar.

Thank you very much. Thank you.

Next question is from the line of Karen Gala from Investment.

I just wanted some coupons, KVP or the duties which with company has requested the Department of Chemicals across all our products. So whether we save guard. So where do we stand on that? And if there is a Stage 1 to 4 or something in dealing with the government. And what state would that be? And what are the progress there?

See, there is, I mean, things have slowed down considerably in the last 2, 3 months. We were at a advanced stage. So I would say 3 in -- now it has gone down. So I need to wait an see how it moves now again.

So currently, there would be no interaction. I mean, as of now there is function from the next function where normally, is that when your dialogue start again?

Yes, yes, of course. I think.

We are moving, but not at that pace.

So sir, how much hopeful are you the case that you put on that is like...

It's so difficult to say, this government, how they will view and my confidence hardly matters, no, here. I will say 100%, 200% I mean one -- so I think let's see. And I should not take improvement on and we should prove well in our -- things which are in our control.

Correct. No, based on benefit.

I understand that. We will work on that. That doesn't mean that we'll not work on that. But of course, but then at the same time, we're running the plant at fully capacity, like we started IPA, like we're getting the maximum efficiencies where we can differentiate between other and us.

Next question is from the line of Rohit Nagraj Nada from Securities and Finance.

And I'd like to [Audio Gap]