Deepak Nitrite Ltd

Resignation of SBU Head – Life Sciences

• Puneet Sharma resigns from SBU Head – Life Sciences.
• Effective close of business hours on 21 August 2026.
• Reason: to pursue an opportunity outside the organisation.
• Contractual notice period of three months; last working day 21 August 2026.

Financial Performance

• Revenue from operations rose to INR 2,592 crore, up 35% YoY and 22% sequential.
• EBITDA at INR 554 crore, up 159% YoY and 45% QoQ; margin 21%.
• PBT reached INR 468 crore, up 202% YoY and 55% QoQ.
• PAT stood at INR 345 crore, up 207% YoY and 57% QoQ.
• Management called the quarter the highest ever revenue, EBITDA, PBT and PAT.

Segment Update

• Phenolics revenue INR 1,775 crore; up 36% YoY, 24% QoQ; EBIT INR 418 crore, margin 24%.
• AI revenue INR 804 crore; up 33% YoY, 14% QoQ; EBIT INR 67 crore, margin 8%.
• Phenolics is largely domestic; AI exports 40–50%; overall 80% domestic, 20% exports.
• Ammonia-to-amines integration completed; strengthens supply security and downstream opportunities.
• MIBK and MIBC to be commissioned in August; acetophenone with them; rest in Q2.
• Polycarbonate project on track; seed marketing with marquee customers.

Debt, Capex & Balance Sheet

• Total capex for the large projects is INR 11,500 crore, funded 60:40 debt–equity.
• Debt funding tied up at competitive rates; equity already contributed.
• Consolidated net worth INR 6,214 crore; debt-to-equity 0.27x.
• Spending to date around INR 1,200 crore; this year INR 1,500–1,600 crore planned.
• Total cumulative project spend about INR 3,000 crore; next tranche from banks.

Projects & Timelines

• Acetophenone to be commissioned with phenolics assets; integrated timeline aligned.
• MIBK and MIBC commissioning in August; rest in Q2.
• Polycarbonate commissioning targeted in H2 FY28-29; BPA to follow after.
• Phenolics capacity debottlenecking to 4 lakh TPA; capex ~INR 70–100 crore.
• Chemtech BPA integration links propylene to polycarbonate; downstream opportunities.

Outlook & Guidance

• Outlook remains positive; investments to improve earnings quality and cash generation.
• Geopolitical developments and price volatility may influence the operating environment.
• Management expects to deliver growth with ongoing capacity additions and downstream integration.
• Operating leverage, backward integration and digitization support margin expansion.

Q&A Highlights

• Q: Phenol capacity run-rate; Maulik says annualized run-rate near target.
• Q: MIBK/MIBC/acetophenone ramp; August for MIBK/MIBC, acetophenone with them, rest in Q2.
• Q: Spreads; Maulik declines to comment on spreads; cites operating leverage.
• Q: Peak debt post-polycarbonate; Sanjay: ~INR 8,000–8,500 crore; 1x leverage not expected.
• Q: Polycarbonate tie-ups; Maulik: NDAs prevent naming; anchor customer strategy.
• Q: Industry supply; Upadhyay: no new capacity concerns; domestic demand strong; phenol import duty reinstated.

Board changes

• Cessation of Shri Diteep Choksi as Independent Director effective on announced dates.
• Board as of August 7, 2026 has 13 directors, with Deepak C. Mehta as Chairman & MD.
• Independent directors include Punit Latbhai, Viput Shah, Arvind Nath Aerawal, Mahesh Chhabria, Bhumika Batra, Mitin Mehta, Adnan Ahmad.
• Earlier announcements on Apr 3, 2026 and May 15, 2026 regarding board changes have become effective.

Cessation of Independent Director

• Cessation of Shri Diteep Choksi as Independent Director effective August 7, 2026 upon completion of second term.

Transaction details

• DCTL issued and allotted 12,000,000 9% OCRPS to Deepak Phenolics Limited.
• OCRPS have face value Rs 100 each, aggregate Rs 120 crore.
• OCRPS are optional convertible redeemable with 9% coupon.
• Allotment completed on 28 July 2026; cash consideration via normal banking channels.
• Related party transaction; arms-length basis between DCTL and DPL.
• Post-transaction, 100% equity of DCTL remains with Deepak Nitrite; DPL holds 100% of DCTL's preference capital indirectly.
• No regulatory approvals required.
• Use of funds to strengthen DCTL's capital base and support project expenses.
• DCTL turnover FY2025-26 Rs 172.23 crore.

Financials

• Consolidated revenue ₹7,887.07 Cr.
• PAT ₹550.66 Cr.
• EBITDA ₹973.09 Cr.
• EPS ₹40.36.
• Dividend ₹7.50 per share.
• Record date 27-Jul-2026.
• Exceptional item ₹12.84 Cr due to Labour Codes.
• Net cash from operating activities ₹538.95 Cr.
• Total capex ₹1,029.08 Cr.

Geography & segments

• Geography: India revenue ₹6,703.30 Cr.

OCRPS allotment

• DCTL allotted 12,000,000 OCRPS at ₹100 to DPL.
• Total value ₹120 crore.
• Related-party deal; DCTL and DPL are wholly owned; transaction on arm's length basis.
• No regulatory approvals required.
• Purpose: strengthen DCTL's capital base and fund project expenses.
• Ownership unchanged; 100% equity and indirect 100% preference in DCTL.
• DCTL turnover FY2025-26 ₹172.23 crore.
• DCTL operates fluorination, nitric acid, nitration, hydrogenation; projects in Gujarat.
• Allotment date: 10 July 2026.

Dematerialisation/rematerialisation status

• Dematerialisation requests processed and confirmed to the depositories.
• Securities dematerialised have been listed on stock exchanges.
• Physical certificates for dematerialisation were mutilated and cancelled after verification.
• Depository's name substituted as registered owner in records within the prescribed timeline.

AGM date and record date

• Record date fixed: July 27, 2026, for 55th AGM and dividend eligibility.
• AGM scheduled for August 5, 2026 at 11:30 IST via video conferencing.
• No dividend amount disclosed; eligibility depends on declaration at AGM.
• Regulatory reference: Regulation 42 of SEBI LODR applicable to AGM notices.