Deepak Nitrite Ltd – Earnings Conference Call (Q2 FY-22’)

Today (Date: 29th Oct 2021), I attended the earnings conference call of Deepak Nitrite Ltd (Q2 FY-22’)

I would like to point out a few important aspects of the business –

  1. Expansion: Company is doing a ~1100 cr of expansion for phenolic & specialty chemical business in the next 14-16 months, which can add ~1700 cr in revenue (TTM Revenue ~5900 cr)
  2. Revoke of Anti-dumping duty: In recent times there was news regarding anti-dumping duty, but India is a net importer of phenols, and the government has revoked import duty for those countries which don’t contribute much in import.
  3. Long-term Contracts with Customers: The company is in a position to make a long-term contract with their customers, recently it has signed a multi-year contract with a large company (company & exact figures are not disclosed). It shows the unique position of the company. These kinds of deals help a company to maintain stability in their business & generate recurring revenue over a long period of time.

Regarding Share Price:

Recently share price of the company is down by almost 25% from its peak, but why?

The real answer is that not even company management & neither me as an investor know the exact reason for the 25% fall in the share price.

Maybe it’s because of that anti-dumping duty or due to the general correction in midcaps stocks and a major correction in chemical companies’ stocks.

But, it’s all assumptions, in a nutshell, I would say that it’s nothing but the volatility of the market & how the stock market works.

As long-term investors, we make money when we own a business. So, temporary market fluctuation should not influence our investment decision.

If you have any questions let me know in the comment section!


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-Afaque Ali

Disclaimer: The above views are the writer’s personal and may be biased. This article should be treated as an informational purpose rather than investment advice. Please consult your financial advisor before making an investment decision.

Afaque Ali
Afaque Ali is an Investor, Entrepreneur, Blogger, and Digital Marketer. He is the founder of Insiderpedia. Skilled in Investing, finance, digital marketing, business development.