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HDFC Securities Report
Vinati Organics Ltd.’s Q1 Ebitda stood at Rs 972 million, down 19/down 4% YoY/QoQ, led by higher sales volume for Isobutyl Benzene (IBB).
Despite sluggish demand for 2-acrylamido 2-methylapropane sulphonic acid( ATBS) in the quarter, Ebitda margin expanded to 42.0% (41.3/41.4/40.2% in Q1 FY20/Q4 FY20/FY20), driven by a customised order.
ATBS product contributed 40% to the Q1 topline (59% in Q4 FY20). The brownfield expansion of 14 kilo tonne per annum (ktpa) has been pushed further to H2 FY21 (earlier: H1 FY21) as current demand for the product can be met by Vinati Organic’s existing capacity of 26 ktpa.
The demand slowdown for ATBS is owing to its reduced demand by the oil and gas industry that forms 25-30% of its global demand.
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