DSCL, an integrated business entity, with extensive and growing presence across the entire agri-rural value chain and chloro-vinyl industry, has reported a rise of 28.6 per cent in its net sales and 40 per cent in PBDIT for the first quarter ended 30th June, 2008.

The net sales for the first quarter stood at Rs. 793 crore and PBDIT at Rs. 67.92 crore. compared to Rs. 616.49 crore and Rs. 48.35 crore respectively, in the corresponding quarter of the previous financial year. The strong operating performance was adversely impacted due to Foreign Exchange Fluctuation loss of Rs. 12.97 crore. PBDIT (excluding Foreign Exchange Fluctuation loss) grew by 81 per cent to Rs. 80.89 crore (Rs.44.76 crore).

The company’s bottomline turned around in Q1 FY09 as its net profit for the quarter settled at Rs. 4.87 crore, compared to a net loss of Rs. 7.77 crore in the corresponding quarter of the previous financial year.

Commenting on the performance for the quarter, in a joint statement, Mr. Ajay Shriram, Chairman & Senior Managing Director, and Mr. Vikram Shriram, Vice Chairman & Managing Director, said: “Our businesses have built inherent strengths and delivered good operating results. Improved margins in Plastics and Chemicals enabled us to tide over the challenging environment in the Sugar business and rising financial charges. Our newer businesses i.e Hariyali Kisaan Bazaar and ‘Fenesta Building Systems’ are progressing as per plan, extending geographical reach and customer base.

Company completed the expansion of the Chemicals capacity to 360 TPD at Bharuch, with the commissioning of 55 MW coal based Power Plant by August 2008, the cost competitiveness of this business will improve significantly.

The Commissioning of 24 MW Co-gen Power Projects in 2008-09 Sugar season will provide additional revenue stream for Sugar Business.We are pursuing options to further strengthen our operations by building raw material and fuel security. These steps along with the multiple revenue streams in built in our operating model should create sustained value going forward.”

Key operating highlights

During the quarter under review, sales from own products were up by 12.5 per cent at Rs. 600 crore and that from traded products by 133 per cent at Rs. 193 crore. Chemicals and Plastics business revenues were strongly driven by higher volumes and better margin realizations. Agri Inputs trading was up by 145 per cent at Rs. 107 crore and Hariyali Kisaan Bazaar business by 125 per cent at Rs. 86 crore.

Fertilizer business also registered higher volumes in Q1 FY 2009 since there was a planned shutdown in Q1 FY08. Company used LNG as feedstock to the extent of 54 per cent, which resulted in energy savings and lower subsidy claims.

DSCL’s doors and windows division-- “Fenesta Building Systems” -- recorded positive PBIDT in the quarter as it gained volumes and improved margins. However, the sugar business continued to face challenges but managed to curtail its losses.

DSCL continued to optimise its existing strengths in the Agri space while simultaneously leveraging its large base of captive power produced at a competitive cost to maximize value creation in its Chloro-Vinyl businesses. The high-value and knowledge based businesses initiated by the Company, including Fenesta Building Systems, Hariyali Kisaan Bazaar, have also delivered encouraging performances.

Chlor-Alkali expansion underway at Bharuch

The company’s first phase of expansion, of its Chlor-alkali capacity from 200 TPD to 360 TPD at its Bharuch facility is complete, the benefits from the same will start accruing post commissioning of the 55 MW Coal based power plant by August 2008. The second phase of expansion, taking the capacity to 445 TPD is expected to be commissioned by March 2009 and is progressing as per schedule.

Capacity expansion in Co-gen power on track

The expansion of the co-gen power capacity from the existing 70.5 MW to 94.5 MW with an exportable surplus capacity of 51.5 MW is progressing as per schedule and is expected to start from sugar season (SS) 2008-09. The Company is expanding co-gen power facilities of 24 MW at its sugar units at Hariavan and Loni for export to the state grid.

LNG based feedstock used at Fertiliser Plant at Kota

DSCL started using dual feed of LNG and Naphtha since September 2007 depending on the availability of LNG. The company is currently procuring LNG on a spot price basis and is simultaneously trying for long-term contracts. The company during the quarter under review used LNG and Naphtha in the ratio of 54: 46.

Hariyali Kisaan Bazaar

Seventeen new Haryali outlets were added during Q1 FY2009. ‘Hariyali’ a ‘rural business centre’, is aimed at meeting farming as well as family needs of the rural population. The number of Hariyali outlets now stands at 177, which the company plans to scale up aggressively to around 300 outlets by March 2009.

‘Hariyali’ is now present in 8 states across India, with Maharashtra being the new state in which 7 outlets were opened in this quarter.

‘Hariyali’ continues to enlarge its offerings of goods and services. It started Seed processing and warehousing activities during the quarter at three locations.

Fenesta™ Building Systems

‘Fenesta Building Systems’, which offers world class UPVC Window and door systems to Indian customers, achieved an order booking of 42000 windows during the quarter (Q4 FY08 being 28000 windows) taking the total orders in hand as on 30th June 08 to 2.3 lac windows.

The division recorded positive PBDIT for the quarter with higher volumes and better margins. The new products launched by the company have also witnessed encouraging response.

Outlook

DSCL expects the realisations and margins in its Chemicals and Plastics business to remain healthy. The implementation of the coal based Power Plant and Chlor-alkali capacity expansion at Bharuch in Q2 FY09, will also add to the margins and profitability in the Chemicals business.

The company’s sugar realisations are demonstrating an upward trend, in view of expected lower production in ensuing sugar season. However the cane price issue remains an area of concern.

In Fertiliser business, subsidy payment is a matter of concern.

Hariyali will continue to deliver aggressive growth while it continues to be in an investment and expansion mode.

Fenesta Building Systems is expected to become profitable at an operating level in FY 09

- End -

Propel CommunicationSolutions (India) Ltdis amongst the very few public limited companies in the business of offering quality PR servicesto a variety of Industry segments. Headquartered in New Delhi, Propel hasa pan-India network of its own branches/associates/representatives.

Propel’s present clientele represent a variety of industries, including IT sector, healthcare, pharmaceuticals, Lifestyles and others. The agency uses all disciplines to create and deliver messages, which can establish clients’ objectives into visibilities. The clients’ products and services deserve recognition in their respective region. Propel can provide it with a bottom line business perspective that will surprise you. The agency’s primary mission is to help clients gain a significant market presence and position for their products and services in the global market. Its approach on every public relations campaign is with a sense of urgency, knowing that the client pay for results.

Propel prides it on meeting the high standards in the PR industry by listening carefully to clients and gaining a deep understanding of their products and services. With strong network of more than 1000 media persons, planned strategy, excellent writing, pinpoint distribution and tenacious follow-up, Team PRopel makes every PR campaign a successful one. Propel’'s unique approach redefines the way PR is taken up as a professional medium to generate awareness for any product / service / event.