BASF Q3 loss widens; stock nose-dives 7 per cent

World’s leading chemical company BASF’s Indian subsidiary posted Q3FY16 loss of Rs 106.38 crore as per the company’s results that were announced after market hours on Tuesday. BASF India Limited is a subsidiary of Germany based world’s largest chemical producer BASF SE. The Company's major segments include Chemicals; Performance Products; Functional Materials & Solutions; Agriculture Solutions and Others.

The company reported an increase in the net revenues by 16 per cent on a Y-O-Y basis. Total revenues from operations increased from Rs 977.56 crore to Rs 1131.7 crore in Q3FY16. Decline in revenue was primarily due to a slowdown witnessed in agricultural and industrial chemical segments. Operationally too, companies EBITDA plunged more than five times in a span of one year. EBITDA decreased from Rs 8.06 crore to (Rs 33.6) crore. Consumption of raw material as a percentage of revenue increased by more than 500 basis points to 48 per cent. Margins turned negative as it declined by 400 basis points. BASF reported a net loss of Rs 106.38 crore for the quarter ended December 31, 2015, which widened as compared to a net loss of Rs. 39.59 crore in the corresponding quarter of the previous year; and Rs. 58.7 crore in the preceding quarter.

Sequentially too company faced pressure on its business. Revenue increased marginally by 1 per cent. EBITDA decreased by 11 per cent due to poor core business performance. Profit after tax also declined by 81 per cent.

Reacting to the quarterly report, the stock declined by 7 per cent to hit a fresh 52-week low of Rs 782.10 on BSE in early trades. BASF India has been an underperformer in the markets for quite some time as it declined by more than 40 per cent in the past year.