Analyst Concall
Tata Chem expects India business to grow 5-6% in FY26
This story was originally published at 22:43 IST on 7 May 2025
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--Tata Chem: UK business getting into better fincl position, debt an issue
--CONTEXT: Comments by Tata Chemicals mgmt in post-earnings analyst concall
--Tata Chem: Do not see Chinese market repeating last year's high growth
--Tata Chem: Factoring in 5-6% growth in India in FY26
--Tata Chem: Focus on EBITDA margin, cash generation in US to bring dn debt
--Tata Chem: Low prices, volumes in US weighed on profit growth
By J. Navya Sruthi and Sunil Raghu
MUMBAI/AHMEDABAD – Tata Chemicals Ltd. expects its Indian business to grow 5-6% in 2025-26 (Apr-Mar), the management said in a conference call with analysts after the March quarter earnings. Managing Director and Chief Executive Officer R. Mukundan said Indian business continues to grow even in the challenging market conditions, while China, the US, and western Europe are either seeing "flashes or slight decline" due to reduced demand. In FY25, demand growth worldwide was mostly led by India at 25% and China at 18%.
Despite China business seeing strong growth in FY25, the company does not expect similar growth in the current year. Usually the company expects about 6% growth in China. For the current year it expects the growth to remain stable.
The company reported a consolidated net loss of INR 560 million for the March quarter against a loss of INR 8.50 billion in the year-ago quarter. Consolidated revenue for the quarter was INR 35.09 billion, up 1% on year but down 2% sequentially. The company's overall performance was lower compared to the year-ago due to pricing pressure in all geographies.
The managing director said the medium and long-term view remains positive because of a strong supply of soda ash. "...in terms of supply side, the soda ash remains the best supply and will continue to remain strong, especially because supply has risen in China more recently."
The production of soda ash rose 8.9% in FY25, which pulled down the prices globally by 25% in the year. "The tariff uncertainty could lead to shifts in production centers of soda ash application industry and this could lead to change in demand centers. However, some of the demand centres will continue to move forward with positive momentum," he said.
The company said it will focus on generating cash flows and improve its earnings before interest, taxes, depreciation, and amortisation margins in the US, to help bring down the debt. Low prices and volumes have weighed on the company's financial growth in the US. The company's gross debt as of Mar. 31 was INR 70 billion, up by INR 15.09 billion due to higher working capital loan in India, the US, and the UK.
Commenting on the UK business, the company said while debt remained an issue there, it was in "tansformation " and moving forward would be in much better financial position. The company announced its earnings after market hours Wednesday. Its shares closed 1.2% higher at INR 826.20 on the National Stock Exchange. End
Edited by Akul Nishant Akhoury
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