Tata Chemicals Ltd. share price target

Q1FY20 revenue rose 5.6% YoY Rs. 2,897cr, primarily led by revenue growth in Consumer products (+13.0% to Rs. 495cr) and Specialty products segment (+8.9% to Rs. 634cr). Basic chemistry products revenue witnessed muted growth of 1.3 % YoY to Rs. 1,946, impacted by lower production of soda ash in Mithapur. By geography, strong performance in US (+10.5% YoY to Rs. 845cr), Africa (+32.3% to Rs. 123cr) and India business (+4.2% to Rs. 1,031cr) offsets weak performance in UK region (-10.8% to Rs. 307cr). EBITDA margins surged 256bps YoY to 20.4% primarily with improved margins for BCP with better realizations for Soda ash and lower costs. The company...

Largely in-line revenue/EBITDA: Revenue grew 6% YoY to INR29b (our estimate: INR31b) in 1QFY20. EBITDA rose 21% YoY to INR5.9b (our estimate: INR5.6b), with the margin expanding 260bp YoY to 20.4% (our estimate: 18.1%). On a like-to-like basis, EBITDA was up 17% YoY to INR5.7b...

The board of TATA Chemicals (TTCH) has approved the demerger of its consumer products business and the transfer of the same to TATA Global Beverages (TGBL) in an all-equity transaction. As part of the transaction, TTCH would transfer the salt, spices, protein foods and certain other food & products businesses. However, the salt manufacturing facility, basic chemistry products and specialty products businesses will remain with the company. Existing shareholders of TTCH will receive 1.14 shares of TGBL for every 1 share held in TTCH.

4 May 2019 reported in-line, however adj. PAT came in higher than expected due to deferred tax benefit of INR462m which led to significantly lower than Revenue grew 10% to INR112.9b, with margin contraction of 280bp to 18.5%. Adj. PAT was down 10.8% YoY to INR10.9b. EBITDA/MT increased 43% YoY to USD53.3 in North America (realization up 5% YoY to USD226.3/MT) and 46% YoY to USD56.1/MT in Africa (realization up 3% YoY to USD255.3/MT). India business delivered 4% YoY growth in soda ash volumes and also improved realization, but profitability was marred by higher power and plant fixed cost.

Tata Chemicals' consolidated revenue grew 8.0% yoy to Rs27.6bn (Emkay est: Rs28.1bn) and EBITDA grew 3.6% yoy to Rs5.3bn (Emkay est: Rs5.4bn). EBITDA margin declined by 82bps yoy to 19.2% (Emkay est: 19.3%). Consolidated soda-ash revenue increased 13.5% yoy to Rs22.1bn on better realizations across geographies. Total soda-ash volume declined 4% yoy due to lower volume at TCNA and the discontinuation of the trading business in Europe (from Q1FY19). second phase of 130K MTPA will come in 3-4 years. The 400K MTPA salt capacity will come in 3 steps in 3-4 years. Mgmt expects soda-ash prices to remain firm globally....

We recently met the CFO of Tata Chemicals John Mulhall. During the meeting, we got a sense of the business dynamics of Soda Ash, Sodium bicarb and Consumer business. Tata Chemical (TCL) is a predominant player in the soda ash industry with a combined capacity of ~4.2 MTPA across different parts like North America, Africa, Europe and India. Moreover, the company also has a soda bicarb capacity of 0.1 MTPA each in India and Europe. Going ahead, the strategy would be increasing soda ash plant utilisation in the Africa region along with improving sales mix of soda bicarb...

Tata Chemicals Ltd Q2FY19 results Comment Revenue increased by 2.47% to Rs. 1013.61 Cr in Q2FY19 when compared to the previous quarter. Also, it rose by 22.69% when compared with Q2FY18.

27 September 2018 TTCH commenced its consumer business in 2011 pulses was the sole product platform then and sold under the brand name of i-Shakti. The brand Tata Sampann was launched in 2015 with a view to include all food/consumer products under a single umbrella. Tata Sampann now encompasses five product platforms (spices, pulses, besan, mixes, and chutneys) in multiple variants. TTCHs pulses, besan and spices products available in general trade are already leveraging Tata Salts robust distribution network. According to the company, most of its products in general trade are already reaching close to an optimum number of touch points. pulses, besan and spices) are now available at 40% of Tata Salts touch points. In line with this, the company has scaled up pulses, is in the process of scaling up besan and is coming up with value-added products like mixes and chutneys.

TCL's revenue grew by 13% YoY in Q1FY19 led by strong growth in consumer products segment (up 33% YoY) on the back of higher volumes from Tata Salt. However, EBITDA rose 8% YoY leading to margin contraction of 87bps in Q1FY19 impacted by weak margin in the US and Africa businesses. While we expect EBITDA margin to decline slightly in FY19E due to rising raw material and crude oil prices, it is expected to expand by 40bps YoY to 21.4% in FY20E led by strong volume...