PCBL shares dive 11% to 5-month low after net profit drops 37% YoY in Q3

Stock market today: Shares of PCBL (formerly Phillips Carbon Black), a leading carbon black manufacturer, plunged 11.35% in early trade on January 13 to hit a 5-month low of ₹346.60 per share after the company reported lower-than-expected earnings for Q3FY25, which were released post market hours on Friday. 

PCBL's consolidated net profit declined 37% year-on-year (YoY) to ₹93 crore in Q3FY25, compared to ₹148 crore in the same period last year, primarily due to a sharp rise in operating expenses. Total expenses for the quarter surged 23% YoY to ₹1,693 crore from ₹1,378 crore in Q3FY24. Notably, the finance cost skyrocketed 254% YoY to ₹117 crore, while employee benefit expenses increased to ₹105 crore from ₹61 crore in Q3FY24, as per the regulatory filing. 

On the revenue side, PCBL reported a 21.3% YoY growth in revenue from operations, which stood at ₹2,010 crore, though it registered a 7% sequential decline. Operating performance showed mixed results as EBITDA improved to ₹317 crore compared to ₹279 crore YoY but dropped from ₹364 crore in Q2FY25. The operating profit margin contracted to 16%, down from 17% in Q3FY24.

In terms of volumes, PCBL reported a 5% YoY growth in sales volumes, reaching 143,500 MT in Q3FY25 compared to 136,108 MT in Q3FY24. The consolidated EBITDA per metric ton (MT) for carbon black stood at ₹19,868 in Q3FY25.

PCBL also provided updates on its specialty chemical capacity expansion. It said the second and final phase of its 20,000 MTPA specialty chemical capacity at the Mundra Plant in Gujarat had been commissioned, increasing its total installed capacity to 790,000 MTPA.

The company has also said it received International Sustainability and Carbon (ISCC) PLUS certification, emphasising its commitment to responsible consumption, production, circular economy practices, and greenhouse gas (GHG) emission reduction.

In addition, PCBL was allotted 116 acres of land in Andhra Pradesh for a new carbon black plant. The strategic location near major ports and customer hubs is expected to facilitate the seamless movement of raw materials and finished products. The company has also outlined plans to reach a total carbon black capacity of 1 million MTPA within the next two to three years.

Stock down 38% from recent peak

After reaching its all-time high of ₹584.40 per share, the stock has been on a consistent downward trend. With today’s decline, it has now corrected 38% from its peak. In October alone, the stock registered a steep 29% drop, and so far this month, it has declined by an additional 20%.

Despite the recent correction, the stock continues to deliver multibagger returns, having gained 191% over the last three years and an impressive 453% over the last five years.

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