Gujarat's GNFC turns long term debt free, posts 51% rise in PAT for FY'18

The company also crossed the Rs 60 billion revenue mark for the first time.
Fertiliser major Gujarat Narmada Valley Fertilizers and Chemicals Limited (GNFC) has turned long term debt free. The state-owned company has paid off the Rs 8.88 billion of long term debt it had at the start of the financial year 2017-18, achieving its target set early last year.

The company now plans to reduce its working capital requirements substantially as well, said Rajiv Kumar Gupta, IAS, Managing Director of GNFC.

On the back of record production of its Touline Diisocyanate (TDI) and non-TDI products and capacity utilisation, coupled with jump in exports, GNFC has posted a 38 per cent growth in its net profit for the fourth quarter ended March 31, 2018 as well as 50.37 per cent in net profit for the fiscal 2017-18. GNFC also registered a profit before tax (PBT) of Rs 11.62 billion, the highest ever among Government of Gujarat companies.

GNFC's Q4 net profit in 2017-18 grew by 37.81 per cent to stand at Rs 3.28 billion, as against Rs 2.38 billion in Q4 of 2016-17, while total income in the same period grew by 28.72 per cent to close at Rs 18.15 billion, as against Rs 14.10 billion. For the entire fiscal 2017-18, while GNFC's net profit grew by 50.37 per cent at Rs 7.94 billion, up from Rs 5.28 billion, its total income increased by 17.19 per cent to close at Rs 60.58 billion from Rs 51.69 billion.

"From liabilities worth Rs 70 billion in 2013-14, we have come down to zero long term debt. We also changed our marketing strategy. We started exploring export markets and hence, from a 15 years average exports of Rs 34 crore, this year the company registered Rs 629 crore worth of exports to 66 countries. This improved our realisation," said Gupta.

According to GNFC, the growth in revenue and profits are significantly led by non-TDI chemicals, both in terms of revenue and profits. Roughly, 65 per cent of GNFC's revenue comes from chemicals, while 35 per cent comes from fertilizers.