Message from the Director (Finance) & Group CFO

DEAR SHAREHOLDERS,

It is with optimism that I present to you the performance review and strategic outlook for Deepak Nitrite Limited for FY 2024-25. While this year tested our resilience amid global uncertainties and a softened pricing environment, it also reaffirmed our commitment to disciplined approach towards customer orientation, cost leadership, effective procurement ideas, execution of projects and long-term value creation.

Our integrated approach across strategic business units, sharp focus on operational efficiency, and a deep-rooted culture of sustainability have enabled us to weather the turbulence and emerge stronger.

ANCHORED IN INDIA’S CHEMICAL GROWTH STORY

While Indian Chemical Industry plays a leading role amongst the producers of the World and those in Asia, Deepak Nitrite continues to play a pivotal role in India’s chemical value chain, aligning closely with the country’s aspirations of self-reliance and sustainable manufacturing. With a balanced portfolio that spans across basic chemicals, performance products, and high-growth intermediates, we remain a trusted partner of choice to industries such as pharmaceuticals, agrochemicals, paints, polymers, and electronics among others. Our strategy has been to focus not only on scale and cost leadership, but also on value-added innovation and import substitution where we are increasingly recognized for our stewardship.

In FY 2024-25, we also deepened our commitment to research-driven development, technological innovation, and sustainable growth. As global supply chains continue to realign, India’s role in the chemical and intermediate landscape is growing stronger. Deepak Nitrite is well poised to harness this momentum through investments in people, processes, and platforms of innovation.

RESILIENT FINANCIAL PERFORMANCE AMID MARKET CHALLENGES

Against a backdrop of market uncertainty, we delivered credible results that reflect the underlying strength and adaptability of our business. Our consolidated revenue grew by 8% to ₹ 8,282 Crores from ₹ 7,682 Crores in FY 2023-24. EBITDA stood at ₹ 1,176 Crores, maintaining a robust 14% margin. Profit Before Tax (PBT) was ₹ 953 Crores and Profit After Tax (PAT) came in at ₹ 697 Crores, a reflection of our operational discipline amid shifting market dynamics. It is worth highlighting that while H2 was relatively muted due to soft pricing, volatile input costs, we ended the year on a stable note. This was driven by recovery in the Advanced Intermediates segment and consistent volume gains in the Phenolics business.

SEGMENTAL PERFORMANCE: NAVIGATING WITH AGILITY

In the Advanced Intermediates segment, we witnessed margin compression in the early quarters largely due to softer realisations, we rebounded strongly with improved demand visibility and greater customer engagement across applications.

The Phenolics segment posted revenues of ₹ 5,805 Crores, a 16% year-on-year growth, with an EBIT of ₹ 783 Crores, representing a 13% margin. Volume growth was visible across all product lines, while pricing environment remained soft and input cost inflation remained. These results reinforce the strategic significance of Phenolics business as a strong margin and cash flow contributor.

Our revenue mix for FY 2024-25 stood at 84% domestic and 16% export, with domestic revenues of ₹ 6,923 Crores and exports at ₹ 1,359 Crores. This balance reaffirms our dominant presence in the Indian market while also reflecting the growing global interest in our products and capabilities.

CAPEX, CAPACITY, AND CAPABILITY: INVESTING FOR TOMORROW

While the Company is on the verge of competing and commence commercial production out of its ongoing projects, FY 2024-25 was a year dedicated to laying robust foundations for future growth. The Company announced total capex plan of ₹ 8,500 Crores for setting up of projects of Phenol-Acetone, IPA, Polycarbonate resin and its compounds. Several capacity augmentation and debottlenecking projects were initiated, setting the stage for volume growth, vertical integration, and margin expansion.

We are particularly excited about the upcoming state-of-the-art R&D Centre near Vadodara, to be developed with an investment of over ₹ 100 Crores. Once commissioned, this facility will serve as the innovation nerve centre for our speciality portfolio, accelerating new product development, improving sustainability, and enabling strategic shifts toward high-value downstream chemistries.

FINANCIAL STRENGTH AND MARKET ENDORSEMENT

We continue to maintain a strong balance sheet, a key enabler of our growth ambitions. Consolidated Net Worth as of March 31, 2025, stood at ₹ 5,389 Crores, with standalone net worth at ₹ 3,126 Crores. Our ongoing expansion initiatives are entirely supported through internal accruals and long-term credit lines, ensuring minimal pressure on liquidity.

We are pleased to share that ICRA Limited reaffirmed our credit ratings this year, maintaining Deepak Nitrite’s long-term rating at [ICRA]AA (Positive) and short-term rating at [ICRA]A1+. Deepak Phenolics received identical ratings, reaffirming our financial prudence, execution ability, and governance standards. These ratings enhance our ability to mobilize capital at effective costs, a crucial factor in sustaining capital expenditure cycles.

Importantly, we continue to operate with optimum debt levels supported by strong internal accruals and prudent capital allocation. This gives us financial flexibility to confidently pursue investments for value addition and growth without compromising on financial stability. With a high credit rating and a strong balance sheet, we are well-equipped to absorb volatility, scale investments, and consistently deliver long-term value to our shareholders.

DELIVERING ON SHAREHOLDER COMMITMENT

Our shareholders are at the heart of every decision we make. In continuation of our dividend tradition, the Board has maintained the aannual dividend at ₹ 7.5 per share in FY 2024-25, representing 375% of face value. This reflects not just our financial performance, but our belief in sharing success with those who have consistently supported our journey.

VISION FOR FY 2025-26 AND BEYOND

As we turn to FY 2025-26, we do so with a spirit of renewed optimism and disciplined execution. Though global headwinds may persist, our strategic investments, efficient operations, and expanding product portfolio place us on a strong path forward. Several of our new facilities are expected to come online in phases across FY 2025-26, from Q2 through Q4, setting the stage for a brighter future when their full-year impact will be realized.

We remain committed to long-term profitability, deeper integration levels, and technology-led differentiation. Our teams are focused on operational agility, customer intimacy, and continuous innovation, ensuring that we stay ahead of the curve in a rapidly evolving chemical landscape.

ACKNOWLEDGING OUR VALUED PARTNERS

I extend my heartfelt gratitude to all stakeholders, our employees for their commitment, our partners for their collaboration, our customers for their trust, and above all, our shareholders for their unwavering confidence. The journey ahead is full of promise. With a clear strategy, a resilient model, and a passion for excellence, Deepak Nitrite is well positioned to shape a more self-reliant, more sustainable, and more globally relevant future.

Thank you for continuing to walk this journey with us.

Warm regards,