Deepak Nitrite Limited has announced a significant intra-group investment through its subsidiary companies. Deepak Chem Tech Limited (DCTL), a wholly owned subsidiary, has allotted preference shares worth ₹80.00 crores to Deepak Phenolics Limited (DPL), another wholly owned subsidiary of the parent company.

Share Allotment Details

The transaction involves the issuance and allotment of 80,00,000 9% Optionally Convertible Redeemable Preference Shares (OCRPS) by DCTL to DPL. The shares were allotted at par value on January 29, 2026.

About Deepak Chem Tech Limited

DCTL, incorporated on October 9, 2020, operates in the chemical industry with a focus on fluorination technology. The company runs a state-of-the-art fluorination plant and has been actively pursuing projects across various sites in Gujarat. Prior to this allotment, DCTL's paid-up capital stood at ₹1,919.50 crores, comprising ₹499.50 crores in equity shares and ₹1,420.00 crores in preference shares.

Financial Performance

Transaction Purpose and Structure

The investment aims to strengthen DCTL's capital base and support the company in carrying out project expenses and general corporate purposes. The transaction is structured as a related party transaction since both DCTL and DPL are wholly owned subsidiaries of Deepak Nitrite Limited. The company has confirmed that the transaction is conducted on an arm's length basis.

Shareholding Structure

Following this allotment, the shareholding structure remains unchanged in terms of control. Deepak Nitrite Limited continues to hold 100% of the equity share capital of DCTL, while together with DPL, it maintains indirect control of 100% of the preference share capital. The transaction requires no governmental or regulatory approvals and was completed through cash consideration via normal banking channels.

Deepak Nitrite shares experienced a decline of 2.02% to ₹1,567.90 in Friday's trading session, positioning the stock among the top losers on the Nifty Midcap 150 index. The chemical company's stock performance reflects mixed financial results despite revenue growth in the fiscal year 2025.

Financial Performance Overview

The company reported contrasting results for FY25, with revenue growth accompanied by declining profitability. The following table summarizes the key annual financial metrics:

Quarterly Performance Analysis

The quarterly results demonstrate significant volatility in the company's performance throughout FY25. The March 2025 quarter showed the strongest performance with revenue of ₹2,179.69 crores and net profit of ₹202.50 crores.

Profitability and Margin Analysis

The company's profitability margins have shown a declining trend over the past five years. Net profit margin decreased to 8.42% in FY25 from 10.55% in FY24, while operating margin fell to 11.83% from 13.45%.

Balance Sheet and Financial Position

The company's balance sheet reflects expansion with total assets increasing to ₹7,717 crores in FY25 from ₹6,096 crores in FY24. Fixed assets grew substantially to ₹4,103 crores from ₹3,066 crores, indicating significant capital investments.

Corporate Actions and Dividend

Deepak Nitrite announced a final dividend of ₹7.50 per share on May 28, 2025, maintaining the same dividend rate as the previous year. The company has a history of corporate actions including stock splits and bonus issues, with the most recent stock split occurring in 2014 when the face value was reduced from ₹10 to ₹2.

Market Performance

With the current trading price at ₹1,567.90, the stock reflects market concerns about declining profitability despite revenue growth. The company's inclusion in the Nifty Midcap 150 index underscores its significance in the mid-cap segment, though recent performance has placed it among the index's top losers.