Chemplast Sanmar Ltd. reported first-quarter consolidated net profit of ₹24 crore against a net loss of ₹64 crore in the year-earlier period, due to an improvement in the prices of PVC and lower feedstock costs.

Revenue from operations jumped by 15% to ₹1,145 crore, while cost of materials increased by ₹47 crore to ₹763 crore, the speciality chemicals manufacturer said in a statement.

“The revenue contribution from speciality chemicals grew by 61%, which is supported by higher volumes of speciality paste PVC from the newly commissioned facility at Cuddalore and the increased revenue from Custom Manufactured Chemicals Division (CMCD),” the company said.

Value-added chemicals revenue grew by 20% due to higher volumes of caustic soda. Suspension PVC revenue remained stable.

“We witnessed a positive swing in profits in the current year on account of improved prices of PVC and lower feedstock prices,” said MD Ramkumar Shankar. “The improvement in PVC prices was largely due to a severe container shortage for cargo originating from China, however, these heightened freight rates have started dropping off post the end of the quarter,” he added.

“This, coupled with continued weakness in the Chinese economy and large volumes of low-priced imports coming in from China, has resulted in PVC prices dropping in July,” Mr. Shankar said.

On Wednesday, the board approved a further investment of ₹160 crore for the capacity expansion of CMCD business.

The company also said it had recently signed a Letter of Intent (LoI) with an agrochemicals innovator for an advanced intermediate for a new active ingredient for a five year period. This is the fifth LoI the company has signed over the past 20 months.