Tata Chemicals posts Q3 profit drop on price cuts, weak demand

BENGALURU, Feb 6 (Reuters): India's Tata Chemicals reported a decline in profit for the third successive quarter on Monday, hurt by lower soda ash prices and soft demand.

Soda ash, the company's largest business, suffered last year as falling caustic soda prices made it more appealing than soda ash for the silicate market, prompting it to cut prices to stay competitive.

The segment comprises about two-thirds of its total sales volume, with the US being its largest market.

Consolidated net profit fell 60 per cent from the previous year to 1.58 billion rupees ($19 million) in the three months ended Dec. 31.

The Tata Group-owned company had cut prices of its key products light and dense soda ash twice last year -- by 3 per cent-4 per cent in April and about 5.5 per cent in August. The combined price cuts eroded its revenue in the latest quarter.

Meanwhile, soda ash sales volume fell about 10 per cent in the quarter, leading to a proportionate decline in total revenue to 37.30 billion rupees.