Sumitomo Chemical (4005.T) Soars 9% to 52-Week High on 52% Q4 Profit Surge

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  <li>Shares of Sumitomo Chemical India surged over 9 percent in intra-day deals on Tuesday to hit their 52-week peak after the company posted strong results for the quarter ended March 2024 (Q4FY24) yesterday.</li>
  <li>This is the sixth straight session of gain for the stock, gaining almost 19 percent in this time.</li>
  <li>"The stock rallied as much as 9.3 percent to its 1 year-high of ₹482. Post today's jump, it has now advanced over 43 percent from its 52-week low of ₹336.40, hit on March 14, 2024," noted a market analyst.</li>
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<p><strong>Sumitomo Chemical India stock hits 52-week high as quarterly profits soar by 52%.</strong></p>
<h2><strong>Sumitomo Chemical India Posts Strong Q4FY24 Results</strong></h2>
<p>Sumitomo Chemical India reported a 52 percent increase in its consolidated net profit for the quarter ended March 2024, reaching ₹109.89 crore compared to ₹72.12 crore in the same period last year. The company's total income for the quarter rose marginally to ₹700.90 crore from ₹668.05 crore in the previous year.</p>
<h3><strong>Stock Performance and Market Reaction</strong></h3>
<p>The stock has seen a significant rally, jumping 19 percent in May following a 15.3 percent increase in April. However, it experienced declines of 7 percent in March and 10 percent in February. The stock's performance in 2024 YTD has been robust, with a 19 percent rise.</p>
<h2><strong>Operational Efficiency and Strategic Focus</strong></h2>
<p>On the operating front, Sumitomo Chemical India's EBITDA grew by 73.9 percent to ₹140 crore in Q4FY24, with the margin rising to 20.8 percent from 12.4 percent in the same quarter last year. Despite the strong quarterly performance, the company's net profit for the full financial year 2023-24 declined by over 26 percent to ₹369.74 crore from ₹502.20 crore in FY23. Total income for FY24 fell by 17 percent to ₹2,939.61 crore from ₹3,555.81 crore in FY23.</p>
<h3><strong>Challenges and Future Outlook</strong></h3>
<p>Sumitomo Chemical India faced several challenges in FY24, including adverse weather conditions, poor demand, inventory reductions, price volatility, and supply chain disruptions. Despite these headwinds, the company focused on minimizing adverse impacts and driving operational efficiencies. The firm remains optimistic about the growth potential of the agro-solution sector, particularly in high-growth markets like India.</p>
<h3><strong>Conclusion</strong></h3>
<p>Sumitomo Chemical India's strong Q4FY24 performance and strategic focus on operational efficiency have driven its stock to a 52-week high. Despite facing significant challenges in FY24, the company's resilience and strategic initiatives position it well for future growth. Investors and market analysts will be closely watching the company's performance in the coming quarters.</p>