Tata Chemicals is in a somber mood today, the stock down over 3% at Rs.256.10, with an intra day low at Rs.253.Its 52-week low is at Rs.234.50.

The stock is down after it posted a consolidated loss of Rs.16 crore v/s net profit of Rs.224 crore in Q3FY13. This loss was mainly on account of three factors – firstly the restructuring of its European operations which led to a one-time charge of Rs.82 crore. Tata Chemicals Europe (TCE), the European unit of the company is restructuring the business in Northwich, UK. TCE operates from three sites in Cheshire—Winnington (Northwich), Lostock (Northwich) and Middlewich and of this, Winnington facility has ceased production. Secondly, its interest cost burgeoned from Rs.118 crore to Rs.166 crore (YoY). Thirdly tax outgo too jumped up from Rs.73 crore to Rs.93 crore. Thus all these ate away the 7% rise in total income at Rs.4598 crore, pushing the company into the red.

Looking ahead, the company has stated that it expects the demand scenario to remain robust and expects stable international prices. Yet, the overhang of subsidy is something which will continue to stress the company. Its subsidy receivable from the Govt at end of Q3FY14 was at Rs.1678 crore and this does exert pressure on the working capital.