BASF India reports declining profits amid rising costs
BASF India has recorded a 26.1% drop in profit for the third quarter due to increased input costs, despite steady demand for its products.
The company’s net profit for the three-month period ending December 31, 2024, declined to US$11.95 million from US$16.1 million in the same period the previous year.
Total expenses increased by 15%, driven mainly by a 7.9% rise in raw material costs.
The Indian subsidiary of Germany-based BASF has also announced plans to shut down its manufacturing facility in Dahej, located in western India.
The company cited outdated technology, low production levels, and high maintenance costs as reasons for closing the plant.
The shutdown, expected in the first half of 2025, is anticipated to reduce fixed costs but have minimal impact on overall earnings, as the unit accounted for only 0.3% of total revenue in 2024.
In Europe, BASF has begun transitioning all sites under its Performance Materials division to 100% renewable electricity.
The switch, which started on January 1, 2025, is part of the company’s broader efforts to reduce its environmental footprint.
BASF is also increasing its investment in renewable energy projects, including offshore wind power at the Hollandse Kust Zuid wind farm and solar energy installations at its Schwarzheide site.
Alongside its sustainability initiatives, the company has introduced an AI assistant, chatBASF, which supports more than 40,000 employees with tasks such as translations and research.
Additionally, BASF has integrated an AI-powered assistant for IT-related inquiries into MS Teams and M365 Copilot as part of its Corporate AI Program to improve efficiency and innovation.
Financially, BASF reported preliminary global sales of US$69.4 billion for 2024, a decline from US$73.6 billion the previous year, mainly due to currency fluctuations.
Despite a slight rise in sales volumes, earnings before interest, taxes, depreciation, and amortization (EBITDA) stood at US$7.9 billion, slightly below the company’s earlier projection of US$8 billion but marginally higher than the US$7.7 billion recorded in 2023.
Cash flow from operations exceeded expectations, reaching US$0.7 billion, surpassing both the forecast of US$0.4 billion and the company’s projected range of US$0.1 billion to US$0.6 billion.
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