Fertiliser shares rally as Cabinet clears urea policy

Shares of fertiliser companies have rallied up to 18% in opening deals after the Cabinet Committee on Economic Affairs (CCEA), on Thursday, approved a urea investment policy, which is likely to incentives fertiliser companies to set up new plants and expand existing capacity.

Fertilisers and Chemicals Travancore (FACT) has rallied 18% to Rs 32.60 on the BSE. National Fertilisers, RCF, Chambal Fertilisers, GSFC and Deepak Fertiliser are trading higher by 2 - 5%.

Under the new policy, the government will give 12-20% post-tax return on fresh capital infused by the manufacturers for setting up of new plants as well as for expansion and revamp of the existing ones.