 "Fertiliser shares in focus; Chambal Fertilizer, Coromandel hit 52-week high")
Shares of fertiliser companies were in focus with four stocks Coromandel International, Chambal Fertilisers & Chemicals, National Fertilizers and Aries Agro hitting their respective 52-week highs on the BSE.
Nagarjuna Fertilisers, Rashtriya Chemicals and Fertilizers (RCF), Aries Agro, Magalore Chemicals & Fertilisers, Fertilizers and Chemicals Travancore (FACT) and Chambal Fertilisers & Chemicals were up between 9% and 12% on the BSE in past two trading sessions as compared to less than 1% gain in S&P BSE Sensex.
The 25 fertilisers companies posted 95% year on year growth in their aggregate net profit at Rs 889 crore for the first six months (April to September) of current financial year 2016-17 (H1FY17). These companies had a combined net profit of Rs 456 crore during the same period previous fiscal.
According to ICRA Research, overall, the outlook for the fertiliser sector continues to remain stable with favourable agro-climatic conditions and liquidation of high systemic inventory.
Although the profits in October-March (H2FY17) should be relatively better due to a further softening of raw material prices, the overall profits for FY2017 should remain weak due to overwhelming impact of weak H1 performance, the rating agency said in recent report.
Overall, for the year FY2017, the upside in the overall volumes is likely to be limited at 2-4% due to high systemic inventory levels at the beginning of the year. Also, the recent government of India move of demonetization could negatively impact demand in the short term for fertiliser as it coincides with the sowing season for the winter crop.
Hence, volume growth is likely to be at the lower end of the expected band. The urea industry would also benefit from subdued energy price environment, which is likely to drive the cost of production lower, added report.
Nagarjuna Fertilisers, Rashtriya Chemicals and Fertilizers (RCF), Aries Agro, Magalore Chemicals & Fertilisers, Fertilizers and Chemicals Travancore (FACT) and Chambal Fertilisers & Chemicals were up between 9% and 12% on the BSE in past two trading sessions as compared to less than 1% gain in S&P BSE Sensex.
The 25 fertilisers companies posted 95% year on year growth in their aggregate net profit at Rs 889 crore for the first six months (April to September) of current financial year 2016-17 (H1FY17). These companies had a combined net profit of Rs 456 crore during the same period previous fiscal.
According to ICRA Research, overall, the outlook for the fertiliser sector continues to remain stable with favourable agro-climatic conditions and liquidation of high systemic inventory.
Although the profits in October-March (H2FY17) should be relatively better due to a further softening of raw material prices, the overall profits for FY2017 should remain weak due to overwhelming impact of weak H1 performance, the rating agency said in recent report.
Overall, for the year FY2017, the upside in the overall volumes is likely to be limited at 2-4% due to high systemic inventory levels at the beginning of the year. Also, the recent government of India move of demonetization could negatively impact demand in the short term for fertiliser as it coincides with the sowing season for the winter crop.
Hence, volume growth is likely to be at the lower end of the expected band. The urea industry would also benefit from subdued energy price environment, which is likely to drive the cost of production lower, added report.
| Price Rs | Gain in % | ||
| COMPANY | LATEST | 1 day | 2 days |
| NAGARJUNA FERT. | 10.39 | 4.95 | 10.18 |
| ARIES AGRO | 181.00 | 4.78 | 8.94 |
| R C F | 52.60 | 3.95 | 10.39 |
| MANGALORE CHEM. | 48.50 | 2.86 | 9.11 |
| COROMANDEL INTER | 311.00 | 2.40 | 3.67 |
| F A C T | 26.75 | 2.10 | 10.31 |
| S P I C | 20.40 | 2.00 | 5.97 |
| MADRAS FERT. | 15.35 | 1.99 | 7.57 |
| NATL.FERTILIZER | 38.60 | 1.58 | 7.37 |
| ZUARI AGRO CHEM. | 244.00 | 1.50 | 2.41 |
| G N F C | 237.80 | 1.43 | 5.29 |
| CHAMBAL FERT. | 79.55 | 1.40 | 12.04 |
| DEEPAK FERT. | 224.30 | 1.40 | 4.23 |
| G S F C | 103.40 | 0.78 | 3.40 |
| ZUARI GLOBAL | 96.80 | 0.68 | 1.15 |
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