GNFC spurts after Q3 PAT soars 123% YoY to Rs Rs 541 cr

Gujarat Narmada Valley Fertilizers & Chemicals (GNFC) surged 11.47% to Rs 508.25 after the company's consolidated net profit surged 122.92% to Rs 540.78 crore on 57.82% increase in net sales to Rs 2,380.33 crore in Q3 FY22 over Q3 FY21.

On a consolidated basis, profit before tax in the third quarter stood at Rs 644.25 crore, up by 91.11% from Rs 337.11 crore reported in the same period last year.

Total expenses rose 46.74% to Rs 1784.23 crore with cost of raw materials consumed rising 74.60% to Rs 1,147.89 crore during the period under review. Power, fuel and other utilities expense rose 48.58% YoY to Rs 323.38 crore in Q3 December 2021.

Revenue from Fertilizers business stood at Rs 737.54 crore (up 46.19% YoY) and revenue from Chemicals business stood at Rs 1,622.30 crore (up 64.45% YoY).

EBITDA surged 85.67% to Rs 674 crore in Q3 December 2021 over Q3 December 2020. EBITDA margin stood at 28% in Q3 FY22 as against 24% in Q3 FY21.

Pankaj Joshi, IAS, managing director of the company said, "While the input costs have gone up significantly across the board, it has impacted fertilizer imports significantly and on YTD basis, total fertilizer imports are down by 33% witnessing across the board import reductions in all key fertilizers i.e. Urea, DAP, NP/NPKs and MOP. However, there is no significant reduction in the demand indicating that accumulated inventories are liquidated in the process.

On a Q-o-Q and Y-o-Y quarterly basis, the fertilizer segment is affected mainly due to lower production of fertilizers and higher input costs respectively whereas on a YTD ending December FY 21-22 basis the performance has improved mainly due to Government support for enhanced subsidies to compensate higher input costs in case of phosphatic fertilizer and in case of Urea due to higher feed and fuel prices.

Whereas the performance, both, on Quarterly Q-o-Q and Y-o-Y basis as well as YTD ending December FY 21-22 basis the Chemical Segment has improved due to vibrant realizations almost across the board. In case of chemicals, due to inherent strength of integration at the company, the product mix was also optimized for better margins."

In its outlook, GNFC said that with flexible and multiple product basket, the company is in a position to leverage boom in specific products and optimize, both, realization and profits. The company is confident of stable performance balancing its product mix to serve markets.

GNFC is a joint sector company promoted and controlled by Government of Gujarat. It is a producer of bulk chemicals and fertilizers. Its product portfolio is a result of plant integration developed over a period of time. Most products are import substitutes and contributes to saving valuable foreign exchange. In few products like Acetic Acid, TDI it is the only producer in the country whereas in respect of product like Aniline, Formic Acid, it is amongst a very few producers in the country.

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