Fertiliser stocks in demand: RCF, Chambal, Deepak, GSFC, GNFC zoom upto 12%

US-Iran war impact: West Asian nations are key suppliers of major fertilisers as well as raw materials for fertiliser manufacturing like sulphur, ammonia etc.

Fertiliser shares today

 

Shares of fertiliser companies moved higher by 12 per cent on the BSE in Tuesday’s intra-day trade amid heavy volumes after the US President Donald Trump suggested that the US-Israeli war on Iran could be close an end.

 

Share price of Fertilizers and Chemicals Travancore (FACT) spurted 16 per cent to ₹766.50 in intra-day trade. Rashtriya Chemicals and Fertilizers (RCF) surged 12 per cent to ₹123.65 in intra-day trade on the back of nea three-fold jump in trading volumes. A combined 14.25 million shares changed hands on the NSE and BSE.

 

Share price of National Fertilizers rallied 12 per cent to ₹78.20, followed by Chambal Fertilisers & Chemicals (₹442) and Deepak Fertilisers & Petrochemicals Corporation (₹994.45) up 7 per cent each, Gujarat State Fertilizers & Chemicals (₹160.40) and Gujarat Narmada Valley Fertilizers & Chemicals (₹434.35) gained 6 per cent each and Coromandel International was up 3 per cent to ₹2,064. In comparison, the BSE Sensex was up 0.7 per cent at 78,097.62 at 11:59 AM.

 

 

However, thus far in the calendar year 2026, most of these stocks have underperformed the market by falling in the range of 9 per cent to 16 per cent, as against 8 per cent decline in the BSE Sensex. 

 

Why FACT, RCF rally up to 16 per cent on Tuesday?

 

The government has assured the fertiliser companies that it is working on multiple plans to gradually lower the shortfall in liquefied natural gas (LNG) supplies from the Middle East, ensuring that production of critical plant nutrients does not get hampered even if the war continues for a longer period, the Business Standard reported.

 

The Centre was looking at every possible way to ensure smooth availability of LNG, and that the shortfall narrows down from 40 per cent to 30 per cent, and subsequently more in a planned calibrated manner, the newspaper reported quoting top government officials.

 

West Asian nations are key suppliers of major fertilisers as well as raw materials for fertiliser manufacturing like sulphur, ammonia etc.

 

Urea prices have increased sharply on March 4, 2026 to around $597/MT from around $484/MT on February 27, 2026, reflecting supply disruptions from the West Asian nations. Similarly Di-ammonium Phosphate (DAP) prices have also risen sharply. 

 

Given the constrained global supplies, prices may rise further if the conflict elongates and will put pressure on the subsidy budget for the Government of India (GoI). As the current situation reflects lack of availability of supplies along with constrained domestic production, India faces an uphill task to maintain a reasonable level of availability of fertilisers for the upcoming season, according to ICRA. 

 

Prices of key inputs, i.e. sulphur and ammonia have also increased sharply as production of the same has been suspended by Qatar and transit through the Strait of Hormuz remains constrained, the rating agency said.

 

Meanwhile, India’s domestic urea production has sizeable dependence on imported LNG, with 85 per cent of the demand met through import in 9MFY2026.

 

Several urea plants have scaled down their production owing to gas supply constraints. As it is an off-season for fertiliser consumption in the country, ICRA does not foresee an immediate impact on the availability of urea for the farmers. However, if the LNG availability remains constrained for a longer period, there might be challenges on urea availability, the rating agency said.

 

A sizeable proportion of India’s urea demand is met through imports with West Asian nations and China contributing to a material portion. The availability of urea from West Asian nations remains constrained while China has stopped exports of urea. Thus, India may have to depend significantly on Russia to meet its urea requirements for the upcoming season, if the West Asian crisis lingers for the next couple of months, ICRA said. 

 

Subsidy requirements of urea manufacturers are expected to increase as gas expenses remain pass-through costs. Significant dependence on imported LNG makes urea players vulnerable to gas availability. The rise in ammonia as well as LNG prices may impact the profitability of phosphorus and potassium (P&K) fertiliser players unless subsidy corrections are made in the upcoming Nutrient-based Subsidy rate revision, the rating agency said.