Best Agriculture Stocks in India in September 2024- 5-yr CAGR Basis

The Indian agricultural sector is expected to increase to $24 billion by 2025. The Indian food and grocery market ranks as the sixth largest globally, with retail making up 70% of the total sales.

India is an important player in the global agriculture sector, with around 55% of its population relying on it for their livelihood. The country has the largest cattle herd (buffaloes) and the most land dedicated to growing wheat, rice, and cotton. With the second-largest agricultural land in the world, the agriculture sector provides jobs to nearly half of India’s population, making it essential for farmers to ensure a food supply. In this article, check the best agriculture stocks in India in September 2024 based on the 5-year CAGR.

Best Agriculture Stocks In India In September 2024 – 5-Yr CAGR Basis

Note: The top 10 stocks in the agriculture sector in India list has been selected from the Nifty 500 universe and sorted based on 5-yr CAGR as of September 10, 2024.

Overview Of Best Agriculture Stocks In India

• Fertilisers & Chemicals Travancore Ltd

Fertilizers & Chemicals Travancore Ltd (FACT) manufactures and sells a variety of fertilisers, by-products, and Caprolactam. FACT produces a range of fertilizers, including complex fertilizers (Factamfos), straight fertilizers (Ammonium Sulphate), organic fertilizers, bio-fertilizers, and imported fertilizers (Muriate of Potash). Additionally, it produces bagged gypsum and Caprolactam, which are used to make items like nylon tyre cords, nylon filament yarn, and engineering plastics.

For the quarter ending June 2024, Fertilizers & Chemicals Travancore Ltd (FACT) reported a net loss of ₹48.7 crore, a sharp decline from the ₹71.8 crore profit recorded in the same quarter last year. The company’s revenue for the period stood at ₹599.6 crore, down 51.4% compared to ₹1,232.6 crore in the previous year.

Key metrics: 

• Earning per share (EPS):₹ -0.88
• Return on equity (ROE): 35.77%

• Deepak Fertilisers and Petrochemicals Corporation Ltd

Deepak Fertilisers and Petrochemicals Corporation Ltd (DFPCL) is a major producer of fertilisers and industrial chemicals. It is a top producer of industrial chemicals in India. The company focuses on making high-quality chemicals that meet both domestic and international standards. Their product range includes Isopropyl Alcohol (IPA), Nitric Acid, Methanol, and Liquid Carbon Dioxide.

For the quarter ended June 2024, the company’s revenue increased to ₹452.16 crore from ₹442.76 crore in the preceding quarter. Meanwhile, the net profit decreased to ₹71.34 crore from ₹112.34 crore in the previous quarter. 

Key metrics: 

• EPS: ₹23.03
• ROE: 9.16%

• Coromandel International Ltd

Coromandel International Ltd is a major agri solutions provider in India, offering a wide range of products and services throughout the farming value chain. The company specialises in fertilisers, crop protection, bio-pesticides, speciality nutrients, and organic fertilisers. Coromandel sells various types of phosphatic fertilisers in India and holds about a 40% share in unique-grade fertiliser sales. The company is a key player in Andhra Pradesh and Telangana, the largest market for complex fertilisers in India.

For the quarter ended June 2024, the company’s revenue increased to ₹4,713.30 crore from ₹3,899.84 crore in the preceding quarter. Meanwhile, the net profit increased to ₹330.96 crore from ₹209.46 crore in the previous quarter. 

Key metrics: 

• EPS: ₹52.46
• ROE: 16.43%

• Rashtriya Chemicals and Fertilisers Ltd

Rashtriya Chemicals and Fertilisers Ltd  (RCF) is an Indian producer of chemicals and fertilisers, established in 1978 and operated by the Ministry of Chemicals and Fertilizers. The company makes a variety of products, including complex fertilisers, urea, bio-fertilizers, micro-nutrients, and soil conditioners from its plants in Trombay, Mumbai, and Thal, Raigad district. In addition to fertilisers, RCF also produces a range of industrial chemicals used in making leather, pharmaceuticals, solvents, dyes, and more.

For the quarter ended June 2024, the company’s revenue increased to ₹4,396.06 crore from ₹3,879.65 crore in the preceding quarter. Meanwhile, the net profit decreased to ₹10.73 crore from ₹97.65 crore in the previous quarter. 

Key metrics: 

• EPS: ₹3.09
• ROE: 3.69%

• Gujarat Narmada Valley Fertilizers & Chemicals Limited

Gujarat Narmada Valley Fertilizers & Chemicals Limited (GNFC) is a joint venture established by the Gujarat State Investments Limited (GSIL), a Government of Gujarat entity, and Gujarat State Fertilizers & Chemicals Ltd. (GSFC). GNFC mainly focuses on industrial chemicals and fertilisers, with a smaller presence in IT services. Its chemical division offers a range of bulk chemicals used to produce speciality chemicals and various end products for different industries.

For the quarter ended June 2024, the company’s revenue decreased to ₹2,021.00 crore from ₹2,110.00 crore in the preceding quarter. Meanwhile, the net profit decreased to ₹115.00 crore from ₹127.00 crore in the previous quarter. 

Key metrics: 

• EPS: ₹35.05
• ROE: 6.28%

Agriculture Sector Outlook

India’s agriculture sector is expected to grow steadily in the coming years, thanks to increased investments in infrastructure like irrigation, storage, and cold chains. Using genetically modified crops is also likely to boost farmers’ crop yields. Due to new, faster-growing pulse varieties and higher minimum support prices, India is projected to become self-sufficient in pulses soon.

Over the next 5 years, the government plans to invest $9 billion in the fisheries sector through the PM Matsya Sampada Yojana, aiming to increase fish production to 220 lakh tonnes by 2024-25. The food processing industry will benefit from adopting quality standards like ISO 9000, HACCP, and good manufacturing practices, which ensure food safety and quality.

The Ministry of Food Processing Industries (MoFPI) is actively encouraging more investment in food processing. The government has extended the PMKSY scheme, with a budget of Rs. 4,600 crore ($559.4 million) until March 2026.

Conclusion

These are the best agriculture stocks in September based on a 5-year CAGR. However, before making any investment decision, make sure to research the company’s financials, management, and past performance. 

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.