The Indian fertiliser sector continues to thrive, supporting over 14 crore farming families by ensuring timely fertiliser availability and driving agricultural growth. The government’s proactive steps towards self-sufficiency, such as the revival of Urea capacities and the introduction of Nano fertilisers, are revolutionising the sector.
Additionally, initiatives like PM PRANAM, the NAMO Drone Didi scheme, and Model Retail outlets are enhancing sustainability and improving technology penetration, ensuring a robust future for Indian agriculture.
As we approach the upcoming budget with a larger focus on the agriculture sector, let’s take a closer look at the best fertiliser stocks to watch in January 2025. In this evolving landscape, we’ll focus on companies that have shown strong performance, particularly those leading the way with the best 5-year CAGR.
| Name | Market Cap (₹ Cr) | 5Y CAGR (%) | Net Profit Margin (%) | 1Y Return (%) | Debt to Equity | PE Ratio |
| Titan Biotech Ltd | 630.56 | 81.03 | 14.99 | 85.41 | 0.06 | 25.36 |
| Aries Agro Ltd (CN) | 382.07 | 35.03 | 2.87 | 38.36 | 0.28 | 19.66 |
| Rashtriya Chemicals and Fertilizers Ltd | 9,945.28 | 31.16 | 1.31 | 3.85 | 0.72 | 44.15 |
| Coromandel International Ltd | 56,825.22 | 29.54 | 7.37 | 54.59 | 0.05 | 34.6 |
| Dhanuka Agritech Ltd | 6,552.13 | 28.18 | 13.33 | 34.23 | 0.02 | 27.41 |
| Chambal Fertilisers and Chemicals Ltd | 20,178.85 | 26.89 | 6.97 | 32.49 | 0.24 | 15.82 |
| Insecticides (India) Ltd | 1,996.98 | 17.14 | 5.18 | 1.16 | 0.09 | 19.51 |
| Rallis India Ltd | 5,813.65 | 11.34 | 5.55 | 18.28 | 0.07 | 39.32 |
| Bharat Rasayan Ltd | 4,209.47 | 10.05 | 8.85 | 12.1 | 0.08 | 44.07 |
Note: The best fertiliser stocks listed here are as of January 02, 2025. The stocks are sorted based on their 5Y CAGR, with a debt-to-equity ratio of less than 0.75, positive year-to-date returns, and a positive net profit margin.
Titan Biotech Limited is a leading manufacturer and exporter of high-quality biological products, catering to sectors like nutraceuticals, pharmaceuticals, and agriculture.
For the quarter ending September 30, 2024, Titan Biotech reported a net profit of ₹669.51 lakh, compared to ₹652.15 lakh in Q2FY24. Revenue for Q2FY25 stood at ₹3939.11 lakh, down from ₹4342.71 lakh in Q2FY24.
Key metrics:
Aries Agro Limited, founded in 1969, is a leading manufacturer and exporter of specialised crop nutrients and micronutrients. The company offers a diverse range of agricultural products, including plant protection, water-soluble NPK, and organic fertilisers, with a focus on enhancing crop yields and quality.
For the quarter ending September 30, 2024, Aries Agro reported a net income of ₹18.87 crore, up from ₹4.75 crore in September 2023. The total revenue for September 2024 was ₹192 crore, compared to ₹156.57 crore in the same period last year.
Key metrics:
Rashtriya Chemicals and Fertilisers Limited (RCF) is a leading Indian producer of fertilisers and industrial chemicals, offering a wide range of products such as urea, complex fertilisers, bio-fertilisers, and micro-nutrients.
For the quarter ending September 30, 2024, RCF’s net profit surged by 55% year-on-year to ₹79 crore, compared to ₹51 crore in the same period last year. The company’s revenue from operations increased by 3.2% YoY, reaching ₹4,290 crore in September 2024, up from ₹4,155.2 crore in September 2023.
Key metrics:
Coromandel International Limited is a leading player in India’s agri-solutions sector, specialising in fertilisers, crop protection, specialty nutrients, and retail services.
For the quarter ending September 30, 2024, Coromandel International reported a 12.3% year-on-year decline in net profit to ₹664 crore, while revenue increased by 6.4% to ₹7,432.8 crore. Despite higher revenues, the company experienced a decline in EBITDA by 7.9%, reaching ₹974.8 crore.
Key metrics:
Dhanuka Agritech Limited is a leading Indian agri-input company, specialising in crop protection products, with a strong R&D division and a wide distribution network.
Dhanuka Agritech reported a 15.5% increase in net profit, reaching ₹117.52 crore for Q2 FY 2024-25, driven by higher sales. The company also saw robust demand, supported by a strong sowing season and favourable monsoon forecasts.
Key metrics:
Fertiliser stocks are strongly impacted by government policies, including subsidies, pricing regulations, and import/export controls. Any alterations to these policies can substantially affect the profitability of fertiliser companies.
The cost structure of fertiliser companies is influenced by fluctuations in the prices of key raw materials, such as natural gas, potash, and phosphates. These price variations can have a direct effect on the financial performance of these companies.
Advances in fertiliser production, such as the development of new formulations and enhanced manufacturing processes, can affect the competitiveness and profitability of companies in the sector.
The fertiliser industry experiences seasonal demand, with peak usage occurring during planting seasons. Consequently, companies may experience fluctuations in earnings and stock prices, depending on the agricultural calendar.
Before investing, assess the competitive environment within the fertiliser sector. This includes examining the market share of leading companies, reviewing fertiliser share price trends, and understanding the production capacity of various players.
The growth and shifts within the agricultural sector play a significant role in fertiliser demand. Stay informed on crop production cycles, pricing trends, and government agricultural policies, as these factors directly influence fertiliser consumption.
The broader market environment and economic indicators are critical when evaluating fertiliser stocks. Regularly monitor the overall market conditions and stay updated on news and developments within the fertiliser sector to make well-informed investment decisions.
Before investing in fertiliser stocks, it is crucial to carefully assess each company’s financial health, market position, growth potential, and associated risks. Aligning these factors with broader investment objectives can help in making informed decisions within the dynamic and ever-evolving fertiliser industry. Additionally, consulting with a financial advisor can provide valuable insights and guidance tailored to individual investment goals.
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.
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