Chambal Fertilizers & Chemicals Limited — Investor Meet, 12-02-2025: Analysts/Institutional Investor Meet/Con. Call Updates

Financial Performance: Chambal Fertilisers reported a significant Q3 performance with a standalone EBITDA of ₹843 crore, up 16% from ₹724 crore year-on-year. Profit after tax (PAT) for the quarter increased 25% to ₹505 crore from ₹404 crore. Over nine months, EBITDA reached ₹2,619 crore, reflecting a 19% growth, while PAT grew 25% to ₹1,557 crore from ₹1,245 crore. Consolidated results also showed strength, with a PAT of ₹534 crore for Q3, up 16% YoY, and ₹1,519 crore for the nine-month period, increasing 29%.

Future Outlook and Growth Drivers: Management highlighted plans for expansion in the crop protection and specialty nutrients sectors with the introduction of new products planned for Kharif and Rabi 2025. Notably, the company is forging partnerships for innovation in biologicals and has established the CFCL-TERI Centre for Excellence, focusing on sustainable agricultural practices.

Order Book and Operational Updates: All urea units operated at optimal capacity, with urea production slightly down to 9.18 lakh metric tons, yet sales rose to 9.88 lakh metric tons. The company received approximately ₹3,350 crore in subsidies during Q3. An upcoming project in collaboration with IMACID will expand phosphoric acid production, expecting completion by 2027-28.

Analyst Q&A Insights: Analysts inquired about the DAP subsidy impact, with management indicating they had booked about 80-85% of the additional subsidy, while acknowledging tight margins in DAP trading. Questions regarding the TAN project generated discussion about domestic demand and expected contributions in FY 27, with management suggesting there would be an initial ramp-up period.

Strategic Focus Areas: Sustainability and innovation are central to Chambal’s strategy, focusing on efficient operations and expansion into seeds and biological products. Management expressed confidence in achieving a strong competitive position amidst evolving market dynamics.

Investor Insight: The financial results demonstrate robust growth and a proactive approach to sustainability and product expansion, aligning with a favorable investment outlook. Observations support a ‘buy’ position due to strong financial health and strategic initiatives.