Shares of this Public Sector Undertaking (PSU) stock under the ‘small-cap’ category gained up to 3 percent in Wednesday’s trading session after the company’s Board approved the setting up of a Nano Urea production plant.
With a market capitalization of Rs 4,077.69 crores, the stocks of National Fertilizers Limited (NFL), the second largest Urea player in India, opened their trading hour on Wednesday at Rs 84.10 and currently trade at Rs 83.12.
The company’s scrip witnessed an intra-day high of Rs 85.33 indicating a gain of approximately 3 percent compared to the previous close of Rs 83.08. The scrip is inching towards its 52-week high price registered at Rs 89.69 apiece.
The stock price traded in the green after the company, through a regulatory filing with the Bombay Stock Exchange (BSE), intimated that its Board of Directors, in a meeting held on 19th December 2023, approved the setting up of ‘Nano Urea’ production plant based on the financial viability in Techno-Economic – Feasibility Report.
During the recent financial quarters, the company’s prime business indicators such as operating revenues and after-tax profits showed favourable movements.
The former increased rapidly from Rs 5,051.23 crores during Q1FY23-24 to Rs 5,659.64 crores during Q2FY23-24, and, the latter, keeping the timeframe the same, reduced its losses from Rs 143.93 crores to Rs 113.1 crores.
Due to positive financial conditions on a YoY basis, the company’s profitability ratios were reported in the green in FY22-23 with the return on equity (RoE) reported at 19.84 percent and the return on capital employed (RoCE) at 15.61 percent.
As per the recent presentations of the company, the ‘own fertilizers’ business segment constitutes approximately 66 percent of the total revenue earned by the company.
To ensure self-sufficiency in the agrochemicals business, the company, as per the latest annual report, shares plans to manufacture facilities for agrochemicals with a total capex of approximately Rs 13 crores.
National Fertilizers Limited is engaged in the business of manufacturing chemicals as well as providing agriculture extension services for educating farmers on fertilizers and know-how on scientific methods associated with cultivation. Having sole operations within India, the company’s operating segments include own fertilizers, fertilizer trading, and others.
Written by Amit Madnani
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