Fertiliser stocks including state-run National Fertilisers (NFL), Chambal Fertilisers, RCF and others zoomed up to 9 percent in September 18 trade after Union Cabinet approved Rs 24,475 crore subsidy on phosphatic and potassic (P&K) fertilisers for the rabi season of 2024-25.
The Union Cabinet, chaired by Prime Minister Narendra Modi in Wednesday's cabinet meet approved the Nutrient Based Subsidy (NBS) rates for rabi season 2024 (from October 2024 to March 2025) on P&K fertilizers which will ensure supply of crop nutrients to farmers at affordable rates.
A benefit of the subsidy is that availability of fertilisers to farmers at subsidised, affordable and reasonable prices will be ensured.
Reports of government subsidy for the Rabi season provided a boost to stocks of companies in the fertilizer sector, with shares soaring during an otherwise choppy trading session today.
Investors anticipate better performance and profitability with the subsidy in place, the cost of fertilisers for farmers will be reduced, leading to an increase in demand. Farmers will be more inclined to purchase these fertilisers, anticipating higher yields in the rabi season.
Chambal Fertilisers and Chemicals share price settled at Rs 520 per share, up 0.13 percent on the NSE in today's trade. During the day, it made an intraday high of Rs 525.85 apiece on the NSE, rising 1.26 percent.
Fertilisers And Chemicals Travancore Ltd stock rose 5.40 percent to an intraday high of Rs 1,029.95 apiece. The counter settled 2.95 percent higher at Rs 1,006 per share on the NSE.
Rashtriya Chemicals and Fertilizers Ltd share price touched an intraday high of Rs 194.59 apiece on the NSE, zooming 4.39 percent. The stock gained after two days of consecutive fall and settled at Rs 193.65 per share on the NSE, rising 3.89 percent.
National Fertilizers Limited stock made an intraday high of Rs 138.8 per share on the NSE, rising 8.98 percent. The counter gained after fall in the last two trading session.
Other stocks such as Deepak Fertilizers (up 6.23 percent), Madras Fertilizers (up 3.96 percent), Gujarat State Fertilizers & Chemicals (up 0.77 percent) were also trading with strong gains.
Fertiliser companies might experience better profit margins due to increased demand and the ability to maintain stable prices, thanks to the subsidy.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
Find the best of Al News in one place, specially curated for you every weekend.
Stay on top of the latest tech trends and biggest startup news.
