Shares of fertilizer companies have witnessed a notable surge in the past week, further extending their gains on October 16. The rise in stock prices can be attributed to the escalating fertilizer prices driven by the ongoing Israel-Hamas conflict.
Companies such as Gujarat State Fertilizers & Chemicals Limited (GSFC), The Fertilisers And Chemicals Travancore Limited (FACT) Gujarat Narmada Valley Fertilizers & Chemicals (GNFC), and Madras Fertilizers have seen substantial gains, ranging from 9 percent to 25 percent over the last five days.
At 12:52 pm, GFSC rose by 12.34 percent to Rs 209.9, FACT gained by 18.83 percent to Rs 651.45, Madras Fertilizer rose by 11.16 percent to Rs 85.15 and GNFC went up by 5.69 percent to Rs 671.
The Israel-Hamas war has raised concerns regarding the global supply chain of potash fertilizer. Ashdod Port, a significant hub for Israel's potash fertilizer exports located north of Gaza, is now operating in an emergency mode due to the conflict. The situation places about 3 percent of the global potash supply at risk, Bloomberg reported citing a note from Ben Isaacson, an analyst from Scotiabank.
GSFC in its June quarterly results reported a 67 percent YoY slide in net profit.
In spite of this, fertilizer stocks have performed quite well outside of the recent upswing, with the majority of the stocks rising by 21 percent and 95 percent during the last six months.
Disclaimer: The views and investment tips expressed by experts on Moneycontrol are their own and not those of the website or its management. Moneycontrol advises users to check with certified experts before taking any investment decisions.
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