National Fertilizers reaps a rich harvest

National Fertilizers Ltd (NFL) is a Mini ratna PSU and producer of chemical fertilizers, organic fertilizers and industrial chemicals. The stock price hit a new 52-week high today at Rs.35.55 and continues to remain firmly in the green.

This sudden spike of interest for NFL is on the back of its robust turnaround performance for Q4 and FY16. For Q4FY16, the company posted a net profit of Rs.31 crore v/s loss of Rs.101 crore in previous Q4. The company stated that it clocked the highest very production - 9.76 lakh metric tonne v/s 7.61 lakh metric tonne, up 28% sequentially, with lowest energy consumption for urea.

The gas pooling policy initiated by the Govt also helped this turnaround. The gas pooling, more than reduction in fuel cost, helped bring down outstanding subsidy bill which resulted in interest gain – its interest cost was down 33% (YoY) at Rs.110 crore. Capacity utilization of 118% also helped ramp up production.