Growth masks margin squeeze; subsidy revision now critical

Revenue +15.9%, but volumes down 9-10%, EBITDA flat ₹761Cr vs ₹782Cr, PAT -24%

Actual results match claim: ₹870Cr revenue, ₹159Cr EBIT confirmed in numbers

Consumption was stable, farmers picked lower MRP stocks early; point-of-sales up 13% to 7.9L tons

Q1 shows margin compression, not expansion. Target is aspirational; depends on subsidy revision & input price normalization not yet delivered

Prior call: '10% subsidy increase'. Q1 reality: rates announced without Middle East crisis factoring. NP/NPK rates do not fully compensate for ammonia, sulphur spikes. Industry production/imports down 21%/38%.

Prior call: uncertainty on raw material trends. Q1 reality: ammonia/sulphur remain elevated. Phosphoric acid settled Q2 @ $1,700 vs $1,360 Q1 (+25%). Management expects sulphur to stay high 'for some time'.

Prior call: optimism on exports. Q1 reality: +20% revenue to ₹870Cr, EBIT +44% to ₹159Cr. Strong pricing power vs cost inflation; product mix improved.

PA-SA plants commissioned as planned; operations stabilized. Rock phosphate mining (Senegal) producing 1.1L tons (on plan). Granulation on track for Q4. EBITDA/ton uplift deferred to normalized cost environment.

No shortage. Farmers picked up low MRP packs early season; slowdown in monsoon caused slowdown in purchase. Industry taken price actions; subsidy revision now needed to sustain production.

Industry taken max price actions. Beyond that, subsidy revision required. Represented to govt; hopeful outcome coming.

3-4 new 9(3) products yearly; 3-4 year pipeline visibility. Latin America presence light now; post-project, plan volume increase via combination products and on-ground presence.

Separate tracks. PA-SA commission handles 60% acid need, comfortable on imports. CDMO organic path via launch plant at Ankleshwar; focus on fluorination for agrochemicals first, then scale to other sectors.

Follow netting principle, net exposure basis. No more than 5-6% of overall EBITDA attributable to forex.

I wish we can do that.

Completing investments, want cash generation first. 8-9M tons nutrient capacity visibility for 2 years ahead. Evaluating MAP plant (Kakinada), purified phos acid for battery chemicals. Fertilizer capex deferred; land acquisition ongoing with Andhra Pradesh govt.

Current portfolio reached reasonable EBITDA level. Moving from 3-4% to 7-8% to 10-11% stages. Further upside requires new products (2-3 year lag). Pursuing intermediates, CDMO to improve margins beyond efficiency gains.

NACL molecules saw price moderation to global MNCs. Coromandel ability to pass through higher input costs realized better pricing. Reflects product mix difference between two entities.

Against expectations, holding high. Likely remain high 'some time' but not sustainable. EV battery demand (nickel leaching) structural shift. These exorbitant levels should soften but may take while. Decided to stay out at these prices; doesn't make economic sense.

Things change; focused on realizing value from INR7,000Cr invested last 3-4 years. Normal sustainable capex INR300Cr annually, but opportunities-based.

No shift happening. DAP high-P (INR1,350/bag) vs 20:20 low-P (INR2,100) doesn't reflect balanced nutrition. If subsidy not corrected for NPK, could have demand destruction risk. Current artificial pricing also impacting. DAP not available beyond volumes; govt encouraging alternates like SSP, organic.

Consolidated depreciation includes mining amortization (overfurden). PA-SA capex depreciation ~INR16-18Cr, NACL intangible amortization ~INR20-21Cr, mining charges ~INR30Cr. Not due to capex alone; mainly mining/amortization expenses.

Will get back to you on specifics.

Witnessed pilot in retail store. QR code links farmer to farm holding/crop type; recommends Urea/DAP/NPK dosage to retailer POS. Farmer restricted to prescribed bags. Win-win: reduces govt subsidy, farmer ensures no N overuse, removes channel arbitrage. Pilot in 10-12 states, 2-3 districts each (Telangana, Karnataka major districts).

BMCC mining costs amortized below EBITDA in depreciation line. So consolidated EBITDA shows mining profit, but after amortization, net impact ~INR30Cr. This gap primarily from BMCC.

Should do that definitely. Will try to put those in.

25-30% price increase already done across grades this year. Beyond this, impossible; has to come from subsidy. Global raw materials correcting slightly (urea $900→down, ammonia softening, sulphur coming off), but industry calibrated purchases to avoid high-cost carryover. Further price increase not doable.

Global agri commodity prices softening, farmer affordability down, cheaper alternatives sought, specialties pushed back. Certain molecules Coromandel deals in not from China; China keeps AIs low, intermediates high. Some markets can absorb price increases. Focusing on B2B exports now; aiming B2C via brands & combinations long-term. AI prices better than earlier.

100%. Otherwise doesn't make economic sense for production. Domestic capacities cannot afford to produce at high sulphur/ammonia prices. Critical for subsidy rates to get revised; else production impact Q2 as well.

Ideally yes, but UP and Maharashtra state bans put hold on demand. Without bans, volumes would pick up significantly. Good global response; started exports last quarter. Coming quarters will focus on international Nano business once registrations complete. Nano DAP working well, confident in product.

Let subsidy come then derive EBITDA per ton. Seeking 6-month average rate per policy, not ad-hoc. No plant can sustain this cost increase in global environment without policy-defined average.

Urea and DAP will be curtailed under QR framework. Ideally should increase NP/NPK demand (better balanced nutrition), but not yet happening at scale.

Just completing capacity expansion. Want to focus on cash generation. Won't add AI capacities (spare in NACL available); leverage capacity between both plants. Investment more toward marketing, brand building, channel network vs asset creation.

Operating plant at target 5L tons rock phosphate production per plan. Want to invest in SSP facility (doesn't cost much $5-6M for 100-150K tons). Huge opportunity using reject rocks; adds value on phosphate in Senegal, can export regionally. If successful at smaller scale, may expand to capture more value in Senegal.

Pressure on overall subsidy bill across categories. Govt cost-passes Urea fully (higher gas prices), DAP compensated fully. Pushback on NP/NPK due to budget constraints. Industry represented; awaiting outcome.

Capacity 750K tons. Want to sell 50% via retail outlets (increasing footprint Maharashtra, Tamil Nadu, Andhra Pradesh, Telangana). Balance 50% (350-400K tons) seeding markets UP, Rajasthan, MP, Chhattisgarh. No challenge in absorbing additional volume.

Seeking policy-defined 6-month average rate for NBS, not ad-hoc subsidy like DAP/Urea. NP/NPK predominantly produced in India. Not asking for additional support; seeking what policy defines.

Average EBITDA per ton needs to go from INR5,000 to INR6,500. Rest of capex toward Senegal or CP new capacity. CP margins show payback <3 years on some capex.

No separate number provided. Continuously growing topline 25-30%, EBITDA margin 20%. Sulphur expansion not helped yet due to current situation (temporary). Pursuing MAP plant, seaweed/gypsum granulation. Business growing well.

INR2,500 to INR3,000 per ton.

Focusing agri drones, gained good traction. Coromandel purchased 100-150 drones Q1, plan 500-drone fleet during year. Dhaksha will cater to agri-drones. Defense orders in final stage; once materialize, scale up. Not very significant EBITDA drag currently.

Yes, once commercialize plant in steady state in normal situation. Don't expect this quarter (spurt in input prices). Once normalcy restores, should realize it.

Given phosphoric acid at $1,700, at least want $800 sulphur pricing.

Post PA-SA/granulation commissioning. Excludes unforeseen subsidy/geopolitical shocks. Includes fertilizer + SSP + organic + Urea + imported DAP.

Timeline: 2-3 year horizon. Dependent on successful molecule positioning and MNC partnerships (CDMO strategy underway).

Market seeding already underway. No absorption challenge flagged. Organic network expansion model (low capex).

Dependent on subsidy rate normalization and input cost stabilization. Q1 shows compression, not expansion. Management cautious: 'don't ask for this quarter; normal situation required'.

Contingent on continued export momentum and ability to pass-through raw material inflation (demonstrated Q1).

Dependent on farmer adoption of water-soluble grades (drip irrigation uptake) and premium product mix (granulation launches).

Maintenance + selective opportunities. Last 3-4 years invested INR7,000Cr (organic + NACL inorganic); focus now on cash generation from these assets.

Strategic to utilize reject rocks and capture value addition in Senegal. Decision point tied to pilot results.

Timing flexible; dependent on market conditions and internal cash generation priorities.

Government NBS subsidy rates (10% increase announced) do not factor Middle East crisis raw material inflation (ammonia, sulphur). NP/NPK rates inadequate; management seeking 6-month average per policy but revision pending. Without revision, fertilizer EBITDA unsustainable; further production cuts likely.

Sulphur, ammonia, phosphoric acid prices elevated due to West Asia geopolitical disruptions and supply cuts by major manufacturers. Phosphoric acid Q2 settled at $1,700 (vs $1,360 Q1, +25%). Sulphur expected to remain high 'for some time.' Price pass-through limited by subsidy cap and farmer affordability.

Fertilizer sales volumes moderated 9-10% Q1 despite company market share gains (22% primary vs 18%). Production throttled to 72% capacity utilization. Risk: if subsidy not revised and prices further hiked, demand destruction among price-sensitive farmers; could exceed current 10% volume decline.

India experienced 23% deficit rainfall (long-period average) in Q1. Reservoir levels 34% of capacity vs 57% prior year. While sowing improved in July (deficit moderated to 17%), continued drought risk could dampen kharif demand and fertilizer offtake in Q2.

Nano DAP and Nano Urea banned by state governments in UP and Maharashtra (major agricultural states). Constrains adoption of these alternate fertilizers despite strong farmer response and subsidy cost-saving potential. Risk: further state-level bans or delayed approval could cap Nano category growth.