What are Fertiliser Stocks?

Given that agriculture is the primary source of Income for 58% of India's population, agricultural inputs, like fertilisers, are critical. It is responsible for the production of the most significant agricultural resources.

Due to the rising and indiscriminate use of fertilisers for improved yields and feeding India's rapidly growing population, the Fertilisers Industry is booming. Furthermore, the government has allocated $19 billion in the Union Budget 2022-23 to compensate fertiliser businesses that sell their products to farmers at below-Market prices.

Due to all these factors, Investing in fertiliser stocks can be pretty beneficial. In this article, there is a list of the most excellent fertiliser firms in India with the best stock returns.

India's Best Fertiliser Stocks

The fertiliser industry is one that the Indian Economy cannot afford to overlook, given the importance of agriculture. Agriculture's contribution to GDP climbed to 19.9% in 2020-21, up from 17.8% in 2019-20. The contribution was last at this level in 2003-04. Here are the 11 best fertiliser stocks in India:

1. Chambal Fertilisers and Chemicals

Chambal Fertilisers and Chemicals is a company that produces urea and di-ammonium phosphate. It is the private sector's largest urea producer, with a capacity of 1.5 million tonnes per year.

The company's segments include the following:

• Fertilisers and other agricultural inputs
• Own-manufactured textiles
• Phosphoric acid
• Shipping,
• And other operations

It worked in the software business as well. However, to end software activities in 2021, the corporation liquidated assets and transferred substantial responsibilities. The company's nationwide distribution network has 3,700 dealers and 50,000 merchants.

It operates in the following states:

• J&K
• Haryana
• Uttarakhand
• Punjab
• Uttar Pradesh
• Bihar
• West Bengal
• Madhya Pradesh
• Rajasthan

It has access to 90% of the country's overall fertiliser market.

2. Coromandel International

The Murugappa Group owns Coromandel International. The company represents the following:

• Auto components
• Abrasives
• Financial services
• Transmission systems
• Cycles
• Sugars
• Agriculture inputs
• Fertilisers
• Plantations,
• And other sectors

In India, the company is a leading agri-solutions provider. It offers a diverse Range of products and services across the farming Value Chain. Its specialisations include fertilisers, bio-pesticides, crop protein, speciality nutrients, organic fertilisers, and other items. The company has a market development team of over 2,000 individuals and sells its products through a network of 20,000 dealers.

It operates 16 Manufacturing facilities in India, including in the following states:

• Tamil Nadu
• Karnataka
• Andhra Pradesh
• Maharashtra,
• And other states

The company's profitability prospects appear to be favourable because of the predicted growth in the Rabi season.

3. Rama Phosphates (RPL)

Rama Phosphates (RPL) is an Indian phosphatic fertiliser company specialising in Single Super Phosphate (SSP) fertilisers. The company also produces the following:

• Oleum
• Nitrogen, Phosphorous, and Potassium (NPK),
• De-oiled cake
• Soya oil

The company's signature brands, 'Suryaphool' and 'Girnar,' are well-known among farmers. In the third quarter of 2021, Rama Phosphates' net profit climbed by 101.1% to 227.2 million, up from 113 million in the previous quarter of 2020. The company's outstanding performance was aided by higher operational revenue.

4. Dharamsi Morarji Chemical Company

Dharamsi Morarji Chemical Company produces bulk and specialised chemicals for various industries, including pharmaceuticals, detergents, and dyes. This small cap firm was one of India's first to produce sulphuric acid and phosphate fertilisers.

It is a multi-product, multi-locational company that has grown to be India's largest producer of SSP and a major manufacturer of heavy chemicals. It operates two manufacturing facilities in Roha and Dahej. Among the company's major clients are:

• Alkyl Amines
• IPCA
• Apcotex
• Aurobindo
• Dow
• Deepak Nitrite
• Pidilite
• And others

5. Deepak Fertilisers and Petrochemicals

Deepak Fertilisers and Petrochemicals is a crop nutrition, chemical, and fertiliser company based in India. It has Real Estate holdings as well. The company has been selling fertilisers under the 'Mahadhan' brand since 1990.

Deepak Fertilisers is a significant chemical business in India. The company produces the following:

• Technical ammonium nitrate (mine chemicals)
• Industrial chemicals
• Crop nutrition

These things are used in:

• Explosives
• Mining
• Infrastructure
• Healthcare

As per Deepak Fertilisers' Smartchem Technologies, an entirely owned subsidiary, Odisha's Chief Minister Naveen Patnaik recently laid the foundation for a 22 billion technical ammonium nitrate complex. The 377-kilo tonne annual capacity project, developed at the Gopalpur Industrial Park, is expected to be operational by August 2024.

5. Basant Agro Tech (India)

Basant Agro Tech (India) Ltd. (BASANTGL), based in India, is among the best-performing fertiliser stocks for 2022. The Agricultural Inputs industrial sub-sector includes the Basic Materials industry.

Basant Agro Tech's price has moved by 62.63% from the start of 2022, based on the previous year's closing price of Rs. 14.45 per share and a year-to-date closing price of Rs. 23.5 per share as of writing. During the same period, the company's market capitalisation increased from $1.31 billion to $2.13 billion. In addition to fertilisers, the company also sells basic materials, agricultural inputs, and chemicals, among other products and services.

6. Bharat Agri Fert & Realty

Bharat Agri Fert & Realty Ltd. (BHARATAGRI) successfully earned YTD returns of 58.44% during the given months of the year 2022. This helped it gain the number two spot on the list of the best-performing companies that earned the highest returns for the year 2022 to date.

The India-based Bharat Agri Fert & Realty shares closed for 288 per share in December of the previous year, and it traded for Rs. 456.3 per share on June 1, 2022. During the same YTD period, the company's market valuation increased from $1.52 billion to $2.41 billion. The company is categorised as a business in the Basic Materials industry area, focusing on Agricultural Inputs.

7. Gujarat Narmada Valley Fertilisers & Chemicals

Gujarat Narmada Valley Fertilisers & Chemicals Ltd. (GNFC) is a Basic Materials sector company based in India and belongs to the Chemicals industrial sub-sector. Based on the previous year's closing price of Rs. 440.65 per share and a year-to-date price of Rs. 679.3 per share, the stock of Gujarat Narmada Valley Fertilisers & Chemicals has gained 54.16% since the start of the year 2022. During the same period, the company's market capitalisation increased from $68.49 billion to $105.58 billion.

8. Mangalore Chemicals & Fertilisers

Mangalore Chemicals & Fertilisers Ltd.'s stock price has risen from Rs. 71.45 per share at the end of December last year to Rs. 89.8 per share at the time of writing. During the period under consideration, the stock achieved a price change of 25.68%.

The market capitalisation of the India-based Basic Materials sector company increased from $8.47 billion to $10.64 billion as a result. The company outperformed the returns provided by some of the most famous stock market indices, ranking among the top 10 best-performing equities in the Fertilisers sector.

9. Rashtriya Chemicals & Fertilisers

Rashtriya Chemicals & Fertilisers Ltd. (RCF) was successful in generating YTD returns of 25.07% based on the market-cap change from $42.04 billion to $52.58 billion during the given months of the year 2022 and the share price change from Rs. 76.2 per share to a price of Rs. 95.3 per share as of Jun 1, 2022.

Rashtriya Chemicals & Fertilisers, situated in India, is designated as the Agricultural Inputs sub-sector firm, which falls within the wider Basic Materials sector, and is ranked number eight in the top-performing list of Fertilisers stocks.

10. Meghmani Organics Ltd

Meghmani Organics Ltd (MOL) has produced a year-to-date return of 20.72% in 2022. Its returns are calculated using the share price, which increased from Rs. 110.5 per share at the end of the previous year to Rs. 133.4 per share on June 1, 2022. During the same period, the company's market capitalisation increased from $28.1 billion to $33.94 billion.

The company is classified as a Basic Materials speciality business, with a further sub-category of Agricultural Inputs. The Fertilisers sector, based in Ahmedabad, India, has outperformed some of the closely followed stock market indices in terms of YTD performance.

Conclusion

Agribusiness is a vital industry that also provides tremendous financial opportunities. Agricultural stocks, on the other hand, are not all the same. Each company has its own issues to deal with. Consider the field of agritech, which has enormous untapped potential. Although yet, in its infancy, agritech will undoubtedly alter how agriculture is conducted.

Finally, the stock you select must be trustworthy when it comes to investing. Investors should invest in a company with a proven track record of success. If there isn't enough faith in the stock, the initial investment will be weak and will be depleted before it has an opportunity to expand.

Frequently Asked Questions (FAQs)

1. Is it wise to invest in fertiliser stocks?

A: Stocks of fertiliser are rising due to robust agricultural markets and supply disruptions. Traders and experts do not believe that current Financial Performance is sustainable, and thus stocks remain cheap. If analysts begin to revise their forecasts for 2023 and beyond, multiple expansions are possible.

2. What does the fertiliser industry's future hold?

A: From 2022 to 2030, the Fertilizer Market would increase at a CAGR of 2.6%, surpassing USD 190 billion. The growing population and changing food patterns in both developed and emerging countries will help the fertiliser industry's expansion in the future years.

3. Why is there an expansion of India's fertiliser industry?

A: As the fertiliser industry relies on raw commodities such as coal, petroleum, and natural gas, it is close to them. India is a predominantly agricultural nation. As a result, fertilisers are in high demand. Fertiliser can be transferred to distant locations via pipes, causing it to spread.

4. Is liquid fertiliser better than granular fertiliser?

A: Liquid fertilisers also have a lower salt concentration, which is why they are often used as starting fertilisers. Granular fertilisers have a higher salt content than liquid fertilisers, which causes roots to avoid them—mainly if they include a lot of nitrogen and potassium.