Gujarat State Fertilizers & Chemicals LimitedChemicalsGSFC
Q1 FY27 concall · earnings callGujarat State Fertilizers & Chemicals Limited
Record Q1 revenue was driven by high fertilizer sales, but profitability was pressured by unprecedented raw material inflation, particularly in sulfur.
Numbers
| Metric | This quarter | Change | Five-quarter trend |
|---|---|---|---|
| Consolidated Sales | ₹3,583 Cr | 64% | |
| Profit After Tax (PAT) | ₹159 Cr | 14% | |
| Fertilizer Segment Sales | ₹2,947 Cr | 82% | |
| Fertilizer Volume | 5.26 lakh metric tons | 17% | |
| Fertilizer EBIT Margin | 4.09% | — |
Financials
From filed quarterly results. YoY and QoQ compare each metric on the same accounting basis.
| Quarter | Revenue | Net profit (PAT) | Basic EPS |
|---|---|---|---|
| Q3 FY25 | ₹2,814.07 Cr+40.2% YoY+6.8% QoQ | ₹133.85 Cr+13.4% YoY-55.1% QoQ | ₹3.36+13.1% YoY-55.8% QoQ |
| Q2 FY25 | ₹2,635.17 Cr-15.5% YoY+21.9% QoQ | ₹298.23 Cr-3.5% YoY+241.5% QoQ | ₹7.60-1.9% YoY+247% QoQ |
| Q1 FY25 | ₹2,162.53 Cr+4.8% YoY+10% QoQ | ₹87.32 Cr-22.4% YoY+284.5% QoQ | ₹2.19-22.3% YoY+247.6% QoQ |
| Q4 FY24 | ₹1,965.25 Cr-17.6% YoY-2.1% QoQ | ₹22.71 Cr-89.9% YoY-80.8% QoQ | ₹0.63-88.8% YoY-78.8% QoQ |
| Q3 FY24 | ₹2,007.75 Cr-42.3% YoY-35.6% QoQ | ₹117.99 Cr-71.2% YoY-61.8% QoQ | ₹2.97-71.1% YoY-61.7% QoQ |
TL;DR
- Consolidated sales increased 64% YoY to INR3,583 Cr, with PAT up 14% to INR159 Cr.
- Fertilizer segment saw sales volume up 17% YoY, but EBIT margin compressed from 8.49% to 4.09% due to raw material inflation.
- Industrial Products segment delivered strong performance with 15% sales growth and a more than fourfold increase in EBIT.
- Raw material costs, especially sulfur (up 231% YoY), are a major concern and are expected to influence industry product mix.
- The company maintains a strong balance sheet with no long-term debt and is executing strategic capex projects.
Said on the call
“Sulfur prices has been now more than $1,000 a metric ton in the international market... it is continuously increasing. That is a very dangerous trend.”
From the Q&A
| Topic | What management said |
|---|---|
| Raw Material Inflation Impact | Management highlighted severe and continuing inflation in key inputs like sulfur (now >$1000/MT), P2O5, and ammonia, which compressed fertilizer margins; they are switching product mix and sourcing imports to manage. |
| Government Subsidy for NPK | Management expressed hope for a subsidy increase for NPK fertilizers when new rates are announced from October 1st, to help offset raw material cost increases. |
| Demand Outlook and Constraints | Management sees no major demand problem but notes product scarcity due to industry operating below capacity; the revival of monsoon has improved the demand outlook for the upcoming rabi season. |
| Capex and New Projects | The APS capacity enhancement project at Sikka is on schedule for commissioning within a month or two; a phosphoric and sulfuric acid project is also planned, with tender received. |
| Industrial Products Sustainability | The caprolactam-benzene spread is currently comfortable (>$800), supporting chemical segment profits; melamine production was nil due to high costs and cheap Chinese imports, with the company seeking government support. |
| Cash Position and Subsidy | The company had INR500 crores in borrowings at June-end due to strategic inventory build-up and working capital needs; outstanding subsidy dues are around INR500 crores. |
Guidance
- Fertilizer sales are budgeted to be more than 22 lakh metric tons for FY27.
- Elevated input costs, particularly for sulphur and phosphoric acid, are expected to influence industry product mix with demand likely to remain skewed towards DAP.
- The caprolactam-benzene spread is expected to remain stable to soft in the near term amid continued volatility in crude oil prices and geopolitical uncertainties.
Source
Summary written from the transcript filed by Gujarat State Fertilizers & Chemicals Limited for the call held on 13 Aug 2025; published 22 Aug 2026, 10:22 IST.
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