In its first cabinet meeting for the new year 2025, the Prime Minister announced key measures for farmers with a special package for companies manufacturing DAP (Di-Ammonium Phosphate) fertiliser and giving financial assistance for DAP producers.
The government has approved financial support for DAP fertiliser producers to offset the rising costs of raw materials aiming to provide better financial security and also improving the crop insurance scheme. This package will remain effective for one year till the end of December 31, 2025. Di-ammonium phosphate is a widely used chemical fertiliser essential for enhancing soil fertility and crop yield.
DAP boosts root development in the early stages of crops, enhances soil nutrient levels, and supports higher crop yields, especially in phosphorus-deficient soils. Since the country imports a significant portion of its DAP fertiliser requirements from abroad, rising raw material prices in the international market often lead to higher costs. To alleviate this burden, the government provides subsidies to make fertilisers more affordable for farmers.
Shree Pushkar Chemicals and Fertilisers Ltd was established in 1993 and is a leading manufacturer of dyes, dye intermediates, and fertilisers. It has recently ventured into the manufacture of Reactive Dyes and Textile chemicals making the company a one-stop shop for the Textile effects industry. It also manufactures a range of Fertilisers and Soil conditioners. The fertiliser product portfolio of the company is producing single super phosphate, NPK, and sulphate of potash at its manufacturing facilities located in Maharashtra and Haryana.
Shree Pushkar closed the second quarter of FY25 showing a steady execution and focusing on operational efficiencies, navigating challenges and opportunities available in the chemical and fertiliser industry. The chemical division posted a sales volume of 15510 metric tonnes while the fertiliser division posted a sales volume of 60896 metric tonnes. Combining both the performances of total sales volumes at 76406 metric tonnes this showed a rise of 16.2% on a year-on-year basis. A key highlight of the company’s financial strategy is the non-lien deposit facility standing at Rs 141 crores which provides additional liquidity and flexibility.
Net profit for Q2FY25 improved by 57.5% year-on-year basis to reach Rs 13.3 crores resulting in a net profit margin of 7.6%.
The company reported consolidated earnings of Rs 175.6 crores in Q2FY25 with EBITDA at Rs 19.1 crores posting a year-on-year improvement of 36.7% with EBITDA margins of 10.9%. The company is quite bullish over the next 12–15 months with EBITDA margin set to improve going forward along with planned capital expenditure taking place over the next few quarters.
Other measures such as low debt on its books, higher volumes, and various other cost-cutting measures should result in profit after tax improving substantially in FY26. A disciplined approach to financial management by the company is quite evident thereby enhancing liquidity for strategic investment. The company has prioritised growth by investing Rs 68 crores in its operational capabilities further. The management of Shree Pushkar Chemicals and Fertilisers is very optimistic over the next two years, expecting a sales turnover of around Rs 1000 crores during FY26 and Rs 1400 crores in FY27 on an EBITDA margin of around 14–15%.
The stock price of Shree Pushkar Chemicals and Fertilisers Ltd is quoting around Rs 275 on the bourses and is a long-term portfolio stock. It can be purchased for an 18-month investment time horizon for fantastic gains. Investors should remember that this is a very small-cap stock and should consider all the risks associated with such stocks and carefully consider the purchase
decision.