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HomePosts Tagged "Deepak Fertilisers and Petrochemicals Corporation Limited"
Agribusiness, Agro chems – Fertilizers, Company News, Finance, India

Company’s Crop Nutrition Business (CNB) achieved a remarkable 83 per cent YoY increase in sales volume of manufactured bulk fertilizer, which is highest ever sales.

Deepak Fertilisers and Petrochemicals Corporation Limited (DFPCL), one of India’s leading producers of industrial and mining chemicals and fertilisers, announced its results for the quarter ended September 30, 2024. Company’ s EBITDA Margin improved to 18 per cent compared to 12 per cent year-over-year. Company’s Crop Nutrition Business (CNB) achieved a remarkable 83 per cent YoY increase in sales volume of manufactured bulk fertilizer, which is the highest ever sales.

Commenting on the performance, Sailesh C. Mehta, Chairman & Managing Director said, DFPCL has shown impressive performance in Q2 FY25, achieving a 13 per cent growth in revenue. This growth was primarily driven by the Crop Nutrition business, which experienced an 18 per cent YoY increase in revenue, while the Chemical business grew by 8 per cent YoY despite a lean quarter for the chemical sectors.

“Fertilizer and Chemical businesses acted as a natural hedge, enabling the company to deliver consistent and improved performance.

“There has been a consistent increase in the proportion of revenue from specialty products, along with an overall rise in revenue, driven by the strategic move of transitioning from commodity to specialty,” says Mehta.

The ammonia plant has enabled all our businesses to reap substantial benefits from backward integration, effectively mitigating supply chain risks and price volatility. As a result, we are now able to capture the increases in global ammonia prices within the group.

As India continues to grow, the chemical and fertilizer sectors are poised to thrive. The demand outlook for the Crop Nutrition, Mining Chemicals, and Industrial Chemicals Business is well aligned with India’s growth story, providing strong and positive tailwinds. We are actively working on the execution of the TAN Project and the Nitric Acid Project in Gopalpur and Dahej, respectively, to capitalize on future growth.

Crop Nutrition Business (Fertilisers) Review

In Q2 FY25, manufactured bulk fertilizer has achieved highest ever sales volume of 268 KMT, an 83 per cent YoY increase, driven by improved demand from above-average rains, which led to 102% Kharif crop sowing and positive market sentiment across all regions.

Sales volume of Croptek surged to 37 KMT, reflecting a 70 per cent YoY growth, with continued focus on providing crop-specific solutions for targeted crops, including cotton, soybean, sugarcane, corn, grapes, pomegranate, and banana.

The company has recently launched premium water-soluble fertilizer grades. Sale of specialty fertilizer Bensulf was 9 KMT, up 7 per cent YoY.

Company’s Crop Nutrition Business (CNB) achieved a

Agribusiness, Agro chems – Chemicals, Agro chems – Fertilizers, Company News, Finance, India, Speciality Chemicals

Company registered Profit After Tax (PAT)of Rs 200 crore which is 76 per cent higher on YoY basis.

Deepak Fertilisers and Petrochemicals Corporation Limited, one of India’s leading producers of industrial & mining chemicals and fertiliser announced its results for the first quarter ended June 30, 2024.

In Q1FY25 company delivered revenue Rs.2,281 Crores, marginal decline by 1.4 per cent on YoY basis due to lower commodity prices. Company’s EBITDA margin improved to 20.4 per cent against 12.1 per cent on YoY basis. Company’s PAT was Rs.200 crore which is 76 per cent higher on YoY basis.

During the quarter, sales of manufactured bulk fertilisers was 174 KMT, representing an 11 per cent increase YoY. The company has launched Smartek fertilizer for paddy, pulses, and cotton, along with the Croptek grade for soybean crops. Sales of specialty fertilizer product, Bensulf, amounted to 10 KMT this quarter, reflecting a 51 per cent increase YoY.

Sales of traded specialty fertilisers in Q1FY25 saw an 80 per cent increase YoY. With global prices for water-soluble fertilisers stabilizing, demand has now returned to normal levels.

 With better monsoon, the demand outlook is positive. We are focusing on delivering crop specific and water-soluble fertilizers which deliver higher yield and productivity to the farmer. Additionally, our recent partnership with Israel-based Haifa Group will help to promote high-performance specialty fertilisers.

Segment Performance:

Chemical Segment (Mining and Industrial Chemical) contributed about 57 per cent of total revenue which grew by 5per cent YoY mainly driven by improved demand in TAN business.

Fertilisers Segment contributed 43 per cent of total revenue which was lower by 9 per cent YoY because of delay in monsoon which post July has picked up very well.

Reduction in key RM Prices during Q1FY25 has resulted in lower NSP:  Ammonia 36 per cent YoY; MOP 37 per cent YoY; Gas 7 per cent YoY; while delivering improved overall margins.

Launched Croptek grade for Soyabean Crop and Smartek grade for Paddy-& Pulse.

The National Budget has proposed Duty hikes on Ammonium Nitrate and Duty reductions on the Precious Metals used for Catalysts, both will have a positive impact.

Commenting on the performance, Sailesh C. Mehta, Chairman & Managing Director said, “DFPCL has delivered an impressive performance for Q1FY25, with notable increase in EBITDA margin by 823 bps YoY, up from 12.1 per cent to 20.4 per cent.

The businesses are reaping the benefits of backward integration of Ammonia plant which has helped mitigate supply chain risk as well as price volatility and the benefits are captured within the group.

Also, the strategy of moving from commodity to speciality has been working to sustain and enhance the margins of the businesses.

Mining chemical segment demonstrated robust volume and margin growth supported by stable imported Fertliser Grade Ammoniam Nitrate (FGAN) prices and lower ammonia prices. The proposed duty hike on ammonium nitrate will also help going forward.

The fertilizer business volume was driven by Croptek and specialty fertilizers, providing crop-specific solutions to farmers. Despite delayed monsoon and high inventory of phosphatic fertilizers, volumes slightly declined by 3 per cent YoY. With rains predicted to be above normal, we expect volume growth in the coming quarter, boosted by new launches: Croptek grade for Soyabean and Smartek for paddy and pulses.

Margins of Nitric acid is stable with volumes lower on YoY basis due to extended repair in WNA plant. The IPA business declined by 8 per cent YoY due to the planned shutdown of the plant. Going forward, we expect stable demand in both Nitric Acid and IPA segment.

We continue to maintain sharp focus on operational efficiencies, drive cost optimizations, capacity utilization, and productivity improvements, which will help us navigate through market challenges and remain steadfast in adding value to our shareholders.

Company registered Profit After Tax (PAT)of Rs

Agribusiness, Agro chems – Fertilizers, Agrotech, Collaborations, Company News, India

 The partnership aims to promote high performing Specialty fertilisers to improve quality and productivity of crops in India and other countries.

 Mahadhan Agritech Limited (MAL), formerly known as Smartchem Technologies Limited (STL) and a subsidiary of Deepak Fertilisers and Petrochemicals Corporation Limited (DFPCL), and Israel-based Haifa Group, a multinational corporation and leading global supplier of Specialty Plant Nutrients have entered into an understanding to promote high performing Specialty fertilizers to improve quality and productivity of crops in India and other countries.

“This partnership with Haifa Group is yet another milestone in MAL’s journey towards transforming agriculture in India with customized crop nutrient solutions that deliver balanced and precise Crop Nutrition. Currently, over 6 million hectares of Agricultural land are already supported by drip irrigation systems spread over most states. It encompasses a wide range of crops including Fruits, Vegetables, Sugarcane, and many other field crops giving a ready platform to deploy the Specialty Water Soluble fertilizers.

The MAL-Haifa offerings will support agricultural practices that counter the vicious trend of water scarcity and also hugely enhance Nutrient uptake & Use Efficiency in the plants. This will directly help achieve our Prime Minister’s dream of Doubling the farm incomes. In addition, these initiatives will also help reduce groundwater and air pollution. We believe this collaboration will bring positive change in the agricultural sector, thereby empowering farmers,” said Sailesh C. Mehta, Chairman & Managing Director of DFPCL. This partnership will significantly contribute to speed-up MAL’s journey in the specialty crop nutrient market.

“I am pleased that we have entered into an agreement with Mahadhan Agritech to support Indian Farmers by synergizing our global expertise and resources with MAL’s on-ground expertise, we aim to proactively address the evolving needs of Indian agriculture and farmer preferences by leveraging the latest technologies. Through this collaboration, we will also take special practices and innovations of Mahadhan Agritech to other geographies in the developing world to improve yields and Agri produce and quality,” said Motti Levin, CEO of Haifa Group, Israel.

 The partnership aims to promote high performing

Agro chems – Fertilizers, Agrotech, Company News, India

Deepak Mining Services and STL will be 100 per cent owned subsidiaries of DFPCL. STL would now focus only on the Crop and Nutrition Business (CNB).

Deepak Fertilisers and Petrochemicals (DFPCL) has announced a demerger of its mining chemicals and fertiliser businesses. The company said the demerger was aimed at simplification of the corporate structure and reduction of multiple entities carrying on similar businesses. This would also result in economies of scale for all the business verticals, including a reduction of overhead and administrative costs, company mentioned.

The board of Smartchem Technologies (STL), a wholly owned subsidiary of Deepak Fertiliser, approved the corporate restructuring plan. Under the Composite Scheme of Arrangement, the TAN business would be demerged from STL to Deepak Mining Services (DMS), another wholly owned subsidiary of DFPCL.

Deepak Mining Services and STL will be 100 per cent owned subsidiaries of DFPCL. STL would now focus only on the crop and nutrition business (CNB). STL manufactures NPK and specialty fertilisers in India. Mahadhan Farm Technologies, a wholly owned subsidiary of STL that manufactures water-soluble fertilisers, would be merged with STL.

Sailesh C Mehta, chairman and managing director, DFPCL, said the proposed corporate restructuring would help create strong independent business platforms within the larger DFPCL brand umbrella and enhance stakeholders’ value over time.

Deepak Mining Services and STL will be

Agro chems – Chemicals, Agro chems – Fertilizers, Company News, Finance, India

Fertilisers segment revenues grow by 47 per cent y-o-y

Deepak Fertilisers and Petrochemicals Corporation Limited, one of India’s leading producers of industrial chemicals and fertilisers (DFPCL), announced its results for the quarter ended September 30, 2022.  The company registered best financial performance with high growth in Q2 and H1. Company’s Q2 FY 2022-23 net profit jumped nearly threefold to Rs 276 crore whereas revenue was up by 51 per cent.

H1review:

The company’s net profit stood at Rs 93 crore during the corresponding quarter of the previous fiscal whereas operating revenue of the company grew by 51.7 per cent to Rs. 2,719 crore during the quarter under review, compared to Rs 1,793 crore in the same period a year-ago. H1 Fertilisers Segment revenues grew by 36 per cent y-o-y with segment margins of 8 per cent. Cost of production inevitably grew due to the sharp rise in the price of raw materials

Q2 review:

Company’s Q2 Fertilisers Segment revenues grew by 47 per cent y-o-y with segment margins of 7 per cent. Although the southwest monsoon started off abnormally, it made a full recovery after June. India received above normal rainfall during the monsoon season (June -Sept) Croptek Cotton and Maize was introduced in Kharif season. Croptek sales volumes received encouraging response during the quarter which was majorly in Cotton, Maize and Sugarcane.Restricted availability of MOP, key source of Potassium i.e ‘K’, majorly impacted Smartek portfolio in Q2. Cost of production has inevitably grown due to the sharp rise in the price of raw materials.

Commenting on the company performance in Q2 and H1, Sailesh C Mehta, Chairman & Managing Director said, “Despite huge RM prices hikes, our pass through remains healthy. Our strong alignment with India growth story provides positive tailwinds to demand growth for our products. Our drive from Commodity to Speciality continues to support premium margins and brand consolidation in the mining chemicals, pharma chemicals and crop nutrition businesses.

 Mehta also added that the unique ADB association has been a very satisfying acknowledgement of the efforts and impact we have been making with providing speciality and crop-specific performance fertilisers and our intense work at the farmer level. Our drive for fast-track project execution for the Ammonia and TAN projects continues full swing.

Fertilisers segment revenues grow by 47

Agro chems – Fertilizers, India, Opinions

By Mahesh Girdhar President – Crop Nutrition, Deepak Fertilisers and Petrochemicals Corporation Limited

Agriculture being backbone of the country, and economic development being directly impacted by growth in agriculture sector, makes all agri value chain equally responsible to continuously work on products output and innovation.  Use of balance nutrition and nutrient use efficiency will help farmer to increase quality, quantity and shelf life of their produce and help agri value chain.

There has been significant focus on improving agricultural production and a lot has been achieved. However, a large portion of food is lost at the end of the supply chain, known as food waste. “Food waste” can be defined as food discarded or alternatively the intentional non-food use of the food or due to spoilage/expiration of food. Globally, around 14 percent of food produced is lost between harvest and retail. This equates to a loss of $400 billion per year in food value, while an estimated 17 percent of total global food production is wasted (11 percent in households, 5 percent in the food service and 2 percent in retail).  In India around 90000 Cr value farm produce is wasted every year.

Food loss includes the food loss across the food supply chain from harvesting of crops until its consumption. The losses can broadly be categorized as weight loss due to spoilage, quality loss, nutritional loss, seed viability loss, and commercial loss. Magnitude of food losses in the food supply chain vary greatly among different crops, areas, and economies. a significant amount of produce is lost in postharvest operations due to a lack of agriculture nutrition knowledge, in efficient use of fertilizer, inadequate harvesting technology and poor storage infrastructure. 

Significant percentage of post-harvest losses can be controlled through improving pre harvest factors which are causing losses. We can improve post-harvest losses through intervention in the field production to a large extent. This needs improvised intervention during in field operations. One Such intervention to improve pre harvest is supplying balanced nutrition which significantly improves Quality, yield and shelf life which will help to reduce losses in the agri value chain.

Role of Balance Nutrition

Crop requires an adequate supply of all essential nutrients for optimum growth. If more than one is limiting/short, growth is determined by the nutrient which is in lowest/limited supply. Seventeen essential Nutrients are required for optimal growth and development of plants. A deficiency of even one Nutrient negatively affects the crop’s life cycle. This has been explained justly by the ‘Law of the Minimum – Liebig Principle’.   This is similar to the fact that a chain is only as strong as its weakest link. If several nutrients are in short supply, it is necessary to apply all of them to derive optimum production. Balanced plant nutrition (BPN) is an integrated approach to meet the nutritional requirements of the crop throughout its lifecycle. Use of BNP will help in maximizing crop yield and Crop shelf life. Providing balanced nutrition to crops throughout their growing season encompasses all aspects of the 4R stewardship.  Essential Nutrients are required to be available to crops at the right time, at right dose through right Source and at right stage of crop.

The productivity, quality & shelf life of produce depends on how nutrient balancing is happening in crops because balanced nutrition plays an important role in increasing the shelf life of the produce. Shelf life of produce increased due to increase in total dry matter or total soluble solid and for increasing the dry matter, there is need of NPKS and micronutrients in balanced proportion.

With aim in Increasing farmer Income through use of Innovative fertiliser technology. Deepak Fertilisers and Petrochemicals Corporation Limited (DFPCL) started journey of developing innovative nutrient solutions since 2018. We first launched a high nutrient use efficiency solution by name of Smartek.  Then we have started introducing crop specific and stage specific balance nutrition solution with brand name Croptek (Crop nutrient solution with all essential major and Micro nutrient) and Solutek (crop and stage Specific product with required nutrient for crops).

Nutrient Unlock Technology (NUT) which unlocks nutrients and enhances bio-availability there by enhancing nutrient use efficiency. By adopting these balance nutrition solutions and Nutrient use efficiency, farmers can minimize wastage and under-dosing of the required nutrients at different stages of the crop growth. Our Croptek Onion which launched in November last year.  Onion Crop Shows improved growth parameters like plant height and number of leaves, neck thickness and overall vigour of crop. This led to significant increase in marketable A&B quality onion over farmer practices. There is also increase in shelf life for more than 6 months.  All above factors have contributed to farmer increase absolute marketable produce and flexibility to sell at right market price.

 Deepak Fertilisers and Petrochemicals Corporation Limited has developed and Launched Crop & stage specific Water-soluble solution Called Solutek based on 3-4 years of internal research and it is validated through various Institute. Soultek is research-based solution containing balanced nutrition as required at different stages of plant growth. Solutek helped farmers to reduce the cost of fertiliser application. Farmer realises   increase in yield, good quality, colour and increased shelf life in all crops. This helps farmer to realise well in export market. There is significant reduction in greenhouse gas emission that leads to lower greenhouse gases, soil pollution and improvement in Soil health.

By Mahesh Girdhar President – Crop Nutrition,