Lucknow Investment：Fertilizer Stocks： Top Ten Fertilizer Sector Companies in India Today (2024)

Fertilizer stocks refer to shares of companies involved in the production and distribution of fertilizers and other essential materials for agriculture. This sector includes businesses that manufacture nitrogen-based compounds, process ammonia, and develop plant nutrition products crucial for crop growth. With the global population rising and food demand increasing, the fertilizer industry presents an attractive investment opportunity for those looking to diversify their portfolios.

In India, the fertilizer sector plays a vital role in supporting agriculture, contributing to food security and rural employment. With the market expected to grow significantly, investing in fertilizer stocks could offer promising returns. However, it’s essential for investors to consider factors such as raw material costs, demand trends, and regulatory changes before making investment decisions. This article will explore a list of the top performing fertilizer and agro stocks in India for 2024 and explore other aspects of the fertilizer sector in India.

Here are the top performing fertilizer stocks in India based on their 5-yr average net profit margin:

Note: The data on this fertilizer share list is from 17th September 2024, and the data is derived from the Tickertape Stock Screener.

Filters used in this list:

Sector: Fertilizers & Agro Chemicals

5Y Avg Net Profit Margin: Sorted from Highest to Lowest

🚀 Pro Tip: You can use Tickertape’s Stock Screener to research and evaluate stocks with over 200+ filters and parameters.

Uniphos Enterprises Ltd, previously known as United Phosphorus Ltd (UPL), was established in 1969 to produce red phosphorus as an import substitute. Over time, it expanded into the production of speciality chemicals, including phosphorus compounds, pesticides, dyes, dye intermediates, plasticisers, and mercury salts. Today, this Indian fertilizer company stands as one of India’s leading producers and exporters of both organic and inorganic mercury compoundsLucknow Investment. It has also emerged as a key player in the pesticide and fumigant industry. Over the last 5 years, the company’s revenue has grown at a yearly rate of 31.23%, higher than the industry average of 10.38%, and its market share increased from 0.02% to 0.04%.

India Pesticides Limited, incorporated on 13th December 1984, has its registered office in Bareilly, Uttar Pradesh, India. This Indian fertilizer company operates in the agrochemical sector, focusing on the manufacture, sale, and distribution of insecticides, fungicides, herbicides, and other agrochemical products. It runs its manufacturing facilities in Sandila and Dewa Road, Uttar Pradesh. Over the last 5 years, the company’s revenue has grown at a yearly rate of 14.98%, higher than the industry average of 10.38%, and its market share increased from 0.26% to 0.32%.

Titan Biotech Ltd., based in New Delhi, manufactures Biological Peptones, Extracts, and Dehydrated Culture Media, which support microorganism growth. These products are essential in clinical diagnosis, vaccine production, antibiotic testing, and antisera development. They are also used in pharmaceutical industry research to check antibiotic sensitivity, detect bacterial contamination in food and water, and support tissue culture work. Over the last 5 years, the company’s revenue has grown at a yearly rate of 20.38%, higher than the industry average of 10.38%, and its market share increased from 0.05% to 0.08%.

Dhanuka Pesticides, established in February 1985, began commercial production in 1986. The Indian fertilizer company is part of the Dhanuka Group of Industries and focuses on producing technical-grade pesticides, including insecticides and weedicides. The company’s production facilities are based in Gurgaon, Haryana, with the capacity to manufacture various products such as fenvalerate technical, fenvalerate 20% EC, butachlor technical, cypermethrin technical, and 2,4-D-ethyl ester technical. Over the last 5 years, the company’s revenue has grown at a yearly rate of 11.8%, higher than the industry average of 10.38%, and its market share increased from 0.78% to 0.84%.

Bayer CropScience Limited is the leading company of the Bayer Group, operating in the Agri Care sector. It focuses on manufacturing, selling, and distributing insecticides, fungicides, herbicides, agrochemicals, and corn seeds. In 1958, Bayer’s partner acquired a small plant in Bombay, where Bayer pesticides were formulated for the first time. The company became publicly listed in India in 1965. Over the last 5 years, the company’s net income has grown at a yearly rate of 17.05%, higher than the industry average of -4.09%, and its debt-to-equity ratio has been 1.78, lower than the industry average of 67.29.

Gujarat Narmada Valley Fertilisers Company Ltd, founded on 10 May 1976 in Bharuch, Gujarat, is a joint venture between the Government of Gujarat and Gujarat State Fertiliser Company Ltd. It is one of India’s key players in manufacturing and selling fertilisers, industrial chemicals, and offering IT services. Over the last 5 years, the company’s debt-to-equity ratio has been 3.28, lower than the industry average of 67.29, and its current ratio has been 337, higher than the industry average of 141.02.

Bharat Rasayan, founded by S N Gupta and Bharat Insecticides in May 1989, manufactures technical-grade pesticides, pesticide formulations, and intermediatesVaranasi Wealth Management. In February 1993, this listed fertilizer company in India launched a public issue to expand its capacity and introduce a new pesticide manufacturing facility. Bharat Rasayan’s products serve as raw materials for pesticide formulation units, which are primarily used for plant protection and boosting agricultural output. Over the last 5 years, the company’s debt-to-equity ratio has been 11.7, lower than the industry average of 67.29, and its current ratio has been 381.12, higher than the industry average of 141.02.

Fertilisers and Chemicals Travancore Ltd. (FACT) was founded in 1943, and its fertiliser plant was established in Udyogamandal, India. In 1960, FACT became a state public sector unit of Kerala, and by 15th August 1962, the Government of India held a major share in the company. FACT Engineering Works was launched on 13th April 1966 to fabricate and install equipment for fertiliser plants, gradually expanding into pressure vessel and heat exchanger fabrication. Over the last 5 years, the company’s revenue has grown at a yearly rate of 16.87%, higher than the industry average of 10.38%, and its market share increased from 1.83% to 2.46%.

Madhya Bharat Agro Products Limited, a public company, was established on 22 October 1997. Initially founded by Mr. Shailander Jain from Sagar, it was acquired by the Ostwal Group in September 2004. At the time of acquisition, the company had a production capacity of 60,000 MT per annum for Single Super Phosphate (SSP). Over the last 5 years, the company’s revenue has grown at a yearly rate of 48.07%, higher than the industry average of 10.38%, and its market share increased from 0.09% to 0.39%.

Founded in 1992, Heranba Industries Ltd specialises in producing agrochemical products. Its product range includes insecticides, fungicides, herbicides, plant growth regulators, and related chemicalsHyderabad Stocks. Heranba boasts an in-house laboratory with advanced instruments, including HPLCs, GCs, polarimeters, particle size analysers, and spectrophotometers. This top fertilizer company in India also offers processing services for various chemical reactions, such as ammonolysis, esterification, hydrolysis, and more. Over the last 5 years, the company’s debt-to-equity ratio has been 13.38, lower than the industry average of 67.29, and its current ratio has been 200.33, higher than the industry average of 141.02.

Picking fertilizer stocks for your portfolio and investing in them is a time-consuming process. Wouldn’t it be great if you get a ready-made portfolio for you to invest in?

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Well, we have some good news for you as now you invest in ready-made portfolios via smallcase. smallcases are portfolios of stocks or exchange-traded funds (ETFs) created around a particular investment theme or strategy. They are designed to offer you an easy and affordable way to invest in a diversified portfolio of stocks or ETFs that align with their investment goals and values.

Here are a few smallcases related to fertilizer stocks in India:

1. Rising Rural Demand smallcase: This smallcase, managed by Windmill Capital, consists of companies that either derive a significant amount of their revenue from rural India or are striving to enhance their foothold across rural markets to benefit from increasing rural demand.

2. House of Murugappa smallcase: The House of Murugappa was also created by the Windmill Capital. This smallcase is a portfolio of stocks that invests in companies belonging to the Murugappa Group. They are one of India’s leading business conglomerates with interests in a wide range of sectors such as engineering, financial services, and agro-products.

Fertilizer stocks refer to the shares of companies that produce, manufacture, or distribute fertilizers. The top fertilizer companies in India are typically engaged in producing and selling various types of fertilizers, such as nitrogen-based, phosphate-based, and potash-based fertilizers, as well as other agricultural inputs and products. The fertilizer sector is an important component of the agricultural industry, and fertilizer stocks can be a good investment option for those interested in the agriculture or commodities market.

An agricultural powerhouse, India has seen a high demand for fertilizers due to extensive crop cultivation. Fertilizer companies are pivotal in fortifying the farm sector by enriching the soil with vital nutrients. Dominated by urea, DAP, and complex fertilizers, the Indian fertilizer industry has undergone a significant transformation, spurred by government backing and the influx of private entities. Forecasts suggest a promising trajectory for the Indian fertilizer market, buoyed by population expansion, evolving dietary preferences, and heightened agricultural yields. Key players in this sector include Tata Chemicals, Coromandel International, National Fertilizers Limited, and Chambal Fertilizers and Chemicals.

The government seeks to boost both private and public investment in post-harvest activities. Nano-DAP use will expand to all agro-climatic zones, and a strategic plan will be created under the Atmanirbhar Oilseeds Abhiyaan to achieve self-sufficiency in oilseeds production.

A detailed programme will be developed for the dairy sector’s growth. The implementation of the Pradhan Mantri Matsya Sampada Yojana will be accelerated to improve aquaculture productivity, double exports, and create more jobs. Funding for the Blue Revolution will rise to Rs.2,352 crore, while the PM Formalisation of Micro Food Processing Enterprises scheme will receive Rs.880 crore.

The Ministry of Agriculture and Farmer’s Welfare has been allocated Rs.1,27,000 cr. The PM-KISAN scheme will provide direct financial aid to 11.8 crore farmers, and crop insurance coverage through the PM Fasal Bima Yojana will extend to 4 crore farmers. Integration of 1,361 mandis under eNAM will facilitate trading volumes of Rs. 3,00,000 cr.

Investing in fertilizer stocks can be suitable for a variety of investors, including:

1. Those seeking exposure to the agricultural sector and looking for diversification in their portfolio.

2. Farmers and agricultural professionals may find investing in fertilizer stocks beneficial as they are directly involved in the industry and understand its dynamics.

3. Investors interested in industries that support global food production and agriculture may also consider investing in fertilizer stocks.

Overall, anyone looking to participate in a sector that plays a vital role in food security and agricultural productivity may find fertilizer stocks worth considering.

Fertilizer stocks in India exhibit several key features that investors should consider:

Market Demand: Fertilizer stocks are influenced by the demand for agricultural products, which, in turn, is driven by factors like population growth and food consumption patterns.

Government Policies: Government regulations and policies regarding subsidies, pricing, and import/export controls significantly impact fertilizer stocks. Changes in these policies can affect the profitability of fertilizer companies.

Raw Material Prices: Fertilizer production depends on raw materials like natural gas, phosphates, and potash. Fluctuations in the prices of these raw materials can affect the cost structure and profitability of fertilizer companies.

Seasonal Variations: The demand for fertilizers is seasonal, with peak demand during planting seasons. Fertilizer stocks may experience fluctuations in earnings and stock prices based on seasonal variations in demand.

Technological Advancements: Innovation and technological advancements in fertilizer production methods, such as the development of new fertilizers and enhanced production processes, can impact the competitiveness and growth prospects of fertilizer companies.

Investing in the fertilizer sector stocks can offer investors several advantages, for example:

Diversification: This sector provides an excellent means to diversify investment portfolios. This is done by gaining exposure to some of the most promising companies within the industry. This diversification helps balance portfolios that may include bonds, stocks, and mutual funds.

High Growth Potential: The projected global population increase by over 33% by 2050 will significantly drive up the demand for food. Coupled with rising incomes in emerging markets leading to increased consumption of high-quality food, there’s a growing need for all fertilizers in large-scale production. Consequently, investing in the best fertilizer stocks in India presents substantial growth opportunities.

Risk Management: The best fertilizer stocks to buy today often follow trends distinct from other sectors, making them a valuable tool for managing investment risks. This divergence minimizes exposure to Indian fertilizer market risks and aids in portfolio diversification.

Export Restrictions Awareness: The best fertilizer stocks in India are susceptible to occasional export restrictions. Necessitating investors to stay informed about regulatory changes within the industry and adjust their portfolios accordingly.

Access to Promising Companies: Investing in this sector grants investors access to some of the industry’s most promising Indian fertilizer companies. This is particularly advantageous for those seeking long-term growth prospects, enabling investments in well-managed firms poised to generate potentially higher returns.

Investing in fertilizer stocks in India carries certain risks that investors should be aware of before making investment decisions. Here are some key risks associated with investing in fertilizer stocks:

Regulatory Risks: Even the best fertilizer company in India is subject to government regulations and policies. These can impact their operations and profitability of even the top 10 fertilizer company in India. Changes in subsidy policies, pricing regulations, or environmental regulations can affect the financial performance of fertilizer companies.

Commodity Price Volatility: Fertilizer companies are exposed to fluctuations in the prices of raw materials such as natural gas, phosphates, and potash, which are used in the production of fertilizers. Changes in commodity prices can impact the cost of production and ultimately the profitability of fertilizer companies.

Weather and Agricultural Risks: The performance of fertilizer stocks is closely linked to the performance of the agriculture sector. Which in turn is influenced by weather conditions and agricultural practices. Adverse weather conditions such as droughts or floods can affect crop yields and demand for fertilizers. Thereby, impacting the revenue and profitability of even the best fertilizer company in India to invest in.

Currency Risks: Fertilizer shares may be exposed to currency risks if they import raw materials or export finished products. Fluctuations in exchange rates can impact the cost of imports or the revenue generated from exports. Thereby affecting the overall financial performance of fertilizer companies.

Market Condition: The overall market condition directly influences the performance of fertilizer sector stocks. Therefore, you should analyse the current market condition, economic indicators, and stock market trends before investing in fertilizer penny stocks.

Competitive Landscape: As an investor, you should evaluate the competitive landscape of the fertilizer industry. This includes the market share of each player, pricing strategies, and production capacity.

Agricultural Trends: The agriculture sector’s growth and trends can be vital indicators of fertilizer demand. Hence, you should track the crop production cycle, crop prices, and government policies related to agriculture.

Apart from this, it is essential to evaluate the future prospects of the fertilizer industry, especially including new product launches, mergers and acquisitions, and technological advancements.

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