GNFC Q1 net profit plunges ₹88 crore, revenue slumps 39%

Gujarat Narmada Valley Fertilizers & Chemicals (GNFC), the Delhi based leading fertiliser company Monday reported an 84.6% year-on-year (YoY) decline in net profit at ₹88 crore for the first quarter ending June 30, 2023.

The fertiliser manufacturer posted a net profit of ₹572 crore in the corresponding quarter last year, the company said in a regulatory filing.

The total revenue from operation stood at ₹1,652 crore during the period under review, against ₹2,696 crore in the corresponding period of the preceding fiscal.

The EBITDA falls 86.2% to ₹105 crore in the first quarter of the fiscal against ₹763 crore in the corresponding period in the previous fiscal.

"The Q1 of FY24 witnessed planned annual turnaround due to which, both, volume as well as financial performance is not comparable. The annual turnaround, apart from volumes, normally also witnesses higher maintenance costs and unproductive costs which has affected net margins," the company said in a regulatory filing.

With annual shutdown over at Bharuch complex coupled with stable Dahej operations, the

company hopes to improve margin profile.With Concentrated Nitric Acid-IV addition, it is expected to add up margin improvement, the company said.

“The fertilizer segment witnessed losses mainly due to complex fertilizer nutrient based subsidy rate change by about 28% on downward side apart from absorbing impacts due to lower volume throughput,” the Gujarat Narmada Valley Fertilizers & Chemicals said.

“The performance is lower in Chemical Segment mainly due to lower sales realization and lower volume. TDI-II volume performance has been consistent during the quarter although realisations moderated during the quarter, the company added.

GNFC is a joint sector enterprise promoted by the Government of Gujarat and the Gujarat State

Fertilizers & Chemicals Ltd.(GSFC). It was set up at Bharuch, Gujarat in 1976. GNFC started its manufacturing and marketing operations up in 1982 with one of the world’s largest single-stream ammonia-urea fertilizer complex and gradually expanded in chemicals.

Gujarat Narmada Valley Fertilizers & Chemicals shares ended at  ₹558.80, down by  ₹27.00, or 4.61% on the BSE.