Q1 25/26

Aug 8, 2025

Summary

Consolidated Q1 revenue rose 1% YoY, while PBT and PAT increased 63% and 59%. Fertilizer EBIT improved, but acid-cost inflation and subsidy decisions remain key margin variables.

Ladies and gentlemen, good day and welcome to the Gujarat State Fertilizers & Chemicals Limited Quarter 1 FY 2025-2026 earnings conference call. This call is hosted by Anurag Services LLP on behalf of GSFC. From the management, we have Mr. S. K. Bajpai, Senior Vice President, Finance & Legal and CFO, Mr. S. V. Varma, Executive Director, Agribusiness, HRS & IR, and other senior members from the management. As a reminder, all participant lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star then zero on your touchtone phone. I now hand the conference over to Mr. S. K. Bajpai. Thank you, and over to you, sir. Okay. Good afternoon, everyone, and thank you for joining us for Quarter 1 2025-2026 earning call of Gujarat State Fertilizers & Chemicals Limited. It's always a great pleasure to connect with all of you and share the key updates that we experienced during the quarter. I hope that you had a chance to review the financial results, media release, and investor presentation available on the stock exchanges and also uploaded on our company's website. While we see the consolidated financial performance for Y-o-Y basis, revenue from operation grew marginally by 1% Y-o-Y from INR 2,163 crores to INR 2,184 crores. PBT rose by 63% Y-o-Y, INR 184 crores from INR 113 crores, and PAT by 59% Y-o-Y, INR 139 crores versus INR 87 crores. If you see quarter over quarter, then revenue from operation grew by 14%, INR 2,184 crores from INR 1,922 crores. PBT jumped by 108% quarter over quarter, INR 184 crores from INR 89 crores, and PAT by 93%, INR 139 crores from INR 72 crores. Quarter 1 marked as a resilient start to financial year 2025-2026, with stable revenues and improved profitability. In volume terms, fertilizer production reduced by 40,787 metric tons. That is approximately 10% in Quarter 1 Y-o-Y. However, this includes a one-time transfer of 40,435 metric ton of urea towards the revamping project. Taking this into consideration, the production reduction is limited to 3,352. That is only 1% Y-o-Y due to lesser urea and DAP production. IP production remains stable year-on-year basis. Reported fertilizer sales grew marginally in volume 2%, and estimated stable in volume terms around 4.51 lakh metric ton in Quarter 1 Y-o-Y basis. However, this includes a one-time transfer of INR 149 crores of urea towards the revamping project. Taking this into consideration, fertilizer sales would have grown by 11% in value terms and 10% in volume terms in Quarter 1. On the cost side, raw material trends were mixed. Prices of natural gas and ammonia softened, offering some relief, while cost of phosphoric acid and sulphuric acid saw a sharp increase, impacting P&K cost economics. Our fertilizer segment delivered a strong EBIT of INR 137 crore, up from INR 86 crore in the corresponding quarter last year, reflecting stronger operating leverage, favorable product mix, and better cost absorption. This was supported by robust trading volumes, especially in NPK, higher manufactured APS and AS sales, and improved realization in P&K fertilizers. Urea volumes, however, declined due to stabilization challenges and exclusion of project-related trial sales worth INR 149 crores in Quarter 1. The industrial product segment turned profitable with INR 25 crore EBIT, aided by improved realization in ammonia and HX crystal, even as spreads and core volume demand subdued. We continue to maintain a strong balance sheet with no long-term debt, healthy net worth, and adequate liquidity. Our liquidity position has also been supported by the timely disbursement of government subsidies, reflecting a proactive fiscal approach by the government. As of date, the company has received subsidy dues for P&K fertilizers and urea claims raised up to the first and second week of July, respectively. This provides the foundation for advancing our CAPEX roadmap. I am happy to report that three major projects were commissioned during the quarter. First one is 15 megawatt solar power project at Charanka, Urea-II Energy Revamp facilities, and our participation in GIPCL of 75 megawatt solar project with our share of 50%, that is 37.5 megawatts. These will enhance cost efficiency and sustainability over the long term. Looking ahead, the progress of the southwest monsoon has been healthy so far, supporting kharif sowing and agri input demand. However, rising input costs, especially for phosphoric acid and DAP, pose challenges for the fertilizer sector. We may see some upward pressure on MRP in the coming months. Policy actions from the Department of Fertilizers will be critical in this context. We intend to pursue a balanced production import strategy, particularly in DAP and non-DAP grades, to protect margins and optimize realizations. In the industrial segment, capro spreads are likely to remain under pressure due to oversupply and continued Chinese dumping. That said, demand for melamine and other key products is expected to remain stable, and we anticipate much better performance in segment for Q2. With that, I now hand over the call for question and answer. Thank you. Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touchtone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question comes from the line of Nirav with Anvil Wealth Management. Please go ahead. Yeah. Sir, thanks for the opportunity and good afternoon, team. Sir, I have a few questions. Sir, just to understand, when we produce AS and APS fertilizers, how are the profitability fixed? Just like as a percentage of realization, which is a mix of MRP and subsidy, we get a certain percentage of this as an operating profit or at the PBT level. So how this mechanism works, let us say if we take for AS grade, which is like MRP plus subsidy is close to around INR 29,000-INR 30,000 a ton. So how the profitability is ensured by the government, something as a percentage of this, or is there any other mechanism which is fixed? So actually, the profitability in case of ammonium sulfate and ammonium phosphate is dependent on the cost of the nutrient, what we are using in the production of AS and APS. Actually, phosphorus, this P2O5 rates are very high, and it is presently around $1,258 per metric ton. So there is no fixed norm that what is the percentage of profit we are earning. It all depends upon at what cost we get this raw material from the international market. As far as ammonium sulfate is concerned, we produce here in Vadodara. So sulphuric acid, as you see, sulfur and sulphuric acid prices are very high. Approximately 150% has been risen if you compare with the last quarter or last on Y-o-Y basis. So really the margins in the case of ammonium sulfate has squeezed a lot. And in APS, due to the phosphoric acid prices going high, there also we are getting hit in the margin terms. Got it. So sir, last year you mentioned that on an average we make close to around INR 3,000-INR 3,500 a metric ton for both these fertilizers put together. How was the scenario in Q1, and how do you see it panning out for FY 2026? As I told you, because of the cost inflation, it is around INR 2,000-INR 2,500 in case of ammonium sulfate we are getting per metric ton. Okay. How do we see for the rest of the year? No, as I told you in the opening remarks, the subsidy is due to be fixed based on the input cost by the Government of India with effect from 1st of October. We are quite hopeful that there must be some revision because sulphuric acid price and phosphoric acid price both have risen a lot, and that is the reason the DAP is not economically viable for us to produce. There is a lot of shortage of DAP in the market also. We hope that government will do certain things with certain criteria for fixing the subsidy with effect from 1st of October. Right. Sir, two clarifications here. One, let us say for both these fertilizer grades, we produce close to around 317,000 tons of volumes. Based on the conversions, I think ammonia requirement is close to around 85,000 tons, and sulphuric acid is close to around 190,000 tons for this quarter. Are both these inputs produced captively, or do we need to source something from the outside market also? As far as sulphuric acid is concerned, we have the four sulphuric acid plants. But still the demand of the sulphuric acid in our complex due to the ammonium sulphate four new plant capitalized a year ago is high. The company has already in the process of establishing Sulphuric Acid V plant, which is due to be commissioned in 2 months from now. Till now we are getting the long-term arrangement with the companies who are supplying the sulphuric acid at the Vadodara complex as well as Sikka complex for our ammonium phosphate sulfate. But after commissioning of the Sulphuric Acid V plant, we will be having the required quantity of sulphuric acid for production of ammonium sulphate. Plus we would have something surplus also to be sold in the market. Surplus also. It will be transferred to the Sikka unit for APS production. Correct. What could be the surplus which we could sell in the market, sir, out of this 198,000 tons after Sorry to interrupt there. Sir, we are not able to hear you. Can you speak a bit louder? Yeah. Sir, just wanted to understand from you, sir, out of this 198,000 tons, how much would be available for sale in the market after using for captive? I don't think so. If the APS requirement in the Sikka around 200 or 250 metric ton— Got it. additional quantity we will be having here at Vadodara complex. We will be transferring the sulphuric acid to Sikka unit. But looking at the price, if the sulphuric acid price comes down and there is any opportunity that we are getting sulphuric acid at Sikka at a lower price, then we can think of going into the market for a sale. Perfect. Is there any volume guidance you can tell for both these fertilizer grades put together and for a company as a whole for FY 2026? FY 2026, the whole year, we are expecting fertilizer in the range of 23 to 24 lakhs. APS and this both combined around 10 lakhs. Correct. This 23 lakhs also includes the trading volumes or they are separate out of this? Estimated on conservative basis because DAP prices are volatile, and we are handing urea for Government of India at Rozi port, but we could not get much allocation last year. We have taken a conservative. This is the minimum which we think. If the trading improves, it will be a further increase. Got it. Second question is on the urea part. We had a revamp undertaken in first quarter. What was the impact on the sales and profitability in first quarter of FY 2026 because of the launch? No, actually during the quarter no. We have commissioned this project on June 2. Yeah. Commercial production started only after that. Only 28 days we could get the commercial production. Otherwise, whatever the production was there during the trial run, we have transferred to the capital side of the balance sheet. During the trial, there is a lot of wastage of the input and all this. We are not in a position to say what is the profitability. As such, in the urea, there is no bigger, big margins available. It is only, I think, if I remember, INR 3 crore only we shifted to the and adjusted in the capital cost. Got it. Sir, currently we have a Gcal per metric ton consumption or the energy norm of 6.5. I think after this revamp, you were saying earlier that our consumption could go down to 5.75 Gcal per metric ton with this revamp. Let's say given the current gas prices, what could be the savings which could accrue to us on a per ton basis? Or if you can say that, what sort of incremental EBITDA could come to us with this urea revamp? So actually after this revamp, we could get less than 6 Gcal energy consumption per metric ton of urea. So whatever the targeted energy norm by the Government of India, it has been achieved. That less consuming of this energy norm, that will provide temporary relief. But I do not know what is the Government of India. They will fix the energy norms and the subsidy for the GSFC. It is under the proposal of DoF ministry. So until unless they notify the energy consumption by us or GSFC and fix the subsidy accordingly, then after we will be only having some margin. Got it. So, sir, two things here. One, are we allowed to recover the revamp cost, which we have spent close to around INR 500 crores for this revamp. So are we allowed to recover through the higher energy consumption norms? And B, also there is a proposal to have an increase in the fixed cost compensation by the government. So your thoughts here? Yeah, actually, as you rightly said, this energy consumption norm has been achieved. Now, we have requested Government of India that they have not reimbursed any capital cost for revamp. Actually it is not INR 500 crore, it is below INR 400 crores. So we have completed our revamping below INR 400 crores. So if they fix the subsidy based on the old energy norms, then we will generate something like INR 50, INR 60 crores per annum. So that payback period will be six to seven years. Correct. Sir, next question is on the chemicals. We have won close to around INR 25 crores this quarter, despite of challenging capro benzene spreads. Last quarter, I think we were at INR 94 crores, and you mentioned that we had done some ammonia trading last quarter because of which the numbers were higher. What was the situation for this quarter like? Is this INR 25 crores entirely from chemicals and this could be a steady run rate, which we should assume or work with given the current spreads of melamine and caprolactam? Does it also include some proportion of trading from ammonia? No, actually, as you rightly said, this capro benzene spread has been reduced to $540. If you see the same quarter last year, it was $582. It has improved from $521 in the last quarter. If you see the quarter-over-quarter basis, it has improved from $521 to $540. That is a good sign of improvement. We have also taken up with the Government of India for anti-dumping duty because a lot of caprolactam and melamine is dumped from the Chinese material in India. For protection of our industry, local industry, we expect the Government of India will do something very soon as the tariff bar is already going on geopolitical. For saving the industry, we are only the producer of melamine in the country. As far as caprolactam, we are only an FACT, produces the caprolactam, but FACT plant, I don't know whether it is continued. Most of the time they are because of this price war, they are closed. So we are only the producer of caprolactam melamine, and we're patiently waiting for any positive outcome from the Government of India. As information we are having, they are certainly doing something for the anti-dumping duty. Correct. Sir, just my question is whether this INR 25 crores is the steady state run rate which one should work with, going forward even the current spread. That is not only the ammonia trading. Ammonia trading is the basic factor, and we continue the ammonia trading if we get the ammonia at a good price. So we import ammonia and trade. There is a good demand of ammonia, so we have the contract in our hand, and we will continue to do so in the next quarter or coming quarters also. But also in the caprolactam side now, we have developed a new product, HX crystal. Right. When the caprolactam was not giving any positive contribution, we have shifted some of the intermediate product like HAS for manufacturing of HX crystal. So during the last quarter, it has also given a very good margin. So the IP sector has coming to positive side and it will continue to do so, because these are the permanent plants, HX crystal and other things like ammonia. So I think now we will have some more improvement in the coming quarter. The last question, if you allow. On the power side, I think we have been investing a lot on renewables, which is also visible in the presentation, what we have shared. So if you can share, for both the complex put together, what is our current requirement of power at both the locations and currently how much it is coming from renewables? Whatever the requirement of the power is there, more than 50% is coming as a green power. Put together this wind means what we are having in solar projects, we are having at Charanka and the one from the GIPCL. So that power, 37.5 megawatt we are getting from GIPCL, our sister concern. It is very good and cheap source of power. Because of that, we have stopped our any power requirement or steam requirement from the gases by generating the power from the gas turbine or steam turbine. We have also now reduced our power requirement from the electricity board. This all combined together has given a lot of cost efficiency as far as power is concerned. Yeah, it is visible in our numbers also because our power cost has not gone up despite of the increase in the production numbers. Correct, sir. Thank you so much, sir, and wish you all the best. Thank you. Thank you. Thank you. The next question comes from the line of Yash with Unifi Capital Private Limited. Please go ahead. Hi, sir. Am I audible? Yes, yes. Yes. Yes. Yeah, sir. In the presentation you have put that there was an increase in P&K fertilizer trading. I saw the volume also has increased by around 4x. Can you just give us the breakup of trading and manufacturing revenue-wise, what is the breakup? It will be helpful. Actually, whatever trading we have done in the last quarter for the NPK 10 and NPK 12 grade of fertilizers, that is the trading portion. On the manufacturing side, we have not produced much DAP, only a small quantity of DAP we produce in the Sikka. All our plants actually, Baroda Fertilizers & Chemicals complex, this is running more than 100% capacity as usual, other than the urea because the revamping project got just commissioned. Percentage-wise, if you see that trading, kitna? 10% of the total. 10% of the total fertilizers. It is in revenue-wise, right, sir? Yes. Yeah. Okay. Last year it was comparatively lower, right? Yeah. Because there was no NPK trade. Now DAP is not available, so we are exploring the APS and other NPK grade of fertilizers. It is required for the balanced nutrition to our crops. Government is also pushing us to provide the balanced fertilizer or complex fertilizer as per the requirement of the crops. Okay. Another question, sir, regarding the past participant just asked. Can you just quantify what will be the power reduction savings by the two new plants which we have just commissioned? Annual run rate, what will be the cost savings? Urea? Not urea, sir. The solar power plant, two plants we have commissioned this quarter, right? What will be the annual power cost savings? No, actually urea, this solar plant has been commissioned just now in the last quarter only. Full impact will be coming in the next quarter. But roughly we can say that INR 20 crores odd figures we will be receiving by way of reduction in the power cost. Okay. Just last one. I think this quarter you also had a reduction in your employee benefit expense. Can you just quantify what was the specific one-off? Either it is one-off reason or anything specifically related to that? Actually, last year in the same quarter, due to the revision of your four years revision, we had paid some money to the LIC for this gratuity and pension funds. That was the major factor. Now it is not coming. This will come only after four years. At the time of revision, certainly the liability accrues. We had to pay the deficit in the fund set up with the LIC for the pension as well as gratuity. Okay, sir. Understood. Just one last thing. Do we intend to increase the production of DAP? Three, four years back, we used to produce basically DAP more. Considering the import restriction from China, basically has put export restriction and there is a shortage of DAP. Do we intend to increase the production in coming quarters? No, actually the DAP production is not cost economical, so we have tied up four shipment of DAP from the international suppliers and actually one has already arrived and three are in the line queue. Enough DAP will be available to the farmers during the season. In place of DAP, we are manufacturing this APS and one idle stream of this DAP production at Sikka unit. We are proposing to convert it for the fungible production, wherever we require to produce DAP or APS or other integrated fertilizers. We are carrying out the modification. Very soon, we are approaching the board for the approval. As soon as we get this approval, we will start the work and within a short period, we will be converting this facility also for production of APS or DAP. In that case, APS production will be doubled, whatever we are achieving presently at Sikka unit. Okay, sir. Thank you. Okay. Thank you. A reminder to all participants to ask a question, you may press star and one. The next question is from the line of Saket Kapoor with Kapoor and Company. Please go ahead. Yeah. Prakash, and thank you for the opportunity. Keeping in mind our Q1 performance, especially in the fertilizer segment, and then with the higher raw material prices, especially phosphoric and sulphuric acid. Phosphoric and sulphuric acid, what should we be reckoning in terms of margin pattern going ahead? I think, sir, you gave the volume number of production number and sales for 2.3 million for fertilizer. Yeah. This is yearly what Varma ji is saying that 2.3 million metric ton of fertilizers we will be producing and selling for the full year. What I am saying that during this quarter, as you rightly said, the phosphoric acid, sulphuric acid price was very high. So it creates some problem in production of DAP. We are also facing the reduction in the margins in case of ammonium sulfate and ammonium phosphate sulfate because the sulphuric acid prices are also very high, as you rightly said. Slowly I will say that these are in the peak levels now. If there is any reduction, it will additionally benefit in our production margins of the phosphoric and sulphuric acid fertilizers. As far as this subsidy is concerned, because of the prevailing prices of the phosphoric acid and sulphuric acid, they fix the subsidy. Which is due from 1st of October. I presume that Government of India will take a note of these high prices of the phosphoric and sulphuric acid, and they will take some higher subsidy for the phosphoric and sulfur-based fertilizers. Right. Sir, Q2 generally, sir, what is the kind of volume uptake we experience for industry? What are we anticipating for this quarter in terms of volume for the fertilizer segment? Around 5.8 to 6 lakhs. Okay. 5.8? To 6 lakhs. Okay. This is for the entirety for the company. Yeah. As a company, Q2. Okay, sir. Sir, when we look at these RM prices, which are, I think so all are as per the import parity prices, and that are very dynamically changing. Why are companies like us which are government entities not referring or suggesting a model by which, with the variations in the prices, the subsidy mechanism could be created in a formula base, so that these ad hoc pain that goes through the companies like us can be reverted into that sense. Since prices everything is available in public domain, only an automated formula principle can be created, a platform can be created or suggested by which these rigidity can be removed when prices or subsidies are reset by themselves and not waiting for the government authorities to take note of the same. Sanjay, you are right. But if we see the side of the government, they cannot give the subsidy whatever the prices internationally coming, and they are raising the price as per their mercy because the subsidy is given by the Indian government. There will not be any end to it. Because if they give the subsidy, whatever the price of phosphoric acid prevails in the international market or their counterparties which are having these rock phosphate deposits and they are producing the phosphoric acid in big quantity, then there will not be any end. That is the limitation with the government also because the subsidy budget is limited and they cannot fix like the unlimited dispersal of the subsidy. For just checking the things, they are keeping this twice in a year. They see what is the price and then they provide the subsidy. I think it is a fair working. Okay. For Q1, our total sales for manufacturing was 3.64 lakhs, and on this we are expecting a tonnage of 5.82. That is what you have just answered in the previous question. Yes. But total our trading, if you see, including trading it is 4.51 million tons. Yes. 4.51 lakhs. So what Varma ji is saying, it is including trading. 5 point. He is saying that 6 lakh metric tons we will be selling in the market, but that is including the trading. Yeah, total turnover. Okay. What should be the likely, then the breakup I just was trying to understand the type of profitability which we have done for this quarter in the fertilizer segment and with the increase in raw material prices. Is there any threat to the profit margins in the ensuing quarter, or we can maintain these numbers? No, we will maintain. Irrespective of whatever the Because we have a lot of material in hand. At least for the quarter there is no problem. We have got this phosphoric acid P2O5 in our stock, so whatever the price increase it will reflect it only in the third quarter of the company. So we are quite sure that there will not be any hit in the margin. After this September, as I said, that I am pretty sure that Government of India will certainly revise the subsidy rates. Okay. Sir, you mentioned for the industrial product that includes some ammonia trading. Can you quantify it for us? What was the contribution from ammonia trading in terms of revenue and profitability? Sir, this is around INR 20 crore surplus margin we have got from this ammonia trading. We are also trading from the Sikka. When the urea plant was in the revamp, we also have the excess ammonia production. We also market it a little bit here in fertilizer complex. That is INR 20 crore is the revenue contribution? Yes. No, margin. Profitability. Yes. Okay. Out of our segmental profit we see INR 25 crore, INR 20 crore is attributable to only the ammonia trading. Yeah, that is right. Okay. Is this only a one-time phenomenon since our unit was not commissioned and we have surplus of the same, or these factors are not going to continue going ahead? No, we will continue as far as this import of ammonia at Sikka plant. So we will continue. We have the long-term contract with the suppliers. So we have the separate quantity for the trading and as per the requirement of Indian market, we trade and provide this imported ammonia. So it was a one-off that during this quarter, sometimes the ammonia stock was full. So either we have to reduce the load of the plant or where we stock. So just for a little we have traded the ammonia from the fertilizer complex. Sir, when we look at your price graph on slide number 6, we find ammonia prices trending lower or settling lower from INR 38,000 metric ton to INR 31,000. Yes. So we are carrying stock. What should one read into this decline from 38 to 31 that we should factor in for the current ensuing quarter? No, actually ammonia import is based on the international prevailing prices. It may come down, it may go up little bit here and there. But whatever the contract we are having to supply the ammonia to Indian market, that is all based on the delta on the imported price. So that will never be a loss to GSFC even if we are carrying the ammonia stock or plus ammonia we are receiving at a higher price or lower price. So we have fixed the formula like delta over the imported price. So that we are getting the margins. Okay. Sir, can you give only one more color? What would be the revenue in that sense? Because industrial product segment posted revenue quarter-on-quarter is higher, even year-on-year is higher. And you have mentioned that the caprolactam prices were lower, the spread was lower. So ammonia trading, how much has it contributed to the top line for the quarter? It is around INR 60 crore. Only 60? That is 10%, 11% of the total revenue in the industrial product. Yes. Okay. Sir, going ahead also in the industrial product segment, I think March quarter, we did saw a higher contribution to the profit. What were the factors that were reversed then Q-on-Q that led into the profitability taking a hit? Or if you could just give the number of ammonia trading for the March quarter also, how much margins we earned for the March quarter? No, actually, one more factor which I tell to you that during this fiscal instruction as on 31st March of the physical stock of the ammonia and the book stock, there was some mismatch. So we have inflated the stock in the system because physical stock was there. So that was also one factor which provided a little more margin because it was the zero stock material uploaded in the system, and that is the reason that you are seeing the higher margins available by way of trading of ammonia. Sir, I didn't get the last point. Can you please repeat once more about the closing stock part? Is it the revaluation aspect which you are mentioning? Not revaluation. Actually, at the financial year-end Okay we check the stock, our statutory auditors, the physical stock versus the book stock. If there is any discrepancy, then we have to replace. We have to correctly our book stock as per the physical stock available. Certain times there are so many segments coming of the ammonia, so there may be somewhere some more material come, somewhere there is a gap. At the year-end, we match the book stock with the physical stock, and in that process, we have got this stock hiked. Okay. So that has gone to the profitability. Yeah. Because if we sell that stock, then it will be total profit because it is zero cost, because cost is already minimal. Right, sir. Sir, on the other expenses line item also. I think Q-on-Q, there is a significant dip from INR 285 crore to INR 201 crore. What explains this lowering of other expenses Q-on-Q basis? Other expenses? Yes, sir. Other expenses line item. One of the reasons I told that this urea plant was under the trial and production. As we have accepted this sales value of the 40,000 metric ton of urea amounting to INR 150 crore, the same manner we have also credited the expenses in the revenue side and transferred it to the capital so that balance can be met and there is no difference as per the accounting standard. We have transferred the expenditure incurred during the quarter for the trial period, that is around two months. That was transferred there. That may be the reason that other expenses might be lower in comparison to other quarters. Right. On the larger projects, sir, of setting up of this phosphoric acid and sulphuric acid project at Sikka, sir, where are we in terms of? At what stage are we, sir, since it will be commissioned by, as per your slide number 8, it will be commissioned in some time in FY 2027, 2028. If you could just give whether DPR is done, what is the current update on the same? Yeah, PSA plant, we have got the basic engineering and we have issued the tender for detail engineering, and that are under the investigation and negotiation label. As soon as we fix the detail engineers, we will start the activities at the Sikka for this PSA project. Okay. What is the total cost of the project for both phosphoric and sulphuric? If you could give the breakup. Cost, still we are in the negotiation stage, so it is not summed up. Earlier, we have estimated around INR 1,500 crores-INR 1,600 crores for this PSA alone. After receiving the actual quote and commercial negotiation, we will be able to finalize and tell to you what is the real cost of this project. Okay. For this, sir, what are we doing for the raw material sourcing for both phosphorus and sulfur to get this project viable and also to ensure raw material security? What steps are being taken or are in the anvil? As I told you, that sulfuric acid plant, we are already commissioning in Fertilizer Nagar. Whatever the addition we will be having, we will be transferring it to Sikka for this production. Additionally, we have the long-term arrangement of sulfuric acid supply from Hindustan Zinc and other suppliers like Adani, who are presently coming in the market with a big volume of sulfuric acid. As far as phosphoric acid is concerned, we are getting it from the foreign suppliers. For PA plant, we require a raw phosphate. Right Talk with the certain parties for securing the rock phosphate supply, and it is not a very challenging job. I think we will be, at the time of requirement of rock phosphate, we will be having full time of the rock supplies. Okay. Lastly, sir, we have some investment in Tunisia, I think so, earlier some JV. What is the latest update on the same? Correct me there if I'm In the first plant, there was a fire in February, so it is still closed, I think. There is no supply we are receiving from the TIFERT presently. As soon as we have sent two executives from GSFC to Tunisia for getting the feedback to what is the status of the facility to be restarted after this fire. We will get the information as soon as the plant is started, so we will restore our supply from TIFERT. Okay. As of now, sir, we used to source the rock phosphate on a contractual basis, or what was the last consignment or tonnage we received from them? No. From Tunisia, we receive only P2O5, phosphoric acid, not rock phosphate. Last time, before six months, we received one shipment, but then after the plants were closed, there was no production and there was no shipment accordingly. What is our investments there? How much have we invested in this project? Maybe they max in 12 or 13, maybe INR 200 crores or odd figures we might have invested in the 15% equity in the TIFERT project along with the Coromandel. Okay. Lastly, sir, on the consolidated numbers, when we consolidate our quarterly results there is an increase of revenue to the tune of INR 13 crore, and the bottom line is reduced by INR 6 crore. So can you explain this phenomenon, what goes into consolidation and why the profitability at the PBT level goes down? No, because of the subsidy impact when we are having about 100% on subsidy GATL. If there is any stock lying there, we book as a sale in the standalone account. But when in consolidation, that subsidy portion is adjusted, so that's why the PBT is down. But whatever sale is there of the GATL as a whole, that increases the revenue. While consolidating, we adjust the sales and the PBT levels. Okay. I'll just go through it again, sir. Okay, sir. Thank you for all the elaborate answers, sir. In the presentation part, offline, sir, I would like to give some more suggestions wherein our presentation can be made more addressable toward the investor. But lot of good changes have been made to the presentation, and we are really grateful to the management for addressing our request. Some more changes can be made that would make the presentation will be more addressable going ahead. So would look to interact with the team who have prepared the same. For my input, sir, if they can be deliberated on. Sure, sir. Thank you. Okay. Thank you, sir. Namaskar, sir. Thank you. The next question comes from Saania Jain with Carnelian PMS. Please go ahead. Hello, sir. Thank you for the opportunity. Just wanted to know what would be the CAPEX number this year? CapEx? CapEx which is capitalized or under execution? Under execution. Under execution should be only this phosphoric acid and sulphuric acid plant at Sikka, which is proposed. That CapEx is around INR 1,600 crores-INR 1,700 crores what we have projected at the time of proposal. Now the firm bids have been received, and we are under negotiation. We cannot disclose the price. This is the CapEx available presently. One more stream of DAP at Sikka is proposed to be converted into fertilizer production facilities like APS and other NPK. Approximately INR 30 crores-INR 40 crores expenditure would be there to convert this DAP plant. Sir, what about the sulphuric acid plant in Vadodara? Yeah. And CAPEX. Commissioned in next month or so, September or October. That is around INR 340 crores of the plant. We will be capitalizing that in the next quarter or in the third quarter. Okay. And sir, did we experience any inventory gain this quarter in the fertilizer segment? What you are saying? Please repeat. Did we experience any inventory gain in the fertilizer segment this quarter? If you could quantify them. Inventory gain? Yes. See, in case of fertilizer, you know that subsidies paid are on power. Normally, in case of Q1 is already off-season, so normally this does not happen. So not major part or anything. Okay. That is it from my side. Thank you. Thanks. Thank you. The next question comes from the line of Manzil Shah with NSFO. Please go ahead. Good evening, sir. A couple of questions. One is, a few years back, the Gujarat government had come out with some guidelines for Gujarat-based PSUs with respect to dividend policy and buyback. Are you supposed to follow those guidelines actually still? Yes, sir, because the circular is still in the force, so we are actually following it. Okay. Because there was a guideline for buyback also, and I think GSFC was one of the candidates for fulfilling those guidelines, actually. Yeah. As far as dividend is concerned, the last quarter we have said now the ex-dividend, when it will be paid, the board will decide accordingly. As far as buyback or bonus share, whatever the items were there in the circular, our chairman is the Chief Secretary of Government of Gujarat, so he knows better. Whatever the instruction coming from the board for buyback or bonus certainly applies. Sir, would it be fair to assume that whatever CAPEX you have announced, and obviously they yet not finalized, okay, but considering improved performance, it could be mostly financed through internal accruals? No, no. Three, four projects we have already commissioned, and now whatever money we are having, it is not sufficient to cater the needs of PSA project, which is more than INR 1,600 crores. Let us see. Whenever we need, we will approach the market for that portion. Sir, but we already have more than INR 2,000 crores cash in the books, and our annual cash generation is close to INR 800 odd crores. Yeah. So that has been reduced quite a bit, INR 800 crores. Now, because of the raw material prices going on, other inventory we are piling up for the next quarter production. So we are not having that much cash, which I can assume that it will suffice for the PSA plant. So you mean to say the March 2025 cash has reduced substantially? Yeah. Presently it is reduced. I do not know if the subsidy is increased, then we save a good margin on the fertilizer and along with the subsidy, then it will require again. Sir, last question. One is, both with regards to lot of increase in the fertilizer prices, there is a talk that the fertilizer subsidy will increase substantially this year. By March 2026, do you think that all the companies would be receiving the subsidies or this time there is a possibility that they can be delayed? No, no. I think that whatever the pricing of the raw material is prevailing, government will certainly look into and increase the subsidy, especially on the phosphorus and sulphuric acid content, P and S. Whatever budget the government has provided in the budget, that will be revised, I think, whatever additional is needed. Because the agriculture sector and fertilizer sector is of prime importance for the economy and for the government also. More from the cash flow perspective, because government has been repaying subsidies for last couple of years, but this year, there would be a substantial increase and, considering the cash flows, would they be able to repay on time or there could be a delay? No, no. We are receiving the subsidy well in time. Up to the July second week, we have been receiving the subsidies. There is no delay from the government side, and I hope that this will continue. Sure. Thanks a lot, sir. Thank you. A reminder to participants, to ask a question, you may press star and one. As there are no further questions from the participants, I now hand the conference over to Mr. S. K. Bajpai for closing remarks. So thank you, participants, and I hope that our team and myself has given the satisfactory reply, whatever questions has been posed to us. It is good quarter for us and hopefully good rainy season is there, so we will come out with the better results in the coming quarter. Till then, goodbye. Thank you. Thank you. On behalf of Gujarat State Fertilizers & Chemicals Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.