Q1 25/26

Aug 1, 2025

Ladies and gentlemen, good day and welcome to the Chambal Fertilisers and Chemicals Ltd Q1 FY26 earnings conference call. 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 touch-tone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Gavin Deesa from CDR India. Thank you, and over to you, sir. Thank you, Sagar. Good day everyone and thank you for joining us on Chambal Fertilisers and Chemicals Ltd Q1 and FY26 earnings call. We have with us today Mr. Abhay Baijal, the Managing Director, Mr. Narendra Goyal, Business Head, Manufacturing Operations, Mr. Anuj Jain, CFO, and Mr. Ashish Srivastava, Vice President, Sales and Marketing. Mr. Tridib Barat, Vice President, Legal and Company Secretary. Before we get started, I would like to point out that some statements made or discussed in the conference call today may be forward looking in nature and must be viewed in conjunction with the risks the company faces. Chambal Fertilisers and Chemicals Ltd does not undertake to update them. The statement in this regard is available for reference in the presentation. We will begin the call with opening remarks from Mr. Baijal. I would now like to invite Mr. Baijal to share his views. Over to you, sir. Thank you, Gav. Thank you. Good day to everybody and a warm welcome to all of you participating in this call. For the quarter under review on a standalone basis, revenues amounted to INR 5,698 crore. EBITDA was INR 929 crore. Profit after tax was INR 638 crore as against INR 552 crore on a year-on-year basis with a growth of 16% at the consolidated level. Also, the company has performed well during the quarter registering a PAT of INR 549 crore as against INR 448 crore last year. This is about 23% growth for the quarter. Urea production volumes were 8.54 lakh metric tons as compared to 9.03 lakh metric tons. Urea sales for the quarter were 8.41 lakh metric tons against 8.87 lakh metric tons. Urea production was lower primarily because of some breakdown at our second plant that is Gadepan 2. That is now normal. Subsidy receipts continue to be timely. The subsidy outstanding was INR 1,326 crore as at the end of Q1. During the quarter, our sales volume of P&K fertilizers consisted of DAP, MOP, NPK, and triple superphosphate and was strong at 4.21 lakh metric tons as against 2.41 lakh metric tons last year with a growth of almost 70%. This has been driven by prudent and strategic sourcing strategy and an enabling subsidy framework. Further, we have sourced adequate volumes of P&K fertilizer ensuring preparedness for the Rabi season. Volume and sales growth for our CPC and SN business continues to be strong at 32%. First quarter FY26 CPC and SN revenues stood at INR 452 crore as against INR 343 crore in the corresponding quarter showing continuing momentum. Contribution for the quarter stood at INR 102 crore which was higher by INR 21 crore as compared to last year. During the quarter, we introduced 13 new CPC products primarily comprising of weedicides and insecticides. Today, our CPC portfolio comprises 73 products with distinct chemistry covering fungicides, weedicides, and insecticides, and these products are well accepted by farmers across India and our territory. Our strategy continues to focus on creating partnerships and alliances for introducing better chemistries and increasing the width of offerings in our channel. During the quarter, we have started the seed business and introduced maize and bajra seed which added INR 6 crore to the top line with a contribution of INR 2 crore. On the biologicals side, we have achieved revenue growth by 80% as compared to last quarter. Total revenue stood at INR 29 crores against INR 16 crores in the previous quarter and as planned a biological fungicide and nematicide will be introduced in Kharif 2025 and Rabi 2025 respectively to address the farmers' pain point for nematodes and disease control. In short, Chambal Fertilisers and Chemicals Ltd is now increasingly focused on technologies which bring benefits in terms of improving farm yields, improve soil health and provide better product outcomes. During the quarter we have inaugurated the Crop Protection Laboratory with our partner The Energy and Resources Institute (TERI), which will develop five new biological crop protection patented products over a period. TERI, as you may know, is a pioneer institution in the area and will be doing this research under the Center of Excellence which we have established to develop these new products. Our Seed to HOURS program, which is a pioneer program in synergizing our contacts with our farmers, is playing a significant role towards strengthening and expanding our relationships with both the farmer and channel partners. During the quarter Chambal conducted over 700 farmer meetings, 420 demos, and analyzed about 27,000 soil samples. We have also significantly expanded our use of social media to reach out to a large number of stakeholders and have launched Uttam Krishi Pathshala, which covers a webinar dedicated solely for educating farmers on various agricultural practices on social media platforms. Our Technical Ammonium Nitrate project is progressing in line with stated timelines. All requisite statutory approvals are in place and we have spent around INR 918 crores till June 2025. Our joint venture IMACID is performing well. The increase in capacity of P2O5 from 500,000 tonnes to 700,000 tonnes is under implementation, which will optimize its operations and increase the profitability further. With that, we are now happy to take your questions. 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 then one on their touchstone phone. If you wish to remove yourself from the question queue, you may press Star then 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. Our first question comes from the line of Vishal from Trinetra Asset Managers. Please go ahead. Good afternoon, sir. Am I audible to you? Yes, I'm sorry to interrupt. Vishal sir, if you're using a speakerphone, maybe request to use a handset, please. The voice was echoing a little bit. Okay, considering the broader macro environment where global fertilizer prices remain elevated, currency volatility persists, and the Department of Fertilizer policy shift, how do you expect this factor to influence your urea and P&K fertilizer margins and volume for the rest of the year? Let me take this question in two parts. The urea is a kind of formula-related pricing, and the margins are not expected to vary much in the remaining part of the year. As far as NPK is concerned, you have to strategically purchase position, basis, the subsidy and the MRP that you can get in the market. You are right that the prices have shown a degree of upward mobility, rapid upward mobility rather, in the last quarter. Some signs of abatement are there, but we will have to see how it goes forward. However, our stocks are well covered for that. Okay, on a second side, your Crop Protection Chemicals, Specialty Nutrients, Biologicals, and Seed segment delivered a standout 32% year-on-year revenue, and you have launched 30 new CPC launches and entered into hybrid seeds. Could you unpack the respective contribution of CPC, SN versus Biologicals versus Seed segment? No, all of them are more or less in the same contribution range, give or take 2 or 3%. Okay. What is a go to market. Trend like across distribution, digital engagement which is our Jumble Connect and field demonstration. To scale these new products, I will ask Mr. Ashish to speak about how we go about marketing this. Over to you, Ashish. Okay, thank you Vishal. Is your question precisely on the digital interventions or on the seed to harvest program? Can you hear me, Vishal? Yeah, I can hear you. Your question precisely is on the digital interventions in marketing or on the. Seed to harvest program like across the. Diffusion channels, how are your new products achieving? New products? To start with, there is a, since the chemistry has come from some other research partners, we do an elaborate product launch and then we have digital connectivity through some WhatsApp chatbot and Uttam pharmaconnect. It is all these things are digitally spread to various stakeholders in the ecosystem. Can Abhay achieve the revised FY 2026 target of INR 1,500 crore revenue in CPC and SN? Are we good in the runway? Yes, we are. Okay, that's it from my end. Thank you for your answer. Thank you, Vishal. Thank you. Our next question comes from the line of Prashant Biani from Elara Capital. Please go ahead. Thank you for the opportunity and congrats on a decent set of results. Abhay sir, what is your expectation from NBS subsidy in H2, and in that backdrop, what kind of credit fertilizer volumes can we see this year? I would say that after the DAP and TSP side have been largely moderated by the government's new approach to keep the companies insulated from price shocks, we are trending back to our original numbers of billion ton plus. Sir, is the price control for TSP there as well? I mean, not price control but. DAP, TSP are under price control. Other NPKs are not. The government is reimbursing INR 1,000 over and above the cost on both. Yeah, more or less. Sir, what is our trade inventory? Of credit fertilizer at the end of Q1. Trade inventory. I would ask Mr. Anuj Jain to speak about how much sales we have made. What we are talking, I think, is the cost. You're talking about inventory, or are you talking about what we have in stock? Actually, no pause inventory, I mean which is lying with the channel. Okay, cost inventory please. Anuj, can you please enlighten us as at the end of June 30. Which. Product exactly is Prashant your query on? We had 1.60 lakh tons of NPK including potash inventories as of end of 30 June. By when are we planning the trial production for it? Since we are nearing the trial. Production will commence early December, late November, and we should be starting production by middle January. you provide some color on EBITDA per ton for TAN based on current realization, what kind of EBITDA per ton we can achieve? The current prices, if I am not wrong, are between INR 35,000 to INR 37,000 a ton net back. I would assume that they would be in the region of five digit plus at the moment. Okay, so Prashant, just one clarification. The POS inventory 160 is of NPKs. Total is around 260. Okay then sir, on urea energy norms, government was about to revise it either in CY or FY 2025. When is that happening and what kind of changes would you be expecting? Which one are you talking about? There are two parts. One is energy norm and one is fixed cost. What is it? Energy norms. Energy norm. I think the government have informally told us the effect of that is already encapsulated in current results. Can you elaborate what is the change in norms? There is some reduction, and to that effect, the negative impact has been factored. Okay. This would be a public document, sir, because this is leading to industry. No, not yet. Not yet. It will be a public document as and when they publish it. Okay, sure sir, I'll come back if I have some more questions. Yes. Thank you. Our next question comes from the line of Viraj from Simplify. Please go ahead. Hello. Hello. Yeah. Yeah. Hello everyone. Yeah, just a couple of questions focused on the year of question pertaining because what early participant was asking. If you see for, you know, our unit one. Hello. Yes. Yes, hello. Yeah. If you see what the earlier norms were for us, say for Gadepan 1 and Gadepan 2, we were around in FY2025 somewhere around 5.2 gcal per ton. The group which we were under, Group 3, I think the unit now is somewhere around 5.5. Correct me. The change which you're talking about is even below 5.2. No. There are marginal variations from the current. No. Okay. Given that we have been taking these energy efficiency projects, the last two years we have seen a good amount of gains flowing in and we were looking at further efficiency projects. The impact of this in terms of port and EBITDA cost, will that largely negate the efficiency gains or should we still see gains flowing in our 2026 numbers? Let's put it this way, the government does review the norms from time to time. We need to continuously keep improving our norms, which we do, as you know, that we continue to do that, not the norm, but efficiency itself through various efficiency projects. We have a pipeline of such projects stretching at least up to 2026, 2027. Those will come into position and as they come into position, our consumption will actually come down again. The delta which is there can keep varying a little bit here and there, but it will be constantly more or less maintained. That's what it is. There is no, sorry. We are well below the norms, being an efficient producer, and we will continue to maintain that gap between the norm and our operating parameters. The percentage sharing of the gains between us and the government, that is, there's no change to that, right? It's just a tightening of the energy efficiency. No, there's no change in the % sharing. What happens is as the norm shift downwards, if you have not made adjustments to your own consumption by efficiency projects, you will tend to lose out. Got it. Just a few more questions on the manufacturing area business. One is the 30.3% benefits. Is there now any communication, you know, in terms of what kind of a plan or a structure we would be post December 2026. As of now, no discussion on that has taken place. Assuming that you were kind of soon the benefit similar to paper 13 for the unit 3 as well, what kind of impact one would see in terms of the agenda from those rough ballparks? Not exact. We see. The point is, as of now, they have not stated anything. All of it is speculative, and we don't believe in discussing speculative numbers out in the open. We have had no discussion absolutely with the government as to what line of action it will follow. As far as the new plants are concerned, there could well be a different policy than what it is today. Let's wait till we get some clarity. As and when we get clarity, we'll definitely communicate. Okay. Just one more question on the urea business. If you see the market per se, you know, industry consumption is much higher than the production and we are now back in deficit, you know, and given the natural rate of growth in the consumption a few years on the line, that would still be a much higher number than what we are today. If you look from an investment point of view in terms of any new greenfield at current prices and the structure, it doesn't seem to be generative. From your interactions with the government, do you see any new policy being laid out for any new greenfield investment? What is that feeling, you know, or communication you're getting from them? I can only tell you that the government is seized of the problem and they can see the trajectory of growth in terms of consumption. We have seen a sharp fall this year itself in terms of the inventories because of the accelerated demand due to slightly early rains, widespread rains, change in cropping patterns, growth of maize cultivation and all that. All of that is being factored into their thought process. Should they feel the need, they will definitely invite new participants. You see, setting up the urea plants is a very capital intensive, time consuming business and it is best carried out by those proponents of projects who have got prior experience in doing so. In that sense, I think the government are quite seized of the matter. As far as my understanding goes, how and what will happen in a short period or in a medium period, I can't say. My understanding is that they are quite seized of the matter. Are the discussions on new investment, if at all with the government, more so that the driver of that would be a new policy similar to NIP12, or will it be more driven by deregulating the front? I can't speculate. See, the point is the government has, for your information and I think everybody knows, that in the budget extended the policy for urea. I mean, one can speculate, one could always think that, look, the same policy would be extended again if a new, because they have done it just about three months back, four months back. Okay, thank you. Thank you. Thank you. Before we take the next question, I request all the participants to use only handsets while asking a question. Our next question comes from the line of Sandeep Mukherjee from SKP Securities Ltd. Please go ahead. Yes, sir. Thanks for taking the question. Sir, can you please share the plant wise production volumes and total ammonia sales figure for this quarter? I will ask Mr. Anuj Jain to explain the plant wise production and ammonia sales. If I am not wrong, you can take down ammonia sale as about 23,000 tons plant wise. He will explain we had production of Gadepan 1 about 2.9 lakh ton, Gadepan 2 around 2.15 lakh ton, and Gadepan 3 about 3.5 lakh ton. Okay, sir. Sir, what would be the volume in IMACID for this quarter? IMACID volume, we had about 1.26 lakh ton which have produced. Last quarter, previous year. Previous year, last quarter. What was it? This year? Same quarter was INR 130,000 last quarter. I don't have the information right now. INR 130,000. Okay. Okay, sir. My last question is, please throw some light on the recently ventured seed business. What is the market size and sourcing or collaboration, if any, and the growth ambitions over there. See, seeds is a very important part of the agri input segment. It's a very big market in terms of the total size. You will have to go through various sections of this. There is hybrid, there is open pollinated varieties and so on. Our focus at the moment is on hybrid and research. The products that we are talking about are maize, mustard, millets, research, variety of wheat. These are basically our focus areas. Because northwest companies like we are, these are some of the things that will have traction in the market. We have started with something like mustard and maize, bajra and maize. We have done about INR 6 crore in sales, which is a very small beginning. Of course, our Ravi ambitions are much higher. They will be an order of magnitude higher than what we have done, as well as market size. As far as the total market size is concerned, which includes open pollinated variety and research, hybrid marketing informs me of the order of about INR 50,000 crore. For this, sir, are we sourcing or do we have a collaboration with someone? We have got alliances. I would ask Mr. Ashish to speak about Sandeep. Presently we have embarked on the seed journey through the white label business. That means we are buying a very popular product from top manufacturers. You know we have tie ups with the top manufacturers in all crop segments. It will not be okay for me to reveal the names, but we are in tie ups with the best in. Business, best in class. Okay. Okay, sir. Thank you very much, sir. Thank you. Our next question comes from the line of Amit Agija from HG Hawa. Please go ahead. Yeah. Good afternoon sir. Thank you for the opportunity. My question was connected to the TAN project like you said. By January, I think, we'll start the commercial production and you said INR 918 crore already spent. I think so. What total capex that we are planning is INR 1,645 million. Correct? Yes. The balance, whatever we will be from the internal sources or you will be raising funds. No, no. Please understand that the total project cost includes contingency, tax, interest during construction, and all that. Correct. You take it out from there. The balance quantity that we have still to spend is of the order of INR 300 to 400 crore, and there are some other items in terms of housing and so on, or what you call as owner scope. That will get completed over time. That has no connection with the production as such. What will be the peak possibility of revenue from this plant once it is commercialized? See, we have. Normally you do not expect 100% production rate from day one. We have basically one operating quarter that is middle of January to March. Assuming that we do about even 67% rate of production, then we are talking about 5.556 million tons product. It sells at today around INR 35,000 to INR 40,000. You can do the math. Understood, sir. Thank you, sir. Always for the future. Thank you. Our next question comes from the line of Prashant Kumar Azariwala, an investor. Please go ahead. Mr. Prashant Kumar, your line is unmuted. Yes, please proceed. Yeah, yeah. Congratulations for good setup from that side. My question is like how long this Gadepan 2 plant was shut down. my memory is not wrong, it is about, in two instances, total about 24 or 25. Exactly what time it was down for first time like in May or like when it was found. It was down in the month of May. The month of May, right. My request for you guys. I think. We have lost almost 20% of our revenue in urea in India, right? You are right. 92 days. 20 days or not, 92 days will be close to 20%. Right. There is. There is no overall material is decided in terms of reportage to the stock exchanges. Sorry to interrupt. Prashant sir, your audio is not very consistent. Your line is breaking. Yes. It was not reported to the stock exchanges, right? We are talking about materiality here. It is not material enough. 20% is material. I think it's a concern to the investor, right? 20%. If you see the total EBITDA for the quarter from that angle, we are. Talking about, is it total? No, I'm talking about turnover point of view, right. Because turnover was down like 20% because of this problem. Investor doesn't know about it. Maybe some informal guys from somewhere, I don't know. Since May, INR 676 of INR 7,700 like that was the peak our stock has made, and then it has come down to this level. That is where my concern is. Maybe some guys know about data or what, I don't understand. No. Mr. Zariwala, let me explain to you. Most of the segment revenue reductions in this particular quarter as compared to last quarter are due to reduction in the prices of gas, which is of the order of 10%. Beyond that, the reduction which is there on account of this is of the order of, if I'm not wrong, just 3 to 4% of that. That is 20% volume. Doesn't make sense like in the ton of war, right? That is what you are trying to tell me, right? No, no. When we are looking at contribution, definitely not to that extent. Even in terms of the turnover of the total company, if you see on INR 5,000 crore or whatever we have reported, it is not even. It is about of the order of. 2 to 3% for you. Last year we have done something like INR 3,600 crore kind of thing. We have done INR 3,100 crore. Please understand that the turnover depends on gas prices this time. Okay. 10% is. 10% is. You can consider from the gas price, right? Another 10% will be from Japan 1, right? I'm saying it is of the order of 2 to 3%. Okay. My concern is like 20, 20 days, 24 days. At least we can have one intimation about it. That will be good for investors. will check internally and get back. Yeah, please. Okay. Thank you. Have a good day. Thank you. Our next question comes from the line of Falguni Dutta from Mansour over Financials. Please go ahead. Hello. Yes. Yeah. Yes. I have just two questions. One is on that energy change norm in urea. How frequently does it change? Is there a duration that it changes after so many years each time they change it? The government can be inconsistent on this and sometimes consistent on this. This norm has been changed after almost 18, last seven years. After seven years. Okay. Normally, is it supposed to change after five years or is there nothing such thing? No such thing. We have no such. They always in the policy will give it sunset clause in that. Sorry I missed you. There is a normally given. Okay. That this will run from this time to this. Okay. After this change, is it known now only as to when will be, when will the next change happen? No, we have no communication on that. Okay. Until the other question. This is not a published policy. This is on the basis of a discussion that was had between us and the department. The numbers that were given to us have been factored into current year's first quarter calculation. Okay. The second question is on the JV expansion. The phosphoric acid 5 to 7 lakh tonne. When is that going to come up? My information is it is late 2026, maybe early 2027. That kind of time. Okay, thank you sir. That's all from. Thank you. Thank you. Our next follow-up question comes from the line of Prashant Biani from Elara Capital. Please go ahead. Thank you for the opportunity again. Sir, how much is the net cash on balance sheet right now? Around INR 1,600 crore as on 30 June. Urea volumes from G3 Plant sales volume, not the production. Sales volumes. Can you please. 3.4 lakh tons. Okay. are the gas prices for the quarter? It is about $15.15 on NCV basis per LMTU. Okay, sir. On the TAN plant, have we been able to calculate how much benefit are we getting from the state incentives either annually or cumulatively over a certain period of time? The package that has been proposed is not yet in a sense signed off. It is in the advanced stages of being signed off. There is a RIPS policy in this and RIPS means Rajasthan Investment. There is a certain % of the total hard project cost. That means excluding interest during construction and certain other things of which I think a certain %, not, not wrong, between 20%, 20%, 25%, 20% to 25% which comes back as some sort of per year payment over a period of 10 years. That means roughly 2% to 3% of the hard cost of the project per year. Two to two and a half. Yeah, that's it. Yeah. What is the hard project cost for us? If I'm not wrong, it is about INR 1.1 billion. INR 1.1 billion? Yeah. Around INR 11,000 crore. Okay. Sir, no incentive on GST, GST or interest subvention. I don't think there are any such schemes in RIPs. Okay. Sir, what is the quantum of impact of energy norm reduction which we have taken provisionally? It is low double digits per quarter. 20 crore? INR 50 crore. No, low double digits. Very low double digits. Okay. there any informal talks with the government on fixed cost reimbursement? That revision is also pending for many years. I have absolutely no idea what they are doing. Okay. How much is the massive investing for such an expansion? See, there are two parts to it. I think the first part in the phosphoric acid plant is about $40 to $45 million. There is a sulfuric acid plant which has to come after that. That is of the order of $120 to $130 million. Okay. Sulphuric acid capacity will be how much? I mean the expansion. If I'm not wrong, it is something of the order of 3,200 tons per day. I'll have to check that. Right. It's a kind of a balancing capacity we have got already. There is a boosting up of the capacity which is there already. I'll have to check that. If my memory is not wrong, it is about a million ton plus. Sir, just lastly, how do you see the channel inventory in fertilizer for the industry? For the industry, I will ask Ashish to give. Prashant, we don't have access to the channel inventory data. If you look at the industry stocks, it is down. Urea stock, each commodity stock is down. I mean, is it like the shortage would be such that whatever the industry sells in Q2 will just go off the shelf, and hence the volume growth can be healthy for Q2 as well as Q3? Is it that kind of situation? See, whatever inventories are available at port or at plant is a continuous operation. They will produce and sell, so there is not much inventories in the pipeline. That's how I can say no. I think, Prashant, what we are trying to get at there is some world of truth in that. The demand is fairly, fairly strong. Strong. Supplies both from gas production as well as imports are running a little short. Therefore, there would be a kind of quick liquidation of. Okay. Okay. Sir, thank you so much for asking, for answering the questions. Thank you. Thank you. Our next question comes from the line of Viraj from Simpl. Please go ahead. Yeah, just two questions. One is, I think in the past we talked about us evaluating different capital projects, be it in the nitric acid value chain or other segments and agri input value chain. Any color you can give? Any update? No. At the moment our complete focus is on getting the Technical Ammonium Nitrate plant off ground, commissioning it. There are additional variations in the product, let us say like LDAN, which are being, for which certain type of engineering is being progressed. That is Technical Ammonium Nitrate only, only a different version of it. We have got three versions of it. Two versions of it are already there, which is HDAN, which is high density, and then there is melt, Ammonium Nitrate melt. There is a third category, which is called low density. For that, the engineering part is on. That is a significant addition to the portfolio of the Technical Ammonium Nitrate project. Okay. On the crop protection, any color you give network coverage now and of the sales which we have now, say again FY25, or how much of the sales are outside our core network of urea and how much is through the urea channel. We are quite a bit focused on our urea channel. Quite a bit of our people have in the channel width itself. In terms of, there is still some way to go in our fertilizer channel itself. However, we are beginning to pick up stray one or two kind of people who are purely from the CPC channel, not very big participants in the fertilizer channel, and they are beginning to get familiarized with our product portfolio. It is a process which will take some time. The fertilizer channel itself is offering quite big opportunities in terms of growth as of now. Okay. We were also engaging with a few MNC players for introduction of nine, three or unique products in the portfolio. Any update on that? I will ask Ashish to answer. Viraj, can you repeat your question? I think we were in the past talking about talks with various MNC players for introduction of specialty molecules on 9, 3 products. Yeah, it's an ongoing process, Viraj. We keep adding molecules every year. This year we have added, I think, 13. It's a continuous process. We keep adding it in the portfolio. Of these or in the pipeline, are there any specialty molecules on 9, 3 products? Majority of them are specialty production in line 3. Can you give any color? Who are the partners here? The products which you launch. Difficult to not name them. To name them. Looking at what the existing portfolio, we always deal with some very good player. Best in class. Okay, thank you very much. Thank you. Our next question comes from the line of Pawan Nahar, an investor. Please go ahead. Thank you. My question is on Gadepan 3 or the urea unit. As I understand, we have an eight-year policy period in which we are entitled to incentives, and thereafter there will be changes. If you can explain what are. These incentives and what will be the changes that come across, you know, in 2027 and later. If you can quantify what would be. The impact after that, Mr. Nahar, the change that will come about. Let me speak to you. We have not initiated any discussion rather the government has not initiated. Initiated any discussion with us what shape form it will take. That Is something still, I mean at the moment not even on the first paper on the file, that's what I can say. The second part is as to what is currently the scheme. Currently the scheme is a normative scheme. It says that for a certain dollar value of your gas a certain amount shall be paid at the base level and as the price increases from that linearly, an addition shall be made to the product price at the rate of something like $20 per ton of gas. For every $20 of ton as for every $1 increase in gas price that is currently the policy at a base of something like $285. That is how it goes. Now as far as the new policy is concerned, whether it will be still norm based, whether it will be on unit cost basis, we don't know. As I've said here to you, the first paper on the file has not yet been put. No sir, I understand that. Please go on. Hello? Yeah, just come on, go ahead. Yeah, basically I get it that, you know, government has not initiated any policy discussion. Still, we would be having some assumptions. Let's say, you know, we are right now in a zone where there is perhaps only us or maybe another company which is getting the pricing. I will not use the word benefit, I will use the word pricing or a formula. Now, if after the eight year period we go back to the formula which is being applied to the other Urea units, what would be the change for us? Let's say today our contribution is X dollars, how much would that become? Because I read that in the policy document. Perhaps if I got it right, the band for ROE is between 16% to 20% and I see that without leverage, the company has been able to make good ROE. There's no point in me getting in there because there are multiple things into that ROE or multiple businesses. If you can just simply tell me that if the policy were to transition to the existing units formula which the existing units. The existing unit formula is a 12% return on net worth policy, correct? Right. So. That is for the unit-based specific net worth. It is a matter of plus there are costs, etc., which have to reimburse. What kind of cost? How much cost will they reimburse? That's what I'm saying. As of now, the current policy for 1 and 2 is a 12% return on net worth policy. When they actually effectuated, what exactly will be the number is something difficult to hazard a guess. Of course, there will be a reduction. I know what you are driving at. The question is what is the extent of the reduction, and that is what we are not hazarding a guess at. The company has its own estimations, which I am not going to share with you at the moment. Fine. Thank you. Thank you. Our next follow-up question comes from the line of Falguni Dutta from Answerover Financials. Please go ahead. Yeah, sir, I just missed on what you said on that Rajasthan government incentive for the TAN plant. On that hard project cost of INR 1,100 crore, what benefit are we supposed to get? That part is about for 10 years. Let us say about 2% of the cost per year or something like that. 2% of the project cost, which is this INR 1,100 crore. Yes. Over a period of 10 years. Yes, that means every year you will get 2%. Every year we get 2%. It adds up to 20%. Yeah. Okay. Thank you so much. Thank you. Our next question comes from the line of Ranjith from IIFL Capital Services. Please go ahead. Yes sir, thanks for the opportunity. My first question. In the past, we have shared our. Aspiration to go global as well. Probably tapping some assets for complex fertilizer so that we can use the force from IMACID. Any update on that front? I can only say that we are working on it. Any other active discussion? Yes sir, please. Yeah. We are in contact with the parties. Any outer timeline I would like to share. Concluding this. These are long, drawn-out and very complicated discussions. It has stop and start options in between. Sometimes you walk away from the table, sometimes you walk towards the table. You know how negotiations are. We don't put timelines. We only hope for the best results. For us it is like the India-U.S. trade deal. People are walking off the table. They are back, coming back to the table. That things happen all the time. Right. is pretty certain that the deal is going to happen. I can't say. How can I say what the other party, as long as there's a willingness to negotiate, something will happen. Yes sir. Thank you. That second question is on the TAN business. What are your thoughts on the demand supply dynamics at least in India, and how soon you'd like to see this ramped up? Lastly, the government has also opened up export quota. How do you see that as well? Thank you. See Dan, the market is expected to be short for a short while, I would say, and then go along as some capacities come into position. If you see the overall environment, I was with the Coal India Chairman, Ex Chairman in fact, sometime back. They are going from 800 million tons of mined coal to 1.5 billion tons by 2032 in the various quarries that they have. They are themselves putting up a plant on coal waste, which they say will be fully absorbed, and they will still be short again on those quantities. In the longer run, with the infrastructure push that we have, and you know that the government has asked for 100 gigawatt of power capacity, coal-based power capacity addition, out of which about 70 to 80 gigawatt has achieved FID. We can see that there will be growth. There may be intermittent phases in which the market could be a little long and where there will be some pressures in terms of prices. On a long-term basis, you see that so far we have grown at 5 to 6% CAGR. It will grow at that kind of rate. I am quite optimistic that the demand-supply situation is in the favor of the suppliers. Yes. On the export front, we would also like to tag those opportunities. Export front is mostly, see, export mostly is Aldan. Aldan is a product that is mostly exported, and we are, as I told you, doing the engineering work for that. As and when we have completed that, of course, that will be post the implementation of this particular phase of the project. That will be phase two of the project. Thank you. It will take us some time to get to that phase where we can't do too many things at the same time. Please understand there is a first basic phase one that you do, and then you go to the next stage. We will definitely look into that. Look into that means we are already committed into doing that kind of project. So far after that, then we will see how the market plays out. Sure sir. Thank you. Thank you. Our next question comes from the line of Sandeep Mukherjee from SKP Securities Limited. Please go ahead, sir. Thanks for the follow up question. Sir, can you throw some color on the capex plans for this year? Apart from TAN. We have some ongoing projects. Can I ask Mr. Anuj Jain to tell us what is the extent of the normal replacement capital expenditure, etc., committed for this year? Hello. Normal capex plans are there. It's about INR 250 crore worth of projects we have. These are ongoing projects, phase-wise expenditures. Thank you. Thank you. Our next follow-up question comes from the line of Amit Agicha from HG Hawa. Please go ahead. Thank you sir for the follow up. My question was correct. The Gadepan 2 urea plant, has it resumed full operations and what was the exact impact on volume and profitability? Connected to that, what will be the planned maintenance shutdown schedule in FY2026? The GAN2 is scheduled to go in March 2026 for its annual turnaround since the second year of operation would have completed. As far as this loss of 55,000 tons is concerned, the total loss of production has costed the company in terms of contribution about INR 1,716-1,717 crores. Thank you, sir. That was my. Thank you. Our next question comes from the line of Prashant Biani from Ilara Capital. Please go ahead, sir. We are around the corner to commence our TAN plant, and our cash generation will increase further. Sir, any plans of future capacity expansion except from the long pending discussion on complex fertilizer? Mr. Biani, do you know how much time it takes to, let us say just for argument's sake, take to plan a INR 9,000 crore capex? Let us say hypothetically speaking on a plant like Gadepan 4 or Gadepan 3. No sir, I am not aware of. The technique, even a million ton or something of that sort of NPK plant, there is so much to be done in terms of tie ups and either in policy or in discussions with parties and so on. The company is not going to sit on its cash, going to do something, work. I mean, I cannot put a finger on the date and time for these things. That's all I can do. I mean except on the complex plan, whatever has been the discussion outside of that, any other thing we want to pursue, and we are there will be. I mean in the sense that we have two or three lines of businesses. Seeds is there, Specialty Nutrients are there. All of them present either organic or inorganic opportunities. Not only that, there could be alliances or collaborations there as well. These are businesses that we need to grow and you can see the way that we are growing them. Sometimes the growth will come through alliances or supply arrangements. Sometimes it will come through collaborations and joint manufacturing. Sometimes it will come through sole manufacturing. What pathway will actually happen in the future depends on the market. It depends on the grades that we are doing, the kind of products that we are doing. Sir, in case of alliances I would believe cash outlay will not be that high. Any decision. We can go into the same with the same partner joint manufacturing. Sir, you have been giving feelers for quite a while. Sir, anything more than that, if you can say, that will be great. If I had something to say and it was approved by the board, definitely I would say. Okay, sir. Thank you. Thank you. Thank you. Ladies and gentlemen, that was the last question for today. I now hand the conference over to the management for closing comments. Thank you all gentlemen for this very engaging one hour of conversation. I hope to have been able to answer your questions, and if there are any follow up questions individually that can be, then Mr. Anuj Jain is there to take them. Thank you so much. Thank you. Thank you. Thank you on behalf of Chambal Fertilisers and Chemicals Ltd. That concludes this conference. Thank you all for joining us. You may now disconnect your lines.