Thank you. Good morning, everyone, and a warm welcome to you all.

My name is Purvangi Jain from Valorem Advisors. We represent the investor relations of Chambal Fertilisers and Chemicals Limited.

On behalf of the company and Valorem Advisors, I would like to thank you all for participating in the company's earnings call for the fourth quarter and financial year ended 2026. Before we begin, let me mention a short cautionary statement.

Some of the statements made in today's earnings call may be forward-looking in nature. Such forward-looking statements are subject to risks and uncertainties, which could cause actual results to differ from those anticipated.

Such statements are based on management's belief as well as assumptions made by and information currently available to the management. Audiences are cautioned not to place any undue reliance on these forward-looking statements in making any investment decision.

The purpose of today's earnings call is purely to educate and bring awareness about the company's fundamental business and financial quarter under review. Let me now introduce you to the management participating with us in today's earnings call and hand it over to them for their opening remarks.

We have with us Mr. Abhay Baijal, Managing Director; Mr.

Narinder Goyal, Business Head, Manufacturing Operations; Mr. Anuj Jain, Chief Financial Officer; Mr.

Ashish Srivastava, Vice President, Sales and Marketing; Mr. Tridib Barat, Vice President, Legal and Company Secretary; and Mr.

Vivek Mishra, Business Head of TAN. Without any delay, I request Mr.

Abhay to start with his opening remarks. Thank you, and over to you, sir.

Thank you, Purvangi, and good morning, everyone. Thank you for joining us in this conference call to discuss our fourth quarter and financial year ended 2026.

The Indian fertilizer industry faced a challenging environment in 2026, marked by global geopolitical uncertainties, elevated energy prices, volatility in key raw material markets. India's agriculture fundamentals remained resilient, supported by a favorable southwest monsoon at 108% of the long period average, healthy reservoir levels at 126% of normal, and strong crop sowing activity across both kharif and rabi seasons.

Kharif acreage stood at 112 million hectares, and rabi sowing at around 68 million hectares, resulting in record food grain production of nearly 348 million tonnes. The Indian agriculture sector grew around 2.4% in FY '26, despite uneven climatic conditions.

India achieved a record fertilizer production of 503 lakh metric tonnes during FY '26 across both urea and NPK/DAP sectors, reflecting continued capacity expansions and improved product availability across regions. Fertilizer demand also remained healthy during the year, while the government continued to support the industry through stable urea pricing, robust subsidy allocation, DBT implementation, and close coordination with industry participants to ensure uninterrupted supply across the country.

Ahead of the kharif 2026 season, the total fertilizer inventory stood at around 200 lakh metric tonnes, equivalent to about 51% of seasonal requirement, as compared to the normal level of 33%, supported by strong advance stocking and efficient logistics management. During Q4 FY '26, geopolitical tensions in West Asia led to sharp volatility in global fertilizer and energy markets.

India continues to remain dependent on imports for key raw materials such as LNG, ammonia, and sulfur. During the quarter, disruptions in supplies from Middle East resulted in volatility in availability and pricing across the industry.

For instance, ammonia prices increased sharply to about $850 to $900 per tonne, while sulfur prices also increased from $900 to $950 per tonne. Elevated LNG prices further pressured input economics for the industry.

Given India's import dependence for key raw materials, the sector faced higher sourcing costs, supply disruptions, and logistics constraints during the quarter. Although the government raised NBS subsidy rates upwards by about 10%, industry margins would remain under pressure due to high raw material costs and rupee depreciation.

During the quarter, the government also took measures to prioritize gas availability for domestic urea manufacturers, which helped limit the impact on production to a very large extent. However, lower gas availability during part of the quarter impacted the capacity utilization slightly and energy efficiency for the sector.

Domestic phosphatic fertilizer production increased during FY '26, while imports of DAP and NPK fertilizers also rose sharply to ensure availability. Within the phosphatic segment, NPK fertilizers continued to gain while companies increased diversified sourcing across Southeast Asia, Africa, Canada, Russia, and China to reduce supply chain risk and improve sourcing security.

From an agricultural perspective, the year remained broadly favorable. Reservoir levels across key agricultural states remained healthy and supported strong crop sowing activity during both kharif and rabi seasons.

Rabi acreage witnessed healthy growth led by wheat, pulses, and oilseeds, while early indicators for the upcoming kharif season also remain encouraging. Rural demand trends remain supportive for fertilizer consumption across regions.

With this backdrop, let me move to our operational and financial performance for the fourth quarter for FY '26. Our crop protection chemicals and specialty nutrients business delivered another year of strong growth during FY '26, driven by higher market penetration, expanding product portfolio, and improved contribution from value-added offerings.

Business continued to witness strong growth in both revenues and margins, with contribution increasing by around 27% YoY. During FY '26, we launched 17 new products spanning herbicides, fungicides, and insecticides, strengthening our presence across key crop segments and geographies.

We also continued to build healthy innovation pipeline with 14 new crop protection products and one specialty nutrient product planned for FY '27. The biologicals business continued to scale up well, with robust increase of about 30% in volumes and 57% growth in revenues, reflecting increased farmer adoption of sustainable agricultural solutions.

Uttam Pranaam, our biogenic nano phosphorus product introduced in Q1 FY '25, witnessed significant increase in contribution during FY '26. The product is developed through a biogenic process and contains 10% P2O5 with encapsulated biomolecules such as polysaccharides and lipoproteins.

Two of our biological products, Uttam Superiza and Uttam Pranaam, have now covered almost 3 million acres since launch, supported by increasing awareness and field-level demonstrations. During the year, we also introduced a water-soluble powder variant of Uttam Superiza, targeted at precision farming, drip irrigation, and high-value crops.

Further strengthening the portfolio, we launched four new biological products across fungicide and nematicide categories during the year. Additionally, we partnered with TERI to establish the CFCL-TERI Centre of Excellence for Advanced and Sustainable Agriculture Solutions, which will focus on research and development for next-generation agricultural technologies.

Coming to our seeds business, we expanded our portfolio during FY '26 with the introduction of new products across wheat, maize, mustard, and bajra categories. The initial farmer response and field performance have been very encouraging, and we continue to strengthen our product portfolio.

The coming year will be increased emphasis on cereal and research varieties. Our bulk fertilizers business delivered a robust performance during FY '26 despite a volatile—

Yeah. Coming to our seeds business, we expanded our portfolio during FY '26 with the introduction of new products across wheat, maize, mustard, and bajra categories.

The initial farmer response and field performance have been very encouraging, and we continue to strengthen our product portfolio. The coming year will be seeing increased emphasis on cereal and research varieties.

Our bulk fertilizers delivered a robust performance during FY '26 despite global volatile operating environment. The phosphatic and potassic fertilizer portfolio segment performed well during the year, supported by effective sourcing, strategic inventory planning, and timely market placement.

We also secured product availability for upcoming kharif season despite continued uncertainty in global raw material markets and supply chains. Urea volumes for the year were more or less marginally lower due to an unscheduled shutdown at one of our plants in quarter one, which temporarily affected production during that period.

During FY '26, we continued our farmer engagement initiatives through digital platforms and outreach programs. Our social media footprint expanded significantly during the year, with both Facebook and YouTube platforms crossing 100,000 subscribers, while our YouTube channel received the Silver Play Button recognition.

The Chambal Uttam Krishi Mitra app crossed 100,000 downloads during the year, reflecting growing farmer participation and engagements. We also conducted multiple digital knowledge sessions, product awareness campaigns, and farmer education initiatives aimed at improving outreach and strengthening connect with the farming community.

Our technical ammonium nitrate project achieved significant progress during FY '26 and has now entered the commissioning phase. Dry runs for the weak nitric acid plant have commenced, and subsequent commissioning activities for downstream TAN, including ANS melt and HDAN products, are also underway.

The project is being developed using state-of-the-art technology from Casale, Switzerland, and has a capacity of 240,000 metric tonnes per annum, representing Chambal's strategic entry into industrial and mining chemicals, marking another important step in the company's growth trajectory. The initiative is aligned with India's broader focus on Aatmanirbhar Bharat, domestic manufacturing, infrastructure development, and energy security, while also creating a new long-term growth avenue for the company.

Finally, let me walk you through the details of the financial performance for the period under review. On a standalone basis, the fourth quarter of financial year 2026, revenue from operations grew 14% year-on-year to about ₹2,785 crores.

EBITDA for the quarter stood at ₹255 crores, up 56% year-on-year, with EBITDA margins at 9.16%. Profit after tax was INR 145 crores, up 46% year-on-year, with PAT margins of 5.22%.

For the financial year as a whole ended 2026, standalone revenue operations increased 25% year-on-year to ₹20,794 crores. EBITDA rose 8% year-on-year to ₹2,679 crores, with EBITDA margins at about 12.88%.

Profit after tax for the period grew 18% year-on-year to ₹1,950 crores, with PAT margins at 9.38%. Our subsidy receivables and subsidy flows, we received a subsidy of around ₹2,048 crores during the quarter as compared to ₹1,592 crores in the corresponding quarter last year.

During FY '26, our subsidy receipts stood at approximately ₹12,276 crores, broadly in line with ₹11,945 crores received in the same period during last year. As of 31st March 2026, total receivables stood at about ₹2,075 crores, comprising market debtors of ₹121 crores and subsidy receivables of ₹1,954 crores.

Coming to segmental performance, our urea segment delivered stable performance. Urea revenues in the quarter came in at about ₹2,432 crores, an increase of 8%.

EBIT margins improved significantly to about 7.83%. Sales volume was marginally higher at 6.72 lakh metric tonnes as compared to 6.3 lakh metric tonnes in the same quarter.

During FY '26, we saw minor decline in the urea segment at around revenue being to ₹12,566 crores, lower by 5%, while EBIT margins remained steady at 14.6%. The sales volumes declined 2% to stand at 34.06 lakh metric tonnes as compared to 34.7 lakh metric tonnes last year.

In the complex fertilizer segment, revenues increased significantly to ₹323 crores during the quarter, reflecting year-on-year increase of 94%. Sales volume also rose 0.65 lakh metric tonnes compared to 0.38 lakh metric tonnes, strong demand and steady increasing adoption of balanced fertilizers.

Complex fertilizer segment out-performed during FY '26, with revenues increasing sharply to INR 7,025 crores, reflecting year-on-year growth of 175%. Sales volume increased 12.31 lakh metric tonne during FY '26 as compared to 5.64 lakh metric tonnes, led by strong growth in DAP, TSP, and NPK fertilizers.

EBIT margins stood at around 4% during FY '26. The CPC, specialty nutrients, and seed segment witnessed a decline in performance in this quarter, revenues lower by 21% year-on-year.

However, EBIT margins remained healthy. For FY '26, the segment result delivered strong performance, revenues increasing by 30% year-on-year to ₹1,203 crores as compared to ₹926 crores in FY '25, and EBIT margins remained healthier at around 23.5%.

Our joint venture IMACID is performing well. The increase in P2O5 production capacity from 5 lakh metric tonnes to 7 is expected to be implemented in December '26.

Further, sulfuric acid capacity is also being increased, which is expected to be implemented a year ahead in FY '27. Board of Directors has recommended a final dividend of INR ₹6 per share, totaling to ₹11 per equity share for FY '26.

Overall, FY '26 reflected resilient execution across our core and value-added businesses despite volatile global operating environment, while the urea business continued to provide operational stability and healthy cash flows. The complex fertilizer segment delivered strong growth driven by DAP, TSP, and NPK volumes.

At the same time, our crop protection chemicals, specialty nutrients, and biologicals business continued to scale up well, with improving contribution, product expansion, and increasing farmer adoption. Progress in technical ammonium nitrate project, continued investment in sustainable agriculture solutions further strengthen the diversification and long-term growth profile of our operating portfolio.

With this, I would like to hand back to the moderator and open for question-and-answer session. Thank you.

Yeah. Am I audible?

Hello?

Yeah. Firstly, congratulations, sir, on a wonderful set of results.

Sir, the first question that I have is I think the last time we talked, you said the gas costs were about 20. Can you give us an idea what the current gas costs are looking like for the first quarter?

They will be around the same number. We are still in the midst of the quarter.

Currently, what I understand, it is 18-plus, 18.5-plus. It may be around the same number.

Okay. Sir, this quarter we have seen a jump in receivables.

I think we've reached almost from 367 to 2,000 crore, to 2,075 receivables. We have also seen an increase in short-term borrowing.

Can you give us an idea on what those are?

See, as far as short-term borrowings are concerned, these are small cash flow mismatches which happen, but they will be eventually evened out during the course of the year. The company is more or less on a stable keel as far as finances are concerned, as you know.

As far as the increase in receivables are concerned, we have a process called escalation and de-escalation. Sometimes what happens is that the government have compensated us on a base of a higher gas number, so that continues when you are actually consuming at a lower cost.

Then you tend to accumulate cash because you get more subsidy than what you would be actually spending. Reverse starts happening if they have derecognized that subsidy or taken it back, then you get a different set of equations.

Secondly, as we go forward, as you know that the prices are going up from the base, there will be somewhat of escalation, which we have taken up with the government to give us interim relief in terms of cash flows. I am very hopeful that the government will look into this very favorably.

Sir, if we see the gas prices elevated for the rest of the year, do you think that this could be a problem that could pop up and continue probably till the end of the year?

What they give is a provisional price for the previous which is applicable for the next one or two quarters. What we are going to tell them, in fact, what the industry is continuously telling them, is that there has been a dollar increase since the gas price increased.

Can you give us interim relief pending final calculations, which I think they are very sympathetic to hearing to. We are hopeful that we will be able to manage this issue, not a big problem.

Okay. Sir, so, we today saw the petrol and diesel price increase.

We've seen the other expenditures that they'll have to make in terms of phosphatic and for urea also. Do you think that situation like the last time we had this in '22, '23 could arise, let's say, in terms of receivables bloating up?

No, I don't think that is going to happen. This government and particular are very clear that fertilizer is a very, very important sector to support, and we have seen the kind of support that they are giving in terms of purchasing at even higher costs.

There is a clear focus on farmer being a very important element of the economy. This support I think is likely to continue despite the costs.

I would hazard a guess as to how much the amount of increase in subsidy is going to be. I hear from the concerned quarters that whatever it takes is the lines there, whatever it takes to support the segment will be available.

Got it. For the TAN, I think 30th April is the commissioning, and I think you gave the update on the same.

At this current year, do you see the capacity reaching to 75%, 80% that we could have done in a year?

Yes, definitely. That Mr.

Narinder Goyal has promised me that by all means he will have 75%, 80%, huh? That is his commitment to me.

Yes, Mr. Baijal, we will do it.

It is his commitment to me, and I'm sure that he will meet that commitment.

I'm so sure, sir, you're aware TAN prices are up by 40%. We've had Russia also putting a curb on the TAN exports to India.

We keep a tab on what's happening in the market. Mr.

Mishra give me a daily report on what the daily prices of TAN are.

Got it. Sir, just last question.

This year we had a very good growth in terms of complex fertilizers, particularly DAP, NPK, and TSP. Do you think in this year in terms of volumes, do you see that we will be able to deliver a growth on this, because there will be limited availability, let's say you've said, just at the current prices that are elevated?

No, you are very right that this year's availability, especially in the phosphatic segment, is likely to be constrained. We do hope that their better sense will prevail.

It is not a question of production; it's a question of logistics. Let's understand that.

We have many ships, about 28 or 29 ships, which are stuck up in the Hormuz. They are carrying material.

They are there loaded up, and so on. It is more a question of logistics than production.

That is firstly one thing to understand. That means if we have an opening up of Hormuz in the next 1 month or so, even if we take a delayed adjustment, because this shipping takes some times to adjust, in 3 months' time, things should return to normal.

That is one thing. Secondly, as far as Chambal is concerned, we did make some strategic purchases very big, early in the beginning of the year, and we are covered at least till July-August in terms of our stocks.

For complex fertilizers?

Yes.

Got it. Sir, just last question.

I think in the last con-call, you had touched upon a new CapEx that we could be looking at and a substantially CapEx. I think there were two, three ideas that you guys had in mind.

I think first one was the urea, a new plant that we could set up, or a TAN expansion, or a new product line. Is there any further guidance you would like to give on the same?

The only guidance I will give is that the government, looking to this situation that is there, are very, very serious in terms of pushing out a policy to attract investment. For our part, we are very ready in the sense that we have land, we have the environmental clearance, I'm happy to report to you on that issue, we have the water requirements tied up, and we have already started talking to the technology buyers.

Some of them have visited our plant. We are ready.

The moment the government pushes the button, within 5, 6 months, we will be on the block to run to this particular situation. That is one.

Secondly, what you talked about, the TAN and so on, they will be subsequent developments, but we are also ready with that in terms of making an analysis where and how we should put that plant. That is in the works, and I will not be able to reveal much more on that.

As far as the fourth plant in terms of urea concerned, we are very, very advanced in terms of execution of this.

Okay. Got it.

Thank you so much, sir. I'll just join back in line.

Yeah.

Thank you for the opportunity. Sir, this quarter we have seen a significant growth in EBITDA per tonne for urea.

What has led to this sharp jump in the quarter, and how to ascertain this quarterly volatility in EBITDA per tonne? Because for the last three quarters, it has been more or less flat, but we have seen a sudden jump in Q4.

No, it is more to do with the product mix. We do know that we do sell a certain amount of ammonia, we had better margins there.

How much was the ammonia volume for this quarter?

That you will discuss offline with Mr. Anuj Jain.

It was primarily because of maybe higher volume and price of ammonia?

No, there is price increase, no doubt, and of course, production of urea was also there, and sales of urea also was higher by about 30,000, 40,000 tonnes. All of that taken together.

Sir, regarding urea volume, 2 years back, same quarter, we had more or less same number of urea sold,

but our

EBITDA per tonne was higher.

Also, sometimes what happens is that you are doing maybe two plants at that time in terms of annual turnaround, debits of that nature also occur. This year, we did one plant, not two.

That has impacted. Although we had planned to do something much earlier, but we did not do because of gas shortage and so on.

That debit in terms of the cost of repair and maintenance also, and on a smaller base, it makes a bigger difference in terms of percentages.

Right. Sir, this entire year, we had around 3.4 million tonnes of urea sales.

Last year, it was 3.47. Would we be touching around 3.5 this year?

Is that in the realm of reality? No,

we had to have two shutdowns. This year was in the end of the year, and then in the beginning of the year, we are currently undergoing one shutdown for Gadepan I, which is a slightly longish shutdown, which will tend to be happening till about June, middle June.

The number that is there that we are going to do is more or less the same, although we'll ramp up and try and ramp up once we have completed the turnaround, run it at a little higher rate. We are confident that we will do better than last year, but whether we'll touch 35, it's a touch and go there, but we will definitely exceed what we did this year.

Sir, how much would be urea inventory with the company at the end of FY '26?

It's about 130,000 around.

Okay. Sir, for quarter one till date, how much of our quarterly requirement of gas for all the three plants combined we are getting from the government or from the GAIL and other OMCs?

No, we have no issues in terms of gas availability as of now, thanks to very active procurement by the government, for which I should thank them. They have really been proactive on this issue.

I'll jump back to the queue.

Yes. Thanks for the opportunity.

As we commissioned the TAN plant, can you throw some light on the TAN and at the end I think this will be the important chapter for the CFCL for the future growth. Can you give some idea about what will be the EBITDA margin range for the TAN when we will operate at the full capacity?

How does the market for the TAN looks like?

I'll start with the last question first. See, the market for TAN is buoyant, I would say.

Demand is there. That the continued emphasis on mining and infrastructure and all that is a strong growth driver for this particular segment of the market.

My view is that we, for this year at least, we do not have any issues in terms of the demand. As somebody just said before this, the questioner before this had made the comment about Russia not supplying, so that the import market is also a little short.

On this basis, I don't think there is an issue in terms of the demand as such. Second part that you questioned in terms of what would be the EBITDA, I think our budgeted numbers are very well there.

In fact, they will be exceeded in terms of what the margins could be, and that's my feeling at the moment.

Oh, sure. Secondly, are we expecting the higher working capital requirement for next quarter due to this high gas prices?

Because as you mentioned in the starting commentary that the government increased the price for the subsidy by 12%, is it par with our cost we incur or it is below our cost?

No, if I could understand what you're saying, Mr. Belekar, is that you are talking about the urea price or you are talking about

the

NPK?

Urea.

Urea. If you understand this business, it is basically a cost-plus kind of business.

Government recognizes the cost, and therefore, in terms of higher prices of gas, except for that impact on working capital, we are able to pass on the cost to the government in the form of subsidy, increased subsidy. It would not be a problem for us.

Oh, sure. That's from my end, and wish you best for the future ahead.

Thank you.

Hi, sir. Thanks for taking my question.

Sir, what was the actual Gcal of G1 and G2 and G3, G1 plus G2 and G3, for the quarter? For the full year, sorry.

Could you repeat that, please?

Sir, what was the actual energy consumption Gcal per metric tonne for G1 and G2 and G3 for the year?

They're definitely below the government norms by percentage, good percentage. Normally we do not reveal these numbers publicly, but we are well below the established norms, therefore a certain amount of energy gain does accrue to us.

Right, sir. Sir, can you tell the sales volume of G1, G2, G3 for the quarter?

I will ask Mr. Anuj Jain to answer this question.

Sales volume for the quarter in the quarter G1 was 2.67 lakh tonne, G2 is 1.52 lakh tonne, and G3 is 2.53 lakh tonne.

Sir. Thank you very much.

Yeah. Good morning, sir.

I just wanted to ask you with the new capacity coming up, can you give me some guidance about the turnover you are expecting in this financial year? The new expansion you are done which is coming up today, the production is going to start today?

That you are talking about TAN?

TAN, yeah.

Yeah. TAN, our production level is about 700 tonnes per day,

and

assuming that we are able to start, we'll start with the WNA production,

nitric acid,

and then it goes to melt production, and then it goes to HDAN, which will come by the end of the month or a little bit later than that. Let's assume that we have got about 9 months production to be very conservative.

We are saying that we have roughly about 160,000, 170,000 tonnes of production would be possible.

Sir, can you give me some revenue guidance roughly around it can add to the

This is a very volatile product in terms of pricing. Somebody just said that the TAN prices are up by 40%.

Normally, they used to. Revenue guidance is dependent on what the number is.

Budgeted number normally for this is about

₹37,000, ₹38,000 a tonne. That is the normal number that you might think about.

Okay. Thank you.

Are you also looking at this year any buyback, like you're thinking about coming up with buyback, because we do see promoters buying back the shares in last quarter, are you looking at buyback and considering buyback?

There is no such proposal on the table as of now.

Thank you so much.

Yeah. First question is on the TAN.

Would we be able to reach a 60%, 70% or even higher utilization in the first year itself? Any color on the market dynamics, given challenges on imports of TAN into the market, is the market right now very tight, or how would you describe the market structure right now?

Market at the moment is short, I think. People want material, and in fact, the sooner we get it to the market, the better.

That's what the issue is. That is one.

The second is that going forward, it depends on what the geopolitical situation pans out at, and what will be the stance of Russia in terms of exports, but I can say there is an underlying growth in about 6% to 7% in the explosives segment, and therefore that translates back into ammonium nitrate. It's about 6% to 7%, and it's a healthy growth, I would say, given that we are already at 1.2 million tonnes or so of demand.

If you are saying 6%, 7% growth, we are talking about 70,000 tonnes per year add on year on year, that kind of number. As of now, I don't think it is more a question of how we produce and how we place it in the market, and what is our connect with the customers, and so on.

There's enough room for everybody to play at the moment.

In the first year, should we expect close to full utilization?

Even in regards to spreads That we know how to run continuous process chemical plants. It all depends on how we successfully commission it, which I'm very hopeful that we will be doing it.

We have the best technology. We have brand-new equipment, and we have a competent team to operate it, I don't see in terms of production why we should have an issue.

That's certainly not a concern.

In terms of key feedstock and raw material availability, especially for urea, be it for TAN, do you think you have covered well for the kharif and rest of the year?

I couldn't get you, but I thought you were talking about raw material availability. For this is basically ammonia, and ammonia is self-produced in our case because we have got three plants producing ammonia, and we have about 3% to 4%, 5% surplus on account of technical reasons.

We don't see any shortfall coming from that side as far as TAN is concerned. We are there in terms of matching quantities for ammonia.

On urea, sir?

On urea, of course, gas is the main component. We first make ammonia, then we make urea.

As I've told you that the government are very proactive in getting the gas for the

fertilizer

plants, so that I don't think is also a constraint. It's only a question of price.

Got it. Given where the prices are for urea and ammonia, do you think that it would be remunerative for you to produce above RAC, any color you can give?

No, I would suggest that you also have a look at where the IPP for urea is. It is $900, sir, way, way above.

It is not a problem in terms of production beyond the RAC.

Okay. Thank you.

Yeah. Hi, sir.

Sir, I think you had mentioned some cost structure and how we would be going about urea plant. Can you just help me understand if we are potentially setting up a new urea plant, how would the project cost go, and how would we look at funding it?

See, we have checked around, and what has been happening in the sector lately, the prices will be ₹9,500 tonnes ₹9,500 crores to ₹10,000 crores. That is the upper bound as far as brownfield projects are concerned.

For about 1.4 million tonnes? Huh?

For 1.3 million tonnes, roughly the same. Now that you know the balance sheet of Chambal,

I don't think

there is much of a challenge in funding that. That is one.

Second of all, in terms of the government policy, now that is the open question, what exactly they are going to offer on the plate. Whatever other information that we have and we have been discussing, it's a doable project.

Got it.

Sir, what would be the CapEx number for FY '27, and what would be the areas of investment?

FY '27, there would be some balance expense on account of the TAN project, of course. Plus there would be the normal routine CapEx of the order of about ₹170, ₹180 crores, which is there every year, which are in terms of either replacement or new, more efficient equipment such as, for instance, steam turbines or CO2 compressors, and so on.

Those are the standard kind of ₹160, ₹170 crores that we spend.

What is the balancing amount in TAN?

Total put together should be around ₹500 crores, urea and TAN put together.

Okay. Sir, once we commission WNA, we would be taking some time to start ANS and HDAN.

Is it that we will store WNA till the time we produce HDAN, or we will sell WNA in the market?

Obviously, we'll sell it in the market. There's a ready and good market for WNA at the moment.

Yes, you're right that there is a sequential commissioning in this process. Our plants on both sides are more or less ready, but as you know that we have to run through dry runs both sides and then commission, and so on.

It will take a little bit of time, but we're there as far as the most important component of the plant is WNA product.

Right. Sir, have we also evaluated making automotive-grade urea?

While it does not come under the subsidy regime, but 75% of India's requirement is imported. Any thoughts if you have ever evaluated this?

No, it is definitely possible with our plants. At least one stream or two streams we can take out to do that, and we are, in fact, having some very, very preliminary discussions on this issue.

We are telling the government also that you should allow us to do this

technical grade

urea for automotive purpose. It is very nascent.

I won't give a timeline onto this. That depends on government policy.

We would require government approval because gas has to be supplied through them. Is that

Yeah. Obviously.

This is a requirement that they would allow us, like they have allowed, for instance, GNFC and GSFC to do that.

Sir, any clarity on G3 profitability starting next calendar year?

What I can say is that what I said last time, that the government are seized of the matter. The file has started.

We have had one or two preliminary discussions. Too premature to give you any guidance on this, but it is moving.

That much I can say, because we are to be in this regime from December 1st onwards. The government are quite aware.

Currently, they are a little busy with other things in terms of sourcing, and so on. I'm sure in the fullness of time, maybe within a month or so, we'll engage more effectively with the government on this issue.

Just lastly, how much would be the net cash on balance sheet?

I think at the end of the year, we were balanced with both I think it was zero zero or almost net cash was whatever cash on the books was more or less counter by the amount of short-term borrowings. Somebody asked that question in the very beginning.

This is a fluctuating number. Once our subsidies get released in the first quarter, and so on, this will go down.

I'm sure we are already surplus, as Anuj informs me.

Sir. Thank you so much for your time.

Sir, I think we had also mentioned something about setting up a phosphatic fertilizer business primarily in a manufacturing site. Has there been a push by the government that you have seen for increasing these capacities also?

I know informally talking, I cannot say anything about this, and it would not be proper for me to say this that they are thinking of something on this area as well. We have, as I've said, in terms of phosphatic capacity, we are and we remain very keen on this.

There are two or three important issues which need to be sorted out in this sector, apart from, of course, the scale and the value-addition, huh?

DAP pricing?

I couldn't get what did you say?

Yeah. I just meant that DAP pricing is also an issue?

No, no. DAP pricing is definitely an issue, but more than that are issues with respect to GST, for instance, in this sector, which is quite a problematic area which they have to sort out.

We have been at it for quite some time with them. That's a tax issue which is easily sorted, but they have to rework their entire GST around this particular sector.

That is one part. The second part is the upfront investment vis-a-vis the value-add, which you rightly said is suppressed because of controlled pricing.

You have to see a situation where we are relatively free in terms of pricing power before we can take this forward. These two things, I think, are the important issues which we are waiting for in terms of production inland.

Our thoughts are not only limited to India, by the way. That is something that, as we have hinted in the past, this is something that remains an ongoing issue.

We have had one or two engagements with somebody who could provide us possibilities outside India, and that is an ongoing affair. At the moment, we have had a break off due to this Gulf War situation and all that,

but

we are ready to engage at some point of time in very near future on this issue.

That would be a JV kind of a structure that we'll be looking outside?

Yes, sir.

Got it. Sir, last question on the CPC and biologic segment.

I know we are gearing up with product launches for this year. What do you think is the strategy or the outlook that we have for this segment?

How big do you think that we can get it in the next 2 to 3 years, considering I think last quarter you had mentioned multiple international companies that you were talking to: Nutrien, Corteva, Syngenta? How are you thinking about this segment?

I'll tell you that Nutrien are already more or less done in terms of engagement. We have got long-term agreements more or less in place, we'll be starting with their products very soon.

Sir, those would be potash products?

No, no, they are specialized nutrient-use efficiency products. Somebody should understand that the agriculture is moving in a different direction.

It is no longer bulk. It is more precision.

It is more specific to soil conditions. It is also very specific to nutrient-use efficiency and application capabilities.

We have to now move from a very generic to kind of specialized agricultural inputs. That is the way it is going, and we have to work with some of the international companies to bring products that really work.

One of them is what we are going to do, it's called I think Uttam Carbonix or something, which we are coming in with Nutrien. It's to increase the carbon content in the soil.

It will improve the nutrient-use efficiency. These kind of products.

Plus Corteva, we are already there with them in terms of some of their products we are already co-marketing.

Sir, how big do you think this could get for us in terms of our outlook?

When we were talking to Nutrien, they said that, "Look, what is the total market in India?" We indicated in the region of $1 billion by the next 5 years.

You can understand what kind of percentage they would be looking for. Even 10% would make a very large number.

Yeah. Got it, sir.

Thank you. Thank you, sir.

Thank you, Purvangi. I would like to thank you all for joining the call today, and hope we were able to address all your queries.

If you have any further questions, you can reach out to our IR partners at Valorem Advisors. Thank you once again for participating in the call.