Gujarat Narmada Valley Fertilizers Shares Fall 6% in Today’s Trading Session; Here’s Why

Synopsis: The Shares of Gujarat Narmada Valley Fertilizers & Chemicals Ltd (GNFC) fell 6% after the company reported RLNG supply from GAIL would drop to 60% from March 6, 2026, due to the Middle East conflict.

The shares of the Small-cap company, which specializes in the manufacturing and marketing of fertilizers (Urea, Nitrophosphate, Neem products) and industrial chemicals, are in focus as they have fallen by 6 percent in the intraday trade.

With a market capitalization of Rs. 6,024.57 Crores on the Day’s Trade, the shares of Gujarat Narmada Valley Fertilizers & Chemicals Ltd declined by 5.8 percent, reaching a low of Rs. 406.05 compared to its previous close of Rs. 431.30.

What Happened

Gujarat Narmada Valley Fertilizers & Chemicals Ltd, engaged in the manufacturing and marketing of fertilizers (Urea, Nitrophosphate, Neem products) and industrial chemicals, has informed that due to the ongoing conflict in the Middle East, the supply of Re-gasified Liquefied Natural Gas (RLNG) from GAIL (India) Limited has been impacted. 

GAIL has received a Force Majeure notice from its supplier, Petronet LNG Limited, and has consequently issued a Force Majeure notice to GNFC. As a result, RLNG allocation to GNFC has been restricted to 60% of the Daily Contracted Quantity from March 6, 2026.

This supply constraint is expected to affect the production of Neem Urea, while the manufacturing of other products remains unaffected for now. The company is closely monitoring the situation and will update the stock exchanges on any material developments.

Financials

The company’s revenue rose by 5.11 percent from Rs. 1,899 crores in December 2024 to Rs. 1,996 crores in December 2025. Meanwhile, Net profit declined from Rs. 163 crores to Rs. 150 crores in the same period.

The company demonstrates a decent return on capital employed (ROCE) of 9.57% and a return on equity (ROE) of 7.08%, with no debt on its books. Its stock trades at a price-to-earnings (P/E) ratio of 9.61, well below the industry average of 17.6, and at 0.73 times its book value, indicating potential undervaluation.

In addition, the company offers an attractive dividend yield of 4.17% and has consistently maintained a healthy dividend payout ratio of 41.6%, reflecting a strong commitment to returning value to shareholders.

In Q3 2024-25, the company reported segment revenues of Rs. 702 cr from Fertilizers, Rs. 1,178 cr from Chemicals, and Rs. 19 cr from other segments. While the Chemicals segment generated a profit of Rs. 182 cr, the Fertilizers segment posted a loss of Rs. 35 cr, and the other segment remained neutral.

Gujarat Narmada Valley Fertilizers & Chemicals Ltd (commonly known as GNFC) is a major Indian public company incorporated in 1976 at Bharuch, Gujarat. It was set up as a joint sector enterprise promoted by the Government of Gujarat and Gujarat State Fertilizers & Chemicals Ltd (GSFC). 

The company began its operations in 1982 with one of the world’s largest single‑stream ammonia‑urea fertilizer complexes and has since grown into a diversified industrial group. Its core business remains manufacturing and marketing of fertilizers, but over the years it has expanded into industrial chemicals such as methanol, formic acid, nitric acid, and acetic acid, and supplies products both domestically and internationally.

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