Fertiliser Stock Sees Fresh Promoter Buying After Best-Ever Annual Profit; Is It Undervalued?

Synopsis: A major fertiliser company just reported its best-ever annual profit, even as a key margin slipped slightly. Meanwhile, a promoter-group entity quietly added more shares from the open market – a move worth paying attention to.

India’s largest private-sector urea manufacturer posted a strong set of numbers for FY26, with net profit crossing a new high for the fourth straight year. The quarterly performance was equally encouraging, with profit jumping sharply compared to the same period last year.

Promoter Adds Shares from the Open Market

CM Airtime Promotion LLP, a promoter-group entity of Chambal Fertilisers and Chemicals Limited, made two separate open market purchases in quick succession. It first bought 1,40,641 equity shares on May 20, 2026, following which its aggregate shareholding rose to 23,81,363 equity shares. It then purchased an additional 30,000 equity shares on May 22, 2026, taking its total holding further up to 24,11,363 equity shares, bringing the total shareholding to 0.602%. Both acquisitions were disclosed under Regulation 29(2) of SEBI’s Substantial Acquisition of Shares and Takeovers Regulations, 2011. 

Open-market buying by promoter entities is generally viewed positively by the market. It signals that those closest to the business believe the stock is attractively valued and are putting their own money behind that conviction. Overall, promoters held 61.25% of the company’s shares as on March 31, 2026 – a strong majority stake that has been increasing gradually over recent quarters, going from 60.40% in March 2025 to 61.25% by March 2026.

FY26 Results: Record Profit, Strong Revenue Growth

On a consolidated basis, Chambal Fertilisers reported an operational income of ₹20,793.7 crore for FY26, up 25% year-on-year. EBITDA came in at ₹2,678.6 crore, an 8% increase over FY25. Net profit for the full year stood at ₹1,953.3 crore, up 18% year-on-year. Earnings per share (basic and diluted) rose to ₹48.76.

The EBITDA margin for FY26 stood at 12.88%, compared to 14.92% in FY25. The compression in margin was due to a higher increase in expenses relative to revenue – total expenses grew 28% year-on-year, against revenue growth of 25%. This is a point retail investors should watch, as sustained margin pressure over multiple quarters can weigh on long-term earnings quality.

Q4 FY26: A Sharp Quarterly Turnaround

The January–March 2026 quarter told a more upbeat story on a year-on-year basis. Consolidated operational income grew 14% to ₹2,785 crore. EBITDA surged 56% to ₹255.1 crore, with EBITDA margin expanding from 6.67% in Q4 FY25 to 9.16% in Q4 FY26. Net profit for the quarter rose 30% year-on-year to ₹169.2 crore.

The sharp quarterly improvement in EBITDA was driven by better performance from the urea segment, which benefited from higher sales volumes. Urea sales volume in Q4 FY26 stood at 6.72 lakh MT, compared to 6.30 lakh MT in Q4 FY25.

Beyond Urea: Agri-Inputs Business Gaining Ground

The Crop Protection Chemicals and Speciality Nutrients segment delivered a 27% year-on-year growth in contribution in FY26. The company introduced 17 new products during the year across herbicides, fungicides, and insecticides, and has 14 more in the pipeline for FY27. The biologicals category also showed robust momentum, with volume growing 30% and revenue growing 57% in FY26. These high-margin, asset-light segments are becoming an increasingly important part of the overall business mix.

About Chambal Fertilisers and Chemicals Limited

Established in 1985, Chambal Fertilisers and Chemicals Limited is India’s largest private-sector manufacturer of urea, with an annual production capacity of 3.4 MMTPA across three plants at Gadepan, Rajasthan. The company holds roughly 10% of the domestic urea market and distributes through a network of over 4,750 dealers and 93,000 retailers across 14 states. It also markets complex fertilisers, crop protection chemicals, speciality nutrients, and seeds under the Uttam brand.

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