💰 Financial Performance

Revenue Growth by Segment

Total revenue grew 39.93% YoY to INR 6,221.46 Cr. Fertilizer segment revenue reached INR 5,437.15 Cr (+35.23% YoY), Petrochemical segment revenue reached INR 774.51 Cr (+89.22% YoY), and Other segments contributed INR 9.81 Cr (-39.74% YoY).

Geographic Revenue Split

Marketing offices across 5 states contributed INR 2,408.97 Cr, representing approximately 38.72% of total consolidated revenue.

Profitability Margins

Net profit ratio improved from 8% in FY22 to 10% in FY23. Return on Capital Employed (ROCE) increased from 16% to 19% YoY, driven by better margins from long-term raw material procurement contracts.

EBITDA Margin

Operating profit (PBIT) reached INR 735.79 Cr in FY23, a 26.74% increase from INR 580.55 Cr in FY22. Core profitability was bolstered by a 26.34% improvement in the net profit ratio attributed to raw material cost management.

Capital Expenditure

Historical capital expenditure was recorded at INR 22.96 Cr in earlier cycles; current year additions to non-current assets for joint ventures were noted at INR 2.34 Cr.

Credit Rating & Borrowing

Not disclosed in available documents; however, interest expense was historically significant at INR 147.63 Cr during loss-making periods (FY13).

⚙️ Operational Drivers

Raw Materials

Specific raw material names are not explicitly listed, but the company utilizes long-term procurement contracts to stabilize input costs for its fertilizer and petrochemical divisions.

Raw Material Costs

Raw material costs are managed through long-term contracts which improved net margins by 26.34% YoY. Procurement strategies focus on long-term price stability to mitigate global commodity volatility.

Logistics & Distribution

Distribution is handled through marketing offices in 5 states, which generated INR 2,408.97 Cr in revenue.

📈 Strategic Growth

Expected Growth Rate

39.93%

Growth Strategy

Growth is driven by the expansion of the Petrochemical segment (+89.22% YoY) and the Fertilizer segment (+35.23% YoY). The strategy relies on long-term raw material contracts to maintain competitive pricing and leveraging marketing networks across 5 key states.

Products & Services

Fertilizers (NPK, Ammonium Sulphate), Petrochemicals (Caprolactam), and Engineering/Consultancy services (Contract Operations).

Brand Portfolio

FACT (Fertilisers and Chemicals Travancore Limited).

Market Expansion

Marketing operations are currently concentrated in 5 states; expansion plans into new regions were not specifically detailed.

Strategic Alliances

Joint Venture with Rashtriya Chemicals & Fertilizers (RCF) for FACT-RCF Building Products Ltd, though a 100% provision for diminution in value has been made.

🌍 External Factors

Industry Trends

The industry is shifting toward long-term supply security for raw materials. FACT is positioning itself by stabilizing margins through contract-based procurement and expanding its petrochemical footprint.

Competitive Landscape

Key competitors include other major public and private sector fertilizer manufacturers in India; FACT maintains a strong regional presence in 5 states.

Competitive Moat

Moat is built on long-term raw material procurement contracts and an established marketing network in South India. This advantage is sustainable as long as supply contracts are renewed at favorable terms.

Macro Economic Sensitivity

Highly sensitive to agricultural demand and government subsidy policies, as fertilizers represent 87.4% of total revenue.

Consumer Behavior

Demand is driven by farmer consumption patterns and seasonal monsoon cycles affecting fertilizer application.

Geopolitical Risks

Vulnerable to global raw material supply disruptions, partially mitigated by long-term procurement contracts.

⚖️ Regulatory & Governance

Industry Regulations

Operations are governed by the DPE Corporate Governance guidelines and SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015.

Taxation Policy Impact

The company is subject to the Central Excise Act and Service Tax (Finance Act 1994).

Legal Contingencies

Pending claims not acknowledged as debts include INR 133.13 Cr under the Central Excise Act and INR 3.61 Cr for Service Tax disputes.

⚠️ Risk Analysis

Key Uncertainties

Significant uncertainty arises from pending litigations (INR 136.74 Cr) and the inherent limitations of internal financial controls regarding the prevention of fraud or error.

Geographic Concentration Risk

High concentration risk with 38.72% of revenue (INR 2,408.97 Cr) originating from marketing offices in only 5 states.

Third Party Dependencies

Heavy reliance on raw material suppliers, though mitigated by long-term contracts that improved margins by 26.34%.