Fertilizer stock falls 8% despite reporting 250% YoY increase in net profits

Synopsis: Rama Phosphate fell after reporting a 250 percent YoY jump in Q3 FY26 profit to Rs. 19 crore, with revenue rising 32  percent to Rs. 238 crore, though the stock saw volatility and closed lower.

This company is an Indian manufacturer of phosphatic fertilizers, primarily Single Super Phosphate (SSP), with diversified operations across fertilizers, chemicals, and soya edible oil is now in focus after it reported its latest quarter results with net profit growth of 250 percen year on year.

With a market capitalisation of Rs. 653 cr, the shares of Rama Phosphates Ltd closed at Rs. 185.10 per share, decreasing 8 percent in today’s market session, making a low of Rs. 173, from its previous close of Rs. 187.30 per share. The stock recovered after the results were reported, but still ended the session down 1 percen compared to its previous close.

Q3 results 

YoY performance

On a year-on-year basis, Rama Phosphates delivered a strong performance in Q3 FY26. Revenue from operations increased by 32 percent, rising from Rs. 180 crore in Q3 FY25 to Rs. 238 crore. Total expenses grew at a slower pace of 25 percent, moving up from Rs. 175 crore to Rs. 219 crore, which supported a sharp improvement in profitability. Net profit surged by 250 percent, jumping from Rs. 4 crore to Rs. 14 crore during the same period.

QoQ performance

On a quarter-on-quarter basis, the performance was relatively softer. Revenue from operations declined by 3 percent, slipping from Rs. 246 crore in Q2 FY26 to Rs. 238 crore in Q3 FY26. Total expenses also edged down by 2 percent, falling from Rs. 223 crore to Rs. 219 crore. Net profit fell by 17  percent from Rs. 17 Crores to Rs. 14 Crores.

About the company 

Rama Phosphates Limited (RPL) is a leading Indian manufacturer of phosphatic fertilisers, primarily Single Super Phosphate (SSP). The company operates diversified businesses across fertilisers, chemicals, and soya edible oil, with strategically located plants in high-consumption regions, producing fertilizers, industrial chemicals, and value-added soy products.

The company reports a ROCE of 7.81 percent and a ROE of 3.77 percent, indicating moderate return metrics compared to industry benchmarks. Its stock is currently valued at a P/E of 14.6, trading at a discount to the industry average P/E of 20.0.

On the balance sheet front, the company maintains a healthy financial position with a debt-to-equity ratio of 0.26. Notably, it has been steadily reducing its debt levels, reflecting improved financial discipline and a strengthening capital structure.

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