National Fertilizers beats Urea production target

National Fertilizers on Thursday after the market hours informed the bourses about the sales and production data of the period between April 2020 and August 2020.

On the sales front, the company has sold 23.81 lakh MT during April-August 2020, which resulted in a growth of 16 per cent as compared to the previous best of 20.57 lakh MT recorded during the same period in 2019-20.

Also on the production front, the company has beaten the production target of its main revenue component Urea. It has produced 16.11 lakh MT of Urea during April-August 2020 as against 14.26 lakh MT produced during the same period in 2019-20. This results in a jump of 13 per cent on a YoY basis. Urea is the chief component of the company’s total revenue with a contribution of ~77.8 per cent, followed by other contributors like gas swapping- 15.4 per cent and ammonium phosphate sulphate- 2.1 per cent.

Looking at the COVID-19 impact on the company’s liquidity, the company is facing liquidity constraints due to a delay in the release of fertiliser subsidy by the government owing to an inadequate subsidy budget. The unprecedented higher borrowings to manage working capital requirement has led to incurrence of huge interest cost to the company.