RCF Stocks Set to Soar After Rs 1,000 Crore Deal with L&T for New Fertilizer Plant!

Rashtriya Chemicals and Fertilizers partners with L&T for a game-changing 1200 MTPD plant at Thal

On October 9, 2024, Rashtriya Chemicals and Fertilizers Ltd (RCF) announced the approval of a major purchase order with Larsen & Toubro Ltd (L&T). The contract involves the construction of a 1200 metric tons per day (MTPD) complex fertilizer plant at RCF's Thal facility in Maharashtra. The plant, based on diammonium phosphate (DAP), will cost approximately Rs 1,000.27 crore, excluding GST.

Lump-Sum Turn-Key Project

The new fertilizer plant will be executed on a lump-sum turn-key (LSTK) basis. This means L&T will be responsible for the complete project from start to finish, including design, procurement, and construction. The project is expected to be completed within a 27-month timeline.

Boost to Fertilizer Production

Once operational, the new plant will enhance RCF's fertilizer production capacity. This development is in line with the company's goal of strengthening its role in supporting India's agricultural sector, ensuring a stable supply of fertilizers for the growing demands of farmers.

July 2024 Contract for Ammonia Plant Revamp

Earlier, in July 2024, RCF had approved another significant contract with Topsoe, a Danish engineering firm. The contract, valued at Rs 514.6 crore, is aimed at revamping the ammonia plant at the Thal facility. This project includes procurement of engineering designs, proprietary equipment, and catalysts.

Focus on Energy Efficiency

The revamp of the ammonia plant is designed to reduce specific energy consumption. This aligns with RCF’s strategy to modernize its operations and improve efficiency. The project will span 36 months and is part of the company’s long-term efforts to adopt more sustainable practices.

RCF’s Operations and Ownership

RCF operates two manufacturing facilities in Maharashtra, at Trombay and Thal. These plants produce nitrogenous, phosphatic, and potassic fertilizers, along with various industrial chemicals. The Indian government holds a 75 per cent stake in the company, while the remaining 25 per cent is shared between LIC, mutual funds, financial institutions, and public shareholders.

Strategic Expansions

With these projects, RCF continues to expand its capabilities and modernize its facilities. The company’s efforts are geared toward improving productivity, enhancing efficiency, and maintaining a leading position in India’s fertilizer industry.