Detailed Narrative
Strong Performance in Value-Added Segments
Chambal Fertilisers demonstrated robust growth in its crop protection chemicals, specialty nutrients, and biologicals segments. The 9-month contribution from these segments grew 30% year-on-year, with the biologicals portfolio alone seeing a 58% revenue increase and 31% volume growth over the same period. The company also introduced five new products in Q3 and has a pipeline of 12 new CPC products and one specialty nutrient product slated for launch in FY27, further strengthening its differentiated portfolio.
TAN Project Nearing Completion and Expansion Plans
The Technical Ammonium Nitrate (TAN) project is progressing well, with EPC work 92% complete as of Q3 FY26. The total estimated cost is INR 1,645 crores, with INR 1,184 crores already incurred, and management expects the project to be completed by April 30, 2026. Chambal views TAN as a critical focus area and is actively exploring both vertical and horizontal expansions, anticipating healthy capacity utilization of 75-80% post-commissioning.
Complex Fertilizer Segment Drives Revenue Growth
The complex fertilizer segment recorded significant revenue growth, increasing 81% year-on-year to INR 1,850 crores in Q3 FY26, with sales volumes rising to 2.94 lakh metric tons from 2.13 lakh metric tons last year. For the nine-month period, revenues surged 180% to INR 6,702 crores, with sales volume reaching 11.7 lakh metric tons. However, EBIT margins for this segment moderated to 4.4% in 9M FY26 from 6.87% last year, primarily due to higher procurement costs for DAP.
Urea Segment Stability and Operational Efficiency
The urea segment maintained stable performance, with revenues of INR 3,708 crores in Q3 and INR 10,134 crores in 9M FY26. Sales volumes were largely flat at 9.83 lakh metric tons in Q3 and 27.3 lakh metric tons in 9M. The company reported improved energy efficiency, with Gadepan-I and G-II plants operating 5-6% lower than norms and Gadepan-III 2-3% lower. A minor 3-day stripper leak in Gadepan-I was the only unscheduled stoppage in Q3, with a 30-35 day maintenance shutdown planned for Gadepan-II in Q4 FY26.
Strategic Partnerships and Digital Outreach
Chambal Fertilisers has partnered with TERI for research in advanced and sustainable agricultural solutions, with products expected from FY27-28 and global commercial rights. The company is also exploring in-licensing opportunities with multinational companies like Nutrien Worldwide, Nichino, Syngenta, and Corteva for new products. Digital engagement efforts are strong, with the Chambal Uttam Krishak Mitra app exceeding 100,000 downloads, reflecting enhanced farmer connect and market reach.
Subsidy and Receivables Management
The company received INR 3,880 crores in subsidy in Q3 and INR 10,228 crores in 9M FY26. Total receivables as of December 31, 2025, stood at INR 2,346 crores, including INR 1,979 crores in subsidy receivables. Management noted that INR 1,000 crores of these dues were received in January and February 2026, indicating ongoing recovery and comfort regarding the subsidy situation, supported by supplementary grants from the government.
Capital Allocation Focus on Growth and Liquidity
The company's capital allocation is primarily directed towards growth projects like the TAN plant and capacity expansions in its IMACID joint venture (P2O5 capacity from 5 lakh MT to 7 lakh MT by Dec 2026, and sulfuric acid capacity in FY27). Management indicated no plans for increased cash returns to shareholders in the next 1-2 years, prioritizing reinvestment for growth. The company maintains a healthy net cash and liquid investment position of INR 800 crores as of the call date.