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GNFC reported a PBT of INR 211 crores and PAT of INR 158 crores for Q3 FY25, marking an incremental increase of INR 76 crores on a sequential quarter basis. This positive change was primarily attributed to operational improvements driven by higher Chemical volumes and certain write-backs during the quarter. The company noted that both PBT and PAT have shown improvement on a sequential quarter as well as year-on-year basis.

The Fertilizer segment saw reduced losses, mainly due to a decrease in input costs for Complex Fertilizer. Management highlighted three positive developments: regular receipt of subsidy payments, pipeline inventories being at their lowest, and ongoing government efforts to revise energy norms (expiring March 31, 2025) and fixed costs for different urea units. However, there is uncertainty regarding the outcome and timeline of these revisions, particularly for energy norms, which could impact future profitability.

The Chemical business improved, driven by higher volumes, especially in TDI and Technical Grade Urea on a sequential quarter basis, and Acetic and AN Melt on a year-on-year basis. While realizations were somewhat subdued, the increased volumes compensated for this. The TDI plant, however, continued to incur a PBT-level loss, estimated by an analyst at INR 150-200 crores, which management confirmed was 'close to the number' and impacted by an elongated shutdown. Current TDI prices are around INR 2,10,000, slightly up from the previous quarter.

GNFC has approved projects worth INR 2,300 crores, which are in various stages of implementation. This includes INR 613 crores for coal-based conversion (CCPP), INR 1,420 crores for the WNA project, and INR 225 crores for the ammonia makeup loop. The coal-based power plant, crucial for TDI cost savings, is now expected to commission around August 1, 2025, after a 4-month delay. The ammonia makeup loop is anticipated by 2027, and the WNA project by 2028. Approximately 60% of the CCPP CAPEX (INR 525 crores) is already committed on an LSTK basis, and INR 187 crores advance has been given for WNA.

The company's key inputs include gas, oil, coal, rock phosphate, benzene, and toluene. GNFC has long-term contracts for urea gases but relies on short-term contracts and spot purchases for Chemical segment inputs like gas. Oil contracts are mid-to-long term, based on global benchmarks like Fujairah. Coal is typically bought on a spot basis a couple of times a year, using an Indonesian benchmark. Benzene and toluene sourcing is a mix of spot and formula-based buying, often linked to Platts. Rock phosphate procurement involves direct negotiation without a fixed reference point.

GNFC's dividend policy is guided by a directive to pay 30% of PAT or 5% of net worth, whichever is higher. Management clarified that buybacks are a separate decision and do not impact the calculation of the dividend payout based on PAT. The company had previously executed a buyback of INR 851 crores around October-November 2023, which is subject to a one-year cooling-off period.