Madhya Bharat Agro Products Limited — Q3 FY26 earnings call

Call held 12 Jan 2026

Management summary

Madhya Bharat Agro Products Limited delivered a robust Q3 FY26, achieving record revenue and profitability driven by strong demand and operational efficiency. The company is making significant strides in its capacity expansion projects in Dhule and Sagar, with commercialization anticipated in FY27. While overall margins were affected by lower-margin imported products, the company maintains strong profitability on its manufactured goods and expects continued growth momentum.

Highlights

  • Revenue of ₹612.4 crores, up 115.9% YoY, marking the highest ever quarterly revenue.

  • EBITDA of ₹66.5 crores, up 68.4% YoY, also the highest ever.

  • PAT grew 77.7% to ₹31.8 crores, reflecting strong profitability.

  • Record fertilizer production volumes of 1,34,355 MT and high capacity utilization (SSP at 109%, NPK/DAP at 115%).

  • Dhule and Sagar expansion projects are on track for commissioning in FY27, promising future growth.

Concerns

  • Overall EBITDA margins were impacted, appearing lower due to the inclusion of lower-margin imported products (2.5-3% vs 13-14% for own production).

  • Inventory buildup occurred due to temporary logistics issues, though expected to be resolved within the quarter.

Key financials

2 periods

Q3 FY26

  • Revenue
    ₹612.4 Cr
    YoY +115.9%
  • EBITDA
    ₹66.5 Cr
    YoY +68.4%
  • PAT
    ₹31.8 Cr
    YoY +77.7%
  • EPS
    ₹3.62
  • Fertiliser Production Volumes
    1,34,355 MT
  • Fertiliser Sales Volumes
    94,958 MT

9M FY26

  • Revenue
    ₹1,472.3 Cr
    YoY +93.1%
  • EBITDA
    ₹185.4 Cr
    YoY +69.5%
  • PAT
    ₹90.4 Cr
    YoY +109.3%
  • EPS
    ₹10.32
    YoY +109.3%

What they filed

Q1 FY27: revenue up 1.5%, net profit up 17.9% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue278 284 297 410 450 +62%612 +115%395 +33%416 +1%
EBITDA36 39 36 57 62 +72%66 +69%41 +14%66 +16%
Net profit14 18 14 28 30 +114%32 +78%60 +329%33 +18%
How to read this

₹ crore, as filed. The percentage beside a figure is the change against the same quarter a year earlier — never the quarter before, which would make every seasonal business look like it collapses and booms each year.

Segment breakdown

  • Q3 FY26 Revenue Breakdown
    ₹615 Cr Total Revenue₹280 Cr Imported Fertilizers Revenue₹335 Cr Manufactured Fertilizers Revenue

Capital allocation

medium confidence
  • Capex Capex disclosed mix of internal accruals and some loan from the banks for Maharashtra project
    • Integrated complex fertilizer plant at Dhule, Maharashtra (3.3 LMT DAP NPK, 3.3 LMT SSP, phosphoric acid, sulfuric acid)
    • DAP NPK fertilizer capacity expansion by 90,000 MT and sulfuric acid capacity at Banda, Sagar, Madhya Pradesh
    Maharashtra project is a mix of internal accruals and some loan from the banks.

Guidance & targets

Margin

  • EBITDA Margin on Own Manufactured Products Margin · ongoing · High confidence 13% to 14%
    for our own production, we are maintaining EBITDA margins of 13% to 14%, and we will continue to maintain the same going forward.

    — Pukhraj Kanther

Capacity

  • Sagar Expansion Commencement Capacity · Q1 FY27 · Medium confidence First week of April
    Our attempt will be to start operations in the first week of April, although it could be a month earlier or later.

    — Pukhraj Kanther

  • Dhule Phase 1 Trial Production Capacity · July 2026 · High confidence July
    We are fully confident and we expect trial production to begin sometime in July, followed by commercial production from October.

    — Pukhraj Kanther

  • Dhule Phase 1 Commercial Production Capacity · October 2026 · High confidence October
    We are fully confident and we expect trial production to begin sometime in July, followed by commercial production from October. There is no confusion on this or no hesitation in confirming that we will start the project by October 26.

    — Pukhraj Kanther

  • SSP, Phosphoric Acid, NPK (Dhule) Commercialization Capacity · October 2026 · High confidence October 26
    October 26.

    — Pukhraj Kanther

Revenue

  • FY27 Revenue Growth Revenue · FY27 · High confidence more than 50%
    Accordingly, in FY 2026–27, we expect revenue to increase by more than 50%.

    — Pukhraj Kanther

  • Dhule Plant Additional Revenue Potential Revenue · post-commissioning · High confidence more than ₹2,000 crore
    The new plant itself has the potential to add revenue of more than ₹2,000 crore.

    — Pukhraj Kanther

  • Q4 FY26 Revenue Momentum Revenue · Q4 FY26 · Medium confidence similar momentum
    We expect to maintain similar momentum during the January-March quarter as well.

    — Pankaj Ostwal

What to watch in Q4 FY26

Sagar Plant Commercialization

Q1 FY27 (April 2026)
Current Civil work completed, equipment in transit, trial runs planned for March
Target Commercial operations commenced

Why it matters

This expansion will add 90,000 MT DAP NPK capacity and sulfuric acid, contributing significantly to increased production and revenue.

Our attempt will be to start operations in the first week of April, although it could be a month earlier or later.

Risks & concerns

  • Margin compression due to imported products

    medium

    Overall EBITDA margins appear lower due to the inclusion of lower-margin imported fertilizers (2.5-3% vs 13-14% for own production), which are necessary to meet demand and expand market presence.

    Management acknowledged

  • Inability to fully meet demand with own production

    medium

    Existing plants are operating at 100% capacity, necessitating imports to offer a complete product bouquet and meet rising demand for NPK variants.

    Management acknowledged

  • Inventory buildup due to logistics issues

    low

    Outward movement of fertilizers was interrupted due to railway transportation being prioritized for agriculture crop movement, leading to piled-up inventory, but expected to be resolved within the quarter.

    Management acknowledged

Q&A highlights

8 direct
Working Capital Management Direct
We have consistently maintained that almost 45% of our annual revenue is in the form of current assets. This trend has not changed, even during the current quarter.

Provides insight into the company's working capital efficiency and management strategy, indicating stability in this key area.

Asked by Nitin Kaushik

Subsidy Impact on Receivable Days Direct
During the season, the process is faster, and subsidy receivables, including sales to wholesalers, remain around two months. During the off-season, this can extend up to four months. I would also like to inform you that all subsidy claims entitled up to the fourth week of November have been received from the Government of India.

Explains the variability in receivable days due to government subsidy processes and confirms timely receipt of recent claims, which is crucial for cash flow.

Asked by Nitin Kaushik

Margin Compression due to Imports Direct
Imported fertilizers typically yield returns of about 2.5% to 3%, whereas our own manufactured products generate EBITDA margins of around 13% to 14%. As a result, margins were impacted during the quarter.

Clarifies the reason for overall margin pressure despite strong performance in manufactured products, highlighting the impact of product mix and import strategy.

Asked by Nitin Kaushik

Sagar Expansion Timeline Direct
Our attempt will be to start operations in the first week of April, although it could be a month earlier or later.

Provides an updated and more precise timeline for a key capacity expansion project, which is critical for future growth.

Asked by Aman Goel

Funding for Maharashtra Project Direct
Maharashtra project is a mix of internal accruals and some loan from the banks.

Gives clarity on the financing strategy for a major greenfield expansion, indicating a balanced approach to funding.

Asked by Rishi Mehta

Revenue Breakdown (Trading vs. Manufacturing) Direct
In quarter, Rs. 615 crores was the total revenue against which the import was Rs. 280 crores and manufacturing was Rs. 335 crores.

Quantifies the contribution of lower-margin trading activities to the overall revenue, providing transparency on the revenue mix and its impact on profitability.

Asked by Jainam Gilani

Dhule Phase 1 Commencement Confidence Direct
We are fully confident and we expect trial production to begin sometime in July, followed by commercial production from October. There is no confusion on this or no hesitation in confirming that we will start the project by October 26.

Reassures investors about the timeline and certainty of a significant capacity addition, mitigating concerns about potential delays.

Asked by Lalit Kumar Sharma

Inventory Buildup Direct
During this quarter, inventories increased due to certain logistics issues at our plant. These issues are expected to be resolved within the quarter, and we are confident that the accumulated inventory will be dispatched in this quarter.

Addresses a potential red flag (inventory increase) and provides a clear plan for resolution, indicating that the issue is temporary and manageable.

Asked by Pramukh Kabra

2 min read 5 chapters

Detailed narrative

Capacity Expansion and Backward Integration Progress

Madhya Bharat Agro Products is making significant progress on its capacity expansion and backward integration plans. At Dhule, Maharashtra, an integrated complex fertilizer plant with 3.3 LMT DAP NPK and 3.3 LMT SSP capacity, along with phosphoric and sulfuric acid integration, is planned for commissioning in H1 FY27. Concurrently, the Banda, Sagar facility is expanding DAP NPK capacity by 90,000 MT and sulfuric acid capacity, with commissioning expected in Q1 FY27. These projects are crucial for scaling operations, improving cost efficiency, and strengthening the company's market position across key fertilizer markets.

Robust Q3 and 9M FY26 Financial Performance

The company delivered its highest-ever quarterly revenue of ₹612.4 crores in Q3 FY26, marking a substantial 115.9% YoY growth. EBITDA also reached a record ₹66.5 crores, up 68.4% YoY, leading to a 77.7% increase in PAT to ₹31.8 crores. For the nine months ended December 2025, revenue stood at ₹1,472.3 crores (up 93.1%), EBITDA at ₹185.4 crores (up 69.5%), and PAT doubled to ₹90.4 crores (up 109.3%). Operational excellence was demonstrated with record fertilizer production volumes of 1,34,355 MT and high utilization rates of 109% for SSP and 115% for NPK/DAP operations.

Agriculture Sector Tailwinds and Policy Support

The agriculture environment remained supportive during the quarter, with strong Rabi sowing progress, favorable monsoon performance, and comfortable reservoir levels, leading to over 614 lakh hectares of crop coverage. Government policies, including approved nutrient-based subsidy rates for Rabi 2025-26 (with a 2% outlay increase), the National Pulses Mission, and MSP hikes for Rabi crops, are expected to bolster farmer income and fertilizer demand. These initiatives, coupled with enforcement actions against black-marketing and promotion of balanced nutrient use, create a positive backdrop for the fertilizer industry.

Margin Dynamics: Impact of Imports vs. Own Production

While overall EBITDA margins appeared squeezed during the quarter, management clarified that this was primarily due to the inclusion of lower-margin imported fertilizers. Imported products typically yield returns of approximately 2.5% to 3%, significantly lower than the 13% to 14% EBITDA margins achieved on the company's own manufactured products. The company resorts to imports to meet rising demand for customized NPK variants and expand market presence, as its existing plants are operating at 100% capacity. Management expects to maintain 13-14% margins on its own production going forward.

Working Capital and Inventory Management

The company consistently maintains approximately 45% of its annual revenue in current assets, a trend that remained stable this quarter. Subsidy receivables typically range from two months during peak season to four months off-season, with all claims up to the fourth week of November received from the Government of India. An increase in finished goods inventory was noted due to temporary logistics issues, specifically railway transportation being prioritized for agriculture crop movement. Management expects these issues to be resolved and the accumulated inventory dispatched within the current quarter.

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