M B Agro Prod.

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.

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.

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.

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^⏳.

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.