Shares of agri-related companies including fertilisers and agrochemicals traded higher by up to 8 per cent on the BSE on Thursday in an otherwise weak market after Finance Minister Nirmala Sitharaman announced a new set of stimulus measures including Rs 65,000-crore fertiliser subsidy to farmers. The move will benefit 14 million farmers, the Finance Minister said.
Deepak Fertilisers & Petrochemicals Corporation and Advanced Enzyme Technologies traded higher by 8 per cent and 6 per cent, respectively in intra-day trade on the BSE.
Rallis India, Coromandel International, and Rashtriya Chemicals & Fertilizers (RCF) were up in the range of 2 per cent to 4 per cent. In comparison, the S&P BSE Sensex was up 0.59 per cent at 43,337 points at 03:08 pm.
India received above-normal monsoon rainfall during the four-month season for the second consecutive year and recorded the third highest precipitation in the last 30 years. Monsoon rainfall ended 9 per cent above normal rainfall, v/s 10 per cent above normal rainfall last year.
The Commission for Agricultural Costs and Prices (CACP) has recommended disbursing fertiliser subsidy directly into the farmers’ bank accounts through the direct benefit transfer (DBT) route, which analysts believe is path-breaking.
“It implies that Urea prices will be de-regulated and the price difference between Urea and other complex fertilizers (NPK, DAP) will narrow to 10-60 per cent from 190-320 per cent (depending on various grades). We expect that India NPK demand could increase by 25-35 per cent due to this move as farmers will be incentivized to use balance fertilisers,” Emkay Global Financial Services said in recent agri inputs & chemicals sector update.
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