New policy lifts fertiliser scrips

Stock prices of fertiliser companies are showing steady growth trends. The growth is in the wake of the government's plans to attract Rs 30,000 crore worth of fresh investments in the fertiliser sector through an investment-friendly policy.

Share prices of most of the fertiliser firms have been increasing ever since the government's plans for investment-friendly policy were made public.

The projected improvement in the availability of gas "" the critical feedstock for fertiliser production "" has also helped the fertiliser firms improve their market acceptance. 

Share price on BSE in Rs
Company	19-Oct	12-Nov	22-Nov
Gujarat State Fertilisers	226.55	263.20	266.80
Gujarat Narmada	133.35	153.80	167.60
Godavari Fertilisers	149.55	149.00	160.00
Nagarjuna Fertilisers	49.95	59.85	69.20
Rashtriya Chemicals	50.20	57.60	65.45

According to a study conducted by ENAM India Research, a leading investment consultancy, the fertilisers sector is to remain bullish in the long term.

ENAM says the fertiliser industry in India is set to improve due a host of factors, including the moves to decontrol the sector in a phased manner and incentivise domestic capacity addition.

Terming that the companies located near gas supply lines are to prove more cost-competitive, ENAM predicts them to gain most in the future.

Assured, undisrupted supply of natural gas to fertiliser units and incentives for generating excess capacities for exports have also been pointed as prerequisites for growth in the fertilisers segment. The huge gas find in the KG basin has therefore become a positive attraction for the sector.

Manu Malik, CFO, Kribhco Shyam Fertilisers, said, "The new investment policy in fertilisers is to bring in huge business for the fertilisers sector."