Gujarat Narmada Valley Fertilizers and Chemicals Limited (NSE: GNFC) Q3 2026 Earnings Call dated Feb. 11, 2026
Corporate Participants:
Unidentified Speaker
D. V. Parikh — Executive Director & Chief Financial Officer
Tejas Shah — General Manager of Marketing
Nitin Patel — Executive Director
Rajesh Pillai — Company Secretary and Compliance Officer
Analysts:
Nirav Jimudia — Analyst
Atharva Bhide — Analyst
Presentation:
operator
Good evening ladies and gentlemen and welcome to the Gujarat Narmada Valley Fertilizers and Chemicals Limited Q3FY26 earnings conference call. This conference is being hosted by Anurag Services LLP on behalf of GNFC Limited. From the management today we have on the call Mr. D.V. parikh, Executive Director and CFO Mr. Nitin Patel, Executive Director, Mr. P.K. purohit, Executive Director, Mr. Rajesh Pillai, Company Secretary and Compliance Officer and other senior members from the management. As a reminder, all participant lines will be in the listen only mode and there will be an opportunity for you to ask questions after the presentation concludes.
Should you need assistance during this conference call, please signal an operator by pressing Star then zero on your touchstone phone. Please note that this conference has been recorded. I now hand the conference over to Mr. D.V. parikh, Executive Director and CFO GNFC Ltd. Thank you. And over to you sir.
D. V. Parikh — Executive Director & Chief Financial Officer
Thank you. Thank you Anurag Services for holding the call and good afternoon to everybody all all the participants on the call. I am joined like it is already informed by my colleague. But there are two other colleagues from marketing. One is Mr. Tejasa who is from marketing industrial product and second is Mr. Biradhar VB Biradar who is from marketing side. So any questions on the marketing side they will take up the questions. I’ll give you the broad overview of the business conditions during the quarter three. As far as fertilizer segment business is concerned, it has been stable.
There is slight improvement in the NBS rates. So complex fertilizer did well. Urea also did well in terms of the volume and on the chemical side it did better on the volume front which is offset by the pricing pressure in case of most products except TDI during the quarter three. As far as global and geopolitical issues are concerned, the uncertainty on methanol still continues which is the main feed into acetic acid. And there are price uncertainties and volatilities including the part of availability which is there in case of methanol going on to the segment performance, the losses in case of fertilizer have come down.
This is mainly because of the unfavorable subsidy freight rates which are booked last quarter which is not there during the current quarter. Aside from the volume of urea and chemical more or less barring for around 2 crore difference in terms of the segment is same others there is a marginal change of 3 crore rupees. So if we account for the kind of other income which is normally received during Quarter two which is showing up under the other income. The operational income has improved mainly driven by the volumes in chemical as well as fertilizer. During the last board meeting there are certain capacity building capex also which are approved.
One is the capacity building for the fifth boiler which is at the Baruch. Expected CAPEX is roughly to the tune of 480 to 500 crore. Current is the estimate. Once we appoint the PMC and detailed exercises done, we will come to know about the final value of the capex on this. Another is to save on the power cost. There is another CAPEX which is done for the extra line from the. From. DGVCL JETCO which will enable to valorize green power as well as provide stability to the existing operations. On the balance sheet side there are no major change and working capital has been quite under control because of the subsidy flow. The base subsidy outstanding as at the quarter is roughly 302 crore rupees. In terms of other assets and liabilities, there are no other major changes. On the project side all the four projects are on stream except that of CCPP which is expected to commission sometime by end March or early April which is expected to give a net inflow.
In terms of the contribution at gross level it is around 110 crore. At NAT level it is going to generate around 82 crore rupees net of its relevant direct cost. The rest of the project like ammonium nitrate melt, additional capacity for ammonia as well as weak nitric acid are on stream. There is a slight delay in case of weak nitric acid which is recoupable because the critical path activities are not affected. So this is the update on all the projects taken together of 2,800 crore worth of capex. As far as projects under consideration are concerned, there are two projects which are there in the public domain and the examination of which is expected to get completed either in the next quarter or subsequent quarter after which we will decide about the further progress direction on those capex.
So, rest of the things we have already shared in the public domain in terms of investor presentation and results are already on the exchange aside from the press release. So with this I sum up my introductory remarks and now hand the call over back to the organizer. Thank you very much.
Questions and Answers:
operator
Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press STAR and one on the Touchstone telephone. If you wish to remove yourself from the question queue, you may press STAR and two participants. You are requested to use handsets while asking a Question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. Participants, you may press star and one to ask a question. We have the first question from the line of Nirav Jimodia from Anvil Wealth. Please go ahead.
Nirav Jimudia
Yes sir. Thanks for the opportunity. Good afternoon to everyone. Sir, I have few questions to ask. So first is on the tdi. Like when we see the global markets, I think we have seen price improvements in China. Also in the European Union side, predominantly the Europe Covestro basf. Everyone have raised the prices. So just wanted to understand from you that when we see our quarterly presentation our realization in Q3 was close to around 168 rupees. So if you can share your thoughts in terms of when can we align with the price increases taken by the global players here in India.
And also if you can help us explain as there is an anti dumping duty also in place. Anywhere between $200 to $300 depending upon the country of origin. So are we getting any benefit of those anti dumping duty in terms of the price realizations?
D. V. Parikh
That’s it. These are the two questions.
Nirav Jimudia
No sir, there are plenty. But I thought I should first start with the TDI part.
D. V. Parikh
Okay, so on the pricing part you are talking about catching up with the pricing which is elsewhere outside India. So all the pricing is done on an import parity basis based on the indexes available to us. Because that’s the way to keep transparency in the pricing. And that’s the way to find question from any customer. So this is how GNFC operates. It takes its price, calculates the the import parity price and prices of products. At times it is at premium, at times it is at discount for exit premium and discount during the quarter. Our colleague Mr.
Tejasa will respond on that. The second question is on the anti dumping duty. Anti dumping duty just yesterday we came to know is extended for another 5 on the TDI. So anti dumping duty is also taken into consideration for the purpose of arriving at an import parity or. I will request Tejas bhai to respond on this.
Tejas Shah
Hello, I am Tejas sir, you are right. You have seen the data. From January onwards the prices are in improving trend in a global level. Yes, you are right. We have also improved our prices in the from January onwards. For Q3 is concerned the prices were suppressed just because of the weak demand. Global weak demand. And as Mr. D.V. parikh said, we are keeping our prices based on the import parity and whatever the TDI receives at Indian ports.
Nirav Jimudia
Correct. Sir, if you can Help us understand like what would be the market of TDI here in India. And we have capacity of close to around 66 67,000 tons put together both the plants. So if you can share the imports which are coming to India.
Tejas Shah
TDI our market share is around 60% and the rest is import. If you see the total TDI consumption in foam it is around 1 lakh tons. 10,000 to 15,000 is going into the system houses and 1 lakh is flexible foam that is produced 60,000. We are selling in the Indian market. As far as the last year 24, 25 is concerned. We have the hedge plant shut down for the four months. So in 24 to 25 we we sold the TDI around 50,500 metric ton in whole year. At present we are going ahead and present our sales up to Q3 is 30,000.
Nirav Jimudia
Correct? Correct sir. Also if you can share your thoughts like with respect to this trade deal which has happened with fta, with EU and with us. Is it possible for us to do some exports of TDI into those markets where now we can become competitive. Because now we have seen even Chinese currency appreciated by 8, 9%. So that could enable us to have some pricing advantage into those geographies.
Tejas Shah
First we have to see what are the advantage we are getting. Because as I mentioned Indian market is growing at the 10% CAGR. So and our sales is around. Our total production is 65,000 to 70,000 tonnes. So our production it will be very easily absorbed in Indian market. Yes, we have to see the geographical changes. Because in the international market we have to compete in on a global level for the pricing front.
Nirav Jimudia
Correct sir. Also if you can share like are there any of our products which were in which were in the export tax rebate where China has removed close to around export tax rebate on around 200250 products. So are there any products of ours which qualifies under that list?
Tejas Shah
Our acidic acid is falling under that. So we hope the acetic acid prices will will be improved in Indian market.
Nirav Jimudia
And even methanol is removed from that list. Right? If I’m not wrong.
Tejas Shah
Yes. But. But we are not manufacturing.
Nirav Jimudia
Correct? Correct. Correct. The second question is on if you can share the production of ammonia in Q3 both through gas and oil route.
Nitin Patel
I am Nitin Patel. The production of ammonia in Q3 was 1 lakh 75,000 roughly. Okay. And the breakup is around 60% is gas and rest oil base.
Nirav Jimudia
Okay. And sir also if you can check the Production numbers for WNA, CNA an melt and formic acid.
Nitin Patel
WNA is around.1 lakh.
Unidentified Speaker
76 thousand.
Nitin Patel
Wn both plant put together is 77,000 and 41,001 and 2 respectively.
Nirav Jimudia
CNA was.
Nitin Patel
Sorry. WNA 77 and 33 respectively. Okay. And CNA is around 8,401, 8,502, 9,603 and 12,000.
Nirav Jimudia
Total 39,000.
Nitin Patel
Total around 38 to 39,000.
Nirav Jimudia
Correct. And for an melt and formic acid if you can help.
Nitin Patel
Yes. Formic acid is 9,300 and an melt. An melt is 1,16,000.
Nirav Jimudia
Sorry. How much sir?
Nitin Patel
1 lakh 16 thousand 4.
Nirav Jimudia
9 months. Right.
Nitin Patel
49. 49 months.
Tejas Shah
I just want to correct the TBI sales figure up to December. Okay. It is 47,610.
Nirav Jimudia
Okay. So possibly in Q2 we would have Q3 we would have produced close to around 32,000 tons , if I’m not wrong.
Tejas Shah
Not in Q3 we produce 16,000 metric ton of TDI.
Nirav Jimudia
Got it? Got it. Sir, your thoughts on a. The benefits on the operating cost. Like last time you mentioned that Satikarni was appointed and they were about to guide us in terms of the savings in the operating cost. So when can we start seeing the benefits of those measures being told by them to implement?
Tejas Shah
Okay. A.T. kearney has initiated its engagement since last October. And so far they have worked on few proposals where there are savings. But these savings are going to happen once the negotiation part mainly is completed. There are part savings which which have already happened. But unless we sign off those contracts with the supplier, this saving is going to get reflected only thereafter out of the total value which we spoke which at Kearney has represented at board level as well to us. The total is between 260 to 300 crore. Certain part of that has been locked.
The clear locking in is in respect of the renewable power purchase agreement which is to the tune of roughly 5 to 7 crore rupees and rest is under. The majority of other savings are under contracting which are yet to be signed off. So we will be in a position to definitely say about annual saving once this contracting is signed off.
Nirav Jimudia
Correct. But if to assume that whenever everything is in place we could save close to around 250 to 300 crores. What you mentioned.
Tejas Shah
No, that is the claim they are making.
Nirav Jimudia
Okay. Okay.
Tejas Shah
We we are yet to sign off as it progresses.
Nirav Jimudia
Okay. Okay.
Tejas Shah
Any management consultant will make a claim of a certain amount. But then some of the initiatives do materialize and some do not. And finally management will certify how much is the actual saving. Which is flowing into the books of account.
Nirav Jimudia
Sir, last two questions before I again join back. So one on the fixed cost revision that is you mentioned that it should be expected by June 2026. So has the exercise completed and it’s now only upon the ministry to give the final decision on the same or are further rounds of meetings held to be held up to decide on the same?
Tejas Shah
As far as industry and company is concerned there are no further rounds of meeting which is which are happening and this is a decision which is within the government and the respective departments have to take appropriate positions on that.
Nirav Jimudia
Correct? Correct sir. Last question is on any shutdowns we have planned for quarter four or let’s say for FY27 anything any of our products which should or which may be going for a maintenance shutdown in Q4 or let’s say anything which is coming up in next financial year.
Nitin Patel
So far as I am Nitin Patel, so far as Q4 is concerned no shutdown is planned. Next major annual shutdown is being planned in 27 that would be in Q2.
Nirav Jimudia
Financial year, financial year 2027. Right.
Nitin Patel
Or calendar April 27.
Nirav Jimudia
So it should be next year itself. Got it. Thank you so much sir. I’ll join back in the queue for further questions.
operator
Thank you. A reminder to all the participants, you may press Star and one to ask a question. We have the next follow up question from the line of Nirav Jimodia from Anvil Wealth. Please go ahead.
Nirav Jimudia
Yes sir. Thanks for the opportunity again sir. One question on the downstreams of nitric acid. So like we have seen that many of the players have put up their nitric acid plants like Deepak nitrite. Even Deepak fertilizer is also expanding. Chambal is also coming up with their own wnse plant. So your thoughts on a With the ammonia prices going up has there been a commensurate increase in the prices of nitric acid and whether we are thinking in going into the further downstream of nitric acid like calcium nitrite or potassium nitrite.
D. V. Parikh
Okay. Our nitric acid 3 which is the investment which is expected to come by June 27 as a clear downstream under an melt. So substantial portion of that is going to be consumed under meltdown and there will be some portion available for merchant sale to the tune of roughly 70,000 out of two 3,000 metric ton per annum. So that will be sold in the market and we have planned for the commercial sale of that and not the further downstream of weak nitric acid for this 70,000 metric ton as of now.
Nirav Jimudia
Okay. Correct sir, second question is on the Capex part like last year you last quarter you explained that out of 2800 crores of capex split between all the four capexes which are currently undergoing. If you can help us understand like how much we have spent till December 2025among each of them that would be very helpful.
D. V. Parikh
Project wise detail. I will. We will provide to the company secretary and he will share with you offline if it is okay.
Nirav Jimudia
Fine, fine. No worries, no worries. But total if you can share how much we have spent till December that also would help sir.
D. V. Parikh
Around thousand crores.
Nirav Jimudia
Thousand crores spent. Okay. Okay sir, last question is on the boiler part. You mentioned that that has now been taken up as a project with 480 to 500 crores of capital investment. So would it. So is this a coal based boiler which would be replacing some of our existing feeds or would it help for further the downstream projects which we are currently undergoing or any sort of annual savings which it could accrue to us.
D. V. Parikh
Okay. Yes. This is going to be a coal fired boiler and there will be varying kind of calorific value of coals that can be used. The specifications will be designed by the PMC who is going to be appointed. And obviously because currently we have a boiler called pulverized boiler and we are going with a boiler called CFBC boiler which has more efficiency if our current boiler are operating between 71 to 75 percentage. This boiler is expected to have an efficiency of around 83%. So obviously there is a business case for it. But we are installing this boiler for the purpose of primarily reliability aside from the financial saving which is coming as a bonus part to it.
Nirav Jimudia
So when this would be coming to the operations like when it would be installed and the benefits should start accruing to us.
D. V. Parikh
Okay, that. That is something we will let you know once the PMC is appointed and detailed engineering exercise is done.
Nirav Jimudia
Perfect. Perfect. Sir. Last in terms of our ammonia requirements. So like we require ammonia for most of our.
Nitin Patel
May I give your answer to your question? The payments part which you asked on the existing Capex is thousand crore is. Yeah, but. But the actual commitment is already done up to 2600 crore. It is like in the nature of giving contracts. Okay. Contracts are done. The payments are to the tune of thousand crore rupees.
Nirav Jimudia
Perfect, Perfect.
Nitin Patel
Okay. Like we have let’s say LSTK contract out of 1420 crore. 1100 crore. An odd amount is already with an LSTK contractor. 357 crore is for n melt with Toyo, around 330 crore worth of Capex is for AMUGL which is new ammonia loop. And for the coal based we are going to add little below 600 crore of capex. The approved capex is 613 crore.
Nirav Jimudia
Correct? Correct. Correct. Sir, on the ammonia part, like the ammonia is required in various products of our product basket. So is the production through oil route sufficient enough currently to meet the requirement? Or do we need to purchase some ammonia also from the outside market?
Nitin Patel
See, we are expanding the ammonia production by ammonia makeup loop which would be to the tune of 50,000 ton per annum.
There would be requirement of ammonia for downstream new projects. So with capacity increase around 35,000 to 40,000, we will have to buy from the market. And with this both buying from the market 35 to 40,000 and ammonia capacity expansion, our ammonia requirement for all downstream projects would be fulfilled.
Nirav Jimudia
Correct? Correct. So currently also we may be buying some ammonia from the market.
Nitin Patel
Currently depending upon the need, I will say the volume is very less.
Nirav Jimudia
Correct. And sir, just a last clarification. For ethyl acetate, we also require ethanol as one of the raw material.
Nitin Patel
Yes, ethanol is one of the raw material.
Nirav Jimudia
Got it sir. Thank you so much and wish you all the best.
operator
Thank you. A reminder to all the participants, you may press Star and one to ask a question. We have the next question from the line of ATHUR from ICICI Prudential Mutual Fund. Please go ahead.
Atharva Bhide
Yeah, thank you for the opportunity. So just two questions. One on volumes one, you explained that of course TDI we can operate at full capacity. So that volume will be there at a aggregate level. You know how much kind of volume growth we should expect in the coming year. That is question number one. And secondly, as you know the previous participant also mentioned and you also mentioned, on two of our key products, TDI and acetic acid, there is some kind of positive movement on global prices. So on domestic prices have they shown similar movement already? One you mentioned since January it has been. But on acidic, on acetic acid, has that flown through or it is not yet visible in the domestic market. That is number two, thanks. Price. Super volume price.
Rajesh Pillai
I will briefly about the pricing part of the acetic acid and tdi. Yes, you are right. From January onwards, both in both the products there is a positive movement as far as the pricing is concerned along with the global market.
D. V. Parikh
And on the volume part, there is expected volume increase from TDI because the kind of hiccup which we have seen this year, it is expected to improve the reliability going forward. So the focus of management is not only to realize the 50,000 capacity there but even the enhanced one for which the slack is already built up. And from 27 onwards the volume increase is already in the public domain. For both weak nitric acid and ammonium nitrate melt. There are going to be cost advantages to improve the profitability because of two things. One is the capacity building capex other than the growth capex which we briefed about. And second is the exercise which is being undertaken for the existing operations transformation. Now how much of that is realized? We will keep on briefing during quarterly calls.
operator
Thank you. A reminder to all the participants. You may press Star and one to ask a question. As there are no further questions from the participants. That concludes the question and answer session. I now hand the conference over to Mr. D V Parekh, Executive Director and CFO GNSC Limited for the closing comments. Thank you. And over to you, sir.
D. V. Parikh
No worries. I’ll request our company secretary Rajesh Mithai to conclude the session.
Rajesh Pillai
Thank you, sir. I would like to thank all the. Participants and the senior executives of the company for joining this call today. I would also express my sincere gratitude to the moderator as well as Anurag Services LLP for coordinating this. Thank you.
operator
Thank you management members on behalf of GNFC Limited. That concludes this conference. Thank you for joining with us today. And you may now disconnect your lines. Thank you.