National Fertilizers Limited joint ventures drive Q2 profit

National Fertilizers Limited reported Rs 6.12 crore consolidated profit after tax for the quarter ended 30 September 2026, as a Rs 20.50 crore share of joint-venture profit more than offset a Rs 16.08 crore loss from operations before joint ventures, exceptional items and tax. The group had posted a Rs 35.81 crore loss a year earlier.

Why did NFL report a consolidated Q2 profit?

NFL reported a Q2 profit because its Rs 20.50 crore share of joint-venture profit converted a Rs 16.08 crore pre-joint-venture loss into Rs 4.42 crore of profit before tax. The consolidated statement showed no exceptional items for the quarter ended 30 September 2026. A Rs 2.79 crore current-tax credit and Rs 1.09 crore deferred-tax charge produced a net tax credit of Rs 1.70 crore, resulting in Rs 6.12 crore profit after tax.

The joint-venture contribution was decisive because it exceeded the loss before joint ventures by Rs 4.42 crore. In the immediately preceding quarter ended 30 June 2026, NFL had reported Rs 95.34 crore of profit before joint ventures and tax, supplemented by Rs 42.47 crore of joint-venture profit. Profit after tax in that June quarter was Rs 113.38 crore, showing that both the operating result and joint-venture contribution declined in the September quarter.

Year on year, NFL's share of joint-venture results changed by Rs 46.10 crore, from a Rs 25.60 crore loss in the September 2025 quarter to a Rs 20.50 crore profit in September 2026. The pre-joint-venture loss, however, widened by Rs 5.76 crore from Rs 10.32 crore. The movement in the joint-venture line was therefore the main factor behind the switch from a consolidated loss to a profit.

What changed in NFL's income and expenses in Q2?

NFL reported Rs 5,813.94 crore of revenue from operations in the September 2026 quarter, up from Rs 4,500.39 crore in the June 2026 quarter but below Rs 6,750.30 crore a year earlier. Other income was Rs 23.85 crore, taking total income to Rs 5,837.79 crore. This was below Rs 6,778.32 crore in the September 2025 quarter.

Total expenses rose to Rs 5,853.87 crore from Rs 4,416.49 crore in June 2026, exceeding total income by Rs 16.08 crore before equity-accounted joint-venture results. Purchase of stock-in-trade rose to Rs 2,568.07 crore from Rs 494.23 crore sequentially, cost of materials consumed increased to Rs 2,404.95 crore from Rs 2,123.43 crore, and power and fuel rose to Rs 1,700.75 crore from Rs 1,501.51 crore.

Changes in inventories of finished goods, stock-in-trade and work in progress provided a Rs 1,553.22 crore credit in the September quarter, compared with a Rs 343.17 crore credit in June and a Rs 881.55 crore credit a year earlier. Finance costs were Rs 74.57 crore, down from Rs 79.30 crore in June but above Rs 54.73 crore in September 2025. Depreciation and amortisation were Rs 103.43 crore, compared with Rs 103.60 crore in June.

Which NFL business segments made money in Q2?

NFL's Others segment produced the highest segment result at Rs 53.96 crore in the September 2026 quarter, followed by traded imported fertilizers at Rs 46.35 crore. Manufactured chemicals contributed Rs 1.02 crore, while manufactured fertilizers recorded a Rs 6.17 crore segment loss. Total segment results were Rs 95.16 crore before finance expenses of Rs 74.57 crore and net unallocable expenses of Rs 36.67 crore.

Manufactured fertilizers remained NFL's largest revenue segment at Rs 4,385.60 crore, compared with Rs 3,883.67 crore in the June 2026 quarter and Rs 3,278.89 crore a year earlier. The segment, comprising urea, bentonite sulphur and bio fertilizers, moved from a Rs 109.92 crore profit in June to a Rs 6.17 crore loss in September.

Traded imported fertilizers under the Nutrient Based Subsidy, or NBS, regime generated Rs 744.95 crore of revenue and Rs 46.35 crore of segment result. Revenue was up from Rs 232.85 crore in June, while the result was marginally below Rs 47.88 crore. The Others segment, covering domestic traded products, agro inputs and sale services, reported Rs 641.98 crore of revenue and Rs 53.96 crore of segment result, against Rs 312.53 crore and Rs 21.50 crore respectively in June.

What do NFL's half-year disclosures show?

NFL reported Rs 119.50 crore consolidated profit after tax for the half year ended 30 September 2026, compared with a Rs 75.25 crore loss in the corresponding 2025 period. Revenue from operations rose slightly to Rs 10,314.33 crore from Rs 10,284.47 crore. The half-year share of joint-venture profit was Rs 62.97 crore, reversing a Rs 32.94 crore share of loss in the prior-year half.

Profit from operations before joint ventures and tax was Rs 79.26 crore for the half year, compared with a Rs 55.06 crore loss a year earlier. NFL also recognised Rs 198.91 crore of subsidy income on diammonium phosphate, or DAP, and triple superphosphate, or TSP, fertilizers under Department of Fertilizers operational guidelines for Kharif 2026 shipments arriving from 1 April 2026 to 30 September 2026.

NFL separately accounted for Rs 117 crore of subsidy income in the half year after the Department of Fertilizers fixed New Energy Norms, or NEN, effective from 1 April 2025 until 31 March 2028. The accounting entry related to the period from 1 April 2025 to 31 March 2026. The disclosure does not allocate this half-year entry between the June and September quarters.

At 30 September 2026, NFL had consolidated assets of Rs 15,603.83 crore, compared with Rs 11,724.31 crore at 31 March 2026. Trade receivables rose to Rs 6,296.23 crore from Rs 5,411.24 crore, while current borrowings increased to Rs 4,563.78 crore from Rs 3,959.25 crore. The reported debt-equity ratio was 1.57 times at the September quarter-end, versus 1.86 times at 30 June 2026.

Conclusion

NFL's Rs 6.12 crore consolidated profit for the September 2026 quarter depended on Rs 20.50 crore of joint-venture income, which overcame a Rs 16.08 crore pre-joint-venture loss. Compared with September 2025, the Rs 46.10 crore swing in the joint-venture result outweighed the Rs 5.76 crore widening in the operating loss before joint ventures.

The next disclosed issues to watch are whether manufactured fertilizers recovers from its Rs 6.17 crore September segment loss and the effect of subsidy accounting. The NEN framework cited by NFL is valid through 31 March 2028, while the Department of Fertilizers guidelines for Kharif 2026 DAP and TSP shipments covered arrivals only through 30 September 2026.