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Sustained high sulfur prices
View Risks →Coromandel International Limited — Q3 FY26
Coromandel delivered a resilient Q3 FY26 despite headwinds from extended rains, sharp raw material cost inflation, and INR depreciation.
bullish
high
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Coromandel delivered a resilient Q3 FY26 despite headwinds from extended rains, sharp raw material cost inflation, and INR depreciation. Consolidated revenue grew 26% YoY to INR 8,863 crore, driven by strong crop protection performance (revenue +24%, EBIT +74%) and record fertilizer production of 990,000 tons (+18% YoY). EBITDA rose 11.5% to INR 805 crore, but margins contracted ~120bps due to unabsorbed subsidy costs. PAT declined 3.9% to INR 488 crore on higher depreciation and interest. Management maintained annualized EBITDA guidance of INR 5,000-5,500/ton, supported by backward integration commissioning this quarter and price hikes of 3-4%. Key risks: sustained high sulfur prices and delayed subsidy compensation could pressure near-term margins.
कोरोमंडल ने तीसरी तिमाही में अच्छा प्रदर्शन किया, भले ही भारी बारिश, कच्चे माल की बढ़ती कीमतें और रुपये की गिरावट जैसी चुनौतियाँ थीं। कंपनी की कुल आय पिछले साल की तुलना में 26% बढ़कर 8,863 करोड़ रुपये हो गई। इसकी वजह फसल सुरक्षा उत्पादों की मजबूत बिक्री (आय +24%, मुनाफा +74%) और रिकॉर्ड 9.9 लाख टन खाद उत्पादन (+18%) रही। कंपनी की कमाई (EBITDA) 11.5% बढ़कर 805 करोड़ रुपये हुई, लेकिन सरकारी सब्सिडी न मिलने से मुनाफे की दर थोड़ी कम हुई। शुद्ध मुनाफा 3.9% घटकर 488 करोड़ रुपये रहा, क्योंकि मशीनरी और कर्ज पर खर्च बढ़ा। प्रबंधन ने कहा कि नई फैक्ट्री चालू होने और 3-4% कीमत बढ़ोतरी से आने वाले समय में मुनाफा बेहतर होगा। मुख्य जोखिम: सल्फर की ऊंची कीमतें और सब्सिडी में देरी से मुनाफा दबाव में रह सकता है।
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Fertilizer Production
990,000 tons
+18% YoY
Highest-ever quarterly production, driven by 100% capacity utilization and operational efficiencies.
Crop Protection EBIT Margin
20%
+600bps YoY
EBIT margin expanded from 14% to 20% YoY, aided by export volume growth and favorable currency.
Nano Product Sales
4,000 kL
+68% YoY
Market leader in Nano DAP; strong traction in horticulture and global trial expansion.
Retail Store Count
1,113
+84 stores in Q3
Added 84 new stores in Q3, driving 20% YoY revenue growth in retail segment.
What Changed vs Last Quarter
NEW
Backward integration plant commissioning in Q4 FY26
The sulfuric acid and phosphoric acid plant at Kakinada will be commissioned in Q4 FY26, expected to lift annualized EBITDA to INR 6,500 per ton.
NEW
Domestic B2C crop protection growth target of 20-25% YoY
Management targets 20-25% annual growth in domestic branded formulation business, driven by new product launches and market expansion.
NEW
Mancozeb capacity expansion of 30%
After a 20% debottlenecking, the company plans a further 30% capacity expansion at Sarigam to meet rising global demand.
UPDATED
Annualized EBITDA per ton target of INR 5,000-5,500 maintained
Despite raw material headwinds, management expects to sustain annualized EBITDA of INR 5,000-5,500 per ton for FY26, supported by inventory management and price hikes.
DROPPED
Crop protection revenue target of INR 5,000 crore annualized
Combined Coromandel and NACL crop protection business expected to reach INR 5,000 crore revenue on an annualized basis, positioning among top 3-4 players in India.
DROPPED
Kakinada acid plant commissioning in January
Mechanical completion expected in December, trial runs in January, and commercial production by second/third week of January. Plant will improve cost profile significantly.
DROPPED
Senegal rock volume scale-up to 500,000 tons next year
Current year target of 300,000 tons from Senegal mine; next year aim to scale to 500,000 tons with additional investments.
NEW RISK
Sustained high sulfur prices
Sulfur prices surged from ~$200 to $550/ton, compressing fertilizer margins. Management expects a correction but uncertainty remains.
NEW RISK
Subsidy compensation lag
NBS rates have not fully compensated for raw material inflation and INR depreciation, pressuring margins. Government supplementary grants may be needed.
NEW RISK
NACL integration and hedge facility underperformance
NACL's hedge facility has low utilization, dragging margins. Management acknowledged the issue but provided no timeline for resolution.
NEW RISK
Market share decline in phosphatic fertilizers
Consumption-based market share fell from 15% to 14% in Q3 due to lower offtake in Andhra Pradesh and Telangana from crop damage.
RISK GONE
Unseasonal rains impacting Rabi demand
Excess rains in August-September affected Kharif crop input application; if similar weather persists in Rabi, fertilizer and crop protection offtake could be dampened.
RISK GONE
Raw material price volatility
Spike in ammonia and sulfur prices during the quarter, though management expects softening. Sustained high prices could pressure margins despite NBS subsidy revision.
RISK GONE
Dhaksha drone order execution delays
Government evaluation of drone prototypes has taken longer than expected, delaying order execution. Future orders depend on successful evaluation, creating uncertainty.
RISK GONE
NACL margin recovery slower than expected
NACL's EBITDA margin fell to ~4% in H1, well below the 9-11% target. Management expects gradual improvement, but integration risks and one-time costs may delay margin normalization.
🤫 Topics management stopped discussing
Mentioned in Q2 FY26, Q3 FY25, Q4 FY25
Spike in ammonia and sulfur prices during the quarter, though management expects softening. Sustained high prices could pressure margins despite NBS subsidy revision.
Mentioned in Q2 FY26, Q3 FY25
Mechanical completion expected in December, trial runs in January, and commercial production by second/third week of January. Plant will improve cost profile significantly.
Fast read
Guidance and risk preview
Despite raw material headwinds, management expects to sustain annualized EBITDA of INR 5,000-5,500 per ton for FY26, supported by inventory managem...
Sulfur prices surged from ~$200 to $550/ton, compressing fertilizer margins.
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