For the complete report, get in touch with us at : info@netscribes.com The report begins with an introduction of different types of fertilizers produced in India categorized as organic, bio and chemical fertilizers. Chemical fertilizer is the focus of the report, which also includes water soluble fertilizers. The market overview section provides details about the domestic fertilizer production, consumption, demand and import levels. The production overview section entails production of fertilizers both nutrient-wise, as well as product-wise, while the consumption overview section includes nutrient-wise and zone-wise consumption of fertilizers. India’s fertilizer consumption has grown at a CAGR of 6.9% from 2006-07 to 2009-10. The demand overview section provides a clear idea about the demand-supply situation of the fertilizer market, including product-wise demand, availability and sales of fertilizers in the country. The import overview section comprises product-wise import of fertilizers along with the installed capacity of fertilizers both nutrient-wise, as well as product-wise. Furthermore, the report provides a detailed description of the fertilizer sales in South Zone covering states such as Andhra Pradesh, Karnataka, Kerala, Tamil Nadu, Pondicherry and Andaman & Nicobar Islands. Andhra Pradesh and Karnataka are the key sales hub in Southern India. Porter’s Five Forces analysis depicts an overall market scenario. A brief description of the drivers that helps the sector to prosper includes large subsidies, capitalization of opportunity presented by low consumption, increase in food grain production and appropriate monsoon. Cost of production of fertilizers is high owing to its inputs like naptha or even natural gas. Fertilizers manufacturing is a tedious process that usually ends up having high costs. In order to prevent reduced profitability due to high input costs, players hike prices transferring the increased cost burden to end consumers. This has a negative impact on the domestic fertilizer market as small farmers face acute affordability issues. The Indian Government witnessed this trend and offered large subsidies to the players in a bid to keep the prices moderate and result in off-takes. It has insulated the farmers from price hikes even in times of price rise in raw materials thereby keeping it more within the reach of them. Even though India has witnessed a rise in fertilizer consumption over the period of time, it is still low against the global average. Countries including China, Malaysia and Bangladesh rank above India in terms of fertilizer consumption. Low usage poses as opportunity that can be capitalized by the players both from the perspective of production and consumption. Fertilizers find its usage in enhancing food productivity and thereby as food grain production increases, fertilizers also witness an upward movement. Finally, good monsoon acts as a potential stimulant for the growth,

1. Fertilizers Market – India
May 2012

2. Executive Summary
 India is the ‐‐ largest nitrogenous fertilizer producer in the world after country 1 and the country 2
Market  Production of fertilizers (nutrient‐wise) has grown at a CAGR of a1% to ‐‐ mn tonnes in 20‐‐
 Consumption of fertilizers (nutrient‐wise) has grown at a CAGR of a2% to ‐‐ mn tonnes in 20‐‐
Drivers: Challenges:
‐ Large subsidies ‐ Increased prices of raw materials
Drivers & ‐ Capitalization of opportunity presented by low ‐ Price hike in natural gas
Challenges consumption ‐ Environmental degradation by fertilizers
‐ Increase in food grain production
‐ Good monsoon
 Department of Fertilizers
Government
 Nutrient Based Subsidy
Initiatives
 Government Schemes
 Water soluble fertilizers (WSF)
 Shift to gas based fertilizer units
Trends
 Increasing joint ventures
Major Players
Competition Rashtriya Indian Farmers
Coromandel National FCI Aravali Gypsum &
Chemicals & Fertilizer
International Fertilizers Minerals India
Fertilizers Cooperative
FERTILIZERS MARKET IN INDIA 2012.PPT 2

3. •Introduction
•Market Overview
•Drivers & Challenges
•Government Regulations
•Trends
•Competition
•Key Developments
•Strategic Recommendations
•Appendix
FERTILIZERS MARKET IN INDIA 2012.PPT 3

4. Chemical fertilizers are the most widely used fertilizers in
India since they supply the primary nutrients for crops
• Fertilizers are soil amendments applied to promote plant growth, the main nutrients added in fertilizers are nitrogen, phosphorus,
potassium while other nutrients are added in smaller amounts
• Main nutrients vital to plants by weight are called macronutrients, including: nitrogen (N), phosphorus (P), and potassium (K) (i.e. N‐P‐ K);
Sulphur (S) is also being used however its consumption is not widespread
F1 Derived from plant, animal & human residues
F2 Derived from plant, animal & human residues
F3 Available in double & multi nutrient combinations and are 100% water soluble
Fertilizer
They are inorganic or synthetic organic materials that are concentrated in
F4 nature and derived from plant, animal & human residues
Primary Fertilizers Complex Fertilizers
F5 F6
Focus Area of the Report
FERTILIZERS MARKET IN INDIA 2012.PPT 4

5. Nitrogenous fertilizers dominate the overall production
whereas potassic fertilizers are completely imported
Production – Overview Production of Fertilizers (Nutrient‐wise)
• India is the ‐ largest nitrogenous fertilizer producer in K P N
the world after c1 and the c2 mn tonnes
t1
 Production of fertilizers (Nutrient‐wise) amounted to ‐‐ mn H
E
tonnes in 20‐‐, growing at CAGR of c3% from ‐‐ mn tonnes F G
28.1% 26.6%
in 20‐‐ 25.9% 24.2%
• Increase in domestic production of fertilizers is
71.9% 74.1% 75.8% 73.4%
required for reducing the rising dependency on
imports as global fertilizer markets are highly
unstable and imperfect 20‐‐ 20‐‐ 20‐‐ 20‐‐
• Among various types of fertilizers produced, urea
Production of Fertilizers (Product‐wise)
continues to hold the largest share of c4% with ~‐‐
mn tonnes during 20‐‐, followed by the production of DAP Complex Fertilizers Urea
Complex fertilizers and DAP mn tonnes t2%
– Major companies like IFFCO, National Fertilizers Ltd., Rashtriya I L
J K
Chemicals & Fertilizers and Chambal Fertilizers are the leading 14.9% 12.7%
14.1% 10.1%
producers of Urea in India 22.9% 23.0% 24.1%
19.6%
 According to the Fertilizer Ministry, production of
fertilizers is expected to reach ‐‐ mn tonnes in 20‐‐, up by 62.3% 66.4% 66.9% 63.2%
c5% from ‐‐ mn tonnes in 20‐‐
– Urea output is expected to increase to ‐‐ mn tonnes in 20‐‐ from ‐‐ 20‐‐ 20‐‐ 20‐‐ 20‐‐
mn tonnes in 20‐‐
FERTILIZERS MARKET IN INDIA 2012.PPT 5

6. Imbalances in demand and supply have been inducing
higher imports over the past years
Import – Overview Import of Fertilizers (Product‐wise)
• India is self sufficient in terms of production of Urea MOP DAP
nitrogenous fertilizers and it has also achieved adequate mn tonnes t3%
production capacity of phosphatic fertilizers O
 However, in the absence of domestic commercially exploitable P
N
sources, complete requirement of potash is met through 32.3% 31.8%
imports M
48.3%
– Installed capacity for both N and P fertilizers have gone up to ‐‐ mn 42.7% 32.4% 32.3%
tonnes and ‐‐ mn tonnes, representing c6% and c7% respectively
31.2% 30.8%
• Import of fertilizers have grown at a CAGR of c8% from ‐‐ 35.3% 35.9%
mn tonnes in 20‐‐ to ‐‐ mn tonnes in 20‐‐ 26.0% 20.9%
 Government allows the production of urea beyond reassessed 20‐‐ 20‐‐ 20‐‐ 20‐‐
capacity to substitute or minimize imports
Installed Capacity (Product‐wise) Installed Capacity (Nutrient‐wise)
Installed Capacity No. of Units P N
units
mn tonnes 80.0 mn tonnes t4%
Q 80 U V
60 30.9% 31.9%
31.0 S 40
R T
19.0
12.0 20 69.1% 68.1%
0
Urea* DAP Complexes SSP 20‐‐ 20‐‐
FERTILIZERS MARKET IN INDIA 2012.PPT 6

7. V Zone Fertilizer Sales – State‐wise
P Q R
u%
mn tonnes C1 D1 mn tonnes A2 mn tonnes v% D3
9.6% 10.2% 5.1% C3 15.6%
B1 17.7% 15.0% 14.5%
A1 B3 13.9%
11.7% A3 21.6%
12.3% 27.0% 30.8% 34.0% 17.2% 24.8%
3 15.7%
19.6% 27.5%
18.6% 21.8% 23.1%
26.1%
69.1% 68.7% 45.7% 44.0% 46.5% 35.2%
58.1% 61.0% 38.1%
20‐‐ 20‐‐ 20‐‐ 20‐‐ 20‐‐ 20‐‐ 20‐‐ 20‐‐ 20‐‐
S T U
mn tonnes mn tonnes mn tonnes x%
w% D4 C6 D6
C4 A5 12.2%
5.6% 15.6%
8.0% 5.9%
28.2% 7.8% A6 B6 21.2%
31.6% 23.0%
39.2% 22.9% 19.7%
A4 B4 13.5% 25.4%
8.6% 28.3% 21.7% 26.5%
6.2% 27.1%
47.4% 50.1%
47.1% 55.3% 53.8% 47.9% 41.3%
33.3% 37.9%
44.0% 43.7%
20‐‐ 20‐‐ 20‐‐ 20‐‐ 20‐‐ 20‐‐ 20‐‐ 20‐‐ 20‐‐
MOP DAP NPK Urea
FERTILIZERS MARKET IN INDIA 2012.PPT 7

8. Drivers & Challenges – Summary
Challenges
Drivers Increased prices of raw materials
Large subsidies Price hike in natural gas
Capitalization of opportunity Environmental degradation by
presented by low consumption fertilizers
Increase in food grain production
Good monsoon
FERTILIZERS MARKET IN INDIA 2012.PPT 8

9. Creation of opportunity for players as India still features low
in terms of fertilizer consumption on a global platform
Capitalization of opportunity presented by low consumption Impact
• Though fertilizers have been a chief component in augmenting food production in India, usage
of fertilizers is skewed in India
• While fertilizer usage in high in certain states with adequate irrigation facilities, it is dismally low
in certain other states
• Added to it there is an imbalanced usage of N, P and K fertilizers across the country
• Efforts are being channelized to increase usage of f1 fertilizers in rice along with development of
f2
• Even though fertilizer consumption shows a northward trend, yet it is still considered to be low
compared to other nations
 Low usage poses as opportunity for the entire sector as it still has room for further growth both in terms of
production and consumption
Fertilizer usage in India
Fertilizer consumption in India is
China registered a
estimated at ‐‐ kg per hectare land consumption of ‐‐ kg /ha
Low consumption
Low consumption
UK has a consumption
s% presents the sector level of ‐‐ kg /ha
Kg /ha presents the sector
B C with opportunities
with opportunities Malaysia has a
A
for further growth
for further growth consumption level of ‐‐
kg /ha
Bangladesh registered a
20‐‐ 20‐‐ 20‐‐ consumption of ‐‐ kg/ha
FERTILIZERS MARKET IN INDIA 2012.PPT 9

10. Government Participation – Summary
Department of Fertilizers
Initiatives
Government Schemes Nutrient Based Subsidy
FERTILIZERS MARKET IN INDIA 2012.PPT 10

11. The Government has a separate department devoted
completely to regulate the fertilizer sector
Department of Fertilizers
• This body comes under the ambit of Ministry of Chemicals & Fertilizers which is headed by a Cabinet Minister
• Its primary objective is to ensure adequate and timely availability of fertilizers at affordable prices in order to maximize
the agricultural outputs in the country
• The department is broadly divided into 5 Wings and are handled by 1 Additional Secretary & Financial Advisor, 3 joint
secretaries and 1 Economic Advisor
• Y1
• Y2
Primary
activities
• Y3
• Y4
• This department has 1 attached office called fertilizer Industry Coordination Committee headed by Executive
FICC Director
• Constituted in 1977, this body looks after the retention Price Cum Subsidy scheme which eventually got
replaced by New Pricing Scheme
FERTILIZERS MARKET IN INDIA 2012.PPT 11

12. Trends – Summary
Water soluble fertilizers
(WSF)
Trends
Shift to gas based fertilizer
Increasing joint ventures
units
FERTILIZERS MARKET IN INDIA 2012.PPT 12

13. Water efficiency with improved quality and appearance of
crops makes WSF attain immense popularity in India
Water soluble fertilizers (WSF)
• Water soluble fertilizers are increasingly gaining popularity owing to its beneficial attributes
• As of 20‐‐, domestic market size of water soluble fertilizers stood at ‐‐ tonnes; majority of it Use of WSF is
increasing crop
being imported
productivity
• In 20‐‐, India’s first water soluble fertilizer plant in b1
C1 was put into operation with a capacity of b2 tonne
Use of  It is a 50:50 JV between India’s b3 and Chile based fertilizer
Water manufacturer b4, which will provide the raw material for
Results C2
Soluble production of b5 in India
Fertilizers  There are plans of investing INR ‐‐ mn to double the capacity by
C3 20‐‐
 b6 is usually priced in the range of INR ‐‐ to INR ‐‐ per tonne
based on quality grade
Characteristics of Water Soluble Fertilizers
Fertiliser use efficiency Comparison
• 100% water solubility
Nutrient Conventional Fertilisers (%) WSF (%)
• Available in double and multi nutrient combinations which Z1 Z4 Z7
may or may not have secondary elements or micronutrients
• Available in the powder or liquid form Z2 Z5 Z8
• Can be used for fertigation and foliar application Z3 Z6 Z9
FERTILIZERS MARKET IN INDIA 2012.PPT 13

14. Public: Domestic Company – Company 1
Company Information Offices and Centres – India
Corporate Address Place 1
Tel No. 123456
Fax No. 123456 Place
Website www.abc.com
Year of Incorporation 19‐‐
Ticker Symbol ‐‐
Stock Exchange ‐‐
Products and Services
Head Office
Category Products/Services
C1 P1 Key People
C2 P2
Name Designation
C3 P3
Person 1 D1
Person 2 D2
Person 3 D3
Person 4 D4
FERTILIZERS MARKET IN INDIA 2012.PPT 14

15. Public: Domestic Company – Company 1
Financial Snapshot Key Ratios
y‐o‐y change
Particulars 2011 2010 2009 2008
Total Income (2011‐10)
Total Income Profit
INR mn Profit / Loss INR mn Profitability Ratios
S
Q R Operating Margin ‐1.19 3.54% 4.73% 3.55% 4.15%
P Net Margin ‐0.96 2.38% 3.33% 1.88% 2.59%
Profit Before Tax Margin ‐1.55 3.50% 5.05% 3.00% 3.71%
Return on Equity ‐2.56 8.28% 10.84% 6.63% 7.72%
Return on Capital Employed ‐3.70 10.58% 14.29% 11.61% 11.18%
Return on Working Capital 2.88 19.91% 17.04% 11.68% 14.77%
2008 2009 2010 2011 Return on Assets ‐1.81 4.11% 5.92% 3.56% 3.75%
Financial Summary Return on Fixed Assets ‐13.66 11.06% 24.72% 12.97% 14.13%
Cost Ratios
• The company earned a net profit of INR 1,385 mn in FY 2011, as Operating costs (% of Sales) 1.21 96.45% 95.24% 96.41% 95.81%
compared to a net profit of INR 1,715.1 mn in FY 2010 Administration costs (% of
‐0.61 12.22% 12.83% 12.27% 14.19%
• The company reported total Income of INR 58,249.6 mn in FY 2011, Sales)
registering an increase of 13.23% over FY 2010 Interest costs (% of Sales) ‐0.05 0.13% 0.18% 0.74% 0.33%
Liquidity Ratios
• The company reported an operating margin of3.54% in FY 2011, a
Current Ratio ‐19.08% 1.49 1.84 1.73 1.55
decrease of 1.19 percentage points over FY 2010
Cash Ratio ‐96.95% 0.02 0.68 0.49 0.59
• The company reported debt to equity ratio of 1.01 in FY 2011, an Leverage Ratios
increase of 21.93% over FY 2010 Debt to Equity Ratio 21.93% 1.01 0.83 0.86 1.06
Debt to Capital Ratio 32.11% 0.27 0.20 0.15 0.27
Financial Summary
Interest Coverage Ratio 0.42% 27.28 27.17 4.83 12.67
Indicators Value (30/04/2012) Efficiency Ratios
Market Capitalization (INR) A Fixed Asset Turnover ‐36.93% 4.64 7.36 6.82 5.40
Total Enterprise Value (INR) Asset Turnover ‐2.06% 1.72 1.76 1.87 1.43
B
Current Asset Turnover 18.56% 2.75 2.32 2.58 2.00
EPS (INR) C Working Capital Turnover 64.75% 8.35 5.07 6.14 5.64
PE Ratio (Abs) (3/05/2012) D Capital Employed Turnover 7.69% 3.47 3.23 3.49 2.95
Improved Decline
FERTILIZERS MARKET IN INDIA 2012.PPT 15

16. Public: Domestic Company – Company 1
Key Business Segments Key Geographic Segments
P1 P2 Country 1
3% 2% 5% 4% 100%
97% 98% 95% 96% 50%
0%
2008 2009 2010 2011 2011
Key Recent Developments
Description News
Overview
• The company produces and markets m1, m2 and m3 in India
 It has earned its reputation primarily on the basis of quality of the nitrogenous fertilizers that it manufactures
Production
• Company has produced ‐ mn tonnes of urea (m4% of installed capacity) during 20‐‐, up by m5% y‐o‐y
Performance  Production of Neem coated urea increased to m6 tonnes from m7 tonnes during 20‐‐
– It is the first company in India to get permission from the Government to produce and market m8
Expansion plans
• Company needs additional gas capacities and is planning to float an open tender for it in 20‐‐
 ‐ mscmd of gas is required for transforming its three non‐gas plants to gas‐based units, at m9, m10 and m11
FERTILIZERS MARKET IN INDIA 2012.PPT 16

17. Private: Domestic Company – Company 1
Company Information Offices and Centres – India
Registered Address Place
Tel No. 123456 Place
Fax No. 123456
Website www.abc.com/
Year of Incorporation 19‐‐
Registered
Address
Products and Services
Category Products/Services
C1 P1 Key People
Name Designation
Person 1 D1
Person 2 D2
Person 3 D3
Person 4 D4
FERTILIZERS MARKET IN INDIA 2012.PPT 17

18. Private: Domestic Company – Company 1
Financial Snapshot Key Ratios
y‐o‐y change
Particulars 2011 2010 2009 2008
Total Income Total Income Profit (2011‐10)
INR mn Profit / Loss INR mn Profitability Ratios
S Operating Margin 3.15 28.58% 25.43% 25.68% 22.41%
Net Margin 1.54 18.90% 17.36% 20.30% 14.25%
R Profit Before Tax Margin 3.15 28.58% 25.43% 25.68% 22.41%
Q
Return on Equity 3.81 19.44% 15.63% 17.45% 9.63%
P
Return on Capital Employed 7.40 47.56% 40.16% 40.08% 27.11%
Return on Working Capital 4.80 24.99% 20.19% 21.88% 11.98%
Return on Assets 3.87 19.44% 15.57% 17.36% 9.55%
Return on Fixed Assets 25.87 98.22% 72.35% 91.83% 47.83%
Cost Ratios
2008 2009 2010 2011 Operating costs (% of Sales) ‐3.15 71.42% 74.57% 74.32% 77.59%
Liquidity Ratios
Financial Summary Current Ratio 9.03% 3.04 2.78 2.76 2.79
Cash Ratio 30.19% 2.09 1.61 1.83 1.94
• Company incurred a net profit of INR 210.2 mn in FY Efficiency Ratios
2011, as compared to a net profit of INR 144.8 mn in FY Fixed Asset Turnover 24.68% 5.20 4.17 4.52 3.36
2010 Asset Turnover 14.67% 1.03 0.90 0.86 0.67
Current Asset Turnover 18.97% 0.89 0.75 0.69 0.54
• It reported total Income of INR 1,112 mn in FY 2011, Working Capital Turnover 13.69% 1.32 1.16 1.08 0.84
registering an increase of 33.31% over FY 2010 Capital Employed Turnover 14.21% 1.03 0.90 0.86 0.68
• The company reported an operating margin of 28.58% in
FY 2011, an increase of 3.15 percentage points over FY
2010
Improved Decline
FERTILIZERS MARKET IN INDIA 2012.PPT 18

19. Private: Domestic Company – Company 1
Key Recent Developments
Description News
• Operates as a premier design engineering and consultancy organization associated with
varied fields ranging across fertilizers, chemicals, Oil and Gas sector, refineries, power
plants, offsites and utilities
Overview
• Is certified by ISO 9001:2008 and equipped with state‐of‐the‐art computer‐aided design
(CAD) software in facilities at q1 and q2
• Has also been granted the status of “q3” by Ministry of Chemicals and Fertilizers
• Has been roped in by Oil and Natural Gas Corp (ONGC) to carry out a detailed feasibility
study for its upcoming gas‐based ammonia plant in q4
• Secured an order for q5 services from q6 for their feedstock changeover project for its 3
plants
• Q7 Ltd has roped in q8 to carry out the designing and engineering work for its sulphuric
Projects acid and ammonium bi‐carobonate plants
• Has also prepared a q9 report for setting up the 4th unit of an q10 plant of q11
• Has won a contract from q12 for feedstock conversion job and feasibility study at the
company’s ammonia plant
• It is also providing PMC services for q13 at q14 in Algeria for q15
• Has also received the contract for preparing q16 for q17 for its coal based ammonia plant
FERTILIZERS MARKET IN INDIA 2012.PPT 19

20. Thank you for the attention
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FERTILIZERS MARKET IN INDIA 2012.PPT 20