RCF news

RCF has managed to stay in the black for year ended 31-03-08 mainly due to lower provisioning of taxation. It’s net sale rose 47% and operating expense rose 51%. A 15% rise in other income helped it sail through. EBIDTA was up 6%. But a 26% rise in interest outgo and a 10% rise in depreciation took its toll on the PBT, which remained stagnant. Its taxation outgo actually reduced 9% and this led to a 6% rise in PAT. On an equity of Rs.551.70 crore, its EPS for FY 08 was at Rs.2.80.

The company’s performance for fourth quarter ended 31-03-08 was much better than expected, with net sales showing a rise of 46% and PAT showing a growth of 54%.

This is for the first time in the history of the company that its sales crossed over $ 1 billion. It marketed the fertilizers produced indigenously as well as imported form overseas market without increasing the manpower cost.

92.5% of the shares is held by the Government of India, 2.37% by institutions and only 5.13% is floating stock.

The company has signed a MoU with IDC of South Africa and Foskar Pty Ltd. to set up a Rs.7,776 crore fertilizers unit and rock phosphate mining venture in Africa. RCF’s immediate investment is about Rs.1,300 crore. RFC will buy back & import almost 90% of the finished products to India.

Currently the fertliser stocks are on a high on reports that the government has provided fertiliser subsidy of Rs.95000 crore for 2008/09, much higher from earlier budget estimates of Rs.31000 crore. The new fertiliser investment policy is likely to be finalised in the next two to three weeks, so the stocks in the sector could see some short term upward rally in the coming fortnight. Currently quoted at Rs.72, one can hold RCF for the sheer pride of owning India’s largest PSU fertilizers company.