Fertiliser stocks rally as gas price hike deferred

MUMBAI: Shares of fertilizers companies gained in trade as the government announced it is deferring gas price hike by three months.

Natural gas is used as a raw material by fertilisers companies for manufacturing urea and other complex fertilisers. Hike in natural gas prices would have had negative impact on the fertiliser industry.

Cost of production of domestic urea would have increased sharply if gas price revision would have happened.

On Wedenesday, Oil Minister said the Cabinet Committee on Economic Affairs (CCEA) has decided that consumers would continue to get natural gas at the existing price of $4.2 per unit till the end of September, a price which had earlier been approved for five years that ended March 31 this year.

At 10:00 a.m.; Chambal Fertilisers gained 2.37 per cent, Fertilisers and Chemicals Travancore was up 1.97 per cent, Rashtriya Chemicals and Fertilisers moved up 1.47 per cent, Coromandel International was 1.24 per cent higher and GNFC advanced 1.85 per cent.