Fertilizer still a very high risk sector: Sajiv Dhawan

In a chat with ET Now, Sajiv Dhawan, MD, JV Capital Services, spoke on fertiliser stocks.

What is your call on the entire fertiliser pack?

That remains high risk. The government cannot decontrol diesel in the way it wants, cannot make a decision on sugar. So why it should be different with fertiliser and fertiliser story has been dragging on for years. There are always some hopes yes, the stocks move up. The stocks also bounced back yesterday considering they have also been battered over the last 1 week as well. So an RCF which has come down 25% up 5-7% in one day again maybe some covering and some bounce on the technical side but again you are playing with a very high risk sector. If the news flow is positive and there is some positive news in the government meeting, you will see a significant run up. So the way I would play it look at options in the call options, some liquidity in some of those fertiliser stocks. That is probably the best way to play it from a risk reward perspective at least in case there is some disappointment, your losses are limited and as always, it is a nasty sector for the average trader.