Mangalore Chemicals & Fertilizers Limited (MCFL) has made a strategic move to strengthen its position in the fertilizer industry by acquiring a Single Super Phosphate (SSP) plant from Zuari Agro Chemicals Limited (ZACL). The Board of Directors of MCFL approved the acquisition on August 8, 2025, in a deal valued at INR 72.75 crore.

Acquisition Details

The acquisition includes a granulated single super phosphate plant and related assets located in Mahad, Maharashtra. The SSP fertilizer business being acquired has an installed capacity of 200,000 TPA (Tonnes Per Annum). However, the plant's recent performance has been affected by lower capacity utilization, resulting in a turnover of INR 47.80 crore in FY 2025.

Strategic Implications

This move is expected to have several positive impacts on MCFL's business:

1. Product Diversification: The acquisition will expand MCFL's product portfolio, adding SSP to its existing range of fertilizers.
2. Market Potential: SSP is emerging as a viable alternative to DAP (Diammonium Phosphate) for specific crops, potentially opening new market opportunities.
3. Financial Growth: MCFL anticipates that this acquisition will boost both turnover and margins through an enlarged product basket.

Transaction Details

Related Party Transaction

It's worth noting that this acquisition is classified as a related party transaction, as MCFL is a subsidiary of ZACL. However, the company has stated that the transaction is being conducted at arm's length, ensuring fairness and transparency.

Historical Context

The SSP business being acquired has faced challenges in recent years. The turnover fluctuated between INR 146.00 crore and INR 47.80 crore in the last three years, with variations attributed to different levels of capacity utilization influenced by geopolitical conditions.

Looking Ahead

As MCFL integrates this new acquisition into its operations, industry observers will be watching closely to see how the company leverages the SSP plant to enhance its market position and financial performance. The success of this strategic move could potentially set a precedent for further consolidation in the Indian fertilizer industry.

The completion of this transaction remains subject to necessary regulatory approvals, including the transfer of leases and fertilizer licenses. MCFL expects to finalize the acquisition within the next three months, marking a significant step in its growth strategy within the competitive fertilizer market.

Mangalore Chemicals & Fertilizers Limited (MCF) has reported a strong financial performance for the first quarter of fiscal year 2026, with significant growth in revenue and profitability.

Financial Highlights

• Revenue from operations increased by 6% to ₹862.00 crores, up from ₹814.00 crores in the same quarter last year.
• EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) grew by 22% to ₹118.00 crores, compared to ₹112.00 crores in Q1 FY25.
• Profit After Tax (PAT) surged by 41% to ₹83.00 crores, a substantial increase from ₹68.00 crores in the previous year's corresponding quarter.
• Earnings Per Share (EPS) rose to ₹5.20 from ₹3.70, reflecting the company's improved profitability.

Operational Performance

MCF demonstrated robust operational efficiency during the quarter:

• The company's ammonia and urea plants operated continuously throughout the period.
• Urea production reached 1.22 lakh metric tonnes.
• Sales quantity increased by 4% to 1.98 lakh metric tonnes, indicating strong market demand.

Production Capacity and Market Presence

Mangalore Chemicals & Fertilizers Limited boasts significant production capabilities:

• Urea production capacity: 3.80 lakh metric tonnes
• DAP and complex fertilizers capacity: 2.85 lakh metric tonnes

The company's primary marketing territories include:

Management Commentary

Nitin M Kantak, Whole Time Director of MCF, expressed satisfaction with the company's performance, stating, "Our Q1 FY26 results demonstrate MCF's resilience and operational excellence. The significant growth in profitability reflects our efficient cost management and strong market presence."

Future Outlook

While the company has reported impressive results, it's important to note that MCF is currently in the process of a proposed merger with Paradeep Phosphates Limited. The company is in the process of obtaining necessary regulatory approvals for this strategic move, which could potentially reshape its future operations and market position.

Investors and stakeholders will be keenly watching how this merger progresses and its potential impact on MCF's future performance in the fertilizer industry.

Note: The financial results are subject to limited review by the company's auditors.