Fertilizer: Fertilizers profits likely to up 17% YoY in 2Q2025 Market Weight Maintained - By Topline Research
Jul 9 2025
Topline Securities
- We expect Topline Fertilizer universe earnings to increase by 17% YoY and 67% QoQ in 2Q2025 mainly due to recover in Urea and DAP offtakes despite weak farm economics, and water shortage. The QoQ uptick in profitability is mostly due to Kharif season that started in April and ended in June, respectively.
- Urea offtake is expected to increase by 3% YoY and 14% QoQ to 1.25mn tons in 2Q2025. Similarly, DAP offtakes are expected to increase by 16% YoY and 99% QoQ to 298k tons in 2Q2025.
- Average Urea prices during 1Q2025 declined by 7% YoY and 1% QoQ to Rs4,477 per bag as companies announced price discounts during the quarter to capture the market share. Engro Fertilizers announced a discount of Rs100-140/bag started in Jan’25 followed by FFC that announced a price discount of Rs40/bag effective from May’25. Whereas, DAP prices have increased by 8% YoY and up 4% QoQ to average at around Rs12,525 per bag, respectively.