Mumbai: Rashtriya Chemicals and Fertilizers Limited (RCF) has announced that leading credit rating agencies have reaffirmed its Non-Convertible Debentures (NCDs) rating at AA/Stable. The move highlights the company’s strong financial fundamentals, operational efficiency, and strategic importance in India’s fertiliser sector.
The disclosure was made to stock exchanges in compliance with regulatory requirements.
ICRA and India Ratings Reaffirm Credit Strength
Rashtriya Chemicals and Fertilizers Limited received:
- ICRA AA (Stable) rating for ₹1,200 crore NCDs
- IND AA/Stable rating from India Ratings for ₹12,000 million NCDs
Both agencies cited the company’s strong government backing, established market presence, and consistent operational performance as key reasons for the rating affirmation.
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Strong Government Support and Strategic Importance
RCF benefits from significant support from the Government of India, which holds around 75% equity in the company.
This backing ensures:
- Stability in operations
- Policy support in the fertiliser sector
- Strategic importance in ensuring domestic fertiliser supply
The company plays a vital role in reducing India’s dependence on fertiliser imports.
Established Market Presence and Diverse Operations
Rashtriya Chemicals and Fertilizers Limited remains one of India’s leading urea manufacturers, contributing approximately 7–8% of the country’s total production capacity.
Its operations include:
- Urea production at Thal and Trombay plants
- Manufacturing of NPK fertilisers
- Production of industrial chemicals like ammonia and ammonium nitrate
For the nine months of FY26, revenue contribution was:
- Fertilisers: 62%
- Fertiliser trading: 27%
- Industrial chemicals: 10%
Improved Operational Efficiency at Key Plants
RCF has made significant progress in enhancing operational efficiency:
- The Thal plant is operating at better-than-normative energy levels
- The Trombay facility has improved energy consumption metrics
- Plants are achieving higher operational capacity and performance
These improvements have strengthened the company’s cost efficiency and productivity.
Growth Plans and Capital Expenditure Strategy
The company has outlined a capital expenditure plan of ₹23 billion for FY27–FY29, focusing on:
- Energy efficiency upgrades
- Expansion of multi-grade NPK production
- Backward integration through phosphoric acid projects
RCF is also investing in Talcher Fertilizers Limited, with commercial operations expected by mid-2027.
Risks Monitored by Rating Agencies
While reaffirming the rating, agencies highlighted certain risks:
- Dependence on government subsidy mechanisms
- Exposure to volatility in natural gas prices
- Potential increase in leverage due to capital expenditure
Despite these factors, RCF’s strong fundamentals and policy support are expected to sustain its credit profile.
Stable Liquidity Position
The company maintains a healthy liquidity profile supported by:
- Access to low-cost financing
- Strong working capital management
- Timely receipt of subsidy payments
This ensures smooth operations and financial stability.
Strong Financial Resilience and Sector Leadership
The AA/Stable rating reaffirmation reflects continued confidence in RCF’s financial strength and its critical role in India’s fertiliser supply chain. With strong government backing and ongoing capacity expansion, the company remains well-positioned for future growth.
About RCF
Rashtriya Chemicals and Fertilizers Limited is a leading public sector enterprise engaged in the production of fertilisers and industrial chemicals. With major manufacturing units at Thal and Trombay, the company plays a key role in supporting India’s agricultural sector and ensuring food security through reliable fertiliser supply.
Read also: RCF Q3 FY26 Net Profit Rises 2.2% to ₹81.37 Crore; Board Declares 10% Interim Dividend
