1.At a Glance
Zuari Agro Chemicals Ltd (ZACL), the grand old fertilizer arm of the Adventz Group, just pulled off a quarterly show that left analysts checking their calculators twice. For Q2 FY26, the company reportedsales of ₹1,423 croreand aPAT of ₹840 crore, up a hilarious112% YoY, helped by a mammoth₹1,168.96 crore exceptional gain. The stock currently sits at₹251, with a market cap of₹1,055 crore, which means the market values the company at roughly one-fourth of its net worth — and probably even less than its land in Goa.
At aP/E of just 3.05andbook value of ₹602 per share, the valuation screams “why is this so cheap?” louder than a farmer shouting during fertilizer shortages. WithROCE at 12.7%,ROE at 9.06%, anddebt-to-equity at 0.24, Zuari has turned from a debt-laden laggard to a balance sheet detox story. But as with all Adventz ventures, the plot always thickens — sometimes faster than urea dissolving in rainwater.
The recent quarter included thetransfer of its Mahad SSP plant to Mangalore Chemicals & Fertilizers (MCFL)for ₹72.75 crore andsale of MCFL shares worth ₹418 croreto Zuari Maroc Phosphates Pvt Ltd. Between these transfers, slump sales, and “exceptional” gains, Zuari’s P&L looks more like a real estate and investment exit log than a fertilizer company.
Still, ₹840 crore profit in a quarter for a ₹1,000 crore company? Even nitrogen would blush at that growth.
2.Introduction
Imagine a company that once sold urea and SSP (Single Super Phosphate) to Indian farmers but today seems to mint profits by sellingentire plantsandsubsidiaries. That’s Zuari Agro Chemicals — the fertilizer company that’s become more aboutfertilizing its balance sheetthan the soil.
Founded way back in 1967, Zuari started as India’s dream of self-sufficiency in fertilizers. Over the decades, it has been through everything — joint ventures, slump sales, NCLT orders, and more corporate restructuring than your average family WhatsApp group after a wedding fight.
Zuari belongs to theAdventz Group, led bySaroj Kumar Poddar, whose portfolio also includes Texmaco, MCFL, and Paradeep Phosphates. The company produces complex fertilizers, SSP, and micronutrients under the “Jai Kisaan” brand — a name that ironically suits the farmers better than the shareholders who’ve waited years for meaningful returns.
But the last few quarters have changed the tone. From selling its Goa plant to Paradeep Phosphates for $280 million in FY22, to now transferring the Mahad SSP unit to MCFL, Zuari seems determined to simplify operations and focus on its profitable, core assets.
Of course, “core assets” here could mean either the fertilizer plants or their real estate — the line between the two has been blurring for years.
So, how did Zuari go from losses to ₹1,076 crore net profit in FY25 and ₹840 crore in Q2FY26? Let’s dig into the soil (and maybe the accounting notes).
3.Business Model – WTF Do They Even Do?
Let’s be honest: Zuari’s business model is as layered as a fertilizer bag that hides more air than nitrogen.
The companyofficiallymanufactures and marketscomplex fertilizers,Single Super Phosphate (SSP), andmicronutrients. Its SSP brand,Jai Kisaan, dominates parts of Maharashtra and Karnataka. In FY23, Zuari sold90,174 MT of SSP, and plans to push1.25 lakh MT in FY24— a 38% jump.
Apart from that, Zuari trades in fertilizers and raw materials, lending an extra dose of revenue volatility. Its FY23 revenue breakup tells the story:
- Finished products – 61%
- Traded products – 8%
- Interest income – 4%
- Profit on asset disposal – 23% (!!)
Yes, a fertilizer company made nearly a quarter of its FY23 income from selling assets. That’s like a dairy farmer saying 25% of his milk revenue came from selling the cow.
But that’s the Zuari way — smart financial farming. Its other ventures include inter-corporate deposits (ICDs) to Adventz subsidiaries (some written off), joint ventures with Morocco’s OCP (via Zuari Maroc Phosphates Pvt Ltd), and ownership stakes in Paradeep Phosphates and Mangalore Chemicals.
So what does Zuarireallydo?It’s part fertilizer producer, part holding company, part lender, and occasionally, a land broker. The fertilizer output may vary, but the corporate creativity remains at
100% concentration.
4.Financials Overview
| Metric | Latest Qtr (Sep’25) | YoY Qtr (Sep’24) | Prev Qtr (Jun’25) | YoY % | QoQ % |
|---|---|---|---|---|---|
| Revenue | ₹1,423 Cr | ₹1,123 Cr | ₹1,246 Cr | 26.6% | 14.2% |
| EBITDA | ₹174 Cr | ₹101 Cr | ₹141 Cr | 72% | 23% |
| PAT | ₹840 Cr | ₹93 Cr | ₹127 Cr | 802% | 561% |
| EPS (₹) | 191.68 | 19.31 | 23.54 | 894% | 714% |
Theexceptional gain of ₹1,168.96 crorefrom the MCFL sale turned this into one of the most “fertile” quarters in corporate India. Even stripping that out, Zuari’s operating performance improved — OPM rose to12%, the best in two years.
The annualized EPS (₹191.68 × 4 = ₹766.7) makes the P/E ratio look like a typo. Of course, that’s purely optical since the extraordinary income isn’t recurring. But hey, it makes the spreadsheet look like Diwali lights.
5.Valuation Discussion – Fair Value Range
Let’s try three lenses to see what Zuari’s true worth could look like.
a) P/E MethodCurrent EPS (FY25): ₹232.91Industry Average P/E: 22.7Reasonable Range (discounted 60–80% due to one-offs): P/E 4–9→ Fair Value Range: ₹930 – ₹2,096
b) EV/EBITDA MethodEV = ₹1,598 Cr; EBITDA (TTM) = ₹463 CrCurrent EV/EBITDA = 3.45xIndustry median: ~9x→ Fair Value Range: ₹1,598 × (9/3.45) = ₹4,171 Cr EV → ~₹995–₹1,050/share
c) DCF (Educational Estimate)Assuming normalized cash flow of ₹500 Cr, growth 4%, discount 12%, terminal multiple 8xDCF Fair Range = ₹850 – ₹1,050/share
📘Educational Disclaimer:This fair value range is foreducational purposes only. Extraordinary items distort near-term profitability, so this is not investment advice.
6.What’s Cooking – News, Triggers, Drama
If Zuari Agro were a TV show, this quarter’s title would be “The Great Slump Sale Saga.”
InSeptember 2025, Zuari completed thetransfer of its Mahad SSP plantand related assets toMangalore Chemicals & Fertilizers (MCFL)for₹72.75 crore. ByOctober, it had also transferred2.9 crore MCFL shares to Zuari Maroc Phosphates Pvt Ltd (ZMPPL)for₹418 crore. Add it up, and you get more than ₹490 crore of “non-fertilizer” income in one go.
TheNCLT Bengalurualso approved thecomposite scheme of arrangementbetween MCFL and Paradeep Phosphates — both partly owned by Zuari entities. The inter-company reshuffling looks like musical chairs — but with ammonia tanks.
Other highlights:
- Approved₹180 crore CCPS investment
