Today, we recommend two stocks, one from the fertilizers sector and another from the aluminum sector, as recommended by the Trade Brains Portal, to buy for an upside potential of more than 34%. The fertiliser sector is vital to the Indian economy by driving agricultural productivity and ensuring food security for its large population.
Meanwhile, the aluminium sector is crucial to the Indian economy as a key industrial material driving growth in infrastructure, transportation, construction, and packaging, creating significant employment and boosting GDP. We also analyzed the market’s performance on Friday to understand what may lie ahead for the stock indices in the coming days.
1. Gujarat State Fertilisers & Chemicals Ltd
- Current price: Rs 198
- Target price: Rs 265
- Upside: 34.1%
- Time frame: 12 months
To view the report for the stock mentioned above or explore other stock recommendations, click here
Why it’s recommended
Founded in 1962, Gujarat State Fertilisers & Chemicals Ltd. (GSFC) stands as India’s first joint sector industrial complex. Over the years, it has grown into a prominent integrated manufacturer of fertilisers and industrial chemicals. Its diverse product portfolio is supported by strong in-house R&D capabilities and globally recognised certifications under the ISO and Responsible Care standards.
GSFC operates through two main business divisions: fertilizers and industrial products. The industrial segment includes items like caprolactam, nylon-6, melamine, and methanol, while the fertiliser segment features products such as urea, ammonium sulfate, and diammonium phosphate (DAP).
In FY25, the company posted revenues of Rs 9,533.9 crore, reflecting a 4.14% increase from Rs 9,154.6 crore in FY24. This growth was primarily driven by the fertiliser division, which benefited from improved operational efficiency and better cost management.
In Q1 FY26, the company reported revenue from operations of Rs 2,184 crore, up marginally by 1% YoY from Rs 2,163 crore. PBT rose by 63% YoY to Rs 184 crore, and PAT increased by 59% YoY to Rs 139 crore. Fertiliser revenue grew 1.15% YoY to Rs 1,631.52 crore. The quarter started with stable revenues and improved profitability.
Fertiliser revenue rose 7.3% year-over-year, from Rs 6,834.62 crore in FY24 to Rs 7,331.8 crore in FY25, supported by a 15.3% increase in total sales volume. The company expects an EBITDA of Rs 3,000 per metric ton for fertilisers in FY26. Profit before tax (PBT) climbed 7.4% YoY to Rs 756.27 crore, while profit after tax (PAT) grew 5% YoY to Rs 591 crore.
GSFC’s renovated Urea-II plant is now running at full capacity, and it has successfully commissioned a 15 MW solar power project at Charanka Patan. The ongoing Phosphoric Acid (PA) and Sulfuric Acid (SA) expansion at Sikka is progressing well, with commissioning of SA V expected in the first half of FY26. In terms of capital expenditure, the company is planning to invest around Rs 600 crore in urea capacity, Rs 453 crore, and Rs 300 crore for the SA V project over the next six months.
Looking ahead, the management intends to pursue a balanced production-import strategy, particularly in DAP and non-DAP grades, to protect margins and optimize fertilization and anticipates demand for melamine and other key products to remain stable and expects much better performance in the segment for Q2 FY26.
Risk Factor
GSFC’s profitability is heavily dependent on regulatory dynamics and government subsidies. Fertilizer pricing and subsidy policies are strictly regulated by the government, directly affecting the financial performance of fertilizer manufacturers.
The timing and availability of subsidies are also crucial for maintaining liquidity in the sector. With raw material prices stabilizing, the government has started scaling back subsidies, prompting companies to rely more on short-term borrowing.
2. National Aluminium Company Ltd
- Current price: Rs 186
- Target price: Rs 225
- Upside: 20.7%
- Time frame: 12 months
To view the report for the stock mentioned above or explore other stock recommendations, click here
Why it’s recommended
Established in 1981, National Aluminium Company Limited (NALCO) is a ‘Navratna’ Central Public Sector Enterprise (CPSE) and falls under Schedule ‘A’. It is one of India’s largest fully integrated producers of bauxite, alumina, aluminium, and power. The company operates the Panchpatmali Bauxite Mines, which supply raw material to its alumina refinery located in Damanjodi, Koraput district, Odisha.
Additionally, NALCO runs an aluminium smelter and captive power plant in Angul. Its production capabilities include 7.5 million tonnes per annum (MTPA) of bauxite, 2.1 MTPA of alumina, 0.46 MTPA of aluminium, 1,200 MW of captive power, 4 MTPA of coal, and 198 MW of wind energy.
Looking ahead to FY26, NALCO aims to increase alumina output by 2 lakh tonnes to reach 22.5 lakh tonnes and has earmarked Rs 1,700 crore for capital expenditure. For FY27, it plans to invest Rs 2,000 crore in aluminium and alumina expansion projects.
The company is actively pursuing growth through new initiatives, including the development of a 3.5 MTPA bauxite mine, a 1 MTPA alumina refinery, a 0.5 MTPA aluminium smelter, and a 1,080 MW captive power facility.
In FY25, NALCO achieved record revenue of Rs 16,787.63 crore and an all-time high net profit of Rs 5,267.94 crore, marking a 165% year-over-year increase. The EBITDA margin also surged by 46%, driven by favourable pricing of alumina and aluminium, with a target EBITDA margin of 36-37% for FY26. In Q1 FY26, the company reported revenue from operations of Rs 3,806.94 crore, a growth of 33% YoY PBT rose 76% YoY to Rs 1,414.89 crore, and PAT increased 78% YoY to Rs 1,049.48 crore.
NALCO has a consistent track record of dividend payments. In FY25, shareholders received a total final dividend of Rs 8 per share, which included two interim dividends of Rs 4 each, disbursed in November 2024 and February 2025.
Looking ahead, as NALCO is a zero-debt company, it gives leverage to its upcoming projects, which require huge investments. The company has signed the lease deed for Pottangi bauxite mines, which will be operated by this year or by Q1 FY27. With this, the capacity will increase by 3.5 million tons. The company is also going ahead with the 5th stream refinery expansion, which will increase the capacity by 1 million tons.
Risk Factors
NALCO’s performance is closely tied to global aluminium prices, which can be volatile due to changes in supply-demand dynamics, geopolitical developments, and global economic trends. In addition, fluctuations in input costs, especially for raw materials like coal and caustic soda, can impact the company’s profitability.
Market Recap 29th August, 2025
Friday’s trading session started on a bearish note and ended with major indices in the red for the third consecutive day. The Nifty 50 opened weak at 24,466.70, down -34.20 points from its previous close of 24,500.90, and further declined to close at 24,426.85, losing -74.05 points, or -0.30%. On the technical front, the index ended below its 20-day, 50-day, and 100-day EMAs but stayed above the 200-day EMA.
The BSE Sensex mirrored this weakness, opening at 80,010.83 and closing at 79,809.65, a drop of -270.92 points, or -0.34%. It briefly dipped below the 200-day EMA during the session but managed to close above it. Momentum indicators showed decreasing strength, with the Nifty’s RSI at 39.14 and the Sensex’s RSI at 37.83, both well below the overbought level of 70. The Bank Nifty also declined, finishing at 53,655.65, down -164.70 points, or -0.31%.
Most sectoral indices closed in the red, though a few outperformed. The Nifty FMCG Index led the gainers, ending at 56,141.85, up 528.90 points, or 0.95%. Colgate-Palmolive (India) Ltd rose 3.05%, followed by United Spirits (+2.30%) and ITC (+2.21%). The Nifty Media Index also posted modest gains, closing at 1,612.00, up 5.65 points, or 0.35%. Tips Music Ltd gained 3.1%, while Nazara Technologies and DB Corp Ltd rose 1.90% and 1.30%, respectively.
On the downside, the Nifty Capital Markets Index was the worst performer, dropping -76.40 points, or -1.80%, to settle at 4,092.35. BSE Ltd led the losses with a -3.8% decline, followed by Motilal Oswal Financial Services (-3.6%) and KFin Technologies (-2.7%).
The Nifty Realty Index also weakened, shedding -11.75 points, or -1.3%, to close at 870.75. Major draggers included Sobha Ltd, Brigade Enterprises, and Godrej Properties, which fell by as much as -3.40%.
Asian markets ended mixed. China’s Shanghai Composite Index rose 0.37% to 3,857.92, while the Shenzhen Component Index gained 0.99% to 12,696.15. Hong Kong’s Hang Seng Index added 0.32%, closing at 25,077.62. Meanwhile, Japan’s Nikkei 225 and South Korea’s KOSPI fell by -0.26% and -0.32%, respectively. As of 5:03 PM IST, U.S. Dow Jones Futures were trading lower at 45,575, down -132 points, or -0.29%.
This week, the Nifty index saw a sharp decline of -1.78%, or -443.25 points, ending below the 24,450 mark. The drop followed the implementation of new 25% U.S. tariffs, which took effect on August 27, 2025. However, markets may rebound next week, supported by India’s strong Q1FY26 GDP growth of 7.8%, the highest in the past five quarters.
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