Synopsis: Fertilizer stocks rallied 20% on strong volume, boosted by the Gas Supply Cap for fertilizer plants. Technicals are bullish, with the stock below its 50 and 200-day moving averages and RSI in the oversold zone.
The shares of the Mid-cap company, specializing in manufacturing and marketing complex fertilizers (Factamfos), ammonium sulphate, organic fertilizers, and caprolactam, are in focus as the stock has rallied 20 percent in intraday trade following the announcement of the Gas Supply Cap for fertilizer plants.
With a market capitalization of Rs. 51,448.69 Crores on the Day’s Trade, the shares of Fertilizers and Chemicals Travancore Ltd hit a 20 percent upper circuit, reaching a high of Rs. 795.10 compared to its previous close of Rs. 662.60.
What Happened
Fertilizers and Chemicals Travancore Ltd, engaged in manufacturing and marketing complex fertilizers (Factamfos), ammonium sulphate, organic fertilizers, and caprolactam, is in focus as they have rallied 20 percent in the day’s trade.
Reason for the rally
Gas Supply Cap for Fertilizer Plants
As per the recent order, the supply of natural gas to fertilizer plants will be limited to 70% of their average consumption over the past six months, which is higher compared to the major sectors like Oil Refiners, Petrochemical Plants, and Power Plants. Additionally, the order mandates that the gas supplied should be used exclusively for fertilizer production, prohibiting its use for any other purpose.
The Central government invoked the Essential Commodities Act of 1955 to ensure the steady supply of natural gas amid shortages caused by the ongoing conflict in the Middle East. According to the order, the supply of natural gas to certain sectors shall be treated as a priority.
The Essential Commodities Act, 1955, allows the Central Government to regulate or control the production, supply, and distribution of essential goods like food, fuel, fertilisers, and drugs to prevent hoarding, black marketing, and shortages that could disrupt daily life.
Volume spike
The stock has recorded a strong trading volume of 8.17 million shares in the day’s session, significantly higher than its average daily volume of around 400–800K. This surge in volume indicates heightened investor interest and adds strength to the ongoing price movement, reinforcing the positive momentum in the stock.
Technical Overview
The stock is currently trading below its 50-day and 200-day moving averages, suggesting a corrective phase after the previous trend. Additionally, the RSI has fallen below the 30 level, placing the stock in the oversold zone and indicating potential for a possible upside bounce.
Financials
The company’s revenue rose by 65 percent from Rs. 949 crores in December 2024 to Rs. 1,568 crores in December 2025. Meanwhile, Net profit of Rs. 8 crores last year turned to a loss of Rs. 68 crores in the same period.
The company’s Return on Capital Employed (ROCE) stands at 8.65%, indicating moderate efficiency in generating profits from its total capital. However, the Return on Equity (ROE) is significantly lower at 1.61%, suggesting limited returns specifically for shareholders.
It also demonstrates strong financial performance, with a three-year average return on equity (ROE) of 27.4%, reflecting efficient use of shareholder capital. Coupled with a consistent dividend payout ratio of 40.2%, it indicates a balance between rewarding shareholders and retaining earnings for growth.
Fertilizers & Chemicals Travancore Ltd (commonly known as FACT) is one of India’s oldest and most significant fertilizer manufacturers, established in 1943 and headquartered in Kochi, Kerala. It was the first large‑scale fertilizer plant in the country, beginning production of ammonium sulfate in 1947 and later expanding into a broad range of fertilizers and industrial chemicals.
FACT has evolved into a multi‑divisional public sector enterprise under the administrative control of the Government of India’s Ministry of Chemicals & Fertilizers. Besides fertilizer manufacturing, its activities extend to engineering design and consultancy and the fabrication of industrial equipment, with production units at Udyogamandal and Ambalamedu near Kochi.
Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on tradebrains.in are their own, and not that of the website or its management. Investing in equities poses a risk of financial losses. Investors must therefore exercise due caution while investing or trading in stocks. Trade Brains Technologies Private Limited or the author are not liable for any losses caused as a result of the decision based on this article. Please consult your investment advisor before investing.
The post Why Did Fertilizers and Chemicals Travancore Shares Skyrocket by 20% Today? appeared first on Trade Brains.