Shares of fertiliser companies surged as much as 4 per cent on the BSE today on the Government’s move to cut subsidy on certain decontrolled fertilisers for the next fiscal.
National Fertilisers Ltd , Rashtriya Chemicals and Fertilisers Ltd and Coromandel International Ltd saw their share prices rise by 3-4 per cent in the afternoon trade on the BSE in an overall weak market.
The Cabinet Committee on Economic Affairs (CCEA) is believed to have approved today the Fertiliser Ministry’s proposal to reduce the subsidy on P and K fertilisers under the Nutrient Based Subsidy (NBS) policy.
National Fertilisers jumped 4 per cent to Rs 93.70 a piece, RCF gained 3.25 per cent to Rs 68.40 and Coromandel International rose 3.56 per cent to trade at Rs 286.50 a share.
Shiva Global Agro Industries gained 0.29 per cent, while Zuari Industries grew 0.88 per cent and Deepak Fertilisers & Petrochemicals Corp was up 0.19 per cent. However, Tata Chemicals was trading 0.29 per cent lower at Rs 361 a piece on the bourse.
Due to strengthening of rupee and bearish global prices, the Fertiliser Ministry had recommended reduction in subsidy on nitrogen (N) and potassium (K) at Rs 24 per kg each and Rs 21.8 per kg on phosphate (P) for the 2012-13 fiscal.
These subsidy rates will be made with effect from April 1, 2012.