Daijiworld Media Network - Mumbai

Mumbai, Jun 10: Shares of fertiliser companies ended higher on Wednesday after reports indicated that the Ministry of Chemicals and Fertilisers may seek additional funds equivalent to its existing budget allocation to offset the impact of rising global fertiliser prices and supply concerns linked to tensions in West Asia.

According to media reports, the ministry has conveyed that it may require an additional amount equal to the current fertiliser subsidy allocation of Rs 1.71 lakh crore for the financial year. If approved, the move would effectively double the government's fertiliser subsidy outlay.

The prospect of increased subsidy support boosted investor sentiment across the fertiliser sector.

Chambal Fertilisers and Chemicals Ltd emerged as the top gainer among major fertiliser stocks, rising 4.23 per cent to close at Rs 474.

Fertilisers and Chemicals Travancore (FACT) gained 3.26 per cent to Rs 904.65, while National Fertilizers Ltd advanced 3.08 per cent to Rs 76.65.

Other fertiliser companies, including Coromandel International Ltd, Rashtriya Chemicals and Fertilizers Ltd and Gujarat State Fertilizers and Chemicals Ltd, also ended the session in positive territory.

Paradeep Phosphates Ltd was the only major stock in the sector to close lower, slipping 0.21 per cent to Rs 126.

The rally comes amid concerns that escalating geopolitical tensions in West Asia could disrupt fertiliser supply chains and increase import costs, placing additional pressure on government subsidy expenditure.

Earlier in the day, Chief Economic Adviser V Anantha Nageswaran indicated that the government's expenditure plans for the current financial year would depend, among other factors, on developments in international fertiliser prices.

Market participants viewed the possibility of higher subsidy support as a positive signal for fertiliser manufacturers, particularly at a time of uncertainty in global commodity markets.