Indian fertilizer stocks fall as govt orders products to be sold under one brand

Gujarat State Fertilizers & Chemicals

29/08/2022 08:44

** Shares of Indian fertilizer makers fall on government
order for companies availing subsidies to sell products under
one brand and logo
    ** Last week, Indian govt said all fertilizer companies
would have to implement new branding by Sept. 15, in a move
widely seen as the Narendra Modi-led government attempting to
drum up support ahead of elections
    ** After gaining 5.9% last week, shares of National
Fertilizers Ltd  NAFT.NS  fall by as much as 5.2%; Gujarat State
Fertilizers and Chemicals Ltd  GSFC.NS  down 4.6% after rising
3.5% previous week; Rashtriya Chemicals and Fertilizers Ltd
 RSTC.NS  down 4.3% after rallying 14.9% last week 
    ** Move will have negative impact on cos as they cannot have
branding - AK Prabhakar, head of research at IDBI Capital
    ** Govt's brand and logo to make up two-thirds of face of
fertilizer bags, with companies left with one-third space on the
bag to brand themselves
    ** The govt decision to do so may be driven by educating the
farmers about subsidy spent by the government on fertilizers -
Rohan Gupta, research analyst with Edelweiss Securities

 (Reporting by Nandan Mandayam in Bengaluru)
 ((Nandan.Mandayam@thomsonreuters.com; Mobile: +91 9591011727;))