Direct benefit transfer for fertilizers a welcome step

RG Rajan, CMD of RCF said that the direct benefit transfer for fertilizers announced in the Budget is a 'welcome step'. The Rs 70,000 crore subsidy proposed in the Budget for the fertilizer industry is sufficient for to cover this year as well as the outstanding amount from last year. 

The company's new facility in Thal, Rajan said that approval from Controller of Certifying Authorities (CCA) is pending and he hopes to get it in the next two months in order to start the project. 

The focus on foreign health cards and to give all the 47 crore farmers foreign health cards is also very good step taken by the Government in the finance budget. 

Next financial year should be better because initial forecasts are next year we will have better monsoon and if we have better monsoon, definitely we will have better results next year. 

This year has been a very bad year because of the drought in Maharashtra, Telangana, Andhra Pradesh and Karnataka. There are huge inventories in all the states and therefore the sales this year are not so good as compared to last year. Dispatches are going on but they will only pick up once you have a good pre-monsoon showers sometime in May, they will pick up in that period, end of April, May, June maybe they will pick up once the pre-monsoon showers start. 

The capex on new facility in Thal is totally funded by RCF. It is a 1.3 million tonne Urea plant costing around Rs 5,500 crore and 70 % will be the debt and equity 30 %. Equity of 30 % will come from internal generation only.