Coromandel International CEO S Sankarasubramanian reports that urea prices have stabilized between $450-$500 per tonne following the recent West Asia crisis disruption. As per Business Standard, the CEO noted that urea prices had touched $950 per tonne during the peak of the crisis, but have now returned to more stable levels. Looking ahead, Sankarasubramanian expects urea prices to remain around $500 per tonne for the remainder of the year, with global commodity prices unlikely to see significant increases. This stabilization provides relief to the fertilizer industry after the recent volatility caused by supply chain disruptions.
Coromandel International delivered robust Q3 FY26 results with consolidated net sales reaching ₹6,003.66 crore, marking a significant 20.35% year-on-year growth. The company's standalone performance was equally impressive, with net sales at ₹5,660.90 crore, up 13.38% year-on-year. This strong quarterly performance validates Motilal Oswal's earlier analysis, as the brokerage had noted the company's ability to offset operational challenges through its diversified business model. The latest results demonstrate Coromandel's resilience in navigating market volatility while maintaining growth momentum across its key business segments.
Motilal Oswal has issued a buy rating on Coromandel International with a target price of ₹2,530 in its research report dated July 25, 2026. According to the brokerage's analysis, the company delivered a muted operating performance in 1QFY27, with EBITDA declining 3% year-on-year, primarily due to Middle East conflict-driven raw material inflation that outpaced subsidy support. Despite the overall performance challenges, the company's crop protection segment continued to demonstrate strong momentum, with standalone EBIT surging 44% year-on-year and achieving margin expansion of 300 basis points.
The West Asia crisis has created significant challenges for the fertilizer industry, with sulphur availability and prices emerging as the single biggest concern. As per Business Standard, Sankarasubramanian highlighted that sulphur is a critical feedstock for phosphoric acid production, with prices having increased significantly alongside ammonia and phosphoric acid costs. The industry faces a demand-supply mismatch for phosphatic fertilizers, with DAP prices holding around $930-$940 per tonne due to China's restrictions on phosphatic exports. However, the CEO expects subsidy outgo to be moderated due to urea price stabilization, with the government's ₹1.71 trillion FY27 fertilizer subsidy allocation providing adequate coverage for current market conditions.
Despite near-term challenges from the West Asia conflict and raw material cost pressures, Motilal Oswal maintains its positive stance on Coromandel International, reiterating the buy recommendation based on the company's strong crop protection business performance and robust Q3 results. The brokerage's analysis suggests that while cost pressures may impact earnings in the short term, the company's diversified business model and strong market positioning support the bullish outlook. With the company engaged in manufacturing fertilizers, plant protection chemicals, and specialty nutrients, along with retail ventures in agri and lifestyle segments, Coromandel is well-positioned to capitalize on the growing demand for comprehensive plant nutrition solutions. The CEO expects 10-15% consumption variation this year, which could provide additional relief to government subsidy outgo.
