Rashtriya Chemicals & Fertilizers Ltd Management Discussions.


As per Word Bank, Indias GDP is expected to grow at 7.3% in the fiscal year 2018-19 and 7.5 % in the following two years, attributing it to an upswing in consumption and investment and it will continue to be the fastest growing major economy in the world.

The interim Union Budget for 2019-20 was announced by Union Minister for Finance, Government of India, in Parliament on February 01, 2019. It focuses on supporting the needy farmers, economically less privileged, workers in the unorganised sector and salaried employees, while continuing the Government of Indias push towards better physical and social infrastructure. Total expenditure for 2019-20 is budgeted at Rs 2,784,200 crore (US$ 391.53 billion), an increase of 13.30% from 2018-19 (revised estimates). Numerous foreign companies are setting up their facilities in India on account of various government initiatives like Make in India and Digital India. Prime Minister of India has launched the Make in India initiative with an aim to boost the manufacturing sector of Indian economy, to increase the purchasing power of an average Indian consumer, which would further boost demand and hence spur development in addition to benefiting investors. The Government of India, under the Make in India initiative, is trying to give boost to the contribution made by the manufacturing sector and aims to take it up to 25 percent of the GDP from the current 17 percent. Besides, the Government has also come up with Digital India initiative, which focuses on three core components: creation of digital infrastructure, delivering services digitally and to increase the digital literacy.

India is expected to be the third largest consumer economy as its consumption may triple to US$ 4 trillion by 2025, owing to shift in consumer behaviour and expenditure pattern, according to a Boston Consulting Group (BCG) report and is estimated to surpass USA to become the second largest economy in terms of purchasing power parity (PPP) by the year 2040, according to a report by PricewaterhouseCoopers.


The fertilizers sales for industry as a whole had witnessed growth by almost 9.06% during the financial year 2018-19. With overall consumption rising, the decline in domestic sales was made up with higher urea imports which rose 25% in the financial year 2018-19. NPK and DAP sales had increased by 7% and 5.27 % respectively as compared to the previous year. MOP sales had increased substantially by 41.65 % as compared to the previous year. Imports of Urea, DAP & NPKs increased by 21.33%, 38.29% and 24.97% respectively during the year 2018-19 as compared to the previous year. On the other hand, imports of MOP witnessed sharp declined of 15.87 %.

Rabi sowing was down 1.9% year to year in the current season for financial year 2019 driven by lower sowing in states like Maharashtra, Karnataka, Andhra Pradesh and Gujarat. These states had witnessed deficient rainfall during the kharif season and low reservoir levels in the rabi season. The sowing levels for rice witnessed a remarkable uptick towards the end of rabi season with increased sowing reported from Bihar and West Bengal, while all other major crops witnessed a decline in sowing during the current rabi season.

International Urea prices have been trending above five- year average of $254/MT since August 2018 driven by elevated coal and natural gas prices, lower Chinese exports and sanctions on Iran. International Urea prices have started moderating as the global market is witnessing a supply glut while demand continues to remain tepid. India has already imported its requirement for the current season while demand from the US remains slow. Despite Chinese operating rates witnessing slight improvement, the competitiveness in the international market remains weak as Chinese producers focus on domestic market. As a result, prices have started moderating and are expected to moderate in the near term. Going ahead with the commissioning of Chambal Fertilisers brownfield expansion, availability of domestic Urea will improve resulting in lower import dependence for India and thus may lead to a downward bias on International Urea prices.

International DAP prices have been trending around $400/ MT for the past 12 months. Production curtailments and slower ramp up of new capacities coupled with healthy demand and rising raw material prices resulted in higher DAP prices. Prices have started moderating in Q4 FY 2019 as the this was an offseason in most of the agricultural regions. International DAP prices are expected to remain firm with a marginal upward bias given the announcement of production cuts by Mosaic Inc US. The company announced reducing its phosphate production by around 0.3 MMT for the upcoming season to support the phosphatic prices.

The upward revision in the budgetary provision for the fertiliser subsidy for financial year 2019-20 to 749.9 Crore (BE) is positive for the fertiliser sector. The subsidy allocation for indigenous Urea has been increased to 400 billion in financial year 2019-20 from Rs 349.9 billion in financial year 2018-19, which will be sufficient to meet the subsidy requirements for the production to be undertaken by plants being commissioned under the New Urea Investment Policy-2012 (NIP-2012) in the upcoming year. The subsidy allocation for imported Urea has been kept unchanged, at Rs 1 36.3 Billion (BE) in financial year 201920 vis-a-vis Rs 1 33.6 Billion, which is expected to provide flexibility to the GoI in terms of subsidy allocation as Urea imports are set to decline from financial year 2020 onwards. The subsidy allocation for the P&K fertiliser has been reduced to Rs 238.3 billion (BE) in financial year 201920 from Rs 250.9 billion (RE) in financial year 2018-19. The reduction in P&K subsidy comes as a surprise when the raw material prices particularly Phosphate (P), Potash (K) and Sulphur (S) have witnessed a steep increase. As a result, the retail price of P&K fertiliser increased by ~25-30% year to year in the current rabi season. While the budgetary allocation for the fertiliser sector may have increased by

~50 Billion, the subsidy backlog is expected to remain significant, exceeding Rs 300 Billion, at the end of FY 201819, which continues to impact the liquidity position of the fertiliser companies.

The subsidy rates for the Phosphatic & Potassic (P&K) fertilisers for financial year 2020 have been retained at the same level as that of financial year 2019 on a provisional basis. The final rates will be announced later by the CCEA and any differential in payment of subsidy will be made or absorbed from companies as per the final rates. The continuation of the subsidy levels as the previous year will keep the retail prices near about at current levels with marginal moderation given the appreciation of the INR against the US dollar. The final announcement for the subsidy rates is expected to be made post completion of the Union Elections in May 2019.



(i) Your Companys strength lies in its skilled manpower, high Brand Equity of its Products such as Ujjwala, Suphala, Microla, Biola, and Sujala and diversified product portfolio of fertilizers and chemicals.

(ii) The wide reach of marketing network ensures that your Company can take its products to the farthest corner of the country.

(iii) Plans for increased usage of digital technology to reach-out to farmers through Mobile App, Facebook page, Twitter handle, Instagram handle and YouTube Channel under the name of "RCF Kisan Munch". RCF is also using community radio services of Krishi Vigyan Kendra (KVK) for telecasting farmers education programs.

(iv) The Farmers Training Institutes at Thal and Nagpur are helping in a big way to educate farmers on latest farming techniques. Also Company has been operating toll free help line number called

"Kisan Care" through which farmers can approach agriculture experts and get their queries addressed.

(v) Larger farmer reach through various farm extension activities like field Demonstration, Sheti-patrika, celebrating soil testing days etc.

(vi) Your Company has a wide portfolio of Industrial chemical products which has applications across several sectors like pharmaceuticals, dyes etc.

(vii) The well maintained plants and equipment ensure that production remains uninterrupted.


(i) The Plants have been in operation for a very long time and needs significant investment for upkeep and upgradation.

(ii) As the ultimate customers of the Company are farmers, agro-climatic condition has a large effect on the performance of the Company.

(iii) Raw material such as Rock Phosphate, MAP, DAP and Potash (MOP) etc. required in the manufacturing of the complex fertilizers has to be imported. Their procurement cost is subject to severe volatility in global raw material prices and variation in the foreign currency exchange rates affecting the profitability of the Company.

(iv) Volatile Natural gas price for non-Urea operations impacting bottom line of the Company.

(v) Owing to inflow of cheaper imports, some of the products like ANP 20:20:0, Methanol, Dimethyl Formamide, Formic Acid, etc. have become economically unviable.

(vi) Owing to the large subsidy backlog, inadequate subsidy provisioning in the Union Budget as well as shifting of subsidy realization from point of dispatch to point of retail sale, the implementation of DBT is likely to have a negative impact on the working capital cycle of the fertilizer industry in the near term.

(vii) Reduction in supply of Domestic gas leads to increase in consumption of imported RLNG at higher cost.


i) Several opportunities exist overseas, for Collaborations / Diversification in the field of manufacturing and mining of raw materials as well as fertilizers thereby presenting an opportunity for marketing of variety of products.

ii) Huge demand and import dependency in case of NPK fertilizers in the Country provides an opportunity to Company for expanding its NPK fertilizer base.

iii) Alternate feedstock such as Coal gives an opportunity for undertaking Fertilizer Projects in other parts of the country closer to coal mines based on latest coal gasification technology.

iv) Experienced and Skilled Manpower of your Company has been in demand for rendering O&M services in India and abroad. In view of your Companys training facilities, as well as the available skilled Engineers and Technicians, your Company is in a position to impart training to many foreign and Indian Companies.

v) Energy saving projects like Trombay Urea-V plant revamp, Trombay Ammonia-V plant revamp, GTG- HRSG project at Trombay, installation of new GT driven PAC-IV, VFD for HP Ammonia feed pump at Thal, etc., are planned for completion within next 2 years. This will have positive impact on the profitability of your Company.

All these opportunities would enable your Company to improve profitability in the coming years.


(i) Manufacturing and marketing of Fertilizers is the core business of your Company. In recent years, there has been high volatility in the prices of raw material resulting in an adverse impact on production and marketing plans. The profitability is susceptible to the input costs of major raw materials, such as Rock Phosphate, Sulphur, DAP, MOP, MAP etc.

(ii) Production of Urea, Complex Fertilizers and chemicals is dependent on the availability of feedstock gas and its economic pricing.

(iii) The industrial chemicals business is also exposed to cut throat global market competition.

(iv) Department of Fertilizers (DoF), Government of India, is under the process of implementing a move to mop up the unintended gains that the fertilizer units are making in nutrient "N" by use of APM/ RIL gas for manufacturing of P&K fertilizers with retrospective effect from 01.04.2010. This, if implemented, will not only have adverse impact on the profitability but also operational viability of the Company. Your Company has made suitable representation to the DoF on this issue.

(v) Uncertainty in government policies in respect of supply of feed stock gas, pricing of fertilizers and subsidy thereon also affect the performance and competitiveness of the Company.

(vi) Gas Pooling Mechanism for Urea production is adding to the interest burden on the Company.


GoI approved Rs 1 0,000 Crore Special Banking Arrangement for the fertiliser sector for meeting the subsidy requirement for FY 2019- 20. The GoI will bear the interest costs up to 7.72% p.a. and 0.48% p.a. to be borne by the respective fertiliser companies. The special banking arrangement helps in reducing the interest outgo for a short period of time and is paid out by GoI within 60 days of disbursement using the proceeds from the next fiscals subsidy budget. Thus, it essentially remains a stop gap arrangement and does not resolve the issue of the subsidy backlog for the industry.

The domestic gas price is expected to rise for financial year 2019-20 given the increase in the international gas prices in the recent months, to which the domestic gas price is benchmarked. Though domestic gas price is expected to rise, the R-LNG prices have softened to a large extent and are expected to moderate further in the near term. Imported R-LNG prices had been on an uptrend driven by strong

Chinese demand as the country partly replaced coal with natural gas as a key source of energy to combat pollution. However, as we move forward, R-LNG prices are expected to moderate given the forecast of a warmer winter in northern hemisphere, falling crude oil prices and high LNG storage levels in Japan, China and South Korea.

An analysis of the financial performance of the companies indicates an increase in the operating profit primarily driven by the chemical segment which offset the weak profitability from the fertiliser segment. The fertiliser segment witnessed softening of the profitability owing to rising raw material prices and currency depreciation. Chemical segment witnessed tailwinds from currency depreciation and healthy demand leading to improved contribution from the chemical segment.

Performance of Urea players is expected to remain stable in the upcoming year, with pooled price expected to moderate given the steep fall in the R-LNG prices which should offset the expected increase in the domestic gas price for H1 FY 2020. The performance of P&K players has been impacted by the rising raw material prices and currency depreciation in FY 2019-20. However, as the year comes to close, the currency has cooled off to a certain extent while raw material prices have also stabilized.

There remains uncertainty over the impact of El-Nino on the upcoming monsoon season, as the reported probabilities for the El-Nino phenomenon and its strength have been unclear so far. In case of a strong El-Nino impact on monsoons the agri stress developed in the current year could carry over and impact the overall agricultural economy. While fertiliser sales volume have had a weak correlation with the strength of monsoons in the past, the profitability of the sector could certainly come under pressure. In case of a normal monsoon with an equitable distribution across the country, ICRA expects the agri economy to witness a positive uptick which will be positive for agri-input industries like fertiliser, agrochemicals etc. Thus, ICRA maintains a stable outlook on the sector for the upcoming kharif season.


1. Imbalance use of fertilizers

2. Skewed pattern of fertilizer use

3. Inadequate use of secondary and micro nutrients

4. Deterioration in soil health

5. Decline in fertilizer use efficiency


The Company has a well-defined Internal Control System that is adequate and commensurate with the size and nature of its business comprising Internal Auditors, which conducts internal audit of various operational and financial matters on on-going basis. M/s Bandyopadhyaya Bhaumik & Co. & M/s. Amit Ray & Co., Internal Auditors has been appointed as Internal Auditors of the Company for the year 2018-19. In house Internal Audit Department is headed by MBA in the rank of Deputy General Manager having adequate number of financial and technical personnel. The recommendation and observations of the Internal Auditors are reviewed regularly by the Audit Committee constituted by the Board of Directors. As required by the Companies Act, 2013, the Audit Committee has formulated the Scope, Functioning, Periodicity and Methodology for conducting the Internal Audit and informed to the Board of Directors. The adequacy & operational effectiveness of Internal Financial Controls over Financial Reporting has been reviewed by the Audit Committee. The performance of the Company is regularly monitored by the Board of Directors.

The Company has an effective budgetary control mechanism in place to take care of the detailed capex and operational budget. Appropriate monitoring mechanism to compare the actual performance with the budget ensures that necessary review is periodically undertaken.


The segment wise performance of the Company is as under: Fertilizer

Your Company produces fertilizers such as Urea (Nitrogenous Fertilizer) at both Trombay and Thal Unit, and

Suphala 15:15:15 (NPK Fertilizer), Biola (Bio fertilizers), Microla (micronutrient fertilizer) and Sujala (100% water soluble fertilizer) at its Trombay unit.

During the year, Company has produced 23.75 LMT of Urea compared to 25.02 LMT produced during the previous year. Company has also produced 5.61 LMT of Suphala 15:15:15 as compared to 4.78 LMT produced during the previous year. In terms of Nutrients, your Company has produced 11.77 LMT of "N", 0.84 LMT of "P2O5" and 0.84 LMT of "K2O" as compared to 12.23 LMT of "N", 0.72 LMT of "P2O5" and 0.72 LMT of "K2O" respectively during the previous year.

In addition to above, your Company has produced 73.14 KL of Biola, 264.55 KL of Microla and 3600 MT of Sujala as compared to 66.32 KL of Biola, 223.88 KL of Microla and 1396 MT of Sujala respectively during the previous year.

Industrial Products

Your Company produces industrial chemicals at its both units. During the year, your Company produced approx. 2.27 lakh MT of various major industrial chemical products as against approx. 1.95 lakh MT during the previous year. Your Company produces, amongst others, Methanol, Conc. Nitric Acid, Sodium Nitrate / Nitrite, Methylamines, DMAC, Formic Acid, Argon, AN Melt etc.



In case of Urea, the farm-gate price is notified by the Government from time to time, so also the dealers margins are indicated. The concessions to the units are given under various policies from time to time. Effective from 1st June 2015, Urea is governed by New Urea Policy 2015 (NUP 2015) under which units are divided into three groups based on preset energy norms. As per NUP 2015, energy norms have been tightened focusing on energy reduction being achieved by Urea units and further tightened from 1st April 2018 in respect of its Thal unit. As regards Trombay in it is expected to be tightened from 1st April 2020. For production beyond the Re-assessed capacity (RAC) i.e. 100% of capacity, the unit will be entitled for the respective variable

cost and uniform Per MT incentive equal to the lowest of Per MT fixed cost of all the indigenous Urea units subject to maximum of Import Parity Price (IPP) plus weighted average of other incidental charges which the Government incurs on imported Urea.

To address the issue relating to availability and pricing of gas for Urea sector, Government of India has announced Pooling of Gas in Fertilizer (Urea) Sector, effective from 1st June 2015 wherein all Urea manufacturers are entitled to gas for Urea production at the weighted averaged pooled price of Domestic gas and Imported RLNG. This has encouraged Urea units to operate at full capacity during the year in sync with the Government policy of "Make of India".

The year witnessed a steep increase in the pool price of Gas for Urea. Though IPP of Urea also increased, it was not proportional to the increase in the cost of gas. Compensation for production beyond RAC was not increased suitably by increasing the component of other incidental charges (Central Government levies) impacting economics of the said production.

The current low price of imported Urea and surging pooled gas prices has created a situation where production of Urea beyond Reassessed capacity has impacted profitability during 2018-19.

P&K Fertilizers

P&K fertilizers are covered under Nutrient Based Subsidy (NBS) scheme. Under the NBS, the subsidy rates for nutrients ‘N, ‘P ‘K and ‘S are notified by the Government on an annual basis. Selling prices are determined by the Company depending on costs of production, seasonal conditions, demand in field, competitors pricing etc.

In addition to NBS, units are also entitled for compensation towards freight expenses based on uniform freight policy. Further the issue of gas allocation and retrospective recovery towards use of cheap Domestic gas for manufacture of P&K fertilizers and chemicals remains unresolved. The said matter has been referred to an Inter-Ministerial Committee for resolution. Company has represented that such action is discriminatory in nature and not in the spirit of the policy and expects a favourable response. Consequent to Gas Pooling being made applicable to Urea, Company has also sought that pooled price be made applicable even to its nonUrea operations for the year 2015-16. From May, 2016, the Company has been using market determined RLNG for Non-Urea operations.

Direct Benefit Subsidy (DBT)

Effective from February, 2018, settlement of subsidy under DBT has been rolled out on PAN India basis. While DBT based subsidy is certainly contributing to rationalisation of subsidy bill of Government of India and also enable in targeted disbursement of subsidy, however, since availability of stocks all over the year needs to be ensured this is straining the working capital of fertilizer companies as erstwhile they were being compensated based on receipted despatches. Further DBT subsidy settlement has been delayed due to exhaustion of Government Budgeted allocated towards Fertilizer Subsidy leading to higher Working Capital and increased finance costs.

Impact of Government Policies on IPD Marketing

Government policy on pricing and prioritizing allocation of natural gas may severely affect production and sale of domestic units manufacturing fertilizers and chemicals.

Free Trade Agreement with other nations may result in lowering of the existing duty structure, thus encouraging cheaper imports which in turn can affect sale of domestic manufacturers like RCF.

Government has liberalized import of chemicals to meet the ever increasing consumption level of chemicals in almost all sectors of the economy. International manufacturers, apart from cheaper energy sources, are having huge production capacities thus benefiting from the economies of scale, making available their products at cheaper rate compared to domestic manufacturers. This has put strain on the margins of domestic manufacturers producing products viz. Ammonia, DMAc, DMF, Methanol etc. As a result, our producing plants like Methylamines (Trombay) & DMF are shut down due to economic un-viability since more than a year. However, for a brief period, Methanol plant was

in operation and again shut down due to unviability due to downtrend of import prices. Sodium Nitrite/Nitrate are viable and plant is in operation since June 2017. However, to safeguard interest of domestic manufacturers the Government has also imposed anti-dumping duty on import of products like Sodium Nitrite / Sodium Nitrate, DMAc and Ammonium Nitrate. Importers from Iran of Ammonium Nitrate reduced their export prices which nullified the anti dumping duty so charged on AN. Cases are pending relating to various chemicals where Indian manufacturers are requesting Government of India for imposition of antidumping duty.


Review of the Financial Performance

During the year, your Company achieved Revenue from Operations of Rs 8,885.47 Crore as against 7281.96 Crore in previous year (PY). Profit Before Tax (PBT) during the year, stood at Rs 235.25 Crore as against Rs 1 28.22 Crore mainly on account of higher sales & margins of Complex Fertilizers, Industrial and traded products. Profit After Tax (PAT) stood at Rs 1 39.17 Crore as against 78.80 Crore. Net Income of Rs 23.44 Crore towards value of Development Right Certificates received/ receivable towards surrender of land during current year and downward revaluation of Development Right Certificate received/ receivable in previous year, has been reported as exceptional item.

Your Company achieved sales volume of 30.49 lakh MT during 2018-19 as compared to 30.65 lakh MT during the previous year. The total sale of manufactured fertilizers during 2018-19 was 29.15 lakh MT as against 29.82 lakh MT during the previous year. Sales of manufactured fertilizers registered reduction of 2.21 % over previous year owing to lower production of Urea due to planned shutdowns for hooking up various energy saving schemes.

Your Company produced 29.36 lakh MT of fertilizers (23.75 lakh MT of Urea & 5.61 lakh MT of Suphala 15:15:15) during the year as against 29.80 lakh MT of fertilizers (25.02 lakh MT of Urea & 4.78 lakh MT of Suphala15:15:15) produced during the previous year.

Energy Consumption

The energy consumption achieved during the year ended 31st March 2019 as compared to the year ending 31st March 2018 has been given below:


Plant For the year For the year
2018-19 2017-18
Ammonia Trombay-V 8.882 8.727
Ammonia Thal 8.184 8.351
Urea Thal 5.661 5.922
Urea Trombay 6.937 6.728

Energy efficiencies at Thal Unit was better as compared to the corresponding period of the previous year due to due energy savings schemes implemented. At Trombay Unit energy efficiency was higher as compared to the corresponding period of the previous year due to unplanned shutdowns taken during the year.



Your organization is a learning organization that has created a culture that encourages and supports continuous employee learning and value employee contributions.

Employee development encompasses growth of the employee at their professional and personal level. Functional, Managerial and Behavioral training is imparted to sharpen their professional growth and for personal growth. Your organization not only emphasizes on Employee Development but also on enhancing skills of family members, which works on Financial, Health and Spiritual well-being.

All the employees of your Company are being sensitized through the Online training module on ‘Sexual harassment of women at workplace. A policy in this regard has also been issued by your company.

Your Company has been identified as one of the Centres

of Excellence in India by Ministry of External Affairs. Under the stream, ‘Agriculture, Food and Fertilizers, along with other 6 Institutes, yours is the only PSU registered to conduct the Certificate Course in Sewage Treatment Process, Certificate Course in Fertilizer Technology and Certificate Course in Fertilizer Quality Control for the International Participants from Developing Countries.

As a part of our expertise sharing initiative, HRD department provided Hands on training on ERP to the College Students HR students pursuing their Master in Management Studies which will enable them to exploit the powers of ERP in their domain from day one of their career in the Corporate World.

Two Batches of 10 days Entrepreneurship Development Program were arranged in your Company free of cost with a view to nurture the talent of SC /ST youth by enlightening them on various aspects of industrial activity required for setting up MSME (Micro, Small and Medium Enterprises).

Your Company also organizes Monthly Inspirational Lecture Series (Motivational Talk Series) to encourage employees to get their goals and commit them to the work, and to benefit the RCF employees, and the citizens in the vicinity.


Your Company maintained cordial and harmonious Industrial Relations with all its employees. All the issues are settled amicably through regular discussions, meetings and dialogues with the employees. There was no occurrence of any untoward incident during the year.

Wage Revision of officers and workers was implemented successfully w.e.f. 01.01.2017 and it will be effective for a period of 10 years.

The 3rd phase of "HR Aapke Dwar" is completed successfully. All the plants are covered under this drive. This is working nicely as Employee Engagement Activity.

Your Company has 3112 employees comprising 1500

Officers and 1612 non-officers as on 31st March, 2019 compared to 3337 employees (1591 officers and 1746 nonofficers) as on the corresponding date of the previous year.

During the year, 23 employees have joined your company which includes 1 Chief Medical Officer, 1 Chief General Manager (Corp.), 1 Managers (Legal), 1 Sr. Officer (Legal), 10 Officers (Finance), 2 Officers (Safety) and 1 Chief Vigilance Officer, 6 Boiler Operator Gr. III.

Your Company has undertaken "Swachha Bharat Abhiyan" in various plants, Hospital, School, RCF Co-operative Credit Society, RCF Township etc.

Your Company has celebrated "International Yoga Day" at RCF Community Hall, Kurul township, Pragati Hall, Thal and also at RCF Trombay Unit at Factory Safety Meeting Hall, Factory Canteen and at Youth Council.

Retiring employees are felicitated every month and feedback review meetings are also conducted by inviting the family members of the superannuating employees.

Your Company has conducted medical check up for employees.


Management strongly believes in continuous dialogues and meetings with Unions of Contract Labours. Mutual Trust & Transparency are the key-factors in co-ordinal Industrial relations.

Statutory Routine inspections by Enforcement Officer of PF & ESIC were carried out.

We adhere to all relevant statutory requirements and abides by all applicable laws to contract labour. We work towards ensuring safe working conditions and fair wages to all including contract labour employed with Contractors of RCF.


A system of Grievance Redressal Mechanism is functioning through dedicated HR Officers. Designated Plant Co-ordinators & Welfare Officers for the purpose of prompt redressal of Employees Grievances act in a proactive manner. There is a ‘three tier system in existence through which the employees grievances are sorted out. It helps in achieving the objective of Employees Satisfaction Enhancement within guidelines and is also develop Trust/ confidence in the system and department. Also SC/ST and PWBD employees have special Grievance Redressal System as per Statutory requirement.


Your Company undertakes several welfare schemes in the field of education, medical, transport, housing etc. In regards to sport, your Company is a prominent patron and sponsors various sports events. Dr. Babasaheb Ambedkar T-20 Corporate Cricket Tournament was successfully organized in month of March/April 2019 for Group B Division teams. Annual Sports were organized for employees and their family members in the month of January 2019. Summer Camps were organized in the month of May 2018 for the children of the employees.


The guidelines in respect of reservation in recruitment and promotion of SC/ST, OBC, Ex-servicemen and Persons with Disabilities are followed by your Company. As on 31st March, 2019, your Company has on its rolls, 457 employees belonging to Scheduled Caste, 224 belonging to Scheduled Tribe and 406 Other Backward Classes.

Your Company is committed to the welfare of the backward classes in general and SC/ST employees in particular. Regular meetings are held with SC/ST Employees Welfare Association to address grievances, if any, and for providing guidance for development.

Your Company has extended Scholarship /Financial Assistance for Education facilities and development of SC/ ST students in Drought prone areas of Maharashtra. Your Company has given financial assistance of Rs 1 0,000/- each to 110 students in drought prone districts who are from 6th Standard to 10th Standards. The scheme will cover the expenses for Text Books / Note Books, Medical, school kit etc.

Your Company has celebrated 127th Birth Anniversary of Dr. Babasaheb Ambedkar in both Buddha Vihar, Chembur and Thal, Alibag, Kurul Colony. The programmes such as puja and lunch were organised.

Medical Camp was organized like every year at Chaitya Bhoomi, Dadar on 6th December, on the occasion of ‘Mahaparinirvan Day. Financial assistance for distribution of food packets and making arrangement for medical camp including medicines along with the vehicles and Doctors was made available by the Company on this occasion.

Woman Achievement

As per the directions of the Ministry, RCF WIPS (Women in Public Sector) CELL is formed in your Company which caters to the needs of female employees and meets on Quarterly basis to discuss the issues/initiatives like programme on mentoring, welfare measures like starting the creche facility, procuring sanitary napkins vending machine and recommendations are put up for needful to the concerned.

It is a moment of pride to announce that your organization, has been awarded first prize under the Mini-Ratna category for the Best Activities undertaken for Women Employees by the forum of Women in Public Sector (set up under the aegis of SCOPE). This award was received by your company during the Regional Meet held at Bhopal in December 2018 by the hands of Honble Special DG of Police(MP), Smt. M. Aruna Mohan Rao.

Your Company has also framed its own ‘Gender Equality Policy. With an objective to create awareness amongst all the employees about Gender equality in your organization, "Gender Equality Week" was observed from 23rd to 28th July 2018 wherein different activities like Essay writing, Poster making and Slogan writing contests were organized.


Sr. Particulars No. 2018-19 2017-18 (regrouped) % Change Reasons
1 Debtors Turnover (Days) 186.91 143.37 30.37 Increase in Subsidy receivable from DoF
2 Inventory Turnover 38.00 16.03 137.05 Increase in Trading Inventory (in transit stock)
3 Interest Coverage Ratio 2.36 3.05 (22.67) Increase in Loans due to Capex / Working capital and firming of interest rates
4 Current Ratio 1.34 1.66 (19.32) Increase in Inventory & Subsidy receivables.
5 Debt Equity Ratio (Long Term Borrowings incl Current Maturities) 0.19 0.14 40.33 Long term loans taken for meeting capex
6 Operating Profit Margin (%) 4.14 2.62 57.81 Better volumes & margins of Complex Fertilizer, Industrial & Traded products. Energy efficiencies at Thal unit.
7 Net Profit Margin (%) 1.57 1.08 44.74
8 Change in return on Net Worth 4.59 2.69 70.50

Ratios at 3 & 6 have been calculated excluding exceptional item (Income) of Rs 23.44 Crore for 2018-19 C0.12 Crore expense in 2017-18).


The financial statement for the year ended 31st March, 2019 are prepared in compliance with IND AS as prescribed under section 133 of the Companies Act, 2103 read with Rule 3 of the Companies (Indian Accounting Standards) Rules, 2015 and Companies (Indian Accounting Standards) Amendment Rules, 2016.


Statements in the Management Discussion and Analysis Report describing the Companys objectives, projections, estimates and expectations may be ‘forward looking statements and actual results may or may not be in accordance therewith. The Companys performance is dependent on several external factors such as performance of monsoon, significant changes in economic environment, Government Policies, fluctuations in prices of raw material and finished products and also their availability etc., which could adversely affect the operations of your Company.