Rama Phosphates Ltd Management Discussions.


The Companys performance is mainly dependent on several external factors which are beyond the control such as monsoon, Government policies, fluctuation in prices of raw material and other internal factors which could adversely affect the operations of the Company.

Some of the foregoing statements in the report may be forward looking and are stated as required by applicable laws & regulations. Many external and internal factors may affect the actual results which could be different from the projections made by the Directors with respect to future performance and outlook of the company.


The company is in the business of manufacture and marketing of Phosphatic Fertilizers, Industrial Chemicals, Micronutrients and also soya seed crushing and soyaoil refining. The company is in existence for more than three decades and is the torchbearer of phosphatic fertilizer manufacturing in western India. The company started with a single product - SINGLE SUPER PHOSPHATE POWDER manufacturing in the year 1982 from single location and currently we cater to the entire gamut of fertilizer products viz., Mixed Fertilizers, Boron and Zincated nutrient fortified fertilizers, Micronutrients, Water soluble fertilizers, Soil conditioner and organic fertilizer from three locations. Similarly, we have included Oleum 23% and Battery Grade Acid in the list of products under Industrial chemicals whilst Lecithin was introduced by our Oil division. Thus, we have grown multi-products manufacturing hub during the course of our existence. We started our operation from Pune unit in 1982 and extended to Indore in 1987 and Udaipur in 1996.

Simultaneously, we have increased our production capacity of phosphatic fertilizer from meagre 85000 MT gradually to 563,000 lac MT as on date. Thus we have equipped ourselves with the growing need of the product in the market.


The Company is engaged in manufacture of basic phosphatic fertilizer, commonly known as Single Super Phosphate which is widely used in the country since a long time. This SSP fertilizer is priced affordably and manufactured within the country by about 109 units spreading throughout the country. The consumption of this fertilizer is mainly concentrates in Western and Northern region. The SSP fertilizer contains important nutrients viz., 16% Phosphate, 11% Sulphur, 21% Calcium and Traces of Minerals. About 41% of Indian soils are Sulphur deficient and that SSP compensates this major anomaly.

The consumption of SSP fertilizer during 2018-19 is 39.76 lac MT out of total consumption of 566.19 lac MT all fertilizers put together. The overall fertilizers consumption has been increased by 2.14% (554.35 lacs in 2017-18) whilst SSP consumption has also gone up by 2.61 lac MT to 39.76 against 38.75 lac MT in 2017-18. It is encouraging to note that the share of SSP out of all fertilizers put together has marginally went up to 7.02% against 6.99% in 2017-18. The industry witnessed great reduction in import of MOP by 10.87% at 28.46 lac MT as against 31.93 lac MT imported in 2017-18.

The detailed product wise consumption details is given below :


% share

Products 2018-19 2017 - 18 % variation 2017-18 2018-19
Urea 31247826 30319979 3.06 54.69 55.19
DAP 9216025 8979007 2.64 16.20 16.28
MOP 2846047 3193179 -10.87 5.76 5.03
Complexes 9333101 9068022 2.92 16.36 16.48
SSP 3975910 3874958 2.61 6.99 7.02
Total 56618909 55435145 2.14 100.00 100.00


a. Chemical Fertilizers : Overview: - The Indian Fertilizer Industry has shown tremendous growth in the last five decades and at present ranks third in the world. Currently India is the second largest consumer of fertilizers after China and also ranks second in the production of nitrogenous fertilizers and third in phosphatic fertilizers whilst the requirement of potash is met through imports due to paucity of potash reserves in the country.

b. Direct Benefit Transfer (DBT) : DBT for fertilizer subsidy has been implemented since March 2018. But, under the present model of DBT for fertilizer sector, payment of subsidy continues to be routed through the industry. It has only changed the mode of payment of subsidy to the industry. Earlier, subsidy on fertilizers used to be released when the material reached the district. But, under DBT, fertilizer subsidy becomes due to industry only after sale of fertilizers to the farmers through Point of Sales (POS) Machine. This has postponed the payment of subsidy by about six months. This is because production of fertilizers is continuous during the year but, sales of fertilizers are seasonal. In fact, fertilizers are sold mainly during peak season of thirty to forty five days each in kharif and rabi seasons. During rest of the months, fertilizers have to be manufactured, moved and stored nearer to consumption points.

c. Imbalance in nutrients consumption ratio : FAI is strongly advocating for correction in retail prices of fertilizers in the interest of soil health and agriculture productivity since nitrogenous fertilizer (Urea) remained unchanged for more than a decade which is out of NBS policy.

From the above data, it is amply clear that imbalance in nutrient consumption is a major issue to be addressed by the authorities so as to improve soil fertility. The ideal NPK consumption ratio of 4 : 2 : 1 is unduly favoured to peak consumption of nitrogenous fertilizer @ 8% in 2013-14 with 7% in the current year. The undue price advantage is playing major role for higher consumption of nitrogenous fertilizer. In order to ensure balanced use of fertilizers and reduce the consumption of urea, vide notification dated 4th September, 2017 Government of India has decided to introduce 45 kg of urea in place of 50 kg bags

The concept of balanced fertilization cannot be confined to N, P and K alone. Balanced fertilization includes application of all the plant nutrients essential for high agricultural productivity and health of the soil.

d. Water Soluble fertilizers : So as to mitigate the imbalances in fertilizer consumption, it is , the industry and growers need to find the right balance of inputs, minimise losses to the environment, reduce nitrate levels in groundwater, emissions of greenhouse gases, soil pollution, as well as surface runoff of nitrogen and phosphorous nutrients, which hamper oxygen production in water bodies. Hence, increasing demand for water-soluble fertilizers Multi-nutrient (NPK) fertilizer still dominates the landscape. Several types of water- soluble fertilizers are available today, including mono ammonium phosphate or MAP, which is a widely used source of phosphorus and nitrogen which also contains the most phosphorus of any common solid fertilizer. MAP is widely used at the beginning of the growth season when phosphorus availability is crucial for the establishment of the root system which can also be tank-mixed with other fertilizers to meet crop nutritional needs throughout the growth cycle.

e. There are two primary fertilizer categories: Urea and non-urea. India produces about 80 percent of its Urea fertilizer needs and the fertilizer industry has the capacity to indigenously meet 50 percent of the countrys phosphatic fertilizers. But India still depends heavily on imports for the raw ingredients for its phosphatic and potassium fertilizers.

In India, presently there are 57 large fertilizers plants producing Urea, DAP, Complex fertilizer, Ammonium Sulphate and Calcium Ammonium Nitrate. With the Make in India programme, Government is restarting all defunct PSUs to achieve self-sufficiency in fertilizer sector. With respect to SSP, there were 109 Plants listed out of which 89 Plants were in operation during 2018-19 (FAI-SSP March 2019 with operative capacity of 10.75 million MT).

f. For cultivation of all products, chemical fertilizers play a major role in increasing produce output to feed the ever growing population. We can ignore the significance of fertilizers for food production only at the cost of nations welfare. Fertilizers are a key component in the growth of Indias agriculture sector, which accounts for about a sixth of the countrys GDP. Therefore it is only in keeping with the importance of the sector that India is the worlds second-largest consumer of fertilizers, (China is the first), and the worlds third-largest producer.


Indian Agriculture is the major source of livelihood for 70% of rural population and hence concentration and development in this sector is of paramount importance to attain inclusive growth. More risk is involved in farming and is also the least rewarded occupation in India Currently, around 60% of farm land is unirrigated, thereby making it vulnerable to errant monsoon. The government is encouraging drip irrigation, distribute solar pumps, high yielding seeds, create market linkages for farmer producer companies, consolidate land holding etc.

3. SOIL HEALTH STATUS : As per the Governments initiative a dedicated scheme on "Soil Health Card" has been launched to take care of Soil Health for the first time in a uniform manner to evaluate the soil fertility across the country Soil Health Card contains the status of soils with respect to 12 parameters, namely - N, P, K (Macro-nutrients), S (Secondary-nutrients), Zn, Fe, Cu, Mn, B (Micro-nutrients) and pH, EC, OC (Physical Parameters). It also provides crop wise fertiliser recommendations. Soil Health Card (SHC) helps farmers to improve productivity by maintaining soil health. SHC also promotes the judicious use of the fertilisers thus reducing the cost of cultivation. Currently, there are 1738 soil testing laboratories spread throughout the country with maximum number of 338 laboratories in the state of Madhya Pradesh. Soil health card provides information to the farmers on fertility status of their soils to enables them to apply soil health card based recommended dosages of fertilizers including micro-nutrients, bio-fertilizers, manures as well as soil ameliorants so as to check the declining fertility of agriculture land and improve the fertility of soils to increase productivity across the country.

As per National Academy of Agricultural Sciences study report (May-18), it is observed that in Indian soils 49% are Zinc deficient followed with 33% soils of Boron deficient. The company has already established its brand image amongst farming community in Fortified fertilizers - Boron and Zincated in its area of operation.

To neutralize "S" deficiency in the soil, Govt. of India has increased subsidy amount payable on "S" nutrient and thus revised subsidy amount on SSP to 2826/- pmt with an increased of र 92/- pmt.

This augurs well for the SSP industry to promote SSP to farmers.


Indias GDP growth (real or inflation adjusted) during the fiscal 2018-19 is reported at 6.9 per cent , marginally lower than CSOs advance estimate of 7 per cent, as per rating agency Ind-Ra. It is further stated that 2018-19 will be the second consecutive year of an economic slowdown in India. "Arresting the slowdown and reviving the economy will be the first challenge for the new government," it said. "In Ind- Ras opinion, the new government will have to devise and execute both short-term and medium- to long-term measures to arrest the slowdown whilst agriculture growth was robust at four per cent. As per World Bank, Indias GDP growth is expected to accelerate moderately to 7.5 per cent in the next three years driven by continued investment strengthening, particularly private-improved export performance and resilient consumption.


The Hon. Prime Ministers vision of "Doubling of Farmers income by 2020" is duly supported with various schemes initiated by the Govt. viz., Some of the recent major government initiatives in the sector are as follows:

• In March 2018, the Government of India extended the urea subsidy to the farmers till 2020 with the aim of ensuring supply of urea at statutory controlled prices.

• As of March 2018, the Government is working on a plan to provide air cargo support to promote agriculture exports from India.

• The implementation of Pradhan Mantri Fasal Bima Yojana (PMFBY) will be made faster and the government is aiming to increase the coverage under the scheme to 50 per cent of gross cropped area in 2018-19.

• The Government of India is made provisioning for computerization of Primary Agricultural Credit Society (PACS) to ensure cooperatives are benefitted through digital technology.

• Around 100 million Soil Health Cards (SHCs) have been distributed in the country during 2015-16 and a soil health mobile app has been launched to help Indian farmers.

• With an aim to boost innovation and entrepreneurship in agriculture, the Government of India is introducing a new AGRI-UDAAN programme to mentor start-ups and to enable them to connect with potential investors.

• The Government of India has launched the Pradhan Mantri Krishi Sinchai Yojana (PMKSY) with an investment of Rs 50,000 crore (US$ 7.7 billion) aimed at development of irrigation sources for providing a permanent solution from drought.

• The Government of India plans to triple the capacity of food processing sector in India from the current 10 per cent of agriculture produce in the country, as a part of the Scheme for Agro-Marine Processing and Development of Agro-Processing Clusters (SAMPADA).

• Under Pradhan Mantri Kisan Samman Nidhi the subsidy amount of र 6000/- was payable in three equal instalments to farmers. The scheme was originally announced in Feb-2019 during interim budget covering farmers owning upto two hectares of land based on Agriculture Census figures of 2015-16 entailed approx.. 3.11 crores of farmers with retrospective effect of Dec. 18. However, the scheme benefit is now extended to all farmers in the country without any land ceiling and thus would cover 14.5 crore farmers in the country as per the announcement made on 31st May, 2019.

• The government has set up a high-powered committee of chief ministers to look at ways to transform agriculture and raise farmers income. The nine-member committee will be chaired by Maharashtra chief minister Shri Devendra Fadnavis. Its members include chief ministers of Karnataka, Haryana, Madhya Pradesh, Gujarat, Uttar Pradesh and Arunachal Pradesh, besides rural development and agriculture minister Shri Narendra Singh Tomar and NITI Aayog member Shri Ramesh Chand. The committee is expected to submit its report within two months


The direct benefit transfer (DBT) scheme was implemented in January, 2013 to reduce leakages in the countrys subsidy system by reducing middlemen and corruption. There are 439 subsidy-based schemes that fall under the ambit of DBT, which includes schemes such as PAHAL or the LPG subsidy scheme, Mahatma Gandhi National Rural Employment Guarantee Scheme (MNREGS), Ayushman Bharat, fertilizer subsidy, various scholarship schemes, among others. The plugging of various loopholes has yielded results with savings to the tune of 1.41 trillion, as of March, 2019 by transferring funds to genuine beneficiaries.

The subsidy payment to the industry is streamlined and that disbursal is improved. Going forward, it is reported in the news that the database of landed farmers being created with the implementation of PM-KISAN cards. It further states the information will be used to provide fertiliser subsidies directly to farmers bank accounts and that the finance ministry and NITI Aayog are working on a proposal to shift DBT in fertiliser from the producer to the consumer. Currently, sale of all subdisied fertilisers to farmers/buyers are made through point of sale (PoS) devices installed at each retailer shop and the beneficiaries are identified through Aadhaar Card and voter identity card among others. Though fertiliser subsidies fell from a peak of Rs 76,600 crore (FY09) to Rs 66,441 crore in FY18, it climbed back to Rs 70,075 crore in FY19, and the government expects to incur a bill of Rs 75,000 crore this fiscal.


SSP is the oldest chemical fertilizer manufactured in India with multi-nutrient as it contains Sulphur and Calcium as secondary nutrient with P2O5 as prime nutrient. It is more suited for crops like oil seeds, pulses, horticulture, vegetables, sugarcane, paddy etc. The SSP fertilizer industry today has grown with total annual capacity of 119.697 lac MT with 109 manufacturing units spread out the entire country. However, the production of SSP is mainly concentrated in West zone comprising of Gujarat, Chhatisgarh, MP, Maharashtra and Rajasthan states in which 63% of total consumption takes place.


The industry witnessed marginal increase in sales quantity by 2.00 lac MT clocking 5.16% increase during this financial year. Total quantity of 40.65 lac MT SSP fertilizers were sold during this financial year against 38.74 lac MT sold in the previous year. Though this is an encouraging trend, there is a long way ahead in increasing the sales quantity.

All India sales figures of SSP fertilizer are given below :

2018-19 40.65
2017-18 38.74
2016-17 42.00
2015-16 46.63
2014-15 42.33
2013-14 39.70
2012-13 41.69
2011-12 48.03

Western region accounts for 63% - 65% of total consumption in the country in which the company operates. The overall major consuming states of SSP is given below:

Product Quantity Lac M.T. % age
Madhya Pradesh 9.57 23.56
Maharashtra 8.63 21.23
Rajasthan 3.85 9.47
Uttar Pradesh 3.87 9.53
West Bengal 3.66 9.01


Product Quantity Lac M.T. % age
Andhra Pradesh 1.59 3.91
Chhatisgarh 1.88 4.63
Haryana 1.67 4.11
Gujarat 1.09 2.70
Punjab 1.06 2.62

Additional Measures adopted by Government for increasing SSP production and consumption:

- Withdrew cap on minimum production of 50% of installed capacity or 40,000 MT to be eligible for claiming subsidy under NBS.

- Introduction of neem coated Urea so as to avoid diversion of mass consumed fertilizer to other uses than agriculture.

- Also introduced DBT (Direct Benefit Transfer) system for effective utilization of benefits to the targeted beneficiary.

- The Government has been very proactive by introducing reforms time to time to help production pick up pace.

With the above measures, it is hoped that adequate availability of SSP fertilizer is ensured in the country with simultaneous benefit to the industry.


The monsoon delivers about 70 percent of Indias annual rainfall, is critical for the farm sector, which accounts for about a sixth of Indias $2 trillion-plus economy and employs about half of the countrys 1.3 billion people. The June-September monsoon is very crucial for a host of cash and food crops in India. The Indian Meteorological Department (IMD) defines average, or normal, rainfall as between 96 percent and 104 percent of a 50-year average of 89 cm for the entire four-month season.

India reported 9% of deficit monsoon rainfall last year, primarily due to a massive rain shortage in north east India. Barring the east and northeast India, IMDs rainfall forecast for the north-west, central and Peninsular India was within the range. For the country as a whole, IMD in its second long range forecast predicted 97% of average rainfall whereas the actual rainfall was 91% - deficiency of 6% when compared against the forecast. The overall monsoon during this season is quite encouraging barring marginal deficits in UP, Bihar, Jharkhand. The main area of our operation, i.e. Western and Central regions reported normal rain during this season which is a encouraging sign for the company.


a. Fertilizer Division: Our units are situated at multi-locations viz., Pune, Indore and Udaipur in the western region which is the main consumption area of Single Super Phosphater fertilizers in the country. The company achieved optimum production as per the market demand.

i) Phosphatic Fertilizers : Single Super Phosphate (SSP) fertilizer is main source for root growth and assist in chlorophyll synthesis of plants and also improves overall quality of produce. "Rama" manufactures SSP powder and Granulated SSP The granulated fertilizers are easy to handle and powder loss is minimized.

ii) Various grades NPK of Mixed fertilizer.

iii) Fortified fertilizers : It is primiarily of Boronated SSP, Zincated SSP and Boronated Zincated SSP.

iv) Micronutrients : At our Indore unit we have introduced a new product Zinc Sulphate Monohydrate, Zinc Sulphate Hepta, Magnesium Sulphate (MgSO4), Mixture of Nutrients.

b. Chemicals Division: Company also manufactures industrial chemicals viz., Sulphuric Acid and Oleum @ 150 TPD at Pune and @ 250 TPD at Indore and operated at optimum efficiency.

c. Power Division:

The units at Indore and Pune have integrated turbo power generation plants which cater to basic power requirements. The power is generated during the production of Sulphuric Acid through exo-thermic heat. With this, the company has achieved substantial savings in power cost by reducing Minimum Demand power purchase from State Discom.

d. Soya Division:

This division is situated next to our fertilizer division in Indore unit with average crushing capacity of 500 TPD and refining @ 100 TPD. This is fully integrated with all facilities for storage of seeds in silos, crushers, expanders, DT, Flakers, storage godown for DOC and tanks for storing crude oil & refined oil.

Soya oil is the second largest consumed edible oil in the world though it takes the prime place in terms of nutrition value. The soyabean oil is rich in PUFA factor (polyunsaturated fatty acid) which helps in cholesterol-lowering effects, along with improving insulin sensitivity. It also boosts the immune system, improve skin quality and the functioning of the nervous system.

Oilseed crops are the second most important determinant of agricultural economy, next only to cereals within the segment of field crops. The self-sufficiency in oilseeds attained through "Yellow Revolution" during early 1990s, could not be sustained beyond a short period. Edible oils constitute an important and dominant component of food expenditure in Indian house-holds food expenditure. India has the fifth largest edible oil economy in the world which accounts for 4% of global vegetable oil production, 12% of global consumption and 21% of globally traded volumes.

It is heartening to highlight that Indian Oilseed farmers are doing better than other farmers excluding cereals like Rice and Wheat growing. Moreover, oilseed growing farmers are adequately paid Minimum Support Price in respective. The current per capita consumption of Edible oils in the country is at 17.5 kg which is still a lot below threshold level of consumption and that there is tremendous scope for improvement. The industry pegs Indias edible oil consumption at 23.5 million tonnes for 2018-19. We have a record soyabean and mustard crop and consumption is similar to that last year. It is possible that soybean plantings will expand in 2019 Despite being the fifth largest oilseed crop producing country in the world, India is also one of the largest importers of vegetable oils today. There is a spurt in the vegetable oil consumption in recent years in respect of both edible as well as industrial usages. During the oil year 2018-19 (Nov - Oct) of six months, edible oil imports increased by 3% to 7.5 million tonne compared to the corresponding period a year ago which was at 7.3 million tonne in spite sudden unprecedented surge by 26% of edible oil import in the country in the month of Mar-19. The trend was buckled down and there was reduction by 11% in April-19. There was reduction in import duty of refined palm oil from Malaysia and Indonesia from 54% to 45% and 50% respectively w.e.f. 1st Jan. 2019 which resulted in higher imports in the country.

In June 2018, the import duty on crude soybean oil was raised to 35 per cent from 30 per cent, and for refined soybean oil it was increased to 45 per cent from 35 per cent. Prior to this, the import duty on these varieties was increased in the month of November 2017. This being a positive sign to the industry and that the urgency of scaling up the oilseeds production is paramount. It has now been planned to achieve a production of 45.64 million tonnes (mts) from nine (9) oilseed crops by 2022-23. Thus, the availability of total vegetable oil from domestic production of nine annual oilseed crops would be about 13.69 mts by 2022.

By employing better cultivation methods with timely introduction of manure, fertilizers with adequate pest controls etc., we can improve the yield and derive benefits. The agricultural ministry is making all out efforts to take annual oil production to 13.69 million tonnes (mt) by 2022, as against the current 7.31 mt. The production of nine oilseed crops (primary source) has been targeted at 45.64 mt, from which availability of vegetable oils would be about 13.69 mt by 2022,


The overall SSP capacity remains at 5.63 Lac MT.

- During this financial year, we have introduced Sodium Silico Fluoride which is obtained by Sodium Sulphate route and recycling of R.Mass into the process.

- As a forward integration of our Sulphuric Acid manufacturing process, 50 TPD LABSA an industrial chemical product to be used mainly in detergent and sulphonation plants for which Sulphuric Acid is the basic raw material is underway.

- SSP plant capacity expansion from 1.81 lac MT to 2.5 lac MT is underway at Udaipur unit.

- Commissioning of new 160 TPD Sulphuric Acid plant at Indore along with allied product viz., oleum, Liquid SO3, Chloro Sulphuric Acid.


In our existence of since three decades, we could spread our wings from a single product Primary Phosphatic Fertilizer to multi-products company in the country catering to respective needs of the farming community. Our ranges include Primary Phosphatic fertilizer, Fortified with Boron and Zinc fertilizers, Micronutrients, Mixed fertilizers, Pesticide, Sulphur Dust Powder, Sodium Silico Fluoride, Soil Conditioner, Phosphate Rich Organic Manure (PROM) - all under single-basket. All our dealers are equipped to sell all of above products and thus we are put at great advantageous position.

Monsoon plays a very crucial role and is the only destabilizer of the industrys prospects and prediction for the current monsoon season is quite encouraging with 95%.

In overall the monsoon is expected to be good during this year and the farmers are in good stead to maintain the tempo as acreage under cultivation during this kharif has shown slight improvement covering 413.34 lakh hectares (lh) as against 452.3 lh covered in the corresponding last year.

Water availability : Water storage in 91 Central Water Commission-monitored reservoirs reported 35.11 billion cubic meter water Govt. Initiative : Based on the all India weighted average Cost of Production (CoP), the Govt. has increased MSP for Kharif crops for this season 2019-20 at least 1.5 times of last budget 2018-19 announcement. This will envisage a minimum of 50 percent as margin of profit to the farmers.

Our brands viz., "Girnar" and "Suryaphhol" are well-entrenched in the market and the product recall amongst farming community is very good.

Our capacity utilization is best amongst the industry and fertilizer division has achieved 61% capacity utilization during the financial year 2018-19 and produced 345307 MT against the industry average of 37.9%.

Products introduced to meet growing demands of farming community with expansion of capacity helped the company to maintain its market leadership.

The extensive and loyal dealers and other operators in the market support the products of the company and conduct exclusive services to the company for mutual growth.

Opportunities : Our manufacturing units are situated in prime consuming areas which is great advantage to the companys operation. This augurs well for the company to maintain optimum production capacity.

Our brands viz., "Girnar" and "Suryaphool" are famous amongst the farmers and brands recall is the best. We offer multi-products under single-basket through our strong and dependable dealers network. The source of major raw material is in close proximity of our Udaipur unit whilst spent acid availability is taken care of for all our units.

DBT introduced by the Government is aiding good support to the industry.

The expansion activities chalked out by the company and optimization of production, introduction of value-added products at regular interval are favourable to the company.

Threat : The main threat to the industry is vagaries of monsoon. The higher installed capacity with lower operational efficiency undermines the industry status.


With the thrust given by the Government for doubling of farmers income in the year 2022 and prospects of good monsoon, the scenario is bright.

Company is expanding its overall capacity which will cater to the growing demand of farmers. Awareness amongst farmers for value-added products, micronutrients, soil conditioner has increased and this is a good sign for the company.

With introduction of DBT by the Government, funds disbursement is streamlined.

Recently announced hike in MSP has boosted the morale of farmers and thus more cultivation is expected.

At Soya front, with timely availability of seeds, we expect comparatively better parity. With the issue of lesser protein content in Brazils DOC material, the major importer China would seek Indian DOC material.

Adequate and timely availability of Rock Phosphate and Sulphur would keep the companys operation without interruption.

The company complies with all regulations with respect to Pollution norms, Quality norms and adopts austerity measures to keep a check on expenses.

At the same time, improvement in internal Bank ratings & external CARE rating would reduce our interest costs.

The company envisages with good monsoon, favourable industrial policies, strict adherence with norms and service to farming community and optimum utilization of plant capacity would put the company in a favourable position in the coming year.


Safety risk

Considering the nature of the industry, Rama Phosphates Limited manufacturing facilities are prone to safety risks. Therefore, the Company continuously strives to promote sound safety practices through :

• Implementation of behavior based safety at its manufacturing facilities.

• Adoption of a Safety Management System based on leading safety standards.

• Regular audits to assess on-ground implementation of various processes prescribed by the SMS.

Each plant has an emergency response plan, which is periodically tested through mock drills drawn up to meet any eventuality. Critical safety incidents are also reviewed by the senior leadership team for root-cause analysis and to prevent subsequent recurrence.

Statutory compliance risk

The Company has a well-structured, documented and demonstrable compliance framework that helps the management monitor and report compliance risk and exposure to the Board. The Board periodically reviews compliance reports of all laws applicable to the Company, as well as steps taken by the Company to rectify instances of non-compliances.

With a view to devise a system to monitor and ensure compliance with all the applicable laws, compliances are classified and monitored periodically.

Various cross-functional teams work together to ensure compliance in the above areas and to keep up with the rapid pace of regulatory changes.

Ethical behavior

The Company places due emphasis on deployment of ethical and fair business practices while running its operations. Ethical behaviour is promoted in the organization through periodic communication and by making all employees aware of its code of conduct. The Company also has a whistle-blower policy to ensure suspected or actual violations to the code are reported, investigated and acted upon.

Interest Rate Risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Companys exposure to the risk of changes in market interest rates relates primarily to the Companys short-term borrowing. The Company constantly monitors the credit markets and rebalances its financing strategies to achieve an optimal maturity profile and financing cost. Since all the borrowings are on floating rate, no significant risk of change in interest rate.

The Company does not account for any fixed rate financial assets and liabilities at fair value through profit or loss. Therefore, a change in interest rate at the reporting date would not affect profit or loss.

Commodity Price Risk

Commodity price risk for the Company is mainly related to fluctuations of raw materials prices linked to various external factors, which can affect the production cost of the Company. Company actively manages inventory and in many cases sale prices are linked to major raw material prices. To manage this risk, the Company enters into long-term supply agreement for Raw Material, identifying new sources of supply etc. Additionally, processes and policies related to such risks are reviewed and managed by senior management on continuous basis.

Capital Management

The Company manages its capital to ensure that it will be able to continue as going concern while maximising the return to stakeholders through the optimisation of the debt and equity balance. The capital structure of the Company consists of net debt and the total equity of the Company. For this purpose, net debt is defined as total borrowings less cash and cash equivalents.

The Company manages its capital structure and makes adjustments in light of changes in economic conditions and the requirements of the financial covenants. The funding requirements are met through short-term/long-term borrowings. The Company monitors the capital structure on the basis of total debt to equity ratio and maturity profile of the overall debt portfolio of the Company.


The overall income achieved र 60772.05 lacs during the F.Y. 2018-19, against र 37611.81 lacs in F.Y. 2017-18. The consolidated PBIDT reported at र 4104.55 lacs, as against 1911.87 lacs in the previous financial year. The net profit of the company for F.Y. 2018-19 is र 1938.99 lacs against र 539.16 lacs in 2017-18.

Ratios FY 2018-19 FY2017-18
Debtors Turnover Ratio 34 64
Inventory Turnover Ratio (on Cost of Goods Sold) 55 73
Interest Coverage Ratio 5.55 2.47
Current Ratio 1.79 1.72
Debt Equity Ratio 0.18 0.35
Operating Margin Ratio 7% 5%
Net Profit Margin 3% 1%
Return on Net Worth (RONW) 13% 4%