Crisil upgrades Deepak Fertilisers outlook to positive

Crisil Ratings has revised the outlook on Deepak Fertilisers And Petrochemicals Corporation Limited's (DFPCL) long-term bank facilities to 'Positive' from 'Stable', reaffirming its rating at 'Crisil AA-'. Short-term bank facilities and commercial paper program ratings remain reaffirmed at 'Crisil A1+'. This upgrade reflects expected improvements in operating performance, driven by ramp-up in expansion projects, sustained healthy profitability, and an enhanced financial risk profile.

DFPCL's capacity expansion projects for Technical Ammonium Nitrate (TAN) and Nitric acid are progressing well, with over 75% and 50% completion, respectively. These projects are expected to significantly boost operating performance from fiscal 2027. Net debt is projected to stay below INR 4,500 crore in the near term and moderate as returns accrue, with net leverage not exceeding 2-2.2 times.

The company's consolidated revenue increased to INR 10,274 crore in fiscal 2025, up from INR 8,676 crore in fiscal 2024, with an operating EBITDA margin of 18.7%. This improvement is attributed to higher volumes and realization growth in TAN and industrial chemicals, and strong volume growth in the fertilizer business. Overall EBITDA margin is expected to sustain above 18-20% over the medium term.