INDIAN PHOSPHATE LIMITED

Brickwork Ratings assigns the ratings of BWR A-(Stable)/A2+ for the Bank Loan Facilities of Rs. 211.00 Crs. of INDIAN PHOSPHATE LIMITED

Particulars

Facilities**	Amount(Rs.Crs.)	Tenure	Rating#
Fund Based	87.50	Long Term	BWR A - /Stable Assignment
Non Fund Based	123.50	Short Term	BWR A2 + Assignment
Grand Total	211.00	(Rupees Two Hundred Eleven Crores Only)

#Please refer to BWR website www.brickworkratings.com for definition of the ratings
**Details of Bank Loan facilities,consolidation or instruments are provided in Annexure RATING ACTION / OUTLOOK

BWR has assigned ratings of BWR A-/Stable/A2+ for bank loan facilities aggregating Rs 211 Crs. The rating  factors in an established presence  with a strong distribution network and experienced promoters; diversified product portfolio;  healthy financial risk profile; moderate working capital cycle marked by receivables from the fertiliser segment; completion of capex; profitability susceptible to regulatory and agro-climatic risks; volatility in raw material prices and foreign exchange rates

The outlook is Stable, reflecting expectations of continued steady growth in revenues, maintenance of operating margins, and prudent financial management. 

KEY RATING DRIVERS

Credit Strengths:

• Established presence in SSP segment with a strong distribution network and experienced promoters :

   The company is promoted by the  Arora family, who have extensive experience ~ 30 years in the fertiliser industry. The company has an established presence across  Rajasthan, Uttar Pradesh, Punjab, Uttarakhand, and Madhya Pradesh, supported by a widespread network of dealers and distributors of ~400-500 for fertilisers. The company markets its products under well-recognised brands such as  Ankur SSP including Ankur SSP (Powder),  Ankur SSP (Granulated), and Zincated & Boronated SSP

   Further, the strategic location of the company’s manufacturing plants in Rajasthan and Tamil Nadu provides access to a vast end-user market, thereby supporting market penetration and logistical efficiency. Their experience has led to the establishment of healthy relationships with its major customers, Hindustan Unilever Ltd. 

   

• Diversified product portfolio :

   The company has a diversified product mix consisting of  LABSA, fertilisers, and sulphuric acid products.  The company reported Total Operating Income of around Rs. 799.09 crores in FY25, registering growth of ~13% as against Rs. 704.18 crores in FY24, and company registered  Total Operating Income of Rs 986.11 Crs at a growth rate of 23.40% in FY26. The company manufactures and sells LABSA and SSP, which contributed ~81% and 12% in FY 26. Further, the company has started its Sulphuric Acid product in CUDDALOR, Tamil Nadu in July 2025, and the capacity utilisation of the same is expected to improve in the medium term and LABSA is expected to start in FY27. This growth is also supported by the inclusion of new products (added in Q4FY2025) such as Zincate SSP, Boronate SSP, and Urea SSP, apart from growth in demand from existing products.

   

• Healthy financial risk profile :

  Net worth of the group improved to Rs. 147.72 crores as on March 31, 2026, supported by proceeds from initial public offering (IPO) amounting to Rs. 67 crores and healthy accretion to reserves. Net worth improved further to Rs 169 crore for the fiscal ending March 31, 2026. Capital structure remained healthy as reflected in gearing and total outside liabilities to net worth (TOL/TNW)  of  0.16 x in FY26  and TOL/ TNW of  0.39 x  for the fiscal ending March 31, 2026, in the absence of any debt-funded capex plans. Debt protection metrics remained comfortable as reflected in interest coverage and net cash accruals to debt ratio (NCD) of 7.47 times and 0.88 times in fiscal 2026. 

• Moderate working capital cycle marked by receivables from the fertilizer segment: :

  Cash conversion cycle was at 36 days as on March 31, 2026, driven by receivables and inventory of 34 and 12 days, respectively. Cash conversion cycle are expected to be around 41-49 days over the medium term. Any significant delay in the receipt of subsidy can impact the company's working capital management and liquidity profile. 

• Completion of capex at Cuddalore :

  The company has already completed the capex of Rs 40-46 Crs in FY26  at Cuddalore.  The plant producing sulphuric acid product is already operational, and LABSA  Proct is expected to be operational in FY27. This is expected to increase the scale of operation in the medium term

• Improvement in scale of operations :

  The scale of operations of the company has increased in FY 26 and is expected to improve in FY27 and FY28 due to completion of capex. Total Operating income improved to Rs 986.11 crs in FY 26 as compared to Rs 799.09 crs in FY 25. Further, it is expected to improve in the medium term. Further, the company has increased its EBITDA to Rs 36.62 crs in FY 26 from Rs 17.10 Crs in FY 26, and PAT has increased to Rs 21.35 crs in FY 26 from Rs 9.17 Crs in FY 25. The scale has improved due to the completion of Phase 1 of the project (sulphuric acid) and is expected to improve further in the medium term due to the completion of Phase 2 of the project (LABSA) in FY27. 

Credit Risks:

• Profitability susceptible to regulatory and agro-climatic risks :

  The company operates in the fertiliser industry, which is highly regulated and dependent on the subsidy levels announced by the GoI and the timeliness of the subsidy release. The profitability remains exposed to the changes in the subsidy rates notified by the GoI, which may sometimes be inadequate to fully offset the fluctuation in input costs. Additionally, the company’s working capital cycle remains vulnerable to any delay in subsidy release by the GoI. The fertiliser division’s demand and profitability are influenced by agro-climatic conditions, particularly the monsoons, due to the low coverage of irrigation in India. 

• Volatility in raw material prices and foreign exchange rates :

  The prices of key raw materials such as rock phosphate, LAB, and sulphuric acid are linked to the global market and subject to volatility arising from fluctuations in international prices and foreign exchange rates. The company also needs to maintain adequate inventory due to the seasonal nature of the fertiliser industry, exposing the stocked inventory to price risks during periods of raw material cost volatility, thereby impacting the profitability.

ANALYTICAL APPROACH - Standalone

BWR ha considered the standalone approach as  there is minimal contribution from Adhishaa Phosphate Limited in the Total Operating income of the Group 

RATING SENSITIVITIES

 

Positive Triggers (Factors that could lead to an Upgrade)

• If the company is able to increase its scale of operations on a sustained basis, with Total Operating income exceeding Rs 1300 Crs
• Margin Expansion and Stabilization: Sustained growth in absolute operating revenues while successfully expanding the EBITDA margin and holding it above 4.25%. 

2. Negative Triggers (Factors that could lead to a Downgrade)

• Profitability Attrition: A dilution of the EBITDA margin below 3.00% driven by intense market competition, or an inability to pass raw material price hikes along to buyers.

• Erosion of Debt Serviceability Buffers: A drop in the Interest Service Coverage Ratio (ISCR) below 2.0x

• Deterioration of Liquidity Cushion: A contraction in Current Ratio to drop below 1.33 x

•  Sharp rise in Total outside liabilities (TOL)/TNW  beyond 1.5x on sustained basis

LIQUIDITY INDICATORS - Adequate

Bank limit utilization averaged at 61.70% during the past 12 months ended May 2026. Gross cash accruals are expected to be Rs. 27.80 crores annually, which will be more than adequate against the yearly repayment obligations of Rs. Nil  Crores in FY 26. In addition, the company does not have any major capex plans in the medium term, which will act as a cushion to the liquidity. The current ratio is at around 2.46 times on March 31, 2026. 

ABOUT THE ENTITY

• The company was established as a public limited company vide certificate of incorporation dated December 14, 1998, issued by the Registrar of Companies. The company was listed in the SME Exchange on 03 Sep 2024
• Company is mainly engaged in the production of Linear Alkylbenzene Sulfonic Acid LABSA 90%, popularly known as LABSA, is an anionic surfactant & used in the formulation of all types of detergent powders, cakes, toilet cleaners and liquid detergents and in the manufacturing of “Single Super Phosphate” fertilizer which is manufactured and supplied as per the standards of Fertilizer Control Order of India in powder and granulated form as well as fortified with zinc and boron.
• The company operates from its manufacturing facility located at Plot No. 5056, Village: Umarda, Girwa district, Udaipur is in close proximity of supply of both the raw materials (a) Rock Phosphate (b) Sulphuric Acid 98%
•  IPL, a company specializing in manufacturing and supplying Single Super Phosphate (SSP) fertilizer, began its journey by trading dolomite and limestone. In 2004, it commissioned a manufacturing facility with a 200 MT/day capacity. In 2009, it diversified into the chemical business with a 150 MT/day capacity. In 2013, it expanded its SSP fertilizer capacity to 400 MT/day. In 2022, it commissioned a second 200 MT/day plant, increasing its combined capacity to 350 MT/day. In November 2022, it set up a 750 KWh solar plant in Bikaner. In 2023, an additional Granulated Single Super Plant was commissioned.
• The company furthermore produces Zincated Single Super Phosphate - "Powder" and Zincated Single Super Phosphate - "Granulated" by incorporating zinc and boron into the rock phosphate mixture prior to its denaturation. The Department of Fertilisers and the Government of India encouraged the SSP sector to create value-added fortified SSP with zinc and boron content due to the deficiency of these elements in the soil.
• For the last 5 years, the focus has been on producing fortified SSP with Zinc and Boron.. As a result, the company is currently generating more than 80% of SSP as fortified SSP. The company derives revenue from the following two business verticals: a) Fertilizer Manufacturing b) Chemical Manufacturing

ESG Profile

Environmental Initiatives

The company has transitioned from a traditional manufacturing focus to one that emphasizes resource efficiency and carbon footprint reduction:

• Captive Solar Power: IPhL has installed a Solar Power plant to meet its captive power requirements. This move reduces reliance on thermal-generated grid power and significantly lowers carbon emissions.

• R&D Focus: Their mission emphasizes "continuous innovation" through research and development aimed at creating sustainable agricultural products.

Social Responsibility (CSR)

The company operates under a structured CSR policy designed to create "societal capital" alongside shareholder wealth. Their key focus areas include:

• Rural Development: Investing in infrastructure and accessibility in rural operational areas (Rajasthan).

• Education: Supporting local education through the distribution of stationery and the development of school buildings. The group also runs a CBSE-affiliated school.

• Health & Sanitation: Promoting preventive healthcare and providing safe drinking water to communities near their manufacturing plants.

• Gender Equality: Implementing programs aimed at the empowerment of women and livelihood enhancement.

Governance & Ethics

IPHL emphasizes transparency and long-term stakeholder relationships as the foundation of its governance:

• Ethical Standards: The company maintains a strict code of conduct centered on "Honesty and Integrity."

• Compliance: Their CSR policy is fully aligned with Section 135 of the Companies Act, 2013, ensuring that a fixed percentage of profits is transparently reinvested into social causes.

• Further there  are Five Independent board of directors in Board 

KEY FINANCIAL INDICATORS (Standalone)

Key Parameters	Units	FY 23 - 24 (Audited - Annual)	FY 24 - 25 (Audited - Annual)	FY 25 - 26 (Audited - Annual)
Operating Revenue	Rs.Crs.	704.18	799.09	986.11
EBITDA	Rs.Crs.	23.04	17.10	36.62
PAT	Rs.Crs.	13.47	9.17	21.35
Tangible Net Worth	Rs.Crs.	81.06	147.72	169.00
Total Debt / Tangible Net Worth	Times	0.50	0.12	0.16
Current Ratio	Times	1.56	2.46	2.46

KEY COVENANTS OF THE FACILITY RATED

There are standard covenants as per Sanction Letter 

STATUS OF NON-COOPERATION WITH PREVIOUS CRA

Not Applicable

RATING HISTORY FOR LAST THREE YEARS (including withdrawal and suspended)

Facilities	Current Rating  (2026)			2025		2024		2023
Type	Tenure	Amount (Rs.Crs.)	Rating	Date	Rating	Date	Rating	Date	Rating
Fund Based	LT	87.50	BWR A-/Stable (Assignment)	NA	NA	NA	NA	NA	NA
Non Fund Based	ST	123.50	BWR A2+ (Assignment)	NA	NA	NA	NA	NA	NA
Grand Total		211.00	(Rupees Two Hundred Eleven Crores Only)

Hyperlink/Reference to applicable Criteria

• General Criteria
• Approach to Financial Ratios
• Short Term Debt
• Manufacturing Company

Analytical Contacts
Karan Ahluwalia Ratings Analyst karan.ahluwalia@brickworkratings.com	Ravi Rashmi Dhar Director - Ratings ravi.d@brickworkratings.com
Media Contact | media@brickworkratings.com	Client Support | clientsupport@brickworkratings.com

SL.No.	Name of the Bank/Lender	Type Of Facilities	Long Term(Rs.Crs.)	Short Term(Rs.Crs.)	Total(Rs.Crs.)	Complexity of the Instrument
1	Indian Overseas Bank	Cash Credit - Sanctioned	67.50	_	67.50	Simple##
2	Indian Overseas Bank	Bank Guarantee - Sanctioned	_	1.00	1.00	Simple##
3	Indian Overseas Bank	ILC/FLC - Sanctioned	_	47.50	47.50	Simple##
4	Punjab National Bank	ILC/FLC - Sanctioned	_	75.00	75.00	Simple##
5	Punjab National Bank	Cash Credit - Sanctioned	20.00	_	20.00	Simple##
Total			87.50	123.50	211.00
TOTAL (Rupees Two Hundred Eleven Crores Only)

## BWR complexity levels are meant for educating investors. The BWR complexity levels are available at www.brickworkratings.com / download / ComplexityLevels.pdf. Investors queries can be sent to info@brickworkratings.com.