Rashtriya Chemicals and Fertilizers Limited has informed the Exchange about Action(s) initiated or orders passed
RCF · price
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Rashtriya Chemicals and Fertilizers (RCF) has informed stock exchanges that the Department of Fertilizers (DoF) has declined its request to recognise the cost of EPMC gas and Spot gas used for producing Trombay Urea in financial years 2021-22 and 2022-23. This non-recognition is expected to result in an adverse financial impact of approximately ₹204.14 crore on the company. RCF has stated that it is once again taking up the matter with DoF for reconsideration, arguing that the rejection is not consistent with the principles of the gas pooling mechanism. The company has termed the move as contrary to established gas pooling norms and is pursuing the issue further with the government.
This is a negative development for RCF shareholders, as a ~₹204 crore hit could materially affect the company's profitability for the relevant years if the decision is not reversed. The fact that RCF is actively contesting the decision offers some hope of relief, but until the matter is reconsidered, it remains a key overhang on the stock.