2,883% returns in five years, but has this fertiliser stock made you any money?

The stock has now surged 33% in the last three trading sessions, thereby erasing all the losses for the year and turning positive on a year-to-date basis.

In the five years since 2020, including 2024, the stock has doubled or more in value in three of them, in 2021, 2022 and in 2023.

However, if one takes a look at the five year picture, the stock has surged nearly 3,000%. From ending 2019 at just under ₹40 per share, they now trade at well over ₹1,000.

Fertiliser shares have been on a tear in the last few trading sessions, ahead of the GST Council meet in New Delhi on June 22. There are reports that the council could cut GST on Fertilisers on the recommendation of the Standing Committee. However, CNBC-TV18 has reported citing sources that the Fitment Committee has urged the  rethink this decision.

The Fitment Committee is of the view that a blanket exemption from items such as fertilisers, chemicals and nutrients, will cause duty inversion and lead to blocking of capital for the industry.

However, despite the near-3,000% surge seen by shares of FACT, would it have made money for the normal retail investor? The answer may be very few of them, as the stock has very little free float available to trade in the market.

Based on the March shareholding pattern, the government continues to own a 90% stake in FACT, while another government entity, the National Investment Fund, owns a 8.56% stake in the company. That leaves the public with 1.44% stake, of which Mutual Funds and Insurance companies own 0.03% and 0.01% stake respectively.

At the current market price, the government stake in FACT is valued at over ₹63,000 crore.

For the March quarter, FACT’s revenue fell 15% year-on-year, while it reported a net loss of ₹61 crore, compared to a net profit of ₹165.6 crore in the same quarter last year.

“One counter where we have been saying that please exercise caution was low floating stock counters. Floating stock was limited, float was controlled and limited activity was resulting into higher price impact. Normally market is pendulum it either swings above fair value or swings below fair value,” Nilesh Shah of Kotak Mahindra AMC had told CNBC-TV18 in an interaction in March this year.

Shares of FACT are locked in a 20% upper circuit at ₹1,090.