Liberty Phosphate Ltd.

Liberty Phosphate Ltd.TMHighlightsBSE SENSEX/S & P NIFTY 17560.87/5322.95SectorFertilizersMarket Cap./Free Float (` Crs.) 103/46Market Price as on 09/08/12 ` (FV `10/-) 71.6052 Week High/Low ` 97.50/45Equity Shares Outstanding (in Crs.) 1.44P/E Ratio (Times) (for FY ‘12) 1.8P/B (Times) (for FY '12) 0.8EV/EBITDA (Times) (FY ‘12) 1.4ROE % (FY ‘12) 41.6Shareholding Pattern as onJune ‘12 (%)Share Price Performanceu SSP is considered to be poor farmer’s fertilizer as it ischeaper to Di Ammonium Phosphate (DAP) in terms of nutrientsand provides an option to optimize use of phosphatic fertilizers.It fulfills the higher requirements of sulphur & phosphate inseveral crops such as oilseeds, pulses, sugarcane, tea, fruits &vegetables etc.u Government wants to encourage use of SSP as it isentirely produced in domestic sector to reduce dependence onimports of potassic-phosphatic (P&K) fertilizers.u Nutrient Based Subsidy (NBS) policy is a long termpositive for fertilizer industry with free market mechanism.u Company has comfortable debt position of 0.53 x. Netdebt is negligible with ` 65 Crs. of cash & cash equivalents. Cashforms about 60% of market cap of the Company.u Prices of Rock phosphate, the main raw material, havegone up by about 50% in FY ’12. This combined with lowersubsidy in FY ’13 and poor monsoon conditions does not augurtoo well for SSP manufacturers.u Delay in subsidy payment, uncertainty of monsoon,volatile international market of raw material, seasonalconsumption of fertilizer (2 months per year), logisticsavailability and cost and high requirements of working capitalshall remain the concern for the industry.u Fertilizer stocks have reacted to the drought like situationin many parts of the country. We believe that it is good time toaccumulate goods stocks in the sector for decent returns over aperiod of one year.Liberty Phosphate Ltd. is also available on www.balance-equity.co.in