Profit forecast for the first quarter of 2022 of many fertilizer companies is expected to increase by 5-10 times

Benefiting from a sharp increase in prices, the profit forecast of the first quarter of 2022 of many fertilizer enterprises is very positive.

At PetroVietnam Fertilizer and Chemicals Corporation (HoSE: DPM), although the company has not announced its business results in the first quarter of 2022, according to SSI Research’s estimates, in the first quarter of this year, the company’s pre-tax profit Phu My Fertilizer achieved VND1,800 billion in EAT (up 10 times over the same period), mainly thanks to the strong increase in average selling price and increased consumption volume.

Similarly, at Ca Mau Petroleum Fertilizer Joint Stock Company (HoSE: DCM), SSI Research estimates DCM will achieve 1 trillion dong in EAT (up 6.6 times over the same period).

Meanwhile, with Duc Giang Chemical Group (HoSE: DGC), the profit of the first quarter of 2022 is estimated at 1,500 billion dong, 7.1% higher than the 1,400 billion dong in the fourth quarter of 2021. 5 times higher than the same period last year (292 billion dong), thanks to the strong increase in average selling price.

Reacting to this information, in today’s trading session (April 14), these stocks simultaneously increased strongly.

In which, DCM shares of Ca Mau Petroleum Fertilizer Joint Stock Company rose to the ceiling at 43,650 VND/share; similarly, DGC shares of Duc Giang Chemical Group also hit the ceiling to 247,200 VND/share.

Stock code DPM of PetroVietnam Fertilizer and Chemicals Corporation also increased strongly by 4,200 dong/share (up 6.18%) in today’s session, to 72,200 dong/share.

From the beginning of 2022 until now, the flourishing movement of fertilizer stocks was supported by positive information on both prices and export volumes in the context of the world’s scarce fertilizer supply, fertilizer price increased worldwide due to the conflict between Russia and Ukraine.

Data from the Ministry of Agriculture and Rural Development shows that fertilizer exports in the first months of 2022 continue to grow strongly in both volume and value. Specifically, fertilizer export turnover in the first 3 months of 2022 amounted to 291 million USD, up 2.8 times over the same period last year.

Previously in 2021, the country’s fertilizer export also reached a record in volume with more than 1.35 million tons (up 16.4% over the same period), earning 559.35 million USD (up 64.2%) compared to 2020).

Meanwhile, on the world market, the fertilizer price index in North America on Green Markets channel for the week ending April 1 was $1,269.8/ton, down $0.6/ton from the previous week. there, according to Bloomberg. However, despite the decrease, the price of this item is still increasing by more than 40% compared to before the war in Ukraine.

The progress of the world fertilizer market depends greatly on Russia because this country is the world’s leading fertilizer exporter.

A recent report of Mirae Asset Securities said that the decline in world fertilizer reserves may put upward pressure on fertilizer prices to continue in the second quarter of 2022. The pressure on fertilizer supply in the world continues to increase when Russia officially stops exporting fertilizers, besides the increased demand for food production will also boost fertilizer demand.

SSI Research also said that the Russia-Ukraine tension could prolong the shortage of natural gas in Europe and create short-term investment opportunities for Vietnam’s fertilizer stocks, which can benefit from the selling price. Urea is higher. Urea prices will decline at a slower pace from their peak in December 2021 as Urea supplies in Europe are expected to be short, and Urea supplies in China grow slowly and export restrictions are ongoing.