FFC says no urea discount as 2025 profit hits Rs73.6bn
Fauji Fertilizer reported Rs73.6bn profit for 2025, kept urea prices unchanged, and outlined expansion plans for retail, farmer outreach, and its PIA-linked investment vehicle.
Fauji Fertilizer Company said on Tuesday it kept urea prices unchanged despite higher international oil prices and reported net profit of Rs73.6bn for 2025, as management used its corporate briefing session to outline earnings drivers, fertilizer sales trends, retail expansion, and its planned role in a Special Purpose Venture for the PIA acquisition.
Management said no discount on urea is currently being offered. It also said the company has not passed on any price adjustments despite higher international oil prices amid ongoing US-Iran geopolitical tensions. The comments come as fertilizer producers remain closely watched for pricing moves and demand trends across the domestic market.
FFC said the overall urea market expanded by 2.3% in 2025. Even so, the company’s market share fell to 43% from 48% in 2024 as sales volumes weakened. Urea sales declined to 2.9mn tons from 3.1mn tons a year earlier, marking a 6% year-on-year drop.
The decline was mainly driven by a sharp fall in Sona NC sales. Management said Sona NC volumes dropped 51% year-on-year to 213k tons. In contrast, Sona P volumes rose 3% year-on-year to 2.2mn tons in 2025, partly cushioning the overall decline in urea sales.
The DAP segment also remained under pressure during the year. FFC said the DAP fertilizer market contracted 18% in 2025, while its own DAP sales also fell 18% to 834k tons. Despite that decline, management said the company’s market share improved, though the figures cited in the briefing require verify because they were stated as moving from 61% from 62% in 2025 [verify].
Inventory levels rose to Rs38bn during the year. Management said the increase largely reflected stockpiling amid higher phosphorus prices. That suggests the company built positions in anticipation of continued cost pressure or supply tightness in phosphate-related inputs.
FFC also highlighted progress in its Sona Centre network, which it described as a platform for stronger farmer engagement through an integrated agricultural ecosystem. The company said more than 118k farmers are now registered on the network, covering about 1.7mn acres of farmland. Fertilizer sales through this channel reached 65k tons, with around 70% urea and 30% DAP.
The company said it now operates 244 Sona stores nationwide. Management said further expansion is planned to widen retail access, improve agricultural advisory services, and help ensure fertilizer availability at official retail prices. The strategy points to a deeper push into direct farmer connectivity and distribution control.
Beyond fertilizer operations, FFC also provided details on the structure for the PIA acquisition. Management said the transition will be executed through a Special Purpose Venture named PIA Equity (Pvt) Ltd. The investor group includes Fauji Fertilizer Company, Arif Habib Corporation, Fatima Group, AKD Group, Lake City Holdings, and The City School.
The total transaction value was disclosed at Rs185bn, including a call option. Management said 75% of payments will be made in two phases between April-May 2026 and April-May 2027. FFC will hold a 34% stake in the SPV, including the call option, giving the fertilizer producer a sizeable position in the investment vehicle.
FFC said its 2025 profit mix remained diversified. It said 62% of net profit came from core fertilizer operations, while 22% came from dividend income and 16% from investment income. Management also said subsidiaries and associated companies contributed Rs30.4bn in 2025, underlining the growing role of non-core earnings in supporting the group’s bottom line.
Alongside the results, the company declared an annual cash dividend of Rs8.5 per share. That took total 2025 cash payout to Rs37 per share. The briefing also referenced a positive investment view on the stock, with FFC trading at a 2026E price-to-earnings ratio of 7.9x and offering a dividend yield of 9.5%.FFC profit drops 22% amid lower margins
The update leaves Fauji Fertilizer balancing softer fertilizer volumes with strong earnings, higher inventories, wider farmer outreach, and a major non-core investment through the PIA SPV. For investors, the next focus will remain on fertilizer demand, margin resilience, execution of the Sona store expansion, and how Fauji Fertilizer manages both its core business and new capital commitments.