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Analyst Opinion
FATIMA - Fatima Fertilizer Company Ltd.
Fatima Fertilizers - a case of compounding
SCS Research update    6/11/2026 12:00:00 AM
Fatima Fertilizer_ is shaping up as a classic “defensive growth” name on the PSX, and those numbers you posted line up with why it’s getting attention: Valuation + Income - PE 5.8x, PBV 1.7x: Cheap vs PSX average and vs global fertilizer peers. The market isn’t pricing in much earnings growth. - *Dividend yield >10%*: Fatima has a track record of high payouts because cash flows are stable and _capex_ is low once plants are running. Why margins are holding up: - Optimized gas: Fertilizer is energy-intensive. Fatima Fertilizers' access to allocated gas at reasonable rates keeps input costs down vs plants relying on RLNG. - Urea + CAN demand: Stable demand + import restrictions keep local prices supported. - Lower finance costs: There is an unleveraged balance sheet, which further boosts EPS. The Natural Resources kicker: Exposure to Natural Resources Limited, alongside Mari Energies and Lucky Cement, puts Fatima Fertilizers in the Balochistan copper/gold/rare earth story. It’s early-stage and not in current earnings, but it’s a free optionality if exploration succeeds. There is a strong chance of positive cash flows in 2031. Risks to watch: 1. Gas policy changes – any cut in allocated gas or price hike hits margins fast. 2. Subsidy/floor price changes – gov’t controls urea pricing, so farm economics + fiscal health matter. 3. Commodity urea prices – if global urea crashes, local prices may follow. Bottom line: At 5.8x PE + 10%+ yield, Fatima Fertilizers can keep compounding through 2026. The Natural Resources exposure is not in the price yet.
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FATIMA - Fatima Fertilizer Company Ltd.
Fertilizer | Urea Offtake May’26
Ahsan Muhammad Asif    6/2/2026 12:00:00 AM
May’26 urea sales came in at ~419k tons, essentially unchanged from 418k tons a year ago, per provisional figures. Compared to April, offtake was down 10% as the market cooled off after farmers front-loaded purchases last month amid fears of price hikes tied to Middle East instability. The trend varied by company. FFC sold 257k tons, well above 207k tons in May’25. FATIMA and AGL also gained, with 87k tons and 31k tons vs 54k tons and 15k tons SPLY. EFERT went the other way, falling to 43k tons from 142k tons last year. For Jan-May’26, total urea offtake is tracking 9% higher YoY at 1,920k tons vs 1,768k tons, helped by stronger farm incomes. FFC is driving the growth with offtake up 29%YoY to 1,099k tons. Meanwhile, EFERT and FATIMA are both down 11%YoY, at 431k tons and 275k tons. On the stock side, industry-wide inventory fell to 990k tons from 1,316k tons SPLY. EFERT still carries the heaviest load at 637k tons, with FATIMA at 221k tons and FFC at 112k tons. We prefer Fatima & FFC.
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FATIMA - Fatima Fertilizer Company Ltd.
Fatima Fertilizer’s Defensive Growth | PE 10.8x, PBV 1.8x | Dividend Yield ~6.5%
SCS Research update    5/15/2026 12:00:00 AM
The Fatima Fertilizer Company remains one of the better fertilizer plays on the PSX, supported by relatively stable off-takes (due to Mari Energies' dedicated supplies of feedstock gas), some improved cash flows (operating cash flows at PKR 9-10bn), and cost-effective strategies. PE 10.8x The company is currently yielding a PE of 10.8x and a PBV of 1.8x, while deciphering a dividend yield of ~6.5%. Gross margins ~38% The fertilizer company is benefiting from dedicated Mari feedstock supplies, lower finance costs (given de-leveraging), and urea and CAN demand, thus supporting gross margins (5-year average 38% - 42%) despite persistent inflationary pressures. Dividend payout play.... The company also maintains operating cash flows of PKR 9 bn - 10 bn and improved payout trends, thus strengthening its 'defensive positioning' within the fertilizer sector. Rear earth factor.... Moreover, FATIMA’s strategic exposure to Natural Resources Limited (NRL) alongside Mari Energies and Lucky Cement Group provides long-term upside potential through copper, gold, and rare earth exploration projects in Balochistan.
Link: https://www.linkedin.com/in/mahsan178/