Karachi: Profitability within the Pakistan fertilizer sector experienced an upswing in the third quarter of the calendar year 2026, largely due to increased nitrogenous offtakes and a rise in nutrient prices. This trend was observed across the AKD Fertilizer Universe, where gross margins saw expansion as a result of a higher composition of nitrogenous nutrients in the sales mix, coupled with elevated prices.

According to AKD Securities Limited, despite the positive impact of increased offtakes and prices, the sector's profitability was partially offset by higher distribution costs, decreased other income, and increased finance costs. The analysis maintains an "overweight" stance on the fertilizer sector, highlighting Fauji Fertilizer Company (FFC) as the top pick, with a target price of PKR 801 per share by December 2026.