BASF - BASF India

📊 NSE: BASF 🏢 Chemicals 📅 Last Updated: 12/13/2025 19:09

💰 Financial Performance

Revenue Growth by Segment

Consolidated revenue grew 10.8% YoY to INR 15,260 Cr in FY25. Segment contributions: Materials (32%), Nutrition and Care (19%), Industrial Solutions (18%), Agricultural Solutions (14%), Chemicals (13%), Surface Technologies (3%), and Others (1%). The Agricultural Solutions segment specifically contributed INR 2,006 Cr in FY24.

Geographic Revenue Split

Not disclosed in available documents, though the company operates as the flagship Indian subsidiary of the German parent BASF SE, with significant raw material sourcing from group companies outside India.

Profitability Margins

Profit After Tax (PAT) margin declined from 4.1% in FY24 to 3.1% in FY25. This 100 bps compression was driven by volatility in crude-linked raw material costs and forex fluctuations. PAT decreased 14.9% YoY from INR 563 Cr to INR 479 Cr.

EBITDA Margin

Operating profitability is sensitive to a 2.5-3% threshold for credit rating stability. In FY24, the Agricultural Solutions segment alone contributed 53.9% of total EBIT (INR 435 Cr), highlighting its disproportionate impact on core profitability compared to its 14.6% revenue share.

Capital Expenditure

The company maintains a strong liquidity profile with cash and bank balances of INR 820 Cr as of March 31, 2025. While specific planned capex for FY26 is not disclosed, the company has no large debt-funded capex plans, focusing on prudent working capital management.

Credit Rating & Borrowing

Maintains a 'Stable' outlook from CRISIL. Borrowing costs are optimized through a working capital limit of INR 1,511 Cr carved out from the parent's global lines of credit. Interest coverage ratio stood at 23.25x in FY25, down from 29.16x in FY24.

⚙️ Operational Drivers

Raw Materials

Crude oil derivatives (primary feedstock), chemical intermediates, and active ingredients for crop protection. Crude-based derivatives represent the majority of input costs for the Materials and Chemicals segments.

Import Sources

Primarily imported from Germany and other global locations where BASF SE group companies operate.

Key Suppliers

BASF SE and its various global subsidiaries serve as the primary suppliers for specialized chemical inputs and traded products.

Capacity Expansion

Not disclosed in available documents; however, the company recently incorporated BASF Agricultural Solutions India Ltd (BASIL) as a wholly-owned subsidiary on May 2, 2025, to facilitate the global business separation strategy.

Raw Material Costs

Raw material costs are highly volatile due to their link to crude oil prices. Profitability is susceptible to these shifts as most inputs are sourced from group companies outside India, creating a dual risk of commodity pricing and currency translation.

Manufacturing Efficiency

Lost time injury frequency rate for workers was 0.32 in FY25, which is noted as higher than peers, indicating a specific area for operational improvement.

📈 Strategic Growth

Expected Growth Rate

Not disclosed in available documents

Growth Strategy

Growth is pursued through a global 'separation' strategy. This includes the demerger of the Agricultural Solutions business by January 2027 to align with a global IPO plan by BASF SE. Additionally, the company is divesting its Coatings business (3.1% of revenue) to Carlyle and QIA as part of a EUR 7.7 billion global transaction to focus on core high-growth segments.

Products & Services

Crop protection products (fungicides, herbicides), performance polymers, automotive OEM coatings, refinish coatings, care chemicals for personal/home care, and industrial chemicals for refining and petrochemicals.

Brand Portfolio

BASF, and specific segment brands like BASF Agricultural Solutions.

New Products/Services

The company is currently focused on the legal and ERP separation of the Agricultural Solutions business, which is expected to be completed by 2027, potentially leading to new product pipelines under the standalone entity.

Market Expansion

The company is evaluating the impact of the global divestment of the automotive coatings business to Carlyle/QIA, which is expected to close in Q2 CY2026.

Strategic Alliances

Binding agreement with Carlyle and Qatar Investment Authority (QIA) for the divestment of automotive OEM and refinish coatings. BASF SE will retain a 40% equity stake in this global business.

🌍 External Factors

Industry Trends

The industry is shifting toward specialized, standalone entities for agricultural chemicals, evidenced by BASF's plan to IPO its global agri-business by 2027. The coatings industry is also consolidating, as seen in the Carlyle/QIA acquisition.

Competitive Landscape

Competes with other global and domestic chemical majors across diversified segments; safety performance (0.32 injury rate) is currently lagging behind peers.

Competitive Moat

Moat is derived from 73.33% parent ownership by BASF SE, providing access to global proprietary technology, a diversified product portfolio that mitigates cyclicality, and a strong financial risk profile with zero debt.

Macro Economic Sensitivity

Highly sensitive to monsoon patterns (affecting 14% of revenue) and global crude oil price cycles (affecting 45%+ of revenue).

Consumer Behavior

Demand is driven by growth in the Indian automotive, construction, and agricultural sectors.

Geopolitical Risks

Trade barriers or supply chain disruptions affecting the parent company in Germany would directly impact BASF India's ability to source key chemical intermediates.

⚖️ Regulatory & Governance

Industry Regulations

Operations are governed by pollution norms and specific registration requirements for crop protection chemicals. The company is currently undergoing a complex legal demerger process to comply with global corporate restructuring.

Environmental Compliance

The Agricultural Solutions sector is subject to stringent registration processes and environmental regulations in India, which impacts the timeline for product launches.

Legal Contingencies

The company has constituted a committee of independent directors to examine the demerger of the agri-business. No specific pending court case values were disclosed in the provided text.

⚠️ Risk Analysis

Key Uncertainties

The primary uncertainty is the impact of the bifurcation of assets and liabilities during the 2027 agri-business demerger, which currently contributes 53.9% of EBIT.

Geographic Concentration Risk

Revenue is primarily domestic (India), but sourcing is concentrated in Europe/Global BASF hubs.

Third Party Dependencies

High dependency on BASF SE for 73.33% equity, technical know-how, and global credit lines.

Technology Obsolescence Risk

The company is undergoing an 'Enterprise Resource Planning' (ERP) separation for its agri-business to ensure digital and operational independence by 2027.