DHARMAJ - Dharmaj Crop

📊 NSE: DHARMAJ 🏢 Pesticides / Agrochemicals - Indian 📅 Last Updated: 12/13/2025 21:31

💰 Financial Performance

Revenue Growth by Segment

Total revenue from operations grew 45.4% YoY to INR 951.04 Cr in FY25, driven by broad-based growth in Branded Formulations (B2C), Institutional Formulations (B2B), and the newly commissioned Active Ingredients (B2B) vertical.

Geographic Revenue Split

Dharmaj operates across 24 states in India with a network of 5,250+ dealers. The export segment contributes approximately 5-10% of total revenue, though it remained static in recent periods.

Profitability Margins

Gross margins improved to 23% in FY25 from 21% in FY24 due to favorable product mix and cost management. However, PAT margin declined from 7% to 4% (INR 34.84 Cr) due to higher operational overheads from the new Sayakha plant.

EBITDA Margin

EBITDA margin compressed to 8% in FY25 from 10% in FY24. While EBITDA absolute value grew 19% to INR 74.8 Cr, margins were impacted by a 279% increase in finance costs (INR 12.90 Cr) and a 239% rise in depreciation (INR 18.27 Cr).

Capital Expenditure

The company utilized INR 105 Cr from its INR 251.15 Cr IPO proceeds for capacity expansion at the Sayakha facility (Unit 2), which commenced operations in January 2024.

Credit Rating & Borrowing

The company maintains a comfortable financial risk profile with a net worth of INR 395 Cr and low gearing of 0.27x. Interest coverage is estimated at 7.66 times for FY25.

⚙️ Operational Drivers

Raw Materials

Key raw materials include agrochemical technicals and intermediates used for formulations such as insecticides, fungicides, and herbicides, representing approximately 77% of total revenue costs.

Capacity Expansion

Unit 1 (Ahmedabad) handles formulations; Unit 2 (Sayakha) is a newly commissioned technical plant for Active Ingredients. Sayakha is expected to reach optimal utilization within 12-18 months.

Raw Material Costs

Raw material costs are managed through a lean inventory approach and just-in-time procurement for volatile materials, supporting a gross profit of INR 206.7 Cr in FY25.

Manufacturing Efficiency

Capacity utilization at the Sayakha plant is currently in a ramp-up phase, with a target to achieve financial break-even for the Active Ingredients vertical in the near term.

Logistics & Distribution

Distribution is supported by a digital dealer app for real-time data and 5,250+ partners across 24 states to ensure supply chain responsiveness.

📈 Strategic Growth

Expected Growth Rate

34%

Growth Strategy

Growth will be driven by ramping up the Sayakha facility to optimal capacity, expanding the Active Ingredients vertical to capture higher margins, and leveraging 168 export registrations currently in the pipeline.

Products & Services

Insecticides, fungicides, herbicides, plant growth regulators, micro-fertilizers, and general insect/pest control chemicals for public and animal health.

Brand Portfolio

Dharmaj owns over 134 brands, including proprietary formulations sold through its B2C distribution network.

New Products/Services

The company has 590 total registrations, with 168 export and 32 technical registrations in the process to drive future revenue contribution.

Market Expansion

Targeting deeper penetration in 24 existing states and expanding the export segment, which currently has 103 exclusive registrations.

Strategic Alliances

The company has established strategic breakthroughs with large agrochemical majors for institutional formulation supply.

🌍 External Factors

Industry Trends

The Indian agrochemical sector is growing due to supportive government policies and increased sowing; Dharmaj is positioning itself by shifting from pure formulations to technical manufacturing.

Competitive Landscape

Faces rising competition in both domestic and international markets from large established agrochemical players and mid-sized formulators.

Competitive Moat

Moat is built on a large registration portfolio (590), a wide distribution reach (5,250+ dealers), and a DSIR-recognized R&D center, which are difficult for new entrants to replicate quickly.

Macro Economic Sensitivity

Highly sensitive to agricultural GDP and monsoon cycles; irregular rainfall in Kharif/Rabi seasons impacts demand for branded formulations.

Consumer Behavior

Increasing farmer preference for branded formulations and high-performance products to improve crop yields.

Geopolitical Risks

Trade barriers or regulatory changes in export markets could impact the 103 exclusive export registrations.

⚖️ Regulatory & Governance

Industry Regulations

Operations are governed by CIB&RC registrations and NABL accreditation for quality control labs; the company must maintain 590+ active registrations.

Environmental Compliance

Operations are ISO 9001:2015 certified and located in GIDC chemical zones, ensuring adherence to industrial pollution and safety norms.

Taxation Policy Impact

Effective tax rate was approximately 24% in FY25, with a tax provision of INR 10.93 Cr on a standalone PBT of INR 45.77 Cr.

⚠️ Risk Analysis

Key Uncertainties

The primary uncertainty is the speed of the Sayakha plant ramp-up; a delay in reaching optimal utilization could prolong the period of depressed ROE (currently 9%).