HERANBA - Heranba Inds

📊 NSE: HERANBA 🏢 Pesticides / Agrochemicals - Indian 📅 Last Updated: 12/13/2025 22:53

💰 Financial Performance

Revenue Growth by Segment

Total consolidated segment revenue for H1 FY26 reached INR 974.14 Cr, representing a 32.77% growth compared to INR 733.67 Cr in H1 FY25. A major business segment contributed INR 255.30 Cr, or 26.21% of total revenue, during H1 FY26.

Geographic Revenue Split

Export revenue contribution has moderated from 45% in FY23 to approximately 28-30% in FY25 due to global demand slowdown. Domestic revenue is supported by a pan-India network of 9,500+ dealers and 21+ depots.

Profitability Margins

Net profit margins are projected to stabilize at 5-6% in the next fiscal year. Consolidated Profit Before Tax (PBT) for H1 FY26 was INR 18.86 Cr, a 71.67% decline from INR 66.57 Cr in H1 FY25, impacted by a 74% increase in depreciation and a 127% rise in interest costs.

EBITDA Margin

EBITDA margins were suppressed at 5.4% for 9M FY25 due to lower product realizations and macro headwinds. Management targets a recovery to 12-14% EBITDA margin for the next fiscal year.

Capital Expenditure

Property, Plant, and Equipment (PPE) increased to INR 730.59 Cr as of September 30, 2025, from INR 662.34 Cr in March 2025. Significant investments are focused on the Sarigam Phase 2 and Saykha facilities.

Credit Rating & Borrowing

The company maintains a 'CRISIL A/Stable' rating (outlook revised from Positive) and 'CRISIL A1' for short-term facilities. Gearing remains low at 0.07 times, though interest expenses rose to INR 23.88 Cr in H1 FY26 from INR 10.49 Cr YoY.

⚙️ Operational Drivers

Raw Materials

Key raw materials include chemical intermediates for Technicals, Formulations, and Intermediates, which constitute the bulk of the 350+ products commercialized.

Import Sources

Not explicitly disclosed, but the company exports to 65+ countries across Asia, Africa, Middle East, and Southeast Asia, suggesting global sourcing and distribution links.

Capacity Expansion

Sarigam Phase 1 started commercial production in Q2 FY25. Sarigam Phase 2 and the Saykha facility are both expected to commence commercial production by the end of Q4 FY25.

Raw Material Costs

Raw material costs are impacted by lower realizations in the technical business. Provision for doubtful receivables increased to INR 8.26 Cr in H1 FY26 from INR 0.65 Cr YoY, reflecting credit environment challenges.

Manufacturing Efficiency

Manufacturing efficiency is currently impacted by lower realizations and the transitionary phase of new CAPEX; depreciation rose 74% YoY to INR 46.99 Cr as new assets were capitalized.

Logistics & Distribution

Distribution is handled through a network of 9,500+ dealers, supporting domestic revenue growth despite international headwinds.

📈 Strategic Growth

Expected Growth Rate

10.50%

Growth Strategy

Growth will be driven by operationalizing Sarigam Phase 2 and Saykha facilities by Q4 FY25, adding new product registrations, and expanding the customer base. The company aims to leverage its integrated 'Technicals to Formulations' model to capture market share as prices bottom out.

Products & Services

Agrochemical Technicals, Formulations, and Intermediates, including Synthetic Pyrethroids and branded domestic formulations.

Brand Portfolio

Heranba, Mikusu India, Daikaffil Chemicals.

New Products/Services

The company is looking to add new product registrations to drive the 'next wave of growth' following the completion of current CAPEX cycles.

Market Expansion

Expansion into 65+ countries and strengthening the domestic presence through 9,500+ dealers and new manufacturing hubs in Saykha and Sarigam.

Market Share & Ranking

Heranba is one of the leading players in the Indian agrochemicals industry with a diversified product mix.

Strategic Alliances

The group includes subsidiaries Mikusu India Private Limited, Heranba Organics Private Limited, and step-down subsidiary Daikaffil Chemicals India Limited.

🌍 External Factors

Industry Trends

The agrochemical industry is currently in a 'transitionary year' characterized by price bottoming and inventory destocking. Future growth is expected from integrated players with strong registration pipelines.

Competitive Landscape

Competes with other large-scale agrochemical manufacturers in both the technical export market and the domestic branded formulation market.

Competitive Moat

The moat is built on integrated operations (Technicals to Formulations), a massive network of 9,500+ dealers, and a portfolio of 350+ commercialized products, which are difficult for new entrants to replicate quickly.

Macro Economic Sensitivity

Highly sensitive to global agrochemical demand cycles and domestic monsoon patterns affecting the formulation business.

Consumer Behavior

Shift toward branded formulations in the domestic market is supporting revenue, while international B2B customers are currently focused on inventory destocking.

Geopolitical Risks

Challenging global macros and trade conditions have already reduced export revenue share by approximately 15 percentage points since FY23.

⚖️ Regulatory & Governance

Industry Regulations

Operations are governed by SEBI (LODR) Regulations and agrochemical manufacturing standards, including CIB&RC registrations for new products.

Environmental Compliance

Operations are subject to pollution control norms at GIDC Vapi, Sarigam, and Saykha; no specific ESG cost figures were provided.

Taxation Policy Impact

The company follows Indian Accounting Standards (Ind AS); specific tax rate impacts were not detailed beyond standard corporate tax applications.

Legal Contingencies

Auditors reported no matters causing belief that financial results have not disclosed required information under Regulation 33 of the Listing Regulations.

⚠️ Risk Analysis

Key Uncertainties

The primary uncertainty is the timeline for the recovery of international demand, which could keep EBITDA margins suppressed below the 12-14% target if destocking persists.

Geographic Concentration Risk

Approximately 70% of revenue is now domestic, increasing sensitivity to Indian agricultural cycles, while 30% remains exposed to 65+ international markets.