NACLIND - NACL Industries

📊 NSE: NACLIND 🏢 Pesticides / Agrochemicals - Indian 📅 Last Updated: 12/14/2025 10:12

💰 Financial Performance

Revenue Growth by Segment

Total revenue from operations for FY25 was INR 1,251.89 Cr, representing a 30% decrease compared to the previous year. However, H1 FY26 showed a recovery with revenue of INR 905.30 Cr, an 18.3% increase over INR 765.32 Cr in H1 FY25. The business is split between Technicals (Active Ingredients) and Formulations (60+ products), with the latter primarily serving the domestic retail market.

Geographic Revenue Split

NACL has a presence in 22 countries. While specific percentage splits per country are not provided, the company maintains a sizable export business with MNCs like Syngenta Asia Pacific and Nissan Chemical Corporation, alongside a vast domestic retail network in India.

Profitability Margins

Profitability was severely impacted in FY25 with a PAT margin of -7.56% (Loss of INR 92.13 Cr) compared to -3.34% in FY24. H1 FY26 saw a turnaround to a profit of INR 15.59 Cr. EBITDA margins are projected to recover to 8.0-9.0% in FY26 as price stabilization occurs.

EBITDA Margin

EBITDA for FY25 was a loss of INR 56.98 Cr, a significant decline from a positive EBITDA of INR 16.32 Cr in FY24. This represents a margin swing from approximately +0.9% to -4.5% YoY due to limited access to working capital and sectoral headwinds.

Capital Expenditure

The company is currently investing in de-bottlenecking capacities to support near-term growth. While the specific INR Cr for FY26 is not detailed, historical net worth grew from INR 350.53 Cr in FY20 to INR 577.41 Cr in FY23, indicating consistent asset base expansion.

Credit Rating & Borrowing

Credit rating was significantly upgraded to CRISIL AA/Stable/A1+ from BB+/A4+ following the acquisition by Coromandel International Limited (CIL). Borrowing costs are expected to decrease due to CIL's AAA rating and a proposed INR 160 Cr line of credit from the parent.

⚙️ Operational Drivers

Raw Materials

Active Ingredients (Technicals) and intermediates for generic molecules including insecticides, fungicides, and herbicides. Specific chemical names are not listed, but these represent the primary cost of goods sold.

Import Sources

Not specifically disclosed in the documents, though the company operates in the global generic molecule market which typically sources from China and domestic Indian suppliers.

Capacity Expansion

Current capacity utilization is approximately 70%. The company is implementing de-bottlenecking projects to increase throughput without massive greenfield spend, aiming to support a revenue target of INR 1,600-1,700 Cr in FY26.

Raw Material Costs

Raw material costs are a major component of the 30% revenue decline in FY25, as price volatility in generic molecules led to inventory write-downs and margin compression.

Manufacturing Efficiency

Capacity utilization stands at 70%. The company leverages cost-efficient manufacturing processes developed over three decades to compete with both organized and unorganized players.

Logistics & Distribution

The company operates a large retail dealer network across India to distribute its 66+ branded formulation products.

📈 Strategic Growth

Expected Growth Rate

32%

Growth Strategy

Growth will be driven by the acquisition by Coromandel International Limited (CIL), which provides financial flexibility and a line of credit of INR 160 Cr. The company plans to reach INR 1,600-1,700 Cr in revenue by FY26 through de-bottlenecking, launching new products from its R&D pipeline, and expanding its presence in 22 international markets.

Products & Services

Insecticides, fungicides, herbicides, and plant growth regulators sold as both Technicals (B2B) and Formulations (Retail).

Brand Portfolio

NACL (66+ branded products in the portfolio).

New Products/Services

The company has over 60 products covering all major crops and continues to develop new generic molecules to replace those facing patent expirations.

Market Expansion

Targeting deeper penetration in the domestic retail market and expanding the export footprint beyond the current 22 countries.

Strategic Alliances

Acquired by Coromandel International Limited (CIL), which now holds a 53.08% stake. NACL also holds a 26% stake in Nasense Labs Pvt Ltd.

🌍 External Factors

Industry Trends

The agrochemical industry is shifting toward innovation-led growth and digital adoption. NACL is positioning itself to benefit from upcoming patent expirations in the global market.

Competitive Landscape

Intense competition from organized regional players and unorganized local manufacturers in the generic segment.

Competitive Moat

Moat is based on 30+ years of manufacturing experience, long-standing relationships with global MNCs, and a strong brand in the domestic retail market. Sustainability is enhanced by the new parentage of the Murugappa Group (via CIL).

Macro Economic Sensitivity

Highly sensitive to agricultural GDP and farm income levels, which are dictated by monsoon performance.

Consumer Behavior

Farmers are increasingly looking for integrated pest management and plant growth regulators, shifting demand away from simple insecticides.

Geopolitical Risks

Trade barriers and changes in registration policies in international markets could impact the export of technical grade active ingredients.

⚖️ Regulatory & Governance

Industry Regulations

Operations are governed by the Insecticides Act, export/import policies, and product registration requirements in 22 countries. Changes in these can lead to product bans or mandatory reformulations.

Environmental Compliance

Subject to stringent environmental safety requirements and pollution norms for chemical manufacturing; specific ESG costs are not disclosed.

Taxation Policy Impact

The company is evaluating special tax benefits as of December 2025 in relation to its proposed Rights Issue.

Legal Contingencies

The company monitors potential provisions for doubtful debtors or write-offs, which impacted FY25 results, though specific litigation values are not provided.

⚠️ Risk Analysis

Key Uncertainties

Seasonality and rainfall distribution (impact up to 30% of revenue), regulatory changes in product safety, and volatility in raw material prices for generic molecules.