💰 Financial Performance

Revenue Growth by Segment

Agrochemicals contribute 70-80% of total revenue, while CRAMS (Contract Research and Manufacturing Services) accounts for 60-70% of revenue. Overall revenue from operations declined 4% from INR 934.23 Cr in FY24 to INR 900.52 Cr in FY25. However, Q1 FY26 showed a 37% YoY recovery to INR 319.51 Cr, and Q2 FY25 grew 5.4% YoY to INR 255.2 Cr.

Geographic Revenue Split

The company maintains a wide geographical presence across domestic and export markets. Q2 FY25 growth was driven by improvements in both domestic and export sales, though specific percentage splits per region are not disclosed in the provided documents.

Profitability Margins

Gross margins for Q2 FY25 stood at 39.5%, improved by product mix. Net Profit Margin (PAT) declined from 5.74% in FY24 to 4.32% in FY25 due to lower absorption of fixed costs and pricing pressures. Operating Profit Margin was 8.38% in FY25 compared to 10.02% in FY24.

EBITDA Margin

EBITDA margin was 11.17% in FY25, a decrease from 12.42% in FY24. EBITDA for FY25 was INR 100.62 Cr, down 13.3% from INR 116.08 Cr in FY24. Q2 FY25 EBITDA margin was 10.3% (INR 26.2 Cr).

Capital Expenditure

The company is investing in new blocks and plant upgrades planned for FY26 to support rising demand. Non-current investments increased to INR 1.57 Cr in FY25 from INR 1.44 Cr in FY24. Debt-funded capex is monitored by rating agencies to ensure it does not weaken the financial risk profile.

Credit Rating & Borrowing

CARE reaffirmed ratings at CARE BBB+; Stable / CARE A2 in September 2025. CRISIL reaffirmed 'Crisil BBB+/Stable' in August 2025. Interest coverage ratio remained healthy at 5.57x in FY25 compared to 5.46x in FY24.

⚙️ Operational Drivers

Raw Materials

Agrochemical technicals and intermediates; specific chemical names not listed, but cost of material consumed represents 65.2% of total revenue (INR 587 Cr).

Import Sources

Sourced from diverse geographies including China (major pricing influencer) and local suppliers in India to mitigate supply chain risks.

Key Suppliers

Not specifically named, but the company is actively developing local Indian suppliers to reduce dependency on imports.

Capacity Expansion

Planned upgrades and new blocks are scheduled for FY26 to boost revenue and profitability by supporting rising demand for new product launches.

Raw Material Costs

Cost of material consumed increased 6% YoY to INR 587 Cr in FY25 (from INR 553 Cr) due to changes in pricing and product mix. This represents a significant portion of the INR 844 Cr total expenses.

Manufacturing Efficiency

Capacity utilization metrics not explicitly stated, but the company noted lower absorption of fixed costs due to flat revenues in FY25, impacting margins.

Logistics & Distribution

Higher freight costs were cited as a reason for lower PBILDT margins in 9MFY25.

📈 Strategic Growth

Expected Growth Rate

37%

Growth Strategy

Growth is targeted through a strong product pipeline, new block commissions in FY26, and a focus on the CRAMS segment (60-70% of revenue). The company is leveraging long-term relationships with global clients and investing in R&D for green chemistry to stay ahead in product development.

Products & Services

Agrochemicals (pesticides, herbicides), specialty chemicals, and industrial chemicals. The company also provides CRAMS services for global agrochemical players.

Brand Portfolio

Punjab Chemicals and Crop Protection Limited (PCCPL); SD Agchem (Europe) NV (subsidiary).

New Products/Services

New product launches are supported by an inventory buildup of INR 222 Cr; these are expected to boost revenue and profitability in FY26.

Market Expansion

The company has a wide geographical presence and is focusing on increasing plant capacity through upgrades to support rising global and domestic demand.

Strategic Alliances

Originally promoted in association with Excel Industries Limited and Punjab State Industrial Development Corporation (PSIDC).

🌍 External Factors

Industry Trends

The global crop protection industry was valued at USD 64.18 billion in FY24. Trends include a shift toward green chemistry and sustainable solutions due to augmented environmental awareness and regulatory scrutiny.

Competitive Landscape

Faces intense competition from leading global and domestic agrochemical companies with strong brand recognition and robust R&D, as well as low-cost Chinese producers.

Competitive Moat

Moat is built on long-standing relationships with global agrochemical majors and a high share of CRAMS business (60-70%), which provides better revenue visibility compared to pure generic manufacturing.

Macro Economic Sensitivity

Highly sensitive to agricultural cycles and monsoon patterns which dictate domestic demand for agrochemicals.

Consumer Behavior

Increased demand for greener alternatives and sustainable chemical solutions is driving the company to innovate in green chemistry.

Geopolitical Risks

Trade dynamics with China are critical, as Chinese oversupply impacts global pricing and revenue realisation for Indian manufacturers.

⚖️ Regulatory & Governance

Industry Regulations

Subject to Section 148 of the Companies Act, 2013 for cost audits. Operations are influenced by environmental awareness and regulatory shifts toward sustainable chemical production.

Environmental Compliance

The company is focusing on solvent recovery and minimized carbon emissions to meet evolving environmental regulations and consumer needs.

⚠️ Risk Analysis

Key Uncertainties

Pricing pressure from China and monsoon dependency are the primary uncertainties, with the potential to impact margins by 1-2% based on historical volatility.

Geographic Concentration Risk

While geographically diversified, the company is heavily reliant on the global agrochemical market's stability.

Third Party Dependencies

Significant dependency on three major customers for over 50% of revenue, making the company vulnerable to the growth plans of these specific clients.

Technology Obsolescence Risk

Risk of products becoming obsolete due to environmental regulations; mitigated by R&D focus on green chemistry and new product pipelines.

Credit & Counterparty Risk

Trade receivables rose to INR 235 Cr in FY25 from INR 197 Cr; the trade receivable turnover ratio slowed to 4.16 from 5.48, indicating a slight increase in credit exposure.