The agrochemical industry facing significant challenges during the first half presented by higher priced inventories, whims of the weather conditions hopes for a rebound. Rajesh Aggarwal, Managing Director of Insecticides India said that the domestic demand scenarios are acceptable. The Kharif crop was good, the yields are decent. The Rabi season also remains favorable though some cyclone effect may be felt and paddy crop may see some impact. But overall the domestic demand scenario is quite decent.
As domestic demand prospects remain reasonable Insecticides, India will benefit from its high exposure to the domestic market. Most of the Asian markets and Africa are better located compared to developed countries and exporters to those regions may continue to feel the heat.
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The growth for Insecticides India is expected to remain in double digits. Insecticides India will benefit from nearly 8 product launches in the year and many earlier launches made during the covid times, Aggarwal said. The strategy of Insecticides India has changed and product launch happens as soon as the product registration happens.
Insecticides India remained active and absorbed the impact of higher cost inventories and had marks of market losses since Q4 of FY23. In this context the worst may be behind us and Insecticides India is once again well placed to see revenue growth moving forward.
Insecticide India while saw Earnings before interest tax depreciation and amortization grow 0.53% during the first half, Its net profit decreased 1.02% during the first half.
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On expansions, Aggarwal said that the expansion of Dahej in Gujarat is complete and once authorizations are received, commissioning of the plant will help support the forward prospects of the Insecticide India. The expansion of Rajasthan Brownfield has also been completed and after the capacity opening after maintenance shutdown undertaken by Insecticides India around Diwali, the benefits will be reaped.
Not surprisingly the stock price of Insecticides India has fallen to lows of ₹410 in July has now recovered well and the share is trading at ₹656 piece.
Meanwhile, as Budget 2024 approaches, Industry hopes that its long-standing Wishlist of PLI (production linked incentive) scheme for Agrochemicals will also be fulfilled. Aggarwal said that the PLI scheme will help give a boost to exports will also be positive to make India a target.
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Published: 07 Dec 2023, 17:19 IST