Insecticides India Ltd share Price Today

Agrochemicals company Insecticides (India) announced Q1FY24 results:

• Revenue from operations increased by 14.14% to Rs 6,399.53 million in Q1FY24 from Rs 5,606.90 million in Q1FY23 on account of favourable monsoon conditions and increasing share of Focused Maharatna products like Hachiman, Shinwa and Torry as a result of our step ahead go-to-market strategies.
• EBITDA margins stood at 7.13% in Q1FY24, a decrease of 329 bps on account of the liquidation of high-cost inventory from the previous year. The high-cost inventory is significantly liquidated from the balance sheet.
• PAT stood at Rs 291.42 million in Q1FY24, compared to Rs 383.09 million in Q1FY23, margins reduced from 6.83% in Q1FY23 to 4.55% in Q1FY24.

Commenting on the performance the management team of Insecticides (India) stated, “We had a strong quarter to start the year in terms of revenue growth as we witnessed a robust demand for our products owing to favourable monsoon. Although there was an initial delay in rains in certain regions of the country, our widespread presence across India mitigated the impact of this factor and helped us achieve a growth of 14.14% YoY in Revenue from Operations. However, the spillover impact of high-cost inventory from the previous year and pricing pressure impacted EBITDA & PAT Margins which stood at 7.13% and 4.55% respectively for Q1FY24.

We took proactive measures to address the challenges by optimizing our inventory management, ensuring that we maintain a healthy stock level while minimizing the accumulation of high-cost inventory. Furthermore, we are closely monitoring weather patterns and market dynamics to anticipate any potential disruptions to our business operations. By staying agile and responsive, we aim to minimize the impact of external factors on our performance and maintain a sustainable growth trajectory

Looking ahead, we anticipate a sustainable growth trajectory in the market driven by favourable monsoon conditions, an array of Maharatna product launches and stabilisation of prices.

We recently launched promising products in the form of Mission granule and Mission liquid, both of which have received very positive responses from the market and contributed to our topline. Products launched in the last few years like Torry, Hachiman, Shinwa, Green Label, Izuki, Dominant and Kunoichi have started yielding positive results, gaining massive tractions as a result of our concentrated marketing efforts on the entire Focused Maharatna range. We are at a turnaround point where micro-go-to-market strategies have played a vital role to spread brand awareness at the ground level to educate the farmers. Additionally, we are expecting to launch three herbicide Maharatna combination products under 9(3) and one insecticide Maharatna product under 9(4) in Q2 and Q3 usage will be across multiple crops.

Export markets were impacted in FY23 and Q1FY24 by the EL Nino impact in major export markets like North America, Europe, LatAm, and Africa which led to lower demand for agro-inputs and consequently to lower prices. In addition to the above, currency fluctuations and precarious levels of forex reserves with several importing countries led to a delay in the recovery of dues for the entire industry which prompted us to deploy a calibrated approach for exports. However, we have now started witnessing positive signs from the export market such as receiving multiple orders from the dealers, stabilization and upward movement in prices of raw material.

Further, to stay relevant and expand our international footprints, we are actively seeking more than 300 registrations in Europe, Latin America and USA markets. We expect to further increase our registrations in upcoming years.

At IIL, we continue to move forward on our mission to grow responsibly towards a sustainable future through continuous support of our employees and other stakeholders I would like to conclude by thanking all our stakeholders for helping us move in the right direction.”

Result PDF

Agrochemical company Insecticides (India) announced Q2FY23 results:

• Consolidated Q2FY23 vs Q2FY22:
  • The revenue from Operations has grown by 31.15% from Rs. 4,439.39 million in Q2FY22 to Rs. 5,822.09 million in Q2FY23.
  • The EBITDA increased by 6.68% from Rs. 641.69 million in Q2FY22 to Rs. 684.54 million in Q2FY23. EBITDA margins declined from 14.45% in Q2FY22 to 11.76% in Q2FY23 on a YoY
  • PAT increased by 7.05% from Rs. 418.79 million in Q2FY22 to Rs. 448.33 in Q2FY23.
  • PAT margins decreased from 9.43% in Q2FY22 to 7.70% in Q2FY23.
• Consolidated H1FY23 vs H1FY22:
  • Revenue from operations recorded a growth of 25.29% from Rs. 9,122.00 million in H1FY23 to Rs. 11,428.99 million in H1FY23
  • The EBITDA increased by 8.24% from Rs. 1,172.51 million in H1FY22 to Rs. 1,269.08 million in H1FY23 and the EBITDA margins de-grew from 12.85% in H1FY22 to 11.10% in H1FY23.
  • PAT stood at Rs. 831.42 million in H1FY23 as compared to Rs. 768.32 million in H1FY22 recording a growth of 8.20% and PAT margins stood at 7.28% in H1FY23 as compared to 8.42% in H1FY22.
  • Total fixed assets (tangibles inc. CWIP) grew by 24.96% from Rs. 2,717.25 million in H1FY22 to Rs. 3,395.68 million in H1FY23 owing to the CAPEX incurred.
  • Current assets stood at Rs. 13,890.55 million in H1FY23 as compared to Rs. 10,445.39 million in H1FY22.
  • Long term borrowings stood at Rs. 29.37 million in H1FY23, compared to Rs. 18.61 million in H1FY23 and Short-term borrowings at Rs. 2,709.73 million in H1FY23, compared to Rs. 1,908.90 million in H1FY22
  • The working capital cycle has marginally decreased to 153 days in H1FY23 as compared to 159 days in H1FY22.
  • The debt Equity ratio stood at 0.29 in H1FY23 compared to 0.23 in H1FY22 owing to the increase in the short-term borrowings
  • Cash flow from operations stands at Rs. (1,977.03) million in H1FY23 as compared to Rs. (803.56) million in H1FY22.

Commenting on the performance of Q2 and H1FY23, Mr. Rajesh Aggarwal (MD) and the management team said:“We are very happy to share that we had a modest quarter and half year, both in terms of financial performance and in terms of market acceptance of our newly launched products in last fiscal year.

On the financial front, IIL has recorded revenue from operations of Rs. 5,822.09 million & EBITDA of Rs. 684.54 million for Q2FY23, thus delivering a growth of 31.15% in terms of revenue and 6.68% in terms of EBITDA. The EBITDA margins subsided by -269 bps in Q2FY23 on a YoY basis mainly due to the increased cost of raw materials and the EBITDA margins improved by 133 bps on QoQ basis, mainly due to improved product mix and stabilized cost of inventory. Further, for H1FY23, revenue stood at Rs. 11,428.99 million and EBITDA stood at Rs. 1,269.08 million. The EBITDA margins declined by -175 bps in H1FY23 owing mainly to the increase in cost of raw materials as compared to H1FY22. Revenue growth was majorly driven by following:

• Products launched in FY22 recorded a revenue of ~Rs.929.93 million in H1FY23, contributing to ~8% of the revenue from operations, as compared to Rs.246.40 million in FY22. This shows the market acceptance of our products among the targeted customers.
• Our R&D initiatives are being recognized as successful innovations in the form of several patents being granted in H1FY23, taking our total patented products to 18, which have performed better than expectations.
• The Herbicides business has done extremely well in this half year and they now contribute to ~41% in H1FY23 as compared to ~33% in H1FY22.
• Focused Maharatna products (premium of 11 product range consisting of the top Maharatna brands which are high-ranking in nature with superior margins) have performed really well in this half year and our total Maharatna products contributed to ~58% in H1FY23 as compared to ~55% in H1FY22.

During H1FY23, we witnessed softening of cost of basic raw materials, however the currency headwinds has limited the positive impact of the same. Further, as there is a market acceptance of our products launched in FY22, we can confidently say that the margins will further improve in the H2 as well.

Further, our working capital cycle has reduced to ~153 days in H1FY23. There has been slight increase in debtor days owing to delayed monsoons, which led to poor cash flows in the market. However, we believe that this is a temporary phenomenon, expected to reverse in the upcoming quarters.

In lines with our continuous efforts and focus towards research & innovation, we are pleased to inform that we have successfully obtained 9(3) registration for Cyazofamid 34.5% SC. Since product registration is a lengthy and gestational exercise in our industry, we expect our sustained efforts at data generation & registration to yield several product registrations in developed international markets in the next two years.

On the exports front, we continue to witness good demand, however we focused on exports in a calibrated manner, retaining our caution on the currency movement and likely distress of foreign debtors. We expect the exports to pick-up in H2 FY23, thereby enabling us to meet our exports target for FY23. The export sales works towards removing the quarterly cyclicality of the business.

During this quarter, we have received a GLP certification for one of our testing facilities at Chopankhi, Rajasthan, which showcases our unwavering commitment to produce highest quality products with most efficient processes. As a constant endeavour to enhance our presence in the biological markets, we have incorporated a wholly owned subsidiary by the name of “IIL Biologicals Ltd”.

Result PDF

Agrochemicals firm Insecticides (India) announced Q1FY23 Result :

• Revenue from Operations has grown by 19.74% from Rs.4,682.61 Mn in Q1 FY22 to Rs.5,606.90 Mn in Q1 FY23 due to increased traction in Maharatna segment business & growth of the B2C & B2B business.
• The EBITDA increased by 10.12% from Rs.530.82 Mn in Q1 FY22 to Rs.584.53 Mn in Q1 FY23 mainly driven by increased share of premium products in product portfolio and higher sales of products launched in FY22 like Hachiman, Oxim and Shinwa which grew by ~3x in Q1 FY23.
• EBITDA margins decreased marginally to 10.43% in Q1 FY23 from 11.34% in Q1 FY22 mainly on account of industry headwinds of rising raw material and energy costs. The company also made a M2M provision of ~INR 6.5cr to account for the Forex fluctuations on raw material purchases during the quarter.
• PAT increased by 9.58% from Rs.349.60 Mn in Q1 FY22 to Rs.383.08 Mn in Q1 FY23.
• PAT margins marginally declined to 6.83% in Q1 FY23 from 7.47% in Q1 FY22.

Commenting on the performance of Q1 FY23, Mr. Rajesh Aggarwal, Managing Director, said: “We are very happy to share that we have had an extremely successful quarter both in terms of financial performance and market acceptance of our newly launched products in last fiscal year. We are glad to see that our Research and development initiatives are being recognized as successful innovations in the form of several patents being granted recently. We are also extremely proud to share that our testing facility at Chopanki, Rajasthan has been awarded the coveted GLP certification recently."

Result PDF

Insecticides (India) announced Q3FY22 results:

• Q3FY22 vs Q3FY21:
  • Revenue from Operations has marginally grown from Rs.2991.74 Mn in Q3 FY21 to Rs.3137.78 Mn in Q3 FY22 mainly due to better product mix.
  • The EBITDA has increased by 23.27% from Rs.150.73 Mn in Q3 FY21 to Rs.185.81 Mn in Q3 FY22 mainly due to efficient inventory management.
  • EBITDA margins has increased to 5.92% in Q3 FY22 from 5.04% in Q3 FY21.
  • Net profit has increased by 32.83% from Rs.59.82 Mn in Q3 FY21 to Rs.79.46 in Q3 FY22
  • PAT margins have increased to 2.63% in Q3 FY22 from 2.06% in Q3 FY21.
  • The Exports have increased to 15% in Q3 FY22 from 5% in Q3 FY21.
• 9MFY22 vs 9MFY21:
  • Revenue from Operation has recorded a growth of 5.27% from Rs.11,646.21 Mn in 9M FY21 to Rs.12,259.78 Mn in 9M FY22 mainly driven by better product mix, focusing on Maharatna Products.
  • The EBITDA has increased by 11.30% from Rs.1220.29 Mn in 9M FY21 to Rs.1358.23 Mn in 9M FY22 and a gain in the EBITDA margins from 10.48% in 9M FY21 to 11.08% in 9M FY22.
  • Net profit stood at Rs.848.80 Mn in 9M FY22, compared to Rs.721.17 Mn in 9M FY21 recorded a growth of 17.70%
  • The Exports have increased to 8% in 9M FY22 from 4% in 9M FY21

Commenting on the performance, Mr. Rajesh Aggarwal, Managing Director, said: “The third quarter has been relatively subdued quarter for the entire agro-chemical industry, due to the building threat of Covid-19, unseasonal rains in parts of our country and damp market conditions. The scaling up of new products already launched in previous quarters has been hampered by barriers in working with the farmers on the grass root level, due to the looming third wave threat of Omicron variant of Covid-19. However, IIL has delivered a consistent performance in terms of Revenue and Sales volume in Q3 FY22, focussing on exports as per its growth plan for the current fiscal year.

The Company has recorded revenue from operations of Rs.3137.78 Mn in Q3 FY22, and Rs.12259.78 Mn on a 9M basis, representing a growth of 5.27% on a 9M basis. Revenue growth was driven by better product mix focusing on Maharatna Products. The Maharatna category of branded products grew to 45.94% from Rs.747.23 Mn in Q3 FY21 to Rs.839.91 Mn in Q3 FY22. The exports grew by a whopping 224.17% and institutional sales grew by 6.10% on a quarterly basis. We are happy to state that we have achieved an export sale of Rs 1036.23 MN on a 9M basis in FY22 vs our total export turnover of Rs 610 MN on a full year basis of FY21. The Company delivered EBITDA of Rs.185.81 Mn in Q3 FY22, with margins of 5.92%. Net profit for the quarter was Rs.79.46 Mn, with margins of 2.63%.

We are also in course of adding new molecules and products to our products portfolio, some of which are to replace off-patented products. The company is also working on new products to replace any of its current products which have a possibility of a ban in future. We expect to launch at least 2 new products in Q4 of FY22, in addition to new launches already done during the fiscal year.

The company also expects to derive benefits from its backward integration capabilities at Dahej, to reduce dependency on Chinese raw materials in the long run. Currently, IIL is trying to streamline production by maintaining higher levels of inventory and using judicious purchase strategies.

With the government’s focus on Bio Chemicals and increasing Exports, in tune with its MakeIn-India movement, IIL plans to capitalize on this opportunity on the back of its backward integration initiatives and its strong research & development program. The company foresees a huge potential for its products in the international market and therefore, we were able to surpass our export target, for FY22, of achieving more than Rs.1000 Mn in 9M ended 31st December, 2021 itself. On a long-term basis, the management foresees exports contributing to at-least 20% of the top line on an overall basis. This target is planned to be achieved by manufacturing newly identified molecules, especially for the international market and advent into new geographies like East & West Europe, Africa, & CIS & NAFTA markets particularly Canada

Thus, IIL has been constantly delivering an intrinsic growth by strengthening its capacities & generating new revenues to replace revenues of banned products. The Management remains committed to continue its efforts to scale up sustainable revenues and take all other strategic measures so as to increase the long-term value for all its stakeholders.”

Result PDF

Highlights:

• Q2 FY22 v/s Q2 FY21:
  • Revenue from Operations has marginally degrown from Rs. 4558.48 Mn in Q2 FY21 to Rs. 4439.39 Mn in Q2 FY22 mainly due to decline in Sale of Branded products because of unfavourable monsoons in this year.
  • The EBITDA increased by 11.12% from Rs. 577.49 Mn in Q2 FY 21 to Rs. 641.69 Mn in Q2 FY22 mainly due to the change in product mix where there was an increase in share of Maharatna products sale thereby giving higher margins.
  • EBITDA margins increased to 14.45% in Q2 FY22 from 12.67% in Q2 FY21. 
  • Net profit increased by 0.87% from Rs. 414.01 Mn in Q2 FY21 to Rs. 417.62 in Q2 FY22 
  • PAT margins increased to 9.53% in Q2 FY22 from 9.08% in Q2 FY21. 

Commenting on the performance, Mr. Rajesh Aggarwal, Managing Director, said: “The second quarter witnessed several challenges due to the 2nd wave of Covid-19 and flood like situation in various states due to heavy rainfall. The Pandemic has resulted in extended lockdowns, slowing down of economic activity and several logistic issues. The Agro sector was slightly less impacted and currently we are seeing demand picking up with easing of restrictions and relaxations in lockdown at several places.

The Company has recorded revenue from operations of Rs. 4439 Mn in Q2 FY22, and Rs. 9122 Mn on a half yearly basis, representing a growth of 5.40% on a half yearly basis. Revenue growth was driven by all segments except Branded Products (other than Maharatna category). The Maharatna category of branded products grew by 17% from Rs 1793.5 Mn in Q2 FY21 to Rs 2099 Mn in Q2 FY22. The revenue of branded products other than the Maharatna Range fell by 32% from Rs 1559.3 Mn in Q2 FY21 to Rs. 1062 Mn in Q2 FY22 mainly due to change in product mix, increased focus on Maharatna range of products under the tail cutting policy of the company. The exports grew by 28.76% and institutional sales grew by 3% on a quarterly basis. We are happy to state that we have achieved an export sale of Rs 563 MN on a half yearly basis in FY22 vs our total export turnover of Rs 610 MN on a full year basis of FY 21. The Company delivered EBITDA of Rs. 641.69 Mn in Q2 FY21, with margins of 14.45%. Net profit for the quarter was Rs. 423 Mn, with margins of 9.53%. The company also received registration under section 9 (3) of the Indian Patent Act for two technical in the current quarter.

The growth was minutely impacted due to lockdowns and slowing of economic activity. Despite challenges, we were successful in maintaining an adequate level of engagements with our customers and other stakeholders via digital channels.

We are also trying to remedy our dependency on China for raw materials; firstly by planning to launch Japanese products and technicals through our in-licensing partners. Secondly, keeping in mind our government’s Make-In-India policy and economies of backward integration we have invested substantially in enabling our plants, like Dahej & Rajasthan; to produce the raw materials & technicals required for our products. We are proud to state that we produce around 20 technicals which are used in 30-40 of our formulations and plan to increase this number in the coming years. We also plan to ultimately export our in-house technicals so as to become less reliant on imports and increase our export share. Lastly, the management was able to successfully envisage the issue of price increase in raw materials due to production abruptions in China and hasthus, put in a plan to mitigate it by increasing level of inventory holding to ensure uninterrupted production in our plants for the fiscal year 21-22. The company further plans to remedy this by increasing the production of premium selling products where the increase in raw material prices is relatively moderate. We do not anticipate any adverse impact of this event on our margins, rather we foresee a positive growth in our margins during FY22.

Thus, the issue of raw material price increase is backed by a well-planned pricing and production strategy to ensure that the plans & targets for FY 22 are met and further help us to reduce our dependency on China.

With the re-opening of the economy post the second national lockdown, we expect lot of new product registrations to be finalized in the upcoming quarters. Our exports of Rs. 177.52 MN in Q2 FY 2022, and Rs 563.83 MN till end of H1 FY 22, is in line with our export target of 1000 MN export sales for FY 22.

Management team remains committed to continue its efforts in launching many new products this year, improve profitability of the business through expanding its backward integration capabilities and take all other strategic measures so as to increase the longterm value for all its stakeholders.”

Result PDF