Hebei Lansheng Biotech Co., Ltd.
Beijing Multigrass Formulation Co., Ltd.

Healthy rains, better crop acreage drive earnings upgrades of India agrochemical firmsqrcode

Jul. 9, 2020

Favorites Print
Forward
Jul. 9, 2020

>  Domestic seed companies are projecting double digit growth in sales, reflecting benefits of higher crop acreages


>  Channel checks by analysts reveal strong product placements by agrochemical companies


Earnings upgrades are rare in a covid-19 ravaged economy. But thanks to better monsoon rains and healthy farm sentiments, agrochemical companies are seeing upward revision in earnings estimates.


“While most industries are staring at a grim future due to covid-19 induced uncertainty, we believe the domestic agriculture-inputs industry has entered a conducive growth phase after languishing in the tepid growth zone for the past three years," says analysts at Edelweiss Securities Ltd.


As of 3 July, kharif crop sowing is 88% higher than the previous year’s levels. Timely onset of monsoon and better water availability are driving crop acreages.


Positive start


Kharif crop sowing took-off on a strong note this year, helped by timely onset of monsoon rains and better water availability


1.png


Fertilizer sales grew 22.7% in the first quarter (Q1 FY21) of the current fiscal, data compiled by Prabhudas Lilladher Pvt. Ltd showed. Domestic seed companies are projecting double digit (15-20%) growth in sales, reflecting benefits of higher crop acreages, points out analysts at Edelweiss.


Similarly, channel checks by analysts reveal strong product placements (shipments to retailers) by agrochemical companies. “Q1FY21 is expected to be one of the best quarters in last 5 years despite lockdown resulting into production, labour availability and logistics issues. We expect industry growth of +20% for Q1 driven by massive surge in herbicide sales, pre-buying led by robust demand expectation and ~5% price increase in generic molecules," analysts at Prabhudas Lilladher said in a note.


Antique Stock Broking Ltd revised its earnings estimates for Bayer CropScience Ltd and Rallis India Ltd (for the current and next fiscal years) upwards by 7-11%. “We keep our estimates unchanged for the remaining coverage universe as we already stand ahead of the consensus," analysts at the brokerage said in a note.


Antique expects domestic focused companies such as Bayer CropScience, Dhanuka Agritech Ltd and Rallis India to report superior growth. Growth at export focused firms such as PI Industries Ltd, Sharda Cropchem Ltd and UPL Ltd may be weighed down by logistics constraints.


More clarity will emerge when the companies release their June quarter financial results. Stocks, meanwhile, reflect optimism. Bayer CropScience and Rallis India gained 59-67% so far this calendar year and have hit new 52 week highs in recent weeks.


[ Survey ]

Join AgroPages TOP 20 India Agrochemical Companies ranking list in FY2019-20

The ranking list of top 20 India agrochemical companies has been published by AgroPages for 7 years since FY2012-13. To understand Indian agrochemical market better and faster, we will make persistent efforts to keep on.

Top 20 Indian Agrochemical Companies in FY 2018-19: Backwards Integration, Forwards “OpenAg”

Join us in this year's list!

 

Note:

1. The list of rankings focuses only on Indian native enterprises, excluding the branches of multinational companies in India.

2. The list of rankings focuses only on the sales of pesticide products(TC & Formulation), excluding the sales of fertilizers and intermediates.
3. If you join this survey, we'll freely publish a PR news online for your company. Please contact: zorro@agropages.com
We'll offer you the Company Directory in the upcoming 2020 India Pesticide Suppliers Guide magazine once the information adopted.

  1. 1. What are the sales of pesticide products(TCs & Formulations) in FY2019-20?
  2. 2. What do you think of the increase/decrease in sales this year compared with last year? Please describe briefly.
  3. 3. What are your company's actions to keep your business running during this tough time?
  4. 4. Please leave your information to submit the survey.
    Your Name:
    Email:
    Company:
    Tel:
    Mobile:
Source: livemint.com

Picture 0/1200

More from AgroNews

Magazine

2020 India Pesticide Suppliers Guide 2020 Market Insight
Chinese issue of 2020 Market Insight 2020 CRO & CRAO Manual
Chinese issue of 2020 Biologicals Special 2020 Biologicals Special
Subscribe Comment

Subscribe 

Subscribe Email: *
Name:
Mobile Number:  

Comment  

Picture 0/1200

Subscribe to daily email alerts of AgroNews.