Rallis India sales down 21% in Q2 FY2015-16

Rallis India registered consolidated net sales of Rs500 crore (Rs636 crore previous quarter) for the second quarter of the FY 2015-16 ended September 30, 2015 . Net profit after tax and minority interest at Rs57 crore (Rs73 crore previous quarter).

Rallis India posted standalone net sales of Rs462 crore in this quarter (Rs578 crore previous quarter). Net profit after tax stands at Rs65 crore (Rs76 crore previous quarter). Q2 EBITDA margin improves by 100 bps to 22.3 percent, with EBITDA at Rs103 crore (Rs123 crore previous quarter).

Commenting on the performance and developments, V Shankar, MD and CEO, Rallis India, said, “We have seen very challenging times in Indian agriculture, with back to back drought year accompanied with low farmer netbacks and tough market conditions.

The southwest monsoon commenced well in the latter half of June but July onwards season went dry, which impacted kharif crops such as cotton, soybean, paddy, etc. Sowing of crops picked up well initially but slowed down with cotton acreages coming down drastically and other crops too got affected.

I am happy that against this backdrop, our new products such as Hunk and Origin have received excellent response from our farmers. Overall due to monsoon deficiency, the crop acreages growth and yields have been impacted. Coupled with lower netbacks for farmers, it has put enormous pressure for the industry.

Current reservoir levels in Maharashtra and southern states of India are low though showers received towards the end of September have increased overall sentiments for Q3.

The international business also faced pressure in the major markets of Brazil and USA. Brazil is reeling from its worst drought of over 80 years and currency devaluation impacting demand. In USA, lower crop commodity prices and higher Inventory impacted consumption. We look forward to market picking up in the latter half of the year.”