Sharda Cropchem Ltd (SHARDACROP) Q2FY27 Concall Transcript - Sep-2026 Qtr
Moderator (Antique Stock Broking Limited): Ladies and gentlemen, good day and welcome to Sharda Cropchem Limited 2Q FY '27 Post-Results Conference Call hosted by Antique Stock Broking Limited. As a reminder, all participant lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star, then zero on your touchtone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Manish Mahawar from Antique Stock Broking Limited. Thank you, and over to you.
Manish Mahawar (Antique Stock Broking Limited): Yeah, thank you, moderator. On behalf of Antique Stock Broking, warm
Manish Mahawar (Antique Stock Broking Limited): to all the participants on the 2Q FY '27 earnings call of Sharda Cropchem. Today, we have Mr. R. V. Bubna, Chairman and Managing Director, Sailesh Mahandale, CFO, and Mr. Jetkin Gudhka, Company Secretary, on the call. Without any delay, I would like to hand over the call to Mr. Bubna for opening comment, post which we will we will open the floor for Q&A. Thank you, and over to you Bubna ji.
R. V. Bubna (Sharda Cropchem Ltd): Thank you. Thank you Manish ji. Good afternoon and very warm welcome to everyone present on the call. Along with me, I have Mr. Sailesh Mahandale, our CFO, and Mr. Jetkin Gudhka, Company Secretary, and SGA, our investment our investor relations advisors. Hope you all have received our investor deck by now. As you are aware we are engaged in marketing and distribution of wide range of agrochemical products, that is herbicides, insecticides, fungicides and biocides, catering to diverse global markets. We prepare comprehensive dossiers and seek registrations of these products in our own name. We allocate substantial resources for securing registrations of our products and thus establish our foothold in the market. Our total product registration stood at 3,044 as on 30th September, 2026. Additionally, 946 applications for product registrations are in the pipeline. I'm pleased to share that we have delivered another quarter of healthy growth and the first half of 2027 has been encouraging across our key operating metrics. Revenue for the quarter grew by 13% year-on-year to ₹1,052 crores. Gross margins expanded by around 140 basis po- points to 35.9%, while EBITDA grew 18% to ₹164 crores, taking our EBITDA margin to 15.6%. Profit after tax for the quarter rose 23% to ₹92 crores. In terms of revenue analysis the quarter may in terms of revenue analysis for the quarter, the 13% revenue growth was on account of increased prices, positive forex impact, and improved product mix of 18.3%, with the volume degrowth of -5% 5.1%. For the half year, the 11% revenue growth was on account of an increased prices, positive forex impact, and improved product mix that is minus 44 14.5%, with a volume degrowth of -3.5%. NAFTA was the standout of this quarter. Revenue from the region grew about 30% year-on-year, with specifica- with significantly better margins. LATAM also did well, with agrochemical revenue up by over 80%. Together, these regions more than made up for a softer quarter in Europe. Europe, our largest market, saw a slight moderation this quarter coming off an exceptionally strong financial year '26. The weather challenges were high- were highlighted last quarter continued through the September quarter with extended heat and drought conditions in parts of Central and Eastern Europe. As a result,
R. V. Bubna (Sharda Cropchem Ltd): Distributors have taken a cautious approach to restocking. We see this as a temporary, weather led impact rather than any change in underlying demands. Our registration portfolio also, registration portfolio and customer relationship in Europe remains strong and as conditions normalize, we expect the region to do well in the best of in the second half, which is seasonally our stronger period. Further, we are encouraged by the momentum in NAFTA and Latam, the steady growth of our non agrochemical business and expected recovery in Europe. Our growing registrations portfolio and healthy pipeline give us a good visibility on new product launches over the coming years. We continue to maintain our FY27 revenue growth guidance to 10% to 15%. We also expect EBITDA margins to improve through the year and remain between 18% to 20% for FY27, supported by better product mix and operating leverages in the second half. FY27 we aim to increase product registrations with a planned capex of ₹550 to ₹600 crores, backed by strong pipeline that reflects a our resilience and growth focuses. With this brief overview, I would now like to hand over the call to our CFO, Mr. Shailesh Mehendale, for discussing our financial and financial and performance over the year. Thanking you.
Sailesh Mahandale (Sharda Cropchem Ltd): Thank you. Good afternoon everyone. Coming to the quarter two FY27 performance, revenue stood at ₹1,052 crores in Q2 FY27 versus ₹929 crores in quarter two FY26, an increase of 13% year-on-year. Coming to the split, agrochemical business grew by 5% year-on-year to ₹840 crores, whereas non-agrochemical business grew by 68% year-on-year to ₹212 crores. Gross margin stood at 35.9% in Q2 FY27, as against 34.5% in Q2 FY26, an increase of 140 basis points. EBITDA grew by 18% to ₹164 crores, with EBITDA margin at 15.6%, as against 15% in Q2 FY26, an increase of 70 basis points. Forex loss stood at 0.4 crores in Q2 FY27, as against loss of ₹6.1 crores in Q2 FY26. PBT stood at ₹107 crores, an increase of 25% year-on-year. On like-to-like basis, PBT prior to forex grew by 17% year-on-year to ₹108 crores. PAT stood at ₹92 crores versus ₹74 crores last year, an increase of 23% year-on-year basis. Coming to the H1 FY27 performance, a revenue stood at ₹2,125 crores in H1 FY27 versus 1,914 crores in H1 FY26, an increase of 11% year-on-year. Coming to the split, agrochemical business grew by 6% year-on-year to ₹1,755 crores, whereas the non-agrochemical business grew by 40% year-on-year to ₹371 crores. Gross margin stood at 36.3% in H1 FY27, as against 35% in H1 FY26, an increase of 130 basis points. EBITDA grew by 12% 22%
Sailesh Mahandale (Sharda Cropchem Ltd): to rupees 343 crores with EBIDA margin at 16.1% as against 14.7% in H1 FY '26, an increase of 140 basis points. Forex gain stood at rupees 7.1 crores in H1 FY '27 as against forex gain of rupees 67 crores in H1 FY '26. PBT stood at rupees 226 crore versus rupees 255 crores last year. On like-to-like basis, PBT prior to forex grew by 16% year-on-year to rupees 219 crores. PAT stood at rupees 180 crores versus rupees 217 crores last year. The company continues to remain a debt-free company with cash, bank, liquid investments stood at rupees 846 crore as on 30th September 2026. Working capital days stood at 70 days as at 31st, 30th September '26, showing an improvement by 28 days as compared to March '26. ROCE stood at 25.9%, and ROE stood at 21, 20.1%, reflecting the continued efficiency of our asset-light, registration-led business model. We can now open the floor for the question answers. Thank you.
Moderator (Antique Stock Broking Limited): Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touch-tone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Anubhav Mukherjee from Prescient Capital. Please go ahead.
Anubhav Mukherjee (Prescient Capital): Am I audible?
R. V. Bubna (Sharda Cropchem Ltd): Yes.
Moderator (Antique Stock Broking Limited): Yes.
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