Ladies and gentlemen, good day and welcome to Dhanuka Agritech Ltd Q1 FY 2026 earnings conference call hosted by Antique Stock Broking Ltd. 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 this conference call, please signal an operator by pressing *10 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, sir.
Thank you. Good afternoon, everyone, and pleased to host today's earnings call on Dhanuka Agritech Ltd. We are immediately seen represented by Mr. M. K. Dhanuka, Chairman, Mr. Rahul Dhanuka, Managing Director, Mr. Harsh Dhanuka, Executive Director, and Mr. V.K. Bansal, CFO, here on the call. Without any delay, I would like to invite Mr. M. K. Dhanuka to start his opening comments, or please begin move to the Q&A. Thank you and over to you, Dhanuka.
Thank you, Manishji. Good afternoon, ladies and gentlemen. I am M.K. Dhanuka, Chairman of Dhanuka Agritech Limited. Welcome you all to the Q1 and FY 2026 earnings call. I have with me Mr. Rahul Dhanuka, Managing Director, Mr. Harsh Dhanuka, Executive Director, and Mr. V.K. Bansal, CFO of the company. As you are aware, Dhanuka Agritech is a leading Indian agrochemical company. Dhanuka is working with the vision of prosperous agriculture. We have a Pan-India presence in all major states to reach out to more than 10 million farmers with our products and services. Dhanuka's key focus has been on the introduction of novel chemistries and extensive product development that distinguishes us from the rest of the industry. With four manufacturing units and 41 warehouses across India, we cater to around 6,500 distributors and 80,000 retailers. Dhanuka has a strong sales and marketing team to promote and develop new products.
Dhanuka, with two R&D laboratories, has world-class NABL accredited laboratories as well as an excellent team for new product registration and development. Dhanuka has international collaborations with 10 leading global agrochemical companies from Japan, US, and Europe, which help us to introduce the latest technology in India. The April to June 2025 quarter remains challenging for the Indian agrochemical industry. A delayed and uneven onset of the Southwest Monsoon impacted the timely sowing of the Kharif crops, leading to subdued demand for agri imports, particularly herbicides. Farmers exercised caution in purchases due to uncertainty in rainfall and lower realization from previous harvests. Additionally, channel inventories remained elevated in certain regions, further affecting primary sales. However, towards the later part of June, rainfall improved, reviving optimism for the upcoming season and setting a foundation for recovery in the second quarter.
India is likely to achieve a new record in food grain production during the 2025-2026 Kharif season, starting next month, buoyed by forecasts of above-normal monsoon rains. The Indian Meteorological Department has forecasted an above-normal Southwest Monsoon for the entire 2025 Kharif season, that is June to September. As shared in the last call, we introduced one new product in Q1, Dinkar, with the help of Hokko Chemical Japan , which is a herbicide for paddy crops, and it has received an encouraging response from farmers, especially in the South region. Further, I would like to share that we are on track to introduce the second product from our Dahej plant in H2 of FY 2026. Also, our sales of Bifenthrin technical from Dahej is on track, in line with our annual objective.
Now, moving on to the financial performance for the last quarter, our revenue from operations stood at INR 528.29 crores in Q1 of FY 2025-2026 versus INR 493.58 crores in Q1 of FY 2024-2025, showing a growth of seven percent . EBITDA stood at INR 83.19 crores in Q1 of FY 2025-2026 versus INR 71.72 crores in Q1 of FY 2024-2025. Profit after tax stood at INR 55.5 crores in Q1 of FY 2025 -2026 versus INR 48.89 crores in Q1 of FY 2024-2025. Zone-wise share of turnover for Q1 of FY 202-20265 is North India 31%, East India 9%, West India 41%, and South India 19%. Product category-wise share of turnover for Q1 of FY 2025-2026 is insecticides 23%, fungicides 11%, herbicides 50%, and others 16%. The shareholders of the company in the 40th Annual General Meeting held today at 11:00 A.M.
declared the final dividend of 100%, that is INR 2 per equity share, having a face value of INR 2 per share. The company has already rewarded its equity shareholders with a buyback of 500,000 equity shares at the rate of INR 2,000 per equity share, absorbing INR 100 crores. We consider ourselves responsible for securing the farmers' welfare and preserving the food security of the nation. We continue to strengthen our association with the agricultural universities, Krishi Vigyan Kendra, and other critical institutions to impart knowledge and the latest technology to the farmers. Thank you very much for your kind attention, and now we would like to open the forum to take the questions. Thank you.
Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may please press star and one on their touchstone 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 Bhavya Gandhi from Dalal and Broacha Stock Broking Private Limited. Please go ahead.
Yeah, hi, thanks for the opportunity. My first question is regarding the onset of monsoon was in fact earlier this year, and overall our revenue growth has been flattish. I mean, a single digit, seven percent odd. If you can throw some light on that, despite monsoon being early, why are we not seeing a significant growth in Q1?
Right.
In terms of revenue?
Right. Monsoon did happen the way it happened, and when it was raining in May, that rain was actually out of place and not the monsoon rains, so to say. That rain did not do much to help some critical crops like soybeans and cotton. In fact, it led to resowing in many places, which means that whatever farmer had sown got wasted, and the farmer had to go again for sowing the seeds. That was a resowing that happened. There was a mismatch in the crop cycle and the consumption opportunity because of which this quarter has shown single-digit growth.
Okay. There's only full year guidance. If you can, again, allude, are we sticking to the full year guidance in terms of revenue and EBITDA margin?
Yeah. In terms of revenue, we are committed to a double-digit growth, maybe a smaller, but we are sticking to our double-digit growth objectives.
In terms of EBITDA margin also, do we still stick to the guidance?
In terms of EBITDA margin, we are of the opinion there would be around 100 basis points of decline in the EBITDA margin in this financial year.
Okay. Sir, is it possible to say the capacity utilization at our technical plant?
Capacity utilization for the entire year will be close to 60% in this year.
60 years. Okay. In terms of top line, is it possible to share some numbers?
For Dahej plant this year, we are.
Dahej plant.
Yeah, Dahej plant, we are expecting a revenue of INR 55 crores.
Okay. Fair enough. Fair enough. That's it from my end. Thank you.
Thank you, sir. The next question is from the line of Shubham Sehgal from Simpl. Please go ahead.
Hello. Am I all ready?
Yes, sir.
Thank you for the opportunity. My first question is, how much was the B2B sales and EBITDA in Q1? Similarly, what was the royalty income pertaining to Bayer products?
You see, from Bayer product, the royalty in terms of royalty is around INR 9 crores.
What was the B2B sales and EBITDA in Q1?
B2B sales is not really significant.
The second question was, we saw material drop in our IPI Index in Q1. Any particular reason behind this?
You see, the IPI Index dropped because of which this is IPI Index quarter. This is the current year plus last three years. Basically, this year, we have launched only one molecule, and three years ago, we launched Onekil in Tornado. Their contribution is bigger as compared to this year's contribution of Dinkar, because of which, again, the declines compared to the previous year.
Okay. Got it. My question was on Sempra and Targa Super, our two molecules . I just wanted to know that compared to the potential of these two molecules, currently, where do we stand at in terms of, let's say, market coverage and their volume? Also, how has the price sense or competition intensity in these two molecules for us?
Targa and Sempra?
Yes, Targa and Sempra.
Yeah, right. Targa Super finds its opportunity in soybean, cotton, groundnut, black gram, and onion. Depending upon the crop acreage shifts, the consumption sometimes does shift. For example, we are very upbeat about the onion opportunity, which has emerged with onion prices going up. Targa will find a very good opportunity in onion and black gram. However, it has received a setback in the soybean markets of Madhya Pradesh where pure rice consumptions have been subdued in the first quarter.
Yeah, actually, my question was, in terms of market coverage and volume share, where do these ads are in change compared to the potential of these two molecules?
Yeah. Market coverage is like when it's top chemistry, t his is a chemistry and grassy weed killer. In that chemistry segment, it is one of the leading products, although in terms of the competition, many more products in general have been launched. Targa still commands a premium position with the farmer in soybean and cotton. Sempra, which is a herbicide finding opportunity in sugarcane and maize, is really doing well. We have launched a gradient control of Sempra this year earlier in Tizom shape. Sempra is being really well accepted with growing acreages of maize and increasing the value of sugarcane.
Okay. What do you feel? How many brands currently for us might be more than, let's say, INR 50 crores or INR 100 crores versus five years back? How many of these brands on the entire product are announced?
Brand-wise, revenue, we do not disclose. Please not share the numbers.
I am not asking for any revenue figures, but you see how many brands have actually created the INR 50 crores or INR 100 crores for us?
Yearly basis is around more than, is around 10 on a yearly basis.
More than you said, more than around 10?
Around 10 brands, around INR 50 crores plus. If you five years ago, maybe it's two, three.
Okay. With already 10 brands, just approximately, you don't know how many were these tie-up products versus in-house products?
Maybe around 50- 50.
Okay. Got it. Okay, I'll join the matches with you.
Thank you, sir. Ladies and gentlemen, to ask a question, please press star and one now. Participants who wish to ask questions may please press star and one at this time. The next question is from the line of Darshita Shah from DSP Asset Managers. Please go ahead.
Yeah, hi. Thank you for taking my question.
Sorry to interrupt you, ma'am. Your voice is very low. Please use your handset.
better now? I am on my handset. Is it better now?
Yes, ma'am, better.
Okay, so my first question was regarding how the liquidation has been so far in the month of July, and if he has seen any improvement on a sequential basis so far in the second quarter?
Yes, the month of July has been better in terms of consumption over the previous quarter, although the previous quarter concluded with inventories in the pipeline. The net effect is subdued only for July as well because as a matter of hygiene practice at Dhanuka, we try and take back unsold stocks from the market. July consumptions had moved forward. However, soybean as a crop remains subdued in terms of herbicide consumption.
Okay. In your opening remarks, you mentioned that a few regions are seeing elevated channel inventory. Could you throw some light on that, and if channel inventory has reduced at this point?
Yes, Herbicide segment in particular, is seeing more of channel inventory. W e have seen this happening in Madhya Pradesh, Maharashtra, parts of Karnataka, and Telangana also where soybean has been an important crop. Herbicide consumption has been subdued in cotton also in large parts of Telangana, Karnataka, and Maharashtra. These two crops and their relevant geographical pockets are still having inventory for the channel.
Got it. Okay. What is your opinion on how the demand should improve for probably the rest of the quarter? Are we used to place our inventory for insecticides and fungicides at this point? Or is it already done? and should that number be seen in the second quarter volume growth?
It is rained, really well, I believe this is already showing a significant jump in fungicide consumption, and we are pretty upbeat about the insecticide consumption also coming up pretty soon. This is the time when insecticide consumptions happen, but the widespread and intense rain is also going to give a boost to the fungicide portfolio. Both the segments are going to have an upbeat time over the next 50, 60 days. Further, these increased rains would help the farmer to increase the acreages wherever possible. Paddy is going to get a booster with this rainfall. We are also looking at a very strong consumption in paddy with a very strong portfolio that we have to offer to the paddy farmer across the country.
Got it. How is the pricing situation now in the domestic market? Bansal, you mentioned that we are still expecting a 100 bps decline, although the first quarter has been seeing aY-o-Y increase on the EBITDA margin front. Are we expecting this 100-bps decline to come on the EBITDA margin front, and when will that kind of play out?
Yeah, you see, in the quarter one, the gross margin is comparatively on the lower side. You should see in the previous financial year, further, the gross margins were 42% as ever highest. You see, because of the ban on biofertilizer molecule, which is highly profitable because of the product mix, we are seeing the impact in the gross margin. Last year, we could get the advantage of the decline in printing material and chemical prices, which is now, what I say is, prices are more or less stable. Therefore, we are expecting a 100 basis point decline in the gross margin. Since we are expecting the double-digit growth on the lower side, similar impacts would appear on the EBITDA as well.
Got it. My question on the pricing pressure is that we are witnessing in the market currently?
Could you repeat that? I am not getting.
No, sir. Any pricing pressure on the technicals or the formulations that we are witnessing at this point?
Pricing pressure across our wide portfolio, there are some products which have felt pricing pressure, but this incessant rainfall, which has happened over the last four or five years, has actually given a boost to some herbicide and insecticide and fungicide consumption. What I'm looking at is stable to northward pricing in the coming weeks.
Okay. Got it. Just one last question now, if you can break down the seven percent top line growth number between volume and price?
You see, there is hardly any difference in the value and volume growth. The volume growth is actually five percent and seven percent value growth is coming on account of the INR 9 crore payment assist from Bayer India towards net economic benefits.
Got it. Sorry, just one last on the way if you can give the first quarter revenue and the EBITDA loss that we saw during the quarter.
EBITDA loss in the first quarter is INR 3 crore, and revenue is INR 16.5 crores.
Perfect. Okay. Thank you so much.
Thank you, ma'am. The next question is from the line of Hussain Baruchwala from Carnelian Asset Management. Please go ahead.
Hello. Hello.
Yes, sir. Please go ahead.
Yes, Last year, we had a revenue growth of almost 33% in Q1, b ecause there was sales returns in Q2, our numbers were subdued. This year, in Q1, the revenue is just 7% and still guiding a double-digit growth at the higher end of double digits. How do you see the numbers going forward? Do you think the serious returns will be lower or because the season has picked up a little bit in Q2? Is that the reason also we need to look into?
Yes. We are pretty upbeat that given the subsequent rainfall and the agriculture spread, we are going to have a double-digit growth, and we are quite positive about that. We have made necessary corrections in our forecast of intensive growth or EBITDA correction as well. We are pretty confident we will be doing double-digit growth.
That's the higher end of double-digit, right?
Double digits, yes.
Got it. Sir, in terms of when I look at your competitors, they have reported a very strong set of numbers. Compared to our numbers, our numbers are a little softer. Any reasons for why our numbers are a little softer. If you can give some glimpse in that sense?
If I can give a reason if that would satisfy you. If we compare the quarter- on- quarter, then last year's quarterly performance was certainly superior, much superior for Dhanuka , which means a much better and wider day as compared to our competitor.
Yeah.
That's for one.
Got it. Got it. Got it. That is from my side. I'll be done here.
Thank you. Thank you, sir. The next question is from the line of Shubham Panderia from Tamohara Investment. Please go ahead.
Hi. Hello. I'm audible?.
Yes, you are.
Please go ahead.
Yeah, in our opening note, we mentioned one of the reasons for the subdued growth was due to lower realization from previous harvests, right? My question is, do we have our portfolio exposure for the top five crops?
I don't know what you exactly said in the first part. I'm not very sure of that. The quarter one growth is subdued also because of Dhanuka having a deeper weeding site portfolio, soybean and cotton. Soybean and cotton herbicide consumption has been muted, and that's the reason, one of the key reasons why this has been low.
Okay. What are our top five products based on the quarter we have of herbicides, pesticides, and fungicides combined?
Right. Our main crops, we name rice, fruits and vegetables, sugar cane. We have significantly expanded our portfolio in maize. Chilli has been an important crop, and we have positioned ourselves strongly in grapes as a horticulture segment. Conventionally, soybean has been a very important crop for us. This has had a muted herbicide consumption this year. Targa Super, Sempra, Cover, Lanevo, Decide, these are some of our key products.
Okay.
A wide offering across all segments, insecticides, herbicides, and fungicides.
Okay. Understood. I'll start the recording. How are we going to start? In 2026, we do have to come back.
Your voice is cracking for me. I can't catch you.
I'm asking the remote processor for the rest of the year.
Sorry, not able to catch you.
Yes, your handset, your voice is breaking.
I am on my handset. Is this clear now?
Yes, sir.
Yes, it's better. Yeah, I was asking about the launches that you have planned for the coming year?
We have already launched a paddy herbicide from Hokko Japan, in the name of Dinkar. As we speak, the product is being consumed in South India. The Hokko team, along with the Dhanuka team, is covering the length and breadth of Telangana and Andhra Pradesh right now, which is a paddy herbicide. Moving ahead, we will be launching Kinzan. This is again on Nissan, Japan, fungicide for grapes and potatoes. We have launched the Melody range this year, which we acquired from Bayer AG last year. Going forward, we will be launching at least two more nme-too products this year.
Okay. One fungicide and, oh, I think your voice is cracking, sir. I couldn't catch you.
Shubham, sir, can you please use your handset?
Yeah, I am on my handset. I don't know why it is cracking. Is it fine? I'm done with my questions. I will join the queue.
Thank you.
Thank you, sir. Ladies and gentlemen, to ask a question, please press star and one now. Participants who wish to ask questions may please press star and one at this time. The next question is from the line of Prashant Biyani from Elara Capital. Please go ahead.
Thank you for the opportunity. Rahul, you just mentioned that we have a deeper weedicide portfolio, which has not done well in Q1. I would assume most of the season would be over. Last year, we had a good launch year. v is-a-vis that the number of launches may be a bit less this time, but still, you are sounding pretty confident of a double-digit growth, which is fine, but where from is this growth then coming from?
Right. Prashantji, we had said that in soybean and cotton, herbicides, yes, that has kind of pulled us back. We have recalibrated our whole approach in terms of how we are going to track the remaining season. Our launches which included last year were Lanevo, which is an insecticide, MYCORe Super, which is a plant nutrition booster, Purge because of soybean herbicide, and many more products. While Purge has had a setback in terms of our last year launches, our other last year launches and various other launches which we are going to do this year are going to drive the growth along with our very strong portfolio of 90 products.
Right. Sir, the delayed start rainfall that we have seen in Andhra and Telangana, would not have hampered the herbicide demand. It would have just deferred it. Is the understanding right?
Yeah, Andhra Pradesh, Telangana, like nothing has shifted. Actually, everything is on track and appears to be good.
Okay. Sir, Skymet's forecast at the start of monsoon, and for IMD as well, I think both of them were expecting the heavy rainfall.
Good rainfall in August, September. Yeah .
In Central India, till now also, it has been fine, but still herbicide demand has been impacted. What is the reason for that?
What happened is the seed sowing which was done for soybean in various geographies of Madhya Pradesh and Maharashtra mostly got washed out because of the heavy rainfall at that point of time. Farmers had to go for re-sowing wherever they could. The opportunity did not coincide with the application of different herbicides. Herbicides in different categories, where Dhanuka offered pre-emergence, post-emergence, broad leaf, narrow leaf, option one, option two, all these herbicides for Dhanuka as well as for the industry have been impacted. At Dhanuka, because we do a relatively faster churn, whatever was not consumed in May was picked back in June. Whatever is not consumed in June is picked back in July. We have a more clear picture of the pipeline inventory, and whatever we are going to do, whatever our channel partner is going to do as a matter of corrective action to keep the business on track.
Sure. Thank you for answering the question.
Thank you.
Thank you, sir. The next question is from the line of Shubham Sehgal from Simpl. Please go ahead.
Hello. About it.
Yes, sir. Please go ahead.
Yes. My question was on export. What is the size of export registration portfolio now in terms of number of molecules and also in terms of number of countries of the types? How has it grown versus 2024? How much of this is manufactured in-house?
Yeah. Expose registration portfolio is only for the products that we are manufacturing in the Dahej and the Melody range of products, these are the only products for which we are going for the international registration. For the Dahej products, currently, it is one product, Bifenthrin. As I mentioned earlier, we'll be introducing the second product by Q2 of this year, and accordingly, the registration process will start after that. In terms of the registrations for the existing product, we have applied for registration in about six, seven additional countries in this year. The Melody range of products, and the Triadimenol as well, these are registered in more than 25 countries across the world. We are in the process of registration transfer of these registrations.
Okay. Got it. Thank you. The next question was, so we are clear.
Sorry, can we hear our speaker? Shubham, your voice is breaking.
Oh, is it better now?
Yes, sir.
Yeah, my next question was, we did both our different segments, like insecticides, herbicides, fungicides, and there are also Other segments. I just wanted to ask, what products are in the Other segment? Is there any growth for quarter one? Because the ratio towards the Other segment has been, what is in the Other segment and what drove the growth?
In the Other segment covers basically a sale of technical, bulk, and PGR category. The growth is in double digits.
Could you repeat the scale of what?
Sale of easy molecules PGR category, and bulk and technical, that comes under Other category. The growth in Other categories is in double digits.
Okay. Okay. All right. Got it. Our next question was, let's see, the total income of INR 14 crores. Is this from the two Bayer products we arrived? Like the quality of income, especially from the two products that we acquired?
I couldn't get the question. Can you repeat your question?
My question is, yes, the royalty income, was this solely from the two Bayer products?
Yes. Yes.
Okay. Got it. My next question was, we had talked about manufacturing to payment revenue mix at 80: 15 in 2025. What products are there in the Traded segments?
Can you repeat your question?
We have a lot of two segments. One is manufacturing and another is traded products for payment revenue. What products do we have in the traded revenue?
You see, in the trade category, there are government brands which we take from our basically in technical terms or tie-up or the principals in the packed form like Tornado, Dabooch , Nabood, Largo. T hese are the molecules and a few more, right?
Okay. Okay. Got it. Just last question. Mark down in the value of investment in the biotech world, if you throw manufacturing company, it was marked down from INR 31 crores- INR 22.5 crores.
Yeah. Right.
What actually is this?
Basically, this is provided on the basis of revision report on a mark-to-mark basis.
Okay. All right. Because of marking on.
Yeah.
Okay. Okay.
This is the last question in our so we have.
Sir, can you come back and clear your voice?
Okay. Sure, sure.
Yes, sir. Please. Ladies and gentlemen, to ask a question, please press star and one now. Participants who wish to ask questions may please press star and one at this time. The next question is from the line of Ankit Gupta from Bamboo Capital. Please go ahead.
Yeah. Thanks for the opportunity. I just wanted to say, on the technical prices, the prices, as you were saying, have stopped declining and have stabilized. How do you see the technical prices trending for this financial year and, if possible, next financial year? Are we seeing Chinese oversupply coming down? How is the inventory situation globally for the technical prices? Any views on that?
Yeah. The technical prices in general are now inching upwards or flat. For the entire year, as we communicated in the previous quarter, we are expecting maybe a two percent increase in the overall volume versus value, two percent higher value because of the price increase. That is the scenario. Regarding the price pressure from China, right now, also the price pressure is there. Low prices are prevailing in most of the products. There are a few products where the prices have increased to a certain extent. On a larger product portfolio, there has not been a significant increase in the prices as yet. Globally, the technical prices remain stable, although the demand seems to have picked up in the last few months.
Sure. You're saying demand in the key markets like the U.S., Latin America, and even Europe has picked up now for the past few months?
Yes, it is starting to pick up. Still there are inventories of collective products in these markets as well. In general, in comparison to FY2025, FY2026, the demand is better.
Sure. Secondly, on our technical plant in Dahej, how many products are we manufacturing currently? H ow do you see its performance for this financial year and next financial year?
Yeah. This financial year, we are expecting a revenue of INR 65 crores. Currently, we are manufacturing one product. In H2, we will be introducing the second product from Dahej. That is for this year. For next year, we are working on a number of products in our R&D lab. Some of them have qualified for further development. We'll be announcing when we'll be introducing more products in the future.
This will all be generic products, right?
Yeah, these will all be generic products.
Okay. Any update on, you know, we were looking to get into CDMO contracts with some of our partners on the formulation side. Any progress on that?
There are ongoing discussions, but no deal has been signed as yet.
Okay. Thank you. Thank you so much. Yeah.
Thank you, sir. As there are no further questions from the participants, I now hand the conference over to management for closing comments.
Thank you. Once again, I would like to thank all the investors and analysts for your support and confidence in Dhanuka. We're setting up a plant in Dahej and expanding our reach in 20-plus countries by acquisition of two brands from Bayer AG. We have embarked on our next era of growth and business success. I reassure our stakeholders that we are committed to the task of transforming the landscape of agriculture and farmers in India. India [Foreign language]Thank you and goodbye until next time.
Thank you, sir. On behalf of Antique Stock Broking Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.