Ladies and gentlemen, good day, and welcome to the Q3 and nine months FY 2026 conference call of Best Agrolife 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 this conference call, please signal an operator by pressing star then zero on your touchtone phone. Please note that this conference is being recorded. This conference call may contain forward-looking statements about the company, which are based on the beliefs, opinions, and expectations of the company as on date of this call. The statements are not the guarantees of future performance and involve risks and uncertainties that are difficult to predict. Today, from the management side, we have with us Mr. Vimal Kumar, Managing Director; Mr. Surendra Sai, Executive Director; and Mr. Vikas Jain, Chief Financial Officer.
I would now like to hand the call over to Mr. Vimal Kumar for his opening remarks. Thank you, and over to you, sir.
Thank you. Good afternoon, everyone, and thank you for joining us today. I will start by sharing an overview of our performance for quarter three FY26, followed by our outlook for the upcoming quarters. During Q3 FY26, our sales performance was lower on a year-on-year basis. This was mostly due to a combination of climate and market-related factors. Q3 was significantly impacted by unusual weather conditions. October 2025 witnessed exceptionally high rainfall across the country. India recorded rainfall that was nearly 49% higher than the long period average, making it the second highest October rainfall since 2001. Rainfall was also erratic and uneven across many regions. North, West, and Central India saw heavy rains, with parts of Punjab and Haryana heavy flooding, having floods. These conditions disrupted sowing schedule and the overall cropping cycle. At the same time, pest pressure in paddy crops remained very low.
While this is positive from a, for a crop health perspective, it reduced the need for crop protection products. As a result, demand in some of our important markets were affected during the quarter. In West India and Central India, excess rainfall impacted soybean supply programs. Important regions such as Madhya Pradesh and South Rajasthan were affected. Because of this, inventory from Q2 were carried forward into quarter three. Fresh product placement and field activity could not take place as originally planned. Official data has indicated that during October to December 2025, all kharif crops exceptional, except paddy, traded and discount 9%-30% of the MSP, the impacted purchases by the farmer. For rabi, the weather condition remained favorable, with stable temperatures across many growing regions, but we saw less disease and pest in crop like wheat, cumin, potato, and onion.
These crops usually contribute to our quarter three revenues, and this softness has impact on our Q3 performance. On the market side, industry faces challenges related to high inventory of generics at the trade level. This led to higher price competition across the industry. Despite these near-term challenges, we remain confident in the long-term fundamentals of our business. We are taking active actions for improving productivity and better predictability and increased profitability. Steps we are taking include database inventory control, ERP analytics for tracking sales and collections, comprehensive app for the sales team operations, connecting dealer and farmer through digital campaigns, and introducing chatbots for the dealers. These steps have begun to show results, and we hope to leverage data analytics and AI to take the company forward to increase productivity, lower costs, and improve profitability.
Our patented product portfolio continue to perform, and our distribution reach remains strong. I am particularly intrigued by the performance of our two newly launched patented combination, Bestman and Fetagen. Both products have received strong acceptance from the farming community. In this very first year, even we got the registration at the end of the season. In the last, we can say August and September, in the two months, we got very good response for these two products, so we are confident that coming year, 2026, 2027, we will get very good, for the Bestman and Fetagen. Each product has crossed more than 400,000 treated acres, which is a strong validation of our innovation efforts. Alongside growth initiatives, we have remained focused on improving operational efficiency. Our continued emphasis on cost optimization, inventory reduction, and disciplined receivables management has helped our balance sheet.
Looking ahead, seasonal activity is progressing well across central, western, eastern, and northern India. Field conditions are improving and farmer sentiment is stable. With a strong pipeline, better cost discipline, and improving market conditions, we are positioned for growth in the coming quarters. We remain committed to delivering sustainable value to our farmer, partners, and stakeholders. With that, I would like to hand over the call to Mr. Vikas Jain, who will walk you through the detailed financial performance for Q3 and 9 months FY 2026. Thank you.
Thank you, Vimal Ji, and good afternoon, everyone. I'll take you through the financial performance for the quarter and nine months ended December 31st, 2025. Starting with Q3 FY26, revenue from operations stood at INR 202.9 crore, compared to INR 274.1 crore in Q3 FY25. This is largely due to unreasonable rainfall affecting crop patterns. Gross margin for the quarter was INR 65 crore, down from INR 89 crore in Q3 FY25. Despite the unfavorable seasonal conditions, we were able to maintain gross margins of 70%. EBITDA for the quarter was a profit of INR 3.8 crore, an improvement over a loss of INR 5.8 crore in Q3 FY25, with the EBITDA margin improving to 1.9% from a negative 2.1% in the same period last year.
Operationally, we focused on cost optimization, with OpEx, excluding the finance and depreciation, reduced by 36% in Q3 and 20% over nine months, helping maintain financial discipline despite lower revenue. On the profit after tax front, we reported a loss of INR 12.7 crore, improving on a loss of INR 24.2 crore in Q3 FY 2025. Looking at the nine-month performance, revenue from operations was INR 1,101 crore, compared to INR 1,540 crore in nine months FY 2025. Gross margins stood at INR 345 crore, down from INR 460 crore in the same period last year. EBITDA for nine months FY 2026 was INR 127 crore, with an EBITDA margin of 11.5%, while PAT for the period was INR 46.1 crore, compared to INR 91.8 crore in nine months FY 2025.
Nine-month year-on-year sales declined by 28%, with 23% attributable to volume decline and 5% due to price variations. Despite the overall decline, the patented portfolio remained relatively stable, with only a 5% reduction, whereas the non-patented portfolio declined by 48%. Sales returns were also much lower than last year, largely due to implementation of the stringent sales return policies. This concludes my overview of the financials. I now hand over to Mr. Sai, who will walk you through other business highlights.
Good afternoon, everyone. I will quickly take you through what's happening on the international business front, mainly around export, registration, and IP. Starting with our export markets, things are moving steadily across the regions. Across key markets, progress remains steady. Our registration for our patented products in Sri Lanka are moving well. Dossier preparation is underway for finalized products in Vietnam and in Morocco. We continue discussions around pesticides and our patented Nano Urea. On the execution front, we finalized our third export shipment to Sudan. We continue to do these exports on a cash basis. The IP side has been particularly strong. We secured three patents for novel combination formulation. In addition, we were awarded a process patent for an intermediate with export potential. This patent improves the yield and purity of the product.
Beyond this, we have filed four international patent applications, which continue to strengthen our global IP position. We also received our first grant in a nano formulation. Our nano particulate fertilizer is aimed at improving nutrient efficiency across crop means. Overall, we are seeing a steady progress, both in expanding our international footprint and in building a strong innovation and IP-led pipeline. That's a quick glimpse from our, my side. Thank you. We can now open the floor for questions. Thank you.
Thank you. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touchtone 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. Our first question comes from the line of Hemant Gupta, an individual investor. Please go ahead.
Hi, sir. Good afternoon.
Good afternoon.
Sir, in the previous phone call, we were discussing mostly about the sales return and the H2 numbers. You were very, very confident that you will achieve INR 600 crore in H2 with positive flat in both the quarters. What happened, sir, suddenly?
It was not about the sale return. What we talking about, there is not, that is under, in the provision only, the sale return we got. That is under the provision only.
... So, Hemant, mostly, in the sense, if you are aware, most part of September, August and September and including October, there was continuous rainfalls, especially in the north, most of the flooding has also happened. So this impacted a little bit of sales. So we were pretty confident that we've been positive. Yeah, can you hear me?
But we had this. Yeah, yeah, but we had this call in mid of November, sir, not October.
Yes, you're right. What I'm saying is that the liquidation and all, the impact of sales return, we come to know only at the end of December and at the end of the quarter. So even though we were hopeful that we might do a good placement for Rabi, but even Rabi is little softer, so the placements also for Rabi has not happened up to the mark. So that was the reason that, some sales were missed, but still, as was committed, that we'll, we'll not have major losses like last year. Our key, key, key improvement was that we had reduced our inventory drastically, along with the reduction in OpEx, even though we missed out a little bit on the profit front.
Sir, even in one of the calls which you had in this end of December with one of the news channels, you were clearly mentioning that you are trying to have profitability in both the quarters. It is just a week before the quarter ending, and I'm not not understanding why this suddenly how this loss has come.
Yeah, Mr. Hemant, as I mentioned, mostly the Rabi happens from the placement happens from end of December, and most of the liquidation will happen during now, so presently, liquidation is going on. So yes, we were confident with respect to our profitability, but we had missed a little bit on the placement front because of the soft Rabi season. So still, as you see, our losses are still pretty limiting to INR 12 crore, which we could have done, based on the placement, what we were expecting, but that didn't happen. So again, our expectation is that Q3, Q4, we should be not having losses. So we had little losses this year, again, we are trying for Q4 not to have any losses.
Okay. And then in terms of this, warrants issue, sir, do you have any communication now with the shareholders? Are they willing to pay before May of this year?
So still based on the market prices, we have to wait for a few more months before we can take any call as to what, what will happen.
If they don't pay before May, what will happen, sir?
As per the terms, the amounts will get forfeited, so we don't want that situation to happen, but, yeah, based on the market situation, we will take a call and discuss with the investors.
Okay. Okay, sir.
Thank you.
Thank you, thank you.
Thank you. The next question comes from the line of Gunit Singh from Counter Cyclical PMS. Please go ahead.
Hi, sir, thank you for this opportunity. I would like to understand if we have been losing market share if we compare from FY 2024 to currently. The revenue went down from INR 1,800 crore to about INR 1,400 crore during 12 months. I want to understand what were the sales volumes for 9 months of FY 2025 versus the 9 months currently, to understand if we're losing any market share or not. Because if you see one of our competitors, Dhanuka Agritech, they have been maintaining their revenues as well as improving their EBITDA margins. For example, our EBITDA margins in FY 2023 were about 18%, and theirs were also the same then. But now theirs have gone up to about 20%, but ours has come down to 10%.
So can you please help me understand what's going on?
So, with respect to the market share, so, obviously Dhanuka and we are obviously in a different growth phase, because ours is mostly recently that we have gone into B2C in recent 3-4 years. But yeah, compared to the volumes, our MD year at the beginning of the year itself was that we want to increase our sales of patented products, so which we were able to do. So our patent portfolio compared to last nine months and this nine months, was just about -4%. That was also because of the prices, otherwise our volumes are up.
But for the non-patent, because last two years we have suffered a little higher on the sales, on the sales return front, wherein we had to take a little bit of inventory that also affected our working capital, our sales of the non-patent was lower. So that we said was lower by 35%-40%. Yes, we might have lost a little bit, but not on the patent portfolio, but on the non-patent, sales a little bit. And with respect to Dhanuka, yes, only for Q3, if you see, most of the companies were able to show better results was because of the exports. But if you see other peer players, what we have, most of them had a reduction of 10%-20% reduction in the sales as well as in the profitability.
So the overall, our volumes have fallen about 30%-35% if we compare year-on-year. So, whereas the competitors, their volumes have not fallen this much. So can you, I mean, help me understand why are we losing market share? What are we not doing right, and what is the way forward for us?
Yes, Mr. Vineet. Yeah. In fact, I cannot say we are losing our market share, it depend on the products. Like, you know, last some years, we were doing mix of some generics and our patent portfolio, and now we are mainly focusing our patent product. Definitely, if I say, when our patent product are selling more and our generics are, we're not selling that way. So definitely, our profitability should be high, our EBITDA margin should be high. That is correct. Your co- your question is very correct, and our concern is the same.
But at the same time, when we are pushing, when we are developing this kind of, our patented molecule, which, in India, if you see any other company, you say the name, no company have that much of, own patent, molecules they are doing in India. But, this is the, this is the period where the last year and this year, we are, we are totally changing toward from generic to patent, and when we are developing this kind of patent products, like our one product, you know, because you know some depth also. So the Ronfen you know. So that itself, one Ronfen, product, is, we are selling more than INR 200 crore, and we are started in 2022, mainly.
You can see in 3-year, 4-year, 2021 we started, but 2022 was the main year. In 3-year, one product, we are getting INR 200 crore. But definitely, what about the others? We are in the phase where we are doing marketing more, where we are doing sales force more, where we are expenses more. The main reason is our expenses is more, and sometimes this kind of condition, climate things, and to develop the new molecule, this is little bit harder. That is the only thing. If we talk about next year, and one year it is enough for us, if it will go well, I can say like this way. We are in some of the products, like I said to you, two products, Fetagen and this our Bestman.
These two products are fantastically doing. That can be bigger than Ronfen in coming year, that we can see. So it depends. So of course, but result is a result, where we are now standing up near 10%, 11% of EBITDA, and we have to reach 20%. We are not far away, but definitely the results are results, and I hope next year will be very good.
So sir, in my understanding, it is because the R&D spends this year that the margins are falling down. Is that correct? So how much is the R&D spend for nine months, and what are the margins for the patent products?
No, I'm not talking about R&D, I'm talking about the expenses on the sales and marketing. Sales and marketing, as well as R&D, but not R&D is not that big part, but major part is sales and marketing for the new products.
Is there so,
If you talk about our gross margin.
Please go ahead.
If you talk about our gross margin, so our gross margin already is around 32%. So gross margin is good, but when we come into the EBITDA, EBITDA less, just because of the new product, it is taking some time. And if any climatic change things or anything come, that will hit us more than others, because we are in a new product and development stage. So definitely nobody will try, if there is a very less demand or already market is sitting in that way. So, but the way we are doing, the way we are, you know, doing our new products, so I think one year is enough to change all the scenario. Because we are on the same path, and I think we are on the right path.
For the last 2, 3 years, we have seen, generic slowly, slowly, it is decreasing, and, the exclusive molecule, which we have, is increasing, year by year. But definitely we are ready with the product, so whenever a chance we get, and, 1 year is enough to come back.
Okay, sir. So based on the current demand scenario outlook, I mean, what do you feel like would should be our top line and EBITDA margins for FY 2027?
Yeah, please, you can.
FY 2027, still pretty early to say. For this year, for FY 2026, only for nine months, our sales are around INR 1,100 crore, so we expect to close the year between INR 1,300 crore-INR 1,400 crore. So this is for the current year, which will close by March 26th. For 2026-2027, still we are in the process to have our number, but, we should see our growth coming back, and, we should be coming back to our earlier numbers, which we had since our earlier two years.
Punit, sir, we did a acquisition of about INR 140 crore in March 2024. But if we look at the numbers for FY 2025, I mean, it does not reflect even in the, even in the revenues, nor in the bottom line. So, can you throw some light on, how the operations are going there, and, I mean, why are the, the numbers not reflect in our revenues?
See, this year, we are already at the beginning of the year itself, we had given to say that this year we will stabilize. Because what happens is, when the sales team since last two years, we're in a mode to do a lot of placements and do higher sales, but because of sales, it didn't work, we were getting affected on our inventory and working capital front. So this one year, it takes time for the sales team to come to newer policies, and we had already informed at the beginning that, this year we will stabilize, and once we are in good shape with respect to our balance sheet, next year we can think of, growing our sales. So it was not that...
It was surprised to some extent because of the continuous rainfall that we missed around INR 70-100 crore of sales. But otherwise, this year was expected as we had thought at the beginning of the year, with respect to, as I said, inventory front, reduction in inventory, reduction in sales return, and reduction in OpEx. Now, all these three are mostly achieved, and there is already awareness in the market with respect to dealers and sales team, that we are more concentrating on our patented products. We will not accept such huge sales return, which is stabilized this year. Next year, again, we are talking about the present numbers, what we are taking from sales team.
We are pretty confident of having our growth back, especially that we have our three products which we introduced last year. It was little late, but so the next year we will see the full results, and also three new products which are going to come. So, so our growth will be back from next year, after, whatever we have done in this year with respect to stabilizing the inventory and working capital.
Okay, so my last question would be, what is our revenue potential from our existing capacity? And in your judgment and opinion, do you think that the worst is behind us and, I mean, our revenues and EBITDA margins cannot go below the current levels, and there's only upside going forward?
So, our capacity to, year to date, INR 1,800 crore also, we have sufficient capacity. So based on our existing capacity, we can do 2,000+ crore. So capacity is not a constraint. So, that thing, more or less, we can easily achieve from our existing capacity without actually adding anything. So it was only because that our, B2C business was pretty much, happened, or we pushed a lot in last two, three years. So whatever we had gained from around 400 crore to today, 1,000 crore in our branded business, happened in last two to three years. So we took a year to stabilize that operation, and we'll see that next year, our, our numbers will go up.
So our capacity is more than enough for us, and even our OpEx, which we have reduced drastically, as stabilized, we had done a lot of restructuring on our locations on the territories. That also has happened and have stabilized this year.
All right, sir. Got it. Thank you very much. John Madhuki.
Thank you. The next question comes from the line of Chintan Mehta, an individual investor. Please go ahead.
Hello, sir. So my name is... Thank you for your numbers. I just want to understand, what is the projection for the international expansion, for Best Agrolife going forward? Like, because, the margins will be much better, so where we are looking, where we are looking, in terms of numbers or in terms of potential in the international expansion?
Yes, please. So in terms of a new revenue stream, exports and international markets will definitely be one big area. And in that, and one of the key challenges in case of international business is the number of registrations. So currently, we are progressing on our patented portfolio registrations, which are expensive, and then we have found very good partners who are doing that. So in addition to this particular registration process which is going on, there is a parallel R&D which is going on in terms of identifying certain intermediates which can also be sold abroad, where the registration cost or the registration challenges do not exist. The third thing that has been working on is in the area of Nano Urea, where we are seeing a good amount of a potential abroad.
So as a result of these multiple initiatives that we have taken on the export front, we opened up a China subsidiary. And the China subsidiary currently is doing, at least it is doing, some degree of revenue. Although it is okay on the gross margin, there is a slight amount of loss in terms of the net profitability. That is because of the initial expenses. This China subsidiary is currently doing some degree of trading practices for buying and selling in China itself. Overall, there is a potential upside that we see in terms of our export revenues. It will be a little bit difficult to be able to give a hard number, because that would be a projection.
But we do expect our export revenues to be a good percentage of our total top line. And as you mentioned correctly, yes, India has been doing a significant amount of export. We are one of the largest exporters of pesticides in the whole world. Given the challenges in China and other things, I do expect... And the options and the advantages in India, I do expect this export market to grow. We are a little slow on this particular front because initially we have not been able to, you know, leverage and catch this, but yes, this will be one big area for us going ahead.
Okay, the follow-up question is that, like, let's say for example, the patent is granted. So how much time it takes for registration? Because I'm not like, I do not have understanding of, how the registration works, but if I want to understand if registration is completed, what is the timeframe or a time period, from which the, you know, revenue gets charged anything after the patent is granted? Because I, in the recent discussion, you mentioned one of the patent is granted, right? So that does mean that the, a product can be developed on that or like, like, what is the timeframe or a time duration that it takes from a patent grant to convert into the real numbers, like what, what, what the journey looks like?
... Yes. That's a good question, because in case of the agrochemical industry, what happens is, getting a patent is little different from registering that particular agrochemical in that country, and being allowed to export and sell. The two are different. Now, what happens is, while we are getting a patent portfolio, as far as the export is concerned, that country's registration time takes anywhere between 2-6 years. In case of Brazil, it may take even more longer than that. So the reason for that is very simple. This is a patented product, and hence, it is a new formulation or a new technical sort of combination in that particular country, and hence, the amount of regulatory oversight is more. So, we have started multiple product registrations in multiple countries.
These will come up anywhere between the next. I would say certain things will be available and will be registered in the next year, especially in Vietnam and Sri Lanka. And from the year that is 2027 onwards, you should be able to see a good amount of revenue. Once this is registered, the sale of that particular product can happen.
Okay, okay. So this is similar to the Sharda Cropchem doing the export. So basically, we are. And any kind of a European agreement that recently completed the with the European Union. So is there going to be any benefits-beneficiary for that sector, free deal?
Yeah, yeah. As of this minute, if we had had multiple active registration for registered products, we could have immediately been able to utilize the opening up of both the U.S. trade market, European market, as well as certain parts of the Australian market. But right now, we don't have that. So once our product gets registered, yes, obviously, the open trade regime which is happening, that will help us a lot.
Okay, thank you.
In fact, it will help us more because... Yeah, yeah, it will help us more because what we are registering is all high value, high margin products.
Okay, sir. Thank you.
Okay.
The next question comes from the line of Kailash Chander, an individual investor. Please go ahead.
Hi, good afternoon. My question is basically regarding receivables. So it has been observed that receivables below six months are continuously, I mean, being increasing, ratio-wise than the receivables more than six months. So can you please elaborate in this front?
Yeah. So receivables, more or less it's in line with what we had previous year. So this year, because of the continuous rainfall and there was a delay in the produce and the same, being repaid by the government. So there was a delay by just about a month or so, but most of the receivables are under control and, there's not a big, surprise there.
Actually, ratio-wise, if you, if you see ratio-wise, I mean, in the financial year, previous financial year, previous financial year, if we see. So, ratio was lower, lower side, three month, particularly if, if we see three, three, three months below. It was, somewhere around... So I'll, just open that thing. So if we look at the balance sheet, so, in... It was-
So, Kailash, can we-
So, so sorry for that. So, for the time being, I'll ask second question. So,
Yeah.
As you mentioned that you are more focusing on the patented products, so what is the time for these products? Total addressable market.
We are focusing on the patented products. We are not focusing on non-patented, the generic ones. So-
Yeah.
With respect to time, it's not the overall market for the agri industry. In that, we define which are the highest selling crops, and within that crops, which are the solutions we want to provide. So for each of the crops, it would be different. But yeah, we are still... As others are playing, we are playing in the overall market, which is around INR 3.5 billion or so.
Okay. Okay. So the receivable part, in the March 2022, so, receivable six months was INR 38 crore, as compared to receivables under six months was INR 2-3 crore. Now it has increased drastically, from year 2025, if we see. So it is 182, over six months, and, under six months, it is 400. So ratio-wise, it is very, at the higher side. So that part I was talking about.
So as I said, in our business, the collection period is defined based on how the produce sales and the money flows from the government to the farmers, dealers, and to us. So this year, mostly it has been delayed by a month or so, but we don't see any major surprises, as I said. So most of our collections will happen now between December to April. So each month, we are getting collections, and each month we see that there's a reduction in the six months. So in March, once you see, you'll see a improvement in our more than six months from what you would have seen in September or March numbers.
Okay. Great, great. So my last question is, as you mentioned, that the company will try to achieve, somewhere between INR 1,300 crore-INR 1,400 crore of revenue in this, particular financial year. So can you please, let us know about the EBITDA margin?
So, EBITDA, with respect to EBITDA, we will be similarly, our endeavor would be to possibly not to have losses, but we'll have minimum profits. So our EBITDA would be little higher than what we have in Q3, because Q3 and Q4 are softer seasons compared to main Q1 and Q2. So again, like how we had planned for Q3, our plan is not to have losses. So EBITDA would be would be in similar lines like current quarter, but it could be a little better, and I'll try we will try not to have losses in Q4.
Actually, I was talking about annualized basis for financial year 20-.
Annualized basis, annualized basis, we will be in the range of around, we'll be at around 12% or so. So that would be our EBITDA targets.
Thank you. That's all from my side.
Thank you. The next question comes from the line of Vivek Rautela, an individual investor. Please go ahead.
Yeah. Hi, all. Good afternoon. So-
Yeah.
Basically, I have a question regarding the outstanding warrants. So the current exercise price for them is INR 64 per share, okay? While the current market price is around INR 18.94, and it may face further downside, downside because of the recent results, as it is in lower circuit today also. So in this context, I just wanted to know what is the management view on this warrant conversion, and how, like, should shareholder think about the potential impact of this?
Our price was INR 640, that was pre-split and pre-bonus.
Now it is 64.
After considering the split and bonus, it is supposed to be at INR 42. So INR 640 is equivalent to INR 42. So instead of INR 42, here we are at around between close to 20 or so. But, as I said, we are hopeful that we are improving, so we are not having the losses like what we had last year. So we hope that the prices would come to a level where investors would feel that, okay, they will pay that balance amount. So we are still wait for our March numbers, and then we'll take a decision.
Yeah, but during like, I'm following it since 2 years, okay? So during this period, the company's revenues have been, like, continue to decline. I understand that the business model has undergone changes, like you are focusing more on patented products, but in several earnings, because mostly I hear all the earnings. So the management has indicated that the worst phase is behind, but the financial performance, like, whether it is revenue or profitability, like, something happens, like sometimes the weather issue, sometimes something. So can you like tell us like when we can expect the revenue growth to be back, at least like when it to our peak numbers? I think it was around 2021 or 2022. So can we expect the same revenue?
Yeah.
Yeah.
So, for this year, it was not that in one or two quarters we could come back to a normal term. So for the entire year, our guidance was that our revenue would be lower, but we would still go on to improve our profitability percentages and reduction in our OpEx, because we had spent heavily on the 9 patents what we had launched. So most of it we are able to achieve in terms of what we had given the guidance, but it's not that this year is was like a big surprise. The surprise was, as I said, was only to the extent of INR 50-100 crore, which we missed; otherwise our results would have been better. So this year, as I...
This year would be the worst, what we say, and the worst will be behind for us, and from next June onwards, already, we have our plans and we have our policies which are in place, which, which till last year was, we were about, we were changing those policies. So now we are more stable with respect to our, the, the number of people, the policies what we have, and the products which we want to sell, and also on the, supply chain front as well. So, so the growth will come, and it will come from the next year immediately. From June onwards, you will see the growth, which will be back.
Okay. Just wanted to know one thing: suppose if we want to do INR 1,800 crore or INR 2,000 crore of revenue, and so when can we expect that? And, like, within one, two years, or it will take more time? And what should be the PAT at that time? Like, profit before tax and profit after tax, what can be the operating profit? If you can tell, like, a little bit, if you can guide it.
Yeah. Yeah, your question is right. In fact, next two year, we are, of course, changing that number, and next year, we will come around INR 1,600, INR 1,700, or maybe INR 1,800 or so. Because, just I told in the, in the, Mr. Guneet question also, that we are already in the, in the, same path where we are developing our new products, and each product will give us good revenue in coming year, in, FY 2027. And, I firmly believe FY 2028 will be the, again, very good year, because each our product, each of our product which is patented, each of our product will have, you know, 2 year, 3 year, 4 year, 5 year history.
And when there is a history of 3-year, 4-year, there will be a big revenue we can expect from these products.
... and that the profitability will be again very high. So again, I will, I want to say, earlier we were doing in a different way, and then we changed our way because that was also important because our inventory level now is very drastically down, which was required to our balance sheet, good balance sheet, and also our debt has reduced. So, so that was our agenda for this current year. But definitely, next coming year, because of our patented molecule, definitely we will do better. And the revenue, almost I can say next two years, again, we will touch to more than whatever we have did in the past.
What can be the OPM percent? Can you tell me, like, if you told around a 20% we can expect, right?
After two years, yes, you can say.
So this year it won't be 20%. Like, if we talk about this year-
Mm.
—like this and the next financial year that is coming. Yeah.
Not 20, but definitely our target is there, but I cannot say 20, but definitely it will be 16%-17% minimum.
Okay. So, like, you are sure, like, the worst is over? Like, it can't be, like, worse than this, right? Like, just wanted to confirm that thing.
Yeah, yeah, we can say because I told you everything, why it is, because we want to create a discipline, and we have. In my commentary also I said we have done very well many things with database, inventory control, ERP, and our, you know, comprehensive apps. And also we are now directly looking at the liquidation at the farmer level. So definitely when we are tightening this and making something like chatbot for the dealer. So many things we have did in the one year. It was a developing year for us, for the new product, again, I would say. And definitely I can say according to the performance of balance sheet, definitely you can say to...
I can say we have seen the worst, and now it will be better only.
Okay. Okay. Thank you so much for your answers. Really helpful, yeah.
Thank you.
Thank you. The next question comes from the line of Saket Kapoor from Kapoor & Co. Please go ahead.
Yeah, sir. Hope, sir, I'm audible?
Yeah, yeah.
Yes, you are.
Yeah.
Yeah. Vimal ji, just taking into consideration discussion, articulate happen, key do course correction exercise up in organization, implement profitability, revenue or profitability, cha they think they to, yeah, yeah, collection already home and get the all the kuch party, können the awesome. So up promoter company 50% stake equity up hold country or anybody investor analyst, minority shareholder, including me, to him, Sabico, yeah, they banta came a organization promoter integrity, key mania, key, key, well, depending upon the market conditions, other market conditions, external environment, what COVID grab regular outperform?
Other than that, trajectory outline, walk the talk to us, Surendra, me, at least message, yes, you are there on the track up 5%, margin 2%-8% variable, but as a number here, investor or investment return like this last was at least is ka cognizance, absolutely.
Ji, Saket ji, thank you, and the day-to-day always are close to me, and thank you for that, for showing interest. Definitely, your concern is correct. As you said, I have a major shareholding, so definitely my concern are the same, always with the company within the company. But definitely, what I can control and what I can change here, as a small shareholder, you cannot do. But definitely, I'm doing my job, and our team is extremely doing very well. In other parties, I will say, and because you all are, because you are our shareholder, stakeholder, so I can frankly tell you, if in other way, I would say I'm very happy with the teamwork, with the groundwork they are doing.
If anybody on the call who know the farmers and every, you know, who has, you know, related to the dealers, if you check in some of the market like Maharashtra, or if you check some of the markets, you know, like Gujarat, or maybe Haryana, or some of the states, you know, there our, our brand is, you know, they don't about, they don't know about balance sheet, they don't know about, you know, share price-
Mm.
They don't know about anything. But they know about the new company, which is the new company, who is growing very fast in the brand image of the company, like Ronfen or Best Agrolife. So it is very popular in the farmer community, I would say. So yeah, if you get up this time, so I feel sometimes very happy. But definitely, it is, we are doing business, so the profitability is equally important, and revenue is also equally important. And I can say from next year, it will be definitely better. And again, I would say last certain thing, getting my birthday is when I direct question the worst.
So I cannot say worst, but definitely, we have done much corrections, and I don't think so there is any surprise on the downward side you will get. Of course, I'm hoping, you should get surprise on the upward side, and, we are doing for our best.
... Ji sir, and sir, sales return say whatever course correction was needed, I think so, Vikasji would be answering that better. That provision and all, if you could just give us some color for the quarter, how much have been our sales return? And provision add back extra provision, sales quarter.
So, so overall, if I tell you overall, last year almost around INR 280 crore return 9 months May, this year INR 180 crore. So we had drastically reduced target quite, but last May sales, excess rainfall. So for example, around INR 70 crore provision, but what we got was around INR 90 crore. So we thought we'll end up with INR 40-50 crore of sales return, but sales return, because extra rain missed different crops and still the deviation, overall, 9 months, 10 months improve 40%-45% sales return. And on specific question of Q3, around 70, but returns actually INR 90 crore.
Okay, sir. And sir, fourth quarter period seasonality factor pesticides?
Fourth quarter season, but Rabi season, so we will do little bit of sales, but with respect to sales return, almost clear Q4 last year, sales return 50%-60% already. So it's not sales return, but sales Rabi season effect, because rain product affect because of the product prices. Price farmers expense. So, so okay, but we'll do reasonably okay and try to ensure last, last quarter Q4 losses. This time losses.
Hmm, last year Capex hold if I remember correctly.
It is still on hold. 4 months.
Okay, sir. Sir, investor management, pesticides... left-hand side, numbers numbers inform decision market. And I hope, sir, that is give us gains that we are anticipating, and we hope for we will be participate in this journey with Best Agrolife. Thank you, sir. Thank you very much.
Thank you.
Thank you. The next question comes from the line of Vijay Jhawar, an individual investor. Please go ahead.
Hi, sir.
Please go ahead, Vijay.
Hi.
Yeah. We want to understand whether we have utilized the proceeds which we have got from the preferential amount.
Whether we what?
The amount which we received-
Sorry.
During the preferential, have we used it or not?
Yeah, yeah. So the 25% amount, what we got, those as part of our utilization, I think we already utilized it for the working capital purpose.
We have actually planned for a CapEx, right? Some, a new plant. So I thought that we are using that particular amount to fund that CapEx. Am I wrong?
The Capex, the Capex was only from the second tranche and from the 75% which we had thought. So that we'll see only once we get that balance 75%, we'll think of the Capex.
So are we looking for any fundraise? Because we are already at a lifetime low in our share prices. So are we looking for any fundraise from promoters or from some institutions?
For Capex, we are not doing anything as of now.
Okay, sir, but we have a due date around June, right? So as the earlier participant asked, that the price is like 50-60% down from what they have actually subscribed. So it looks like impossible to receive the balance 75% amount. So is there any plan B?
So, I think we don't want to commit as of now that, okay, we are not going to get that INR 75 and we'll do something else. So, the Capex plan can hold because we have enough capacities to go for our target for next two years. So we will see if the situation will improve. If we feel that we are in a better position, then we'll think of taking the funding from outside. But yeah, presently we are not thinking about that.
... Sir, we have report from weather agencies, so there is a possibility of El Niño in next financial year. So do you have any plans? Because we have now your promoter start giving the guidance of INR 1,700 crore-INR 1,800 crore, and if at all there is a possibility of El Niño, then do you feel that there is a risk even to the current revenue levels?
So, 17, 18, and it was for next two years. So in the sense, next year our plan would be to achieve at least around higher than INR 1,500 crore, INR 1,500-INR 1,600 crore, and then going up to INR 1,700-INR 1,800 crore. So El Niño, obviously there are presently some articles going on to say that there are El Niño effect which might be there. But our nature of industry is that we cannot be waiting to see how it pans out. We have to work on our supply chain much before. So we will work with caution, but because we have already put good policies to ensure that we'll not place too much and then later on take it, that will help us.
Yes, El Niño effect might be there, but it will show only in July, August, but before that, we have to prepare ourselves with the inventory, which we will do, but we will go with a caution.
Sir, there is a person called Raj Kumar in our shareholding pattern. So, is there a, like, any connection to him with the promoter?
No, not clear. Not clear. I'm not aware of Raj Kumar.
No, no. There is a person called Raj Kumar, who is holding 7%-8% equity in Best Agrolife. So is there any-
Okay.
connection with the promoter group?
No, no, I don't think so.
Because he's a huge equity person in Best Agro, and he has sold quite a large chunk during the split and bonus time. So I felt that he's an insider or something, because-
No, no.
He keeps on... Yeah.
There's no, there's no relation as such. Yes, possibly he might have higher holding, but then we don't know about it, with respect to any relation with promoters.
There's no relationship with promoters. Okay.
There's no relationship.
So, yeah. So, what's your expectation from Q4? Because we are already at a INR 12 crore loss in Q3, so do you think that it will continue or we'll have a better quarter?
Our expectation is not to have losses. So in Q4 last year, we had very high losses. So based on already, we have worked on the OpEx part, which we are reducing it drastically. So sales, obviously, as I said, the demand is a little softer, so we don't expect very high sales, but we expect not to go into losses and have even the small profit, but our plan is not to have losses.
Sir, because we are already paying INR 50-55 crore interest to the banks, and our profitability is below since last few years, so how do you think that the business is sustainable? Because our interest cost is more than our net profit.
See, there, there is a huge potential because based on the market situation, we see that many of the companies doesn't have this kind of portfolio what we have. Now, obviously, company is going through a situation wherein we had gone heavily into the market and faced certain situation, which we are trying to improve, and this year we already knew that the steps if we will take, there might be some reduction in the sales. So yes, sales are down, profitability is not so heavily lower, so we are still profitable for full year, and we'll remain profitable. It's only that after, going through these policies, now we are in much comfortable position with respect to our inventory. Even our dealers are more comfortable with respect to the policies what we are doing, and even our sales team is more stable now. Because last year they...
Because of restructuring of territories, there might be situation where people are moving from one place to another, but now everything is pretty stable, and we are in a much better position to grow because of our portfolio strength. So that way, we are going to do this year, and we are hopeful that if everything goes well, we will see much, much better numbers this year.
Sir, why has the interest cost gone up in Q3?
Interest cost obviously would be based on the loan what you would have utilized. So if there was a delay by a month or so, wherein if dealers have paid late, then we charge dealers with little bit of interest for delay payments. So that we do based on after they do the payment. So even though on one side there will be interest, so this next this quarter or next quarter, we'll see that we might, we'll be charging some amount as recovery of that interest. So it's not that we are paying higher, we would be recovering this from the dealer who are paying little later to us.
Thank you. Ladies and gentlemen, due to time constraints, we will take that as the last question for today. I would now like to hand the conference over to Mr. Surendra Rai for the closing remarks.
Thank you everyone for your time today. We appreciate your interest, feedback, and confidence in the company. Your engagement will help us sharpen our focus and stay aligned with long-term value creation. I would also like to thank our employees, partners, customers, and investors for their support and commitment. We look forward to staying engaged with you and updating you on the progress in the coming quarter. Thank you very much and have a good afternoon.
Thank you, sir. Ladies and gentlemen, on behalf of Best Agrolife Limited, that concludes this conference call. Thank you for joining us, and you may now disconnect your lines.