Sharda Cropchem Q3 2022 Concall Highlights

Operational Highlights

• Revenues grew by 78.2% you from ₹494 Cr to ₹880 Cr in Q3FY22
• EBITDA margin expanded by 220 bps YoY to 22.8% in Q3 FY22 driven by economies of scale , effective cost management marginally setted off by higher freight cost.
• Strong volume growth, high realisation and better product mix

Revenue growth YoY

• Europe -124% 
•  NAFTA-76% 
• LATAM-18 %  RoW 19%

Geography wise gross margins 

• Europe 36%
• NAFTA 37%
• LATAM 14%
• ROW 23%

Segmental review

• Agrochemicals : Non-Agrochemicals revenue mix stood at 82:18 in Q3 FY22 as against 81:19 in Q3 FY21 
• Agrochemicals revenues during Q3 FY22 grew by 79.8% YoY 
•  Non-Agrochemicals revenues during Q3 FY22 grew by 70.9% YoY
• Formulation mix at  94% and AI mix stood at 6%
• Herbicides continues to command 50.1% of revenues followed by fungicides at 26.3% and insecticides at 23.5% in Q3 FY22

Non agrochemicals geographical split for revenue contribution

• NAFTA- 50%
• Europe- 29%
• LATAM 7%
• RoW- 14%

Business Strategy

• Prudently investing in new product registrations
• Total product registration stood at 2645 on 31dec 2021
• Additionally 1099 application of product registration globally at different stages of approval 
• Registrations cost depends on country to country and numerous other permissions within the region 
• Europe has highest cost of registration and timeline
• The capex stood at ₹203Cr on 31 Dec 2022 vs ₹170 Cr in same period previous year 

• Concentrating portfolio in each geography
• Growth rate depends on  number of products in a portfolio, sowing season, seasonality in rains etc

Volume breakup

• Europe -43.58 lakh kg
• NAFTA- 32 lakh kg
• LATAM- 7.7 lakh kg
• RoW 10 lakh kg.
• Total- 95 lakh kg 

Growth was driven by volume (up by 51%) and realisation (up by 26%)

• The number of distributors is increasing slowly, besides existing distributors are buying more 
• Market share will not be more than 10% for any molecule in any geography
• Non Agro products are order based and customer specifications, similar to CSM
• EBITDA margins sustainable and efforts to improve more