Dhanuka Agritech -
Q3 FY 24 results and concall highlights -
Revenues @ 403 vs 393 cr { volume growth @ 8.5 pc, price growth at (-) 6 pc }
Gross profit @ 155 vs 130 cr ( margins @ 38 vs 33 pc )
EBITDA @ 62 vs 51 cr ( margins @ 15 vs 13 pc yoy )
PAT @ 45 vs 47 cr ( due steep jump in Depreciation cost @ 13 vs 4 cr YoY - on account of the new Dahej facility )
Company operates via 03 manufacturing plants, 41 warehouses, 6500 distributors and over 1000 strong field force
Product wise sales break up (YoY) -
Insecticides - 32 vs 29 pc
Fungicides - 21 vs 20 pc
Herbicides - 35 vs 39 pc
Others ( Plant growth Regulators ) - 12 vs 12 pc
Geography wise sales break up ( YoY ) -
North - 22 vs 22 pc
South - 39 vs 38 pc
East - 12 vs 11 pc
West - 27 vs 29 pc
Company signed a LoI with a Spanish biotech - Kimitec to set up a JV in India to commercialise biological crop protection products. Kimitec operates the largest Biotech Lab for Agro products in EU
Invested in a startup - KissanKonnect - it delivers farm produce directly to consumers through it mobile app and stores network
Significant Gross Margin expansion is due to improved sales from speciality vs generic products
Expecting a high single digit volume growth in Q4 as well
There r 3 types of Biological agro products that the company is working on - Bio Nutrients, Bio Stimulants, Bio Regulators. Some of Kimitech’s products are already approved in India. Company intends to start rolling out these products in the next Kharif season. The Mkt for Bio products is growing very fast @ 15-16 pc CAGR in India. Margins in these products are > company level Gross Margins
For FY 25, a lot of exiting launches are lined up in the Herbicides, Insecticides categories. This should help the company clock double digit revenues with improved margins in FY 25 ( that would be a bumper outcome … IMHO )
Company launched an innovative Japanese product - Decide used against the sucking pests for the chilli crop ( a few years back ). It ended up being a huge hit. Has scaled up well. Another product - Zanet - a fungicide for Tomato crop has been doing very well. On similar lines, company is going to introduce a new Herbicide for the Ground nuts and Soyabeans crops
Company had earlier guided for 80-100 cr of topline from the Dahej pant for FY 25. However, due to a slowdown in the AI mkts ( globally ), company is likely to revise this guidance lower. Still expect Dahej plant to be EBITDA positive inside next 2 yrs. This yr, Dahej plant has clocked an EBITDA loss of around 10 cr for 9M FY 24
Management remains extremely exited about the new and innovative product launches in next FY
Disc: holding, biased, not SEBI registered