Summary
India Pesticides Limited - Q3 FY26 Earnings Call Summary Wednesday, February 11, 2026 04:00 P.M.
Event Participants
Executives 2 D. K. Jain (CEO), S. P. Gupta (CFO)
Analysts 6 Ajay Desai (Shree Jayant Enterprises), Diya (Sapphire Capital), Lakhan Yadav (Pin Ace Securities), Manish Badani (360 One Capital), Vidhi Shah (C.R. Kothari), Vishvender Singh (Prudent Equity)
Financials & KPIs
| Metric | Reported | Commentary |
|---|---|---|
| Revenue (Q3 FY26) | ₹229 crores | +31% YoY; driven by strong demand for herbicides and intermediates. |
| Revenue (9M FY26) | ₹808 crores | +27.6% YoY; supported by 28% growth in exports and 33% growth in domestic sales. |
| EBITDA (Q3 FY26) | ₹41 crores | +39.7% YoY; margins improved to 18% (vs 17% LY) due to operating leverage. |
| Net Profit (Q3 FY26) | ₹23 crores | +41% YoY; PAT margin at 10% despite one-off tax and wage code provisions. |
| Net Profit (9M FY26) | ₹89 crores | +44% YoY; reflects improved cost efficiency and R&D-driven product mix. |
| Export Revenue (Q3) | ₹96 crores | +28% YoY; major contributions from EU and Australia markets. |
| Domestic Revenue (Q3) | ₹130 crores | +33% YoY; strong performance in core herbicide segments. |
| Capacity Utilization | 65% | For 9M FY26; management expects expansion in utilization with new technical plants. |
| Technical/API Mix | 73% | Represents the dominant share of revenue; Formulations account for the remaining 27%. |
Geographic & Segment Commentary
- International Markets: Export revenue rose to ₹96 crores in Q3, driven by steady demand in the European Union and Australia. Management noted that while EU sales peak in Q2, Australian demand typically strengthens in Q3 and Q4.
- Domestic Market: Recorded ₹130 crores in Q3 revenue; demand remained resilient in the herbicide and intermediate segments despite a delayed monsoon. The B2C branded segment currently accounts for approximately 18-20% of total revenue.
- Shalvis (Unit 2): Commercial production of technical products has commenced at the Shalvis facility. One block is operational (insecticides) and a second (herbicides) is under construction, targeting a scale-up to ₹100 crores revenue in FY27.
Company-Specific & Strategic Commentary
- Capacity Expansion: Technical capacity reached 28,200 MT, with an additional 1,000 MT expected by the end of Q4 FY26. Management targets a phased expansion to 30,000 MT and eventually 10 blocks at the Shalvis site over 5 years.
- CDMO Portfolio: The company is actively engaged with global innovators in Japan, USA, and Australia. Samples have been approved by US/Australian clients, and a Japanese partner visit is scheduled for March 2026.
- Backward Integration: Commissioned the Pretilachlor PEDA intermediate plant with expanded capacity. This move strengthens supply assurance and enhances cost competitiveness against global peers.
- Sustainability: Successfully integrated 6 MW of solar power supply at the Sandila unit from a group captive plant to reduce reliance on conventional power.
- R&D and Registrations: Received 5 CIB registrations and 6 overseas registrations this quarter. A new fungicide technical product is expected to contribute ₹50 crores to future revenue.
Guidance & Outlook
| Metric | Guidance / Outlook | Commentary |
|---|---|---|
| Revenue Growth | ~20-25% for FY27 | Driven by Shalvis scale-up and new registrations in Australia/Europe. |
| EBITDA Margin | 18% - 20% (Long-term) | Management aims to maintain margins via process optimization and higher-value technicals. |
| Revenue Target | ₹3,000 crores by March 2031 | Vision includes ₹1,100cr from Hamirpur, ₹1,500cr from existing units, and ₹500cr from B2C. |
| FY27 Capex | ₹105 - ₹130 crores | ₹80-100cr for Shalvis and ₹25-30cr for Sandila; largely funded by internal accruals. |
Risks & Constraints
| Risk | Context |
|---|---|
| Chinese Competition | Management noted pricing pressure in a few technical products due to competition from China, though overall realizations remain stable. |
| Regulatory/Tax | Q3 experienced higher tax expenses (33%) due to deferred tax provisions and wage code implementation (₹0.6 cr one-off). |
| Domestic Inventory | A slight inventory overhang exists in the domestic B2C market, though IPL’s limited exposure (20%) mitigates the macro impact. |
Q&A Highlights
Revenue Seasonality & Exports
- Question: Why did export revenue decline sequentially from Q2? (Lakhan Yadav)
- Answer: Q2 is seasonally stronger for the EU, while Q3/Q4 see higher volumes for Australia; the fluctuation is based on geography-specific demand cycles (D.K. Jain).
Shalvis Facility Progress
- Question: What is the revenue potential and block status at Shalvis? (Vidhi Shah)
- Answer: One block is active; the second is expected by Aug/Sept 2026. We expect ₹80-100 crores in revenue next year and can eventually accommodate 10 blocks reaching ₹1,000 crores (D.K. Jain).
Product Pricing Realization
- Question: How are pricing trends for molecules like Captan and Prosulfocarb? (Yogansh)
- Answer: Realizations are stable; Q3 volume growth was 31%, perfectly matching the 31% revenue growth, indicating no significant price erosion (S.P. Gupta).
CDMO Strategy
- Question: Is there an update on site visits and sample approvals for CDMO? (Yogansh)
- Answer: Japanese clients are visiting in March 2026. Australian and US clients have already approved samples; discussions are moving toward materialization (D.K. Jain).
Key Takeaway
India Pesticides Limited delivered a robust Q3 FY26 performance with 31% YoY revenue growth and a 41% surge in net profit, underpinned by strong herbicide demand and export recovery. The company successfully transitioned into the commercial phase at its Shalvis facility, which is projected to contribute up to ₹100 crores in FY27. Strategically, IPL is pivoting toward higher-value technicals and CDMO partnerships, supported by a backward-integrated PEDA plant and a growing registration pipeline in Australia and New Zealand. While the quarter saw one-off tax provisions and wage code impacts, operational margins remained healthy at 18%. Management has laid out a clear roadmap to reach ₹3,000 crores by FY31 through a mix of existing capacity expansion and the Hamirpur project. The company remains focused on R&D and internal accrual-funded capex to maintain its debt-light balance sheet while navigating localized Chinese pricing competition.
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