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Agrochem major UPL reported a 28 per cent rise in net profit at ₹813 crore for quarter ended September 2022, over ₹633 crore for the same period last year.
Revenues for the quarter were up 18 per cent at ₹12,506 crore (₹10,567 crore in Q2 last year). The revenue growth was largely driven by higher realisations, which were up by 21 per cent, while the volumes were down by 7 per cent during the quarter. Favourable exchange rate also aided the revenue growth by 4 per cent.
“We continued to see robust growth momentum in Q2 FY 23 with 18 per cent y-o-y. Our focus on quality growth with a better product mix and proactive actions drove a strong 35 per cent y-o-y growth in EBITDA, with EBITDA margins expanding by 278 basis points,” said Jai Shroff, CEO, UPL Ltd.
The company recently announced a strategic corporate realignment initiative as part of which investors such as ADIA, Brookfield, KKR and TPG have collectively invested around ₹4,000 crore for minority stakes in UPL’s India Agtech and Global Seeds Business platforms.
Despite uneven rains affecting the kharif cropping pattern, UPL saw its India revenues grow by 22 per cent to ₹1,808 crore. Latin American business grew by 20 per cent at ₹6,092 crore, while the North American revenues were up 24 per cent at ₹1,185 crore. However, the European business saw a muted growth of around 1 per cent at ₹1,354 crore. Drought in parts of Europe impacted the growth in the region, said Mike Frank, President and COO, UPL
Glufosinate products
In India, September quarter growth was led by glufosinate products. The company launched new insecticides for paddy and cotton, while it also witnessed significant growth in its NPP biosolutions and products.
Shroff said the higher soil moisture level augurs well for the rabi cropping season. “Going forward, we are well poised to continue our healthy growth momentum in the second half of the year and we are confident of meeting our FY23 guidance of revenue growth of 12-15 per cent and EBITDA growth of 15-18 per cent and reducing our net debt by $650 million,” he said.
Post earnings announcement, the UPL scrip ended 1.8 per cent lower at ₹717.05 on the BSE.
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