Please note that this conference is being recorded. I now hand the conference over to Mr. Manish Mahawar from Antique Stock Broking. Thank you, and over to you, sir. Yes, thank you, Selvin. Warm welcome to all the participants on the 4th FY 20-earning call of Dhanuka Agritech. From the management, we have Mr. M.K. Dhanuka, MD, Mr. Rahul Dhanuka, Joint MD, Mr. Harsh Dhanuka, Executive Director, and Mr. V.K. Bansal, CFO, on the call. Without further ado, I would like to hand over the call to Mr. M.K. Dhanuka for opening remarks, after which we will open the floor for Q&A. Thank you, over to you, Mr. Dhanuka. Thank you, Manishji. Good afternoon, ladies and gentlemen. Myself, M.K. Dhanuka, Vice Chairman and Managing Director of Dhanuka Agritech Limited. I hope all of you are doing well and keeping safe. Thank you for joining us in the conference call for the results of Q4 FY 2022-2023 of Dhanuka Agritech Limited. I have with me Mr. Rahul Dhanuka, Joint Managing Director; Mr. Harsh Dhanuka, Executive Director; and Mr. V.K. Bansal, CFO. As you know, Dhanuka Agritech Limited is a leading agrochemical company in India, focusing on branded sales in the market. The company's strength lies in the manufacturing and marketing of formulated products. The product portfolio is spread across insecticides, herbicides, fungicides, and plant growth promoters. Dhanuka Agritech is working with the vision of transforming India through agriculture. Our belief is that when we transform the lives of farmers by enhancing their productivity and quality, and in turn enhancing their income, we are making a small contribution in transforming India. We work in all major crops in India and have implemented the best-in-class technology to ensure a smooth and efficient supply chain. Dhanuka has a pan-India presence through its marketing team and warehouses in all major states across India. With three manufacturing units and 41 warehouses across India, Dhanuka cater to around 6,500 distributors and dealers and around 80,000 retailers. Through this extensive network, Dhanuka reaches out to approximately 10 million Indian farmers with its products and services. Dhanuka has more than 1,000 technocommercial staff, supported by a strong sales and marketing team, to promote and develop new products. It was due to the efforts of this team that Dhanuka was able to secure higher growth in its focused products in comparison to the generic products, which helped us to protect the bottom line in a challenging year. Dhanuka's strong R&D division has world-class NABL-accredited laboratory as well as an excellent team for new product registration and development. Dhanuka has international collaboration with 10 leading global agrochemical companies from the US, Japan, and Europe, which helps us to introduce the latest technology in India. Recently, Dhanuka have established a modern R&D facility with a research farm in Palwal, Haryana, for faster development and commercialization of new products. The rainfall was erratic, both in kharif and rabi season. The pest infestation was also low, due to which many sprays were missed out by the farmers. This has impacted the growth plans of the industry as well as the company. In the first half of the financial year, the prices of raw materials were on an increasing trend, but in the second half of the financial year, the prices were on a reducing trend on a monthly basis, due to which the company has incurred losses on high-cost inventory. This has impacted the gross margin and EBITDA margin of the company. Now moving on to the financial performance, our revenue from operations during Q4 FY 2022-2023 is INR 371.23 crores, representing an increase of 16.63% over the corresponding period last year. For the financial year 2022-2023, it is INR 1,700.22 crores, which is 15.05% up over the last year. First time, Dhanuka has touched the mark of 1,700 crore top line. EBITDA stood at INR 77.88 crores in Q4 of FY 2022-2023, up 19.67% year-on-year basis. For the financial year 2022-2023, it is INR 278.69 crores, up 5.82% over last year. Profit after tax is at INR 65.31 crores in Q4 of FY 2022-2023, up 20.28% compared to the corresponding previous quarter. It is INR 233.51 crores in FY 2022-2023, up 11.85% year-on-year basis. First time Dhanuka has touched the earnings per share more than INR 50 per equity share. The zone wise percentage share of Dhanuka, of turnover for Q4 FY 2022-2023 was North India 29%, East India 11%, West India 19%, and the highest share was from South India, 41%. Product category by share of turnover for Q4 of FY 2022-2023 was insecticides 46%, fungicides 17%, herbicides 27%, and other 10%. The company has already rewarded its equity shareholders as it bought back 10 lakh equity shares at the rate of INR 850 per equity share, absorbing INR 85 crores. The board of directors has recommended 100% final dividend, that is, INR 2 per equity share, having a face value of INR 2 per equity share. The final dividend will be subject to the approval of the shareholders in their 38th annual general meeting, scheduled to be held on August 2, 2023. We are happy to inform you that the company has launched the following new products. Number one, Im-Prove, 29.73% SC, which is a maize herbicide. Mesotrax, 24.97% SC, which is also a herbicide for maize and sugarcane. Apart from this, the company has introduced the three biological products. One is Downil, 2% AR for controlling downy mildew. Speranyl, 2% AR for controlling of wilt and rot, and Pytex, 1% WP for controlling of white grubs, termites, and borers. We are happy to inform you that the company has received patent registration for its product, soluble granular insecticidal composition, Carter, with brand name Mortar. Our technical plant project at Dahej is progressing well. We are expecting the production to start in 3rd week of July. Initially, we will start with the production of Bifenthrin technical. Recently, we have received important government approvals for operating a factory, that is, factory license, PESO license, which is issued by Petroleum and Explosives Safety Organization, as well as power connection approval. The new plant will support Dhanuka in our long-term business objectives and revenue growth. We consider ourselves responsible towards securing the farmers' welfare and preserving food security of the nation. We continue to strengthen our association with the Farmer Producer Organization, that is FPOs, Krishi Vigyan Kendras, that is KVK, and other critical institutions to increase our business expertise and boost our market presence. Thank you very much for your kind attention. We will now take the questions from 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 the handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Prashant Biyani from Elara Securities. Please go ahead. Yeah, thanks for the opportunity. My question is for Mr. Rahul Dhanuka. Sir, in this scenario where other companies have struggled to clock margin accretive growth, what went right for you this quarter? Well, we really strengthened our relationship with the channel in the previous quarter. Our team took it to the next level in terms of leveraging our channel reach, primary as well as secondary. Okay. Sir, for secondary sales, would you mean that even the liquidation was strong for us? Come again? By secondary sales, would you mean that even the liquidation was strong in this quarter? When you say liquidation at the farmer level consumption, that may not be happening immediately. Mm-hmm. Moving from the primary level to the secondary level, yes. Which channel would you mean when you say primary to secondary? Primary is the Dhanuka direct accounts. Mm-hmm. The secondary channel is when they distribute it to sub-retailers. Okay. Sir, what is the current market situation, and how do you see the market shaping up for kharif? Okay. Market shaping up for Kharif is from two angles. One is how the commodity prices are panning out. Second is how the product prices, agrochemical prices are appearing. Commodity prices continue to show a positive trend in terms of wheat and sugarcane. Mm. Cotton prices have slightly eased out in last few days. Overall, even after easing out, we are at a really good, reasonable level in terms of farmer profitability. Commodity demand appears favorable. In terms of the product prices, so far we have witnessed in last quarter and even now, a slowdown in terms of prices cooling down for agrochemical imports, so the domestic prices are also, as of now, soft. These two things put together will create a business outlook. In terms of the agriculture opportunity and the on ground, I think so that is very favorable, given various supported schemes from the government and farmers' inclination towards moving towards horticulture crops. Right. Lastly, sir, on the technical facility front, what would be our plans for production ramp-up post-commencement, and how much revenue should we pencil in for this year and next? Right. We are expecting the production to start in third week of July. In the current financial year, we are expecting a revenue of around INR 60 crores from the technical plant. As we move into the next financial year, the definitely the production and the revenue would be much higher. Okay. That's it. Thank you from my side. Thank you. The next question is from the line of Sudarshan Padmanabhan from JM Financial PMS. Please go ahead. Thank you for taking my question. Congrats on good set of numbers. Sir, my question is just taking forward from the previous participant. This is on, you know, the inventory. I mean, if you're looking at how the channel behavior has been, it has been a little slow, primarily, you know, on account of, you know, the prices falling down, et cetera. Do you think this issue is largely sorted? If you can talk a little bit more about the inventory behavior in the channel, and also how, you know, your inventory is in the channel, you know, in that context. The inventory in the channel is mixed. Various products of Rabi are still in the pipeline. You know, we were looking at price going up in April, May. In anticipation of that, channel has lifted up some inventories in March. That is not yet to happen. However, this is also an expression of solidarity that the channel has demonstrated with us in Dhanuka, and also the way channel forces demand panning out in May and June. Keeping these two things together, this Q4 business has happened. Going forward, the consumption of this product at the farmer level will decide how there is movement further. Sir, is there any specific sub-segment where you are seeing a little bit more challenge, like, I mean, whether it is insecticides or fungicides or herbicides, or is it across the board? I would say the segments are crop-specific, that the segments of sugarcane, segments of maize and paddy and soya bean and summer pulses, these have shown traction in the month of March in anticipation of consumption in April and May. In terms of agrochemical segment, herbicides have shown more traction. Sure, sir. Sir, with respect to the raw material prices, the high-cost raw material prices, I mean, with this quarter, you know, sales, I mean, have we been able to exhaust the entire amount of high-cost inventory, or how much of high-cost inventory is still remaining with us, sir? You see, high-cost inventory is becoming an easy part of life. Every month the prices are declining. Yes, as on 31st of March, some high-cost inventory was in the system, again, the IC price is dropping again in the month of April and May as well. A significant portion of high inventory was recovered in Q4 itself. One final question before I join. Sir, if I'm looking at your raw material prices, I mean, a lot of, you know, the price hikes happened, you know, post-COVID in the last 18 months or so, compared to what it was in pre-COVID. I mean, do you think that the prices have rationalized enough, you know, to, you know, levels which are a little bit more reasonable, or do you think that there is still significant downside left for the prices to get back to the reasonable level? The uncertainty prevails. The prices have corrected this month also, and as of now, it seems that the prices would start improving sometime July onwards. Sure, sir. Thank you a lot. I'm done. Thank you. Before we take the next question, a reminder to all participants that you may press star and one to ask a question. The next question is from the line of Himanshu Upadhyay from O3 Capital. Please go ahead. Yeah. Hi, good afternoon. Congrats on good set of results. I had a question on export opportunities, okay? In our previous calls, we had stated that we have a team of export manager or a person we have hired. What we are finding is, even for our formulation business, there are opportunities, okay? Can you elaborate on how are we focusing on that business, what are the challenges in that business, and can it be a substantial business for us in next 2-3 years, or it is not the focus area itself for the formulation export business? Right. so, formulation exports is definitely an important business that we are looking at. in next 2 to 3 years, this business will grow. We established the division, last year only, and we are receiving a lot of query, and we are trying to develop our relations with international customers and receiving very good response. Okay. What will be our strategy for that business in here, if we are on the, especially on the formulation business exports? Currently. Yeah, the scope is very high. Currently, we are addressing easy-to-reach markets, as we do not have international registration. We are also looking at getting registrations in some of the developed markets, as the business is very attractive in those markets. We see this as a very good potential in the future, and we will continue to work for the formulation exports also. The, our API plant, which was to come in July, is it means on time, and are trial production, et cetera, are started for that plant, or there is still some way to go for it to start trial production also? Yes. Our commercial production is started, expected to start on third week of July. All the things like trial production and everything will happen in time before that. Okay. One thing, just out of curiosity, I had a question: You are investing in drones, agro chemicals and plant nutrition, et cetera, okay. What is our view on seeds business, have you evaluated that business and its, we have evaluated that business and rejected? What would be the reason for it, and why not... Which it is also a business which is very near to what we are doing, but any specific reason whether you like it, you don't like it, or, why is it at the back of, or lower in priority versus the other businesses which we are trying to develop? Just some of your thoughts. You are asking about the business prospects in seed industry? No, I'm saying that we have been going from agrochemicals to nearby businesses also, okay? Even, plant growth, plant nutrition and plant growth enablers and all those type of products, okay, which is some 10%, 12% of others revenue. Have you evaluated seed business, and why not go into that business also? We are investing for exports, businesses and all those businesses. What is your. Right now, we are seeing drones, precision agriculture as the frontier technologies of agri tech, and we are also looking at nutrition and bioproducts as the current demand of the farmer. Export opportunity was what we looked at as opportunity Dhanuka can explore with our technical plant also coming up. The focus is here. Seed is a very adjacent business, no wonder, and, as of now, we are focused on what we are doing. Tomorrow, seed is not a closed door for us, and at right time, we might like to explore that. Mr. Himanshu, we request that you return to the question queue for follow-up questions. The next question is from the line of Viraj from SiMPL. Please go ahead. Yeah, hi. Just a couple of questions. First is, you know, for Q4 and for FY23, can you give some perspectives in terms of price and volume mix? Yeah. You see, in terms of Q4, the value and volume growth was similar. There was hardly any difference. On annual basis, just little difference. Volume growth is around 8%, as against the overall growth, 15%. You said that we have made corrections and, you know, we've taken some steps in terms of the channel part. Can you elaborate a little bit more in terms of what, you know, how is that network changed for us, and what are the initiatives we took there? Right. Dhanuka has a Pan-India network of 6,500 primary channel partners. This is spread across Northeast Assam to South India, Jammu and Kashmir, and Gujarat, and, you know, just to give a flavor of Pan-India. This Pan-India network, we have worked over last year, especially to increase our secondary reach through the primary channels. In the FY23, we have increased our penetration in the secondary channel. We have increased our reach in the rural hinterland. That is what has changed slightly over last year. Okay, second question was largely in terms of the gross margin. Now, if you look at our gross margin, it's at lowest levels in last 10 years, right? We're all around 34.5%, and because the margin structure we used to own back in 2013. Now, and this is also one of the reasons why our operating margin are also a bit more there. Just the question is in two parts. One is just to understand the impact of high cost inventory, how much would that be? Other than that, are there any other reasons which are more structural in nature, say, the share of non-specialty moving up or, the margins at which we used to own in terms of larger brands or in the specialty portfolio, has that also moderated than what we used to own earlier? If you can just elaborate reasons behind the low contribution margins and how that should kind of, you know, behave on next couple of years for us. You see, for the year 2022, 2023, this problem is for the industry as a whole. We were not exception to that. Large impact on account of the price erosion and the high inventory costs. Secondly, there was a substantial growth in the B2B share segment. Normally, in the B2B share segment, competition is very high. Because of this, our margins are impacted, and you are right, key variable margin has badly hit in the year, but it's for all. We are expecting this year there should be some improvement in the gross margin side in the current financial year. Okay. You know, just a related question is, you know, if you look at our operating expenses, say, in 2023, does this fully reflect the normalized spends which we used to do towards demand creation activities like field staff or A&P spends towards new brands? This is like a normalized spend for us because it's been, you know, quite low for last few quarters, and we've been kind of been able to control. The spends have been quite in a very tight band for us, so just trying to understand, you know, does this fully reflect the activities which we used to do pre-COVID, or that is still yet to be reflected? It is on full scale level this year. Sorry, sir? The COVID impact is gone. It is on full scale basis. Okay. Any other areas where we've been able to derive cost savings or we were able to have a much more better control on the cost? Cost control, you will see our employee cost has improved significantly over a period of last 5 years. Our productivity has increased. Okay. If I can just squeeze in one last question. You know, in the presentation you talked about, you know, us starting out with production for Bifenthrin. If you look at some of these molecules, especially in the synthetic pyrethroids, you know, given the way the prices are right now, even some of the most backward-integrated players are not making any money. You know, they're operating below cost and in certain cases are shutting down capacity. In that sense, how should we understand the profitability, you know, behaving, say, for next one or two years? Yes, currently there is a significant price challenge in pyrethroids, and we find the situation in Bifenthrin is favorable, and we are expecting positive gross contribution from Bifenthrin, and that is why we have taken a decision to start with this product for the first round. Mr. Viraj, we request that you return to the question queue for follow-up questions. We shall take the next question. The next question comes from the line of Zainab Petiwala from Swan Investments. Please go ahead. Hi, sir. Thanks a lot for this opportunity. What will be the total addressable market size for the patented product that we got? We have got a patent for our pre-launch product, Tizom. We had launched this product way back in 2014 or 2015. The patent was long-standing. This product is finding application in paddy, stem borer and leaf folder, recently we have decided to expand it in sugarcane top shoot borer also. Paddy stem borer, paddy leaf folder, and sugarcane top borer is a large market size, should be close to about INR 4,000 crores. Okay. This product will compete with Rynaxypyr of FMC in that segment. Okay. Are we planning any CapEx for our unit at Dahej or no plans for FY 2024 and FY 2025? Yes, in the current financial year, there will be some CapEx beyond the current cadence. For the next financial year, we will share the plans in forthcoming call. Okay, sir. Thank you a lot, sir. Thank you. Thank you. The next question is from the line of Rohit Nagraj from Centrum Broking. Please go ahead. Thanks for the opportunity, congrats on a good Q4. First question is, there is a lot of talk regarding El Niño impact during this kharif season. What is our history, I mean, what does our history tells us in terms of whenever El Niño has occurred historically? Has it impacted us severely in terms of volumes and business? Just your perspective on the same. Thank you. Right. El Niño is normally associated with lower rainfall in South Asia, yet there have been years which were El Niño years and still India received relevant and good rainfall. El Niño has a mixed bag when it comes to rainfalls and uncertainty associated with it. In case of errativity and abnormality in rainfall, Indian agriculture will get impacted and so will our business be. At Dhanuka, we are trying to make ourselves closely associated with irrigated setup of the farmers. A large section of Indian agriculture is irrigated, and with recent irrigation projects and rural electrification, irrigation opportunities have increased, and we are positioning ourselves in those segments. Dhanuka has introduced various products which are useful for arid application and dry application. Even in case of a low rainfall situation, our product portfolio is designed to mitigate the risk. Sure, got it. Thank you for that explanation. Second, just some clarifications on the greenfield CapEx. I understand the overall CapEx would be about, say, INR 260-270 crores, which includes the formulation unit, insecticide, MPP, and for the bifenthrin and MPP miticide plant. Earlier, we had guided EBITDA margins of 12%-15%. But given that, initially, these kind of margins will be seen in FY25 or so. Are these numbers largely in line and correct? You see, sir, Harsh, I'm replying. You have to take the Dahej project as a startup. It is not possible to have those margins at initial level. The margins are possible once we have some tie-up with Japanese product and do some contract manufacturing, et cetera. With the initial phase of these synthetic pyrethroids, that kind of margins are not possible. Initially, first year we are envisaging around 20% gross margin, but EBITDA margins will be not positive this year, in first year, because the volumes are very less. Once the volumes will start picking up, then the EBITDA margin will come in positive. Initially, as a startup, companies makes loss and after two, three years, they become profitable. Similarly, Dahej project should also be considered as a startup, but for long term, once we get the Japanese product, et cetera, it will be a much viable project in times to come. Right, sir. Right, sir. Got it. This bifenthrin technical, we will be selling it, B2B, or we will be also using it, captively? We will be using it captively also, and apart from this, we will supply to other domestic players in India, and we would also like to export also. It is expected that around 50/50% will be export and 50% will be domestic. Right. Just one clarification again on the product launches. Last time you had indicated in FY 2024, we have 290 molecules and 394 molecules. The current two launches include these which were planned for FY 2024? Yes. Yes, that is correct. Okay, these, 2 are both, 9(3), molecules? 9(4). Okay. Fair enough. Fair Fair enough. Just one last clarification. The greenfield project CapEx will be about INR 260 crores, which will be completely capitalized during FY24. Is that correct? FY 2024? Yes. In FY 24, entire INR 267 will not be capitalized. Okay, how much will be capitalized during this year, and how much portion will go in for FY 25? This year would be around INR 200 CR. Okay, fair enough. Thank you so much, and best of luck, sir. Thank you. The next question is from the line of Chintan Modi, from Haitong Securities India Private Limited. Please go ahead, sir. Yeah. Thank you, sir. Sir, can you tell how much was the volume growth for the fourth quarter and for the full year? Yeah, see, volume growth in the quarter four was 16.5%, and full year it was 8%. 8%? Yeah. Okay. Considering that next year the demand on ground seems to be decent, should we expect this 8% kind of volume growth to continue, or you expect a higher volume growth in the next year? Of course, we are expecting a higher volume growth in this year. Okay. That would be somewhere around, can we expect like, in the range of 10%-15% out, approximately? No, we are expecting in double digits, but it just depends on monsoon. Okay, sure. Because of reducing pricing trend, the volume growth will be higher this year in comparison to the value growth. Sure, sure. Looking at the growth margins, can we directionally expect some improvement to happen in FY 2024 compared to FY 2023? Yes, for sure! We are very much confident that there should be some improvement this year, for sure. Sure. Sir, just one observation, if you look at last five years of gross margin trend, it has been gradually, you know, deteriorating. Last year, I understand it was because of the lot of raw materials or, I mean, the volatility that we have seen in the raw material prices. Directionally, it has been coming down. Some highlight, if you can share on that. This is not true. In the year 2021, the gross margin was on the peak. Sir, your, COGS, what I can see currently in FY 21 is about 62.2%, and which has increased to 65.6% in FY 23. Gross margin in FY 2021 were highest, which was 37.7%, and in this year, 34.39%. That deterioration has happened, that is okay. Also little bit on a longer trend also, if you look at, there has been some deterioration. Yeah. Over a period of time, you know, the segment I'm seeing, the share of herbicide has increased. In the case of herbicide, the competition is fierce. That way, little impact is there. This year was very, very difficult for the industry as a whole. Sure. Okay, that's it from my end. Thank you. Thank you. The next question is from the line of Prashant Biyani from Elara Securities. Please go ahead. Yeah. Rahul ji, you mentioned in the initial question that channel is in anticipating early demands. This will be for which crop and in which segment? I shared that maize, sugarcane, paddy and summer pulses. Okay. Sir, otherwise, is it that in 4Q placement was a bit higher than normal or some of the products we might have been placing in Q1, we have done some early placement because of channel wanting that? Some placement has been higher. Yes. Okay. One different question. Most of the fertilizer companies are now venturing into agrochemical space. Even now, Sitara planning to set up the plant. Why can't we do the same? Have we thought of either developing a Nano Urea or a Nano DAP by ourself, or entering into some sort of a tie-up with IFFCO, or even set up a SSP manufacturing facility for which phosphate source is available, we also have the money power to invest? I could not get your question, Mr. Prashant. The question is about fertilizer companies entering agrochemical space, or the question is about Dhanuka setting up fertilizer? We setting up fertilizer. Right. As of now, we are looking at value-added nutrition management, what the Prime Minister has been constantly, continuously been talking about. One is soil health, and second is the integrated nutrition management. That is where we are kind of focusing ourselves on. The bulk fertilizer, which is a volume game, is as of now left with the fertilizer companies. As per the nanotechnology, a lot of research is yet to be done on the nanotechnology and how it emerges and its applications, and its application, utility and benefits are yet to be proven. Dhanuka is watching this space closely, doing our own R&D at our newly established R&D center in Palwal, and we are evaluating the value added to the farmer before we can come in actively and commercially. Okay. that's it from my side. Thank you. The next question is from the line of Yogesh Tiwari from Arihant Capital. Please go ahead. Yeah. Good evening, sir. My first question is, basically, we have launched 3 biological products. Any long-term target, what would be the revenue contribution from biological products in next 2-3 years to the overall revenue? Well, I believe in about three years' time, this could be contributing up to 5% of our total revenue. Okay, 5%. Sir, in terms of guidance, you have mentioned about 50-100 basis point improvement on current year. Will this be driven by, like, cost control, like, the doing away or with high margin, high cost inventory, so it will be more driven by that or by the product mix? It will be driven by largely the improvement in the gross margin. Okay. Sir, last question on the mix. Basically, we have launched two herbicides, and mostly our product portfolio is like 56% insecticides. Going forward, will herbicide share increase compared to insecticides? Well, I believe, insecticide segment is going to become richer in Dhanuka over the next three years. Our share in insecticide is going to go up, as in insecticide share in our portfolio is going to go up. Sure. Sir, lastly, within insecticide, what would be the spread between pyrethroids and organophosphates? The spread between pyrethroids and organophosphates, as in, these are not the only two segments. There are at least seven different segments of insecticides that we operate on. Pyrethroids and organophosphates are one small segment of the total portfolio of close to 50 insecticides that we handle. Okay. Which segment would be like organo? I assume the organophosphate would be the major part within insecticide, for our portfolio. What exactly is your question? Yeah. Just, yeah, just wanted to know, what type of within insecticides, which would be the leading segment, subsegment within insecticides portfolio? Yes. Actually, now, as the chemistry has improved over the last two decades, there is not one segment which is dominating. Well, almost 30 years back, organophosphates were dominating. 20 years back, before Bt cotton came in, synthetic pyrethroids were dominating. After Bt cotton, synthetic pyrethroids and organophosphates have become a segment in the portfolio. Very important range. Even now, out of our 50 products, close to 11 or 12 brands will be synthetic pyrethroids and organophosphates. 30 other products come from different segments. Some of them are neonicotinoids, some of them are GABA inhibitors, some other are miticides. The spread is really wide. Some of the largest insecticides that we are handling, for example, Caldan and Rynaxypyr, which is cover liquid and cover granule. These are completely different chemistries and very powerful chemistries in their own capability. Synthetic pyrethroids and organophosphates do not dominate Dhanuka's portfolio. Emamectin Benzoate, which is a secondary metabolite of a bioproduct, extremely safe. We have a wide diversified across crops and different pests and diseases, different pests and insect portfolio, which we are going to only make powerful with some of our launches. Last year, we launched Decide, our Japanese premix product, and next year also, we are going to launch a Japanese premix product in horticulture segment. Dhanuka is going to strengthen the insecticide portfolio significantly in next couple of years. Mr. Yogesh, we request that you return to the question queue for follow-up questions. We shall take the next question. The next question comes from the line of Viraj from SiMPL. Please go ahead. Yeah, I just had one query. You know, the guidance which you gave in terms of margin, 50-100 basis points, that is after considering the impact we may have because of the Dahej facility commissioning, right? Can you repeat the question? Your voice was not audible. Improvement of, 50-100 basis points, which we gave, for FY 2024, that is including the impact we may see because of Dahej's facility commissioning. No, no. We are telling the entire thing, see, standalone without Dahej so far now. Dahej's contribution will be very insignificant in this year. It is irrespective of Dahej. It is irrespective of Dahej? Yeah. Okay. Thank you. Thank you. The next question is from the line of Rohit Nagraj from Centrum Broking. Please go ahead. Yeah, thanks for the follow-up. Just one question in terms of, any further dialogues with, Japanese customers. We've been talking, with them, regarding any long-term contract or for some products. Any product development on the same? Thank you. Yes. There is development, and we are in continuous discussion. I think as we have informed earlier, these are long-term projects, so we are not expecting anything to close very quickly. It may take some time, but we are very confident of getting Japanese projects in the future because of our long-term relationships with the Japanese partners. Sure. That's it. Thank you so much. Thank you. The next question is from the line of Rohan Gupta from Nuvama. Please go ahead. Hi, sir, good evening, congratulations on good set of number in the current scenario. I already just wanted to have some clarification in terms of systems and channel inventory, not just only for Dhanuka, but for across the industry. In the current scenario, the industry is preparing for the kharif crop, but we have seen that the season and El Niño has been impacting the channel, and there has been some resistance also from the channel in terms of restocking the inventory. Also, on the contrary, we are seeing that the raw material prices are falling, which may lead to fall in end product pricing as well. In this kind of scenario, how you see that the channel inventory is right now? Is it less, more, and, I mean, yes, that is the first clarification. Yeah. Channel inventory would be relatively higher. Okay. This is across and when the system or the channel is sitting on a high cost inventory, you are expecting the prices to fall. Will it lead to lower acceptance once the prices fall, raw material prices fall? Say, suppose in July, when you put the new material in the market at lower prices, will there be lower acceptance from the dealer or channel at the new prices because they will be sitting on a high cost inventory? How the system will pan out? Yeah. There is that risk, certainly, that the listing is mitigated for a while before the liquidation happens. You see, in the month of March, the many companies are having different scheme on account of the incremental discount, right? After considering the discount impact probably March. Hello? Yeah. Okay. sir, we have also seen that there is a very significant practice now, which has been continuously increasing year by year, is offering very heavy cash discounts or CD schemes or attractive schemes at the start of the season itself in the placement time, placement season. Generally, March, April, which is considered to be a placement season, we used to see earlier CDs or company offerings, CDs of close to 6%-8%. We have seen some of the new players or even the existing players in the system have offered CDs or incentive schemes as aggressive as even 12% to even going up to 18% also. Do you see that this new trend is emerging, which is definitely making the large dealers and distributors to grab the material at the starting of the season and to benefit from the schemes? When we are more closer to the consumption, that basically drives the leads to volatility or unpredictability for players like you, because we don't know how much large dealers, distributors will be sitting on a low or previous inventories. That is probably making your business more unpredictable and more volatile. Well, business has not become any lesser or more unpredictable or volatile. Business has always been like that. Agriculture, agrochemical has always been as unpredictable and as volatile. The need to feed 1.5 billion population in India and now 8 billion populations across the globe, opportunity to export wheat and various other commodities, has only put India relatively on the forefront of balancing the global food demand and agrochemical industry in a better position to be able to service that. Nothing about uncertainty or unpredictability has changed here. The weather and the supply chain remains as unpredictable as ever. Talking about the cash discounts, these are schemes camouflaged under different titles. Like earlier we said, that the balancing of the schemes allows the channel to mitigate the risk of reducing prices. These are the schemes which are available to the channel, offered by companies by different names. Okay, sir. Thank you. Thank you. I would now like to hand the conference over to Mr. M.K. Dhanuka for closing comments. Good evening, friends. To summarize at last, Dhanuka continues to demonstrate our ability to overcome challenges and emerge stronger despite uncertain business environment. Dhanuka will aggressively roll out new formulations in the upcoming quarter to ensure that it reaches to the consumer. I reassure our shareholder and all the stakeholder, that we are committed to the task of transforming the landscape of agriculture in India, and will play an integral role in rewriting the future of a better and new India. Wishing you all good health and safety. Thank you very much. Thank you. On behalf of Antique Stock Broking, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.