Good day, ladies and gentlemen. Welcome to the Best Agrolife Limited Q2 FY 2023 earnings conference call. As a reminder, all participant lines will be in the listen only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star then zero on your touch tone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Rahul Thakur from Ernst & Young. Thank you, and over to you, sir. Thank you, Lisa. Hello, and good afternoon, everyone. I'm pleased to welcome you all to Q2 FY 2023 earnings call of Best Agrolife Limited. Please note a copy of all our disclosures are available on the investor section of our website as well as on the stock exchanges. Anything said on this call which reflects our outlook toward the future or which could be construed as a forward-looking statement must be reviewed in conjunction with the risks that the company has listed. Today, on the management side, we have with us Mr. Vimal Alawadhi, Managing Director, Mr. Raajan Ailawadhi, Executive Director, Mr. Atul Garg, Chief Financial Officer, and Mr. Davinder Dogra, President Finance. I now hand over the call to Mr. Vimal Alawadhi for his opening remarks. Over to you, Vimal Ji. Hi. Thank you and welcome everyone to the Q2 FY 2023 earnings call. I hope you all are doing well and enjoyed Diwali festivities. Given this is our first conference call interaction, before I discuss the business performance for the quarter, let me walk you through a background on the company. Best Agrolife is among the top 15 agrochemical companies in India. Founded in 2010, we began our journey as an agrochemicals formulation company and over the years entered into manufacturing of technicals as well by 2017. In branded formulation with Best brand, we have started in 2017. With the launch of the Best brand, our strategy was to gradually start introducing first-to-market complex products as well as build a product basket of novel molecules. Since 2017, we have worked on various strategic initiatives which are yielding results today. Let me briefly discuss these initiatives. Investment in human capital. A strong team is an asset for any organization. It was our endeavor to build a strong and experienced professional management team across R&D, marketing, sales, production, et cetera. To the team that has joined us from reputed domestic and global companies, carrying rich experience and shares our vision of growth. In that, I would say Mr. Karlekar, who is the head of many MNC companies in India and Southeast Asia also, now he's with us. In R&D, basically we are R&D company and we are doing many innovation in our R&D. Number two is investment in capacities. We focused on developing manufacturing capabilities and invested in capacities for growth. As of now, we have 30,000 metric ton formulation capacity and 7,000 metric ton technical capacity. In R&D investment, we have continuously invested heavily in R&D to build a robust product pipeline of complex and novel molecules. Our strong R&D focus has fortified as we have been granted a patent of four products, each of them in insecticide, herbicide, and fungicide. We have also launched a basket of new product under first-to-market strategy. CTPR formulation being one of the best examples. We have also been granted registration for indigenous manufacturing for Pyroxasulfone Technical, for which India is currently import-dependent, same in CTPR. Overall, investment in R&D efforts help us develop a wide product basket of patented as well as complex products. Widened geographical presence. Initially, we were present only in North India market. From here, we grew our network 1,000+ distributors in 2019 to more than 5,200 distributors as we speak. We are now present in almost all Indian states with the exception of a few. All these initiatives have put us on path of strong growth trajectory with a robust product pipeline, wide distribution network and experienced management team. Let me now highlight the business update for the quarter. I would like to inform you that this was the highest revenue generation quarter in the company's history. Our revenue for the quarter was INR 700 crore, more than double our revenue as compared to the same period last year. This was driven by our first patented product, Ronfen, as well as other newly launched products such as Axeman, Tombo, and Citigen. Ronfen contribute significantly revenue for the quarter. Overall, new products launched this year contributed majorly to the top line. This is in line with our commentary that most of our growth will come from new products even in future. I would like highlight that we were late in launching Ronfen this year. We started selling this product in July, whereas the season for this product start in May, June every year. Despite our late market entry, we saw unprecedented demand of Ronfen. It gives me immense pleasure to say that in my career I have not witnessed an agrochem product receive such penetration and generate such revenue in the first three months of its launch. This is testimony of our R&D capabilities. This is first product. This kind of 27 more product we have in pipeline, which we are getting each year. I am also proud to inform you all that Best Agrolife became the first company in India to launch CTPR formulation. The single molecule has around INR 2,800 crore domestic market with only two players other than the innovator that are currently selling the product. Even though we were first to enter the market, we expect to gain good market share in this product. During the quarter, we also generated registration of indigenous manufacturing of Pyroxasulfone Technical. This product, with a domestic market of INR 450 crore, is currently being imported in India, and we expect to launch this in the market around December 2022. Given that we are the only domestic manufacturer of the product, we expect to generate decent revenue from this in the coming quarters and years. Before I conclude, I would like to share that we have been granted a patent by Patent Office of India for a synergistic fungicide composition comprising cyazofamid, dimethomorph, and difenoconazole for the term of 20 years, which is global patent. To conclude, we have a strong pipeline of revolutionary and complex products. The launch for the two patented product is pending, which is expected by next year. Overall, a strong pipeline of products under patented first-to-market and import substitute strategy give me enough confidence to state that the Best Agrolife will deliver strong growth in revenues as well as profitability going ahead. I would now hand over the floor to Mr. Dogra, our President Finance, who will take through the financial. Thank you. Thank you very much. Thank you, Vimal Alawadhi. Hello everyone, and thank you for joining us here today. I would like to briefly touch upon the key performance highlights for the quarter ended 30th September, 2022, after which we'll open the floor for the questions and the answers. Operating revenues for Q2 FY 2023 was INR 700 crore as compared to INR 324 crore in last year same quarter and a 116% increase from last year. On sequential basis, revenue grew by 51%. Revenue growth was driven by new product launch, as Mr. Vimal Alawadhi said, and which contributed mostly in the revenue growth from the last year. EBITDA was at INR 182 crore in Q2 FY 2023 as compared to INR 35 crore in the last year quarter, a growth of 418% year on year. This would translate to 26% EBITDA margins for Q2 this year, an expansion of 15 percentage points over the same quarter last year. Higher EBITDA margins were driven by the new products, majorly contributed by Ronfen and other few products which we have mentioned, which we launched during the quarter. Profit after tax was at INR 130 crore in Q2 FY 2023 as compared to INR 25 crore in Q2 FY 2022, a growth of 415% year-on-year. Coming to the segmental results, revenue from branded formulation was around 61%, both the B2C and B2B formulation business. Revenue from technical business was around 39%. As guided earlier, our revenue from branded formulation will continue to improve as we expand our. As we are expanding B2B and B2C area basis and also launching new branded products. On the balance sheet side, our working capital for the first half looks stretched due to higher inventory for the new product launches as well as products for launching, to be launched in the coming quarter. To build a branded business, we were required to provide credit to our distributors, expanding the number of distributors majorly, which stretched our debtor days. I would like to highlight that we plan to bring down the working capital days in the range of 90-100 days. We are working towards this target, and we have already put in place new incentive schemes for the same. During the quarter, the cash and cash equivalent, including banks, bank balance improved significantly to INR 148 crore as on September 2022. With this, we'd like to open the Q&A section. Thank you. Thank you. Ladies and gentlemen, we will now begin with the question and answer session. Anyone wishing to ask a question may please press star and one on your touchtone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. Participants, in order to ensure that the management is able to address questions from all participants in this conference, we request you to limit your questions to two per participant only. The first question is on the line of Dhruv Hemrajka from Monarch AIF. Please go ahead. Yeah. Good afternoon, sir, and congratulations on a great set of numbers. My question is regarding the recent patent for the fungicide product that you have got. What is the market size for this product? Yeah. Good afternoon. Raj on this side. Yeah. Yeah. Basically, previously these products are available in solo formulations, whereas put together this product goes in a particular downy mildew, powdery mildew segment. Uh-huh. In grapes and in various fruit crops. The market size is approximately INR 350 crore of this individual molecules, particular in this segment where we are trying to capture, where downy mildew and powdery mildew and oomycetes class is there or fungus is there. This particular combination will be able to control that particular class and both these diseases, downy mildew and powdery mildew. Out of INR 350 crore, easily with this premix, which will, you know, reduce number of sprays also, we can but easily in first year itself we can capture around 20% in, with the launch itself. Okay. Sir, this market share of INR 350 crore which you're trying to capture, is it serviced by the domestic players or by imports? No, no. It is basically this product is in import only. Recently one technical indigenous manufacturer players have also entered in one molecule. Solo formulations were, you know, there were formulations imported in solo products, like azoxystrobin is there, that solo formulation is available, but it is also in monopoly only. One player is having that, and that formulation is also again patented. This way farmer was also, you know, he was also mixing these two products or some other products also because the disease complex appears in these crops basically. That's why we decided to bring this premix in proprietary patented formulation to control that entire complete disease complex together. Okay. Sir, what would be the launch date, launch timeline of this product? Basically, this is in registration. It may take little bit time. I believe so that by second, third quarter of next year, in this period it will be available. Maybe we have more than a year to go for this new patented product to be launched in the market. Yeah. Less than a year. Approximately a year you can say. Approximately a year. Sir, my second question is on the export market opportunities. Right now we don't have much export opportunity, export sales coming in, but now we have a blockbuster launch of the product Ronfen in the domestic market. How do you see in-licensing, you know, of this product, to the export markets and also the other products? Definitely, we have near about 28 unique products in the pipeline. Each product, you know, like India, we go through registration for every one of the products. The same product we have to go for the other country and each country have different regulation for every product. We already have started from last 3 years, some of Southeast Asia countries like Thailand, like Vietnam. Also we have started something in Brazil and some Middle East. Many countries we have started registration. The moment we'll get registration, because we have all the patents for 20 years, globally patents we have all the molecules. Definitely once we will get the registration, we'll start that. More of that, this is not only the formulation which is our patented we are going to export in future. Definitely we are going to export our strobilurin chemistry product like cyproconazole, azoxystrobin. In that we are very strong in strobilurin chemistry. That as a technical, as an intermediate also we will start supplying in FY 2024. Okay. Definitely there is a big scope for us because we have unique combination also and unique products also and technical. Sure, sir. I'll come back in the queue. Thanks. Thank you. Thank you. The next question is on the line of Ranvir Singh from Edelweiss Wealth. Please go ahead. Yeah. Thank you for taking my question. First, let me appreciate the kind of in form transformation you are bringing and very good set of numbers, so congratulations for this. My question was related to the new product launches. You said that majority of the growth came from the new products. I assume that the base business has been flattish in this quarter. As we said, the launch of the new patented product Ronfen and few other three, four products, so majority of the contribution and the growth has been from the new products only. That has been our strategy for future also. The base business will be flattish or would be at the same level at best. In Q1, we had some INR 463-odd crore revenue. That also included any part of revenue from new products or new product all revenue came after Q1? All the new products were launched in Q2 only. There was some delay, but better for next year that all the new products were launched from Q2 only. Okay. For this quarter, I think some INR 250- odd crore what we, you know, the incremental sales we got. Majority of it came from Ronfen or the other four products also contributed. You know, if you could give some, you know, highlight how was the contribution of Ronfen versus the rest of the product. Of course mainly was Ronfen only, because that is our first patented combination. We have different process patent also for some product, but this was the first patented product which we have launched in Best Agrolife Limited. Definitely in first quarter to get that much of response was very good. With any of the new molecule when we are going to launch at first in India or first in any of the territory. First in first quarter get this kind of result was very, very good, and we are very, very happy with that. Because in first quarter we have that much of result, definitely in coming years and coming months and coming quarters will be fantastic for when this product will be launched fully. After this Q2, what would be the revenue guidance for FY 2023? Because earlier guidance, I think, the current H1 number seems to you know indicate that will exceed what we are seeing. If you could give some you know outlook here. Yeah, definitely. You are correct. As per, you know, we have given guidance, we will close that so we can see here. Definitely which we are giving guidance 30% of growth in the revenue and 20% in EBITDA, that definitely, we can achieve more than that of course. Guidance we are giving the same only. This year it will be like if suppose our revenue grows more than 30% growth, so it doesn't mean next year it will be now 30%. It will be still 30%. Whatever the growth it will come excess in any year. Next year we have already big plans. 30% and 20% which we always say, that will be maintained always. Yeah. My question was basically in this context, with INR 700 crore current revenue what we generated in this quarter, being a seasonal business, I think the most of it would have been in inventory and some debtors because, you know, channel filling would have happened in this quarter. Obviously we cannot extrapolate this into second half. If you could, you know, guide here that INR 700 crore, what incremental sales of INR 240 crore we have seen. Is this likely to adjust within the rest of the year or we will see other mode of revenue coming in there? Yeah. Actually, yeah. Basically, undoubtedly this second quarter is main quarter in agrochemical industry. This year particularly after rains were good everywhere, rabi is also looking very promising. You know, bumper area of sowing is coming in bengal gram and other crops it is coming. Third quarter then is also going to remain promising, no doubt in that. I expect this inventory, some of the inventory which we are holding in the start of fourth quarter itself, January month is also going to play an important role, and we will bring good numbers in next two quarters also. Can we expect something like INR 1,700 crore? Sorry to interrupt. Mr. Singh, may we request that you return to the question queue? This is the same question actually. Sir, there are participants waiting for their turn. Oh, okay. Okay. Thank you. Okay. Nice. I'll be back. Yeah. Thank you. The next question is on the line of Kushal Narnolia from HDFC Securities. Please go ahead. Hello. Am I audible? Yes, sir. Yes, yes. Yeah. Congratulations for very strong set of numbers for the quarter and H1 FY 2023. My question was regarding these new products only. Let's say you launched the Ronfen and you said that earlier that around INR 400 crore kind of revenue it can contribute for FY 2023. Still the guidance remains same for the year or you may revise upward for this year for the new product? Yeah, same, the question I got from the previous, you know. Anyways, definitely, we don't want to revise actually. Definitely this year will be better than what we have committed or like what we have committed earlier. Yeah. Because you know, you can say this was late. The Ronfen, our registration got late. Definitely, we can say that guidance will be there, but this year will be higher than that for sure. This year will be higher than that. Okay, great. On the same line only, so, let's say, about the Ronfen only, is it a seasonal kind of a product that Q2 remains major contributor or, let's say going forward, the product sales may get taper off in Q3 and Q4? Is it like that or there is no seasonality as such? Actually, as far as this product is concerned, it is not a seasonal product or achievement product. It is basically it goes for all sucking pest and it goes in cotton also, chili also. Chili is a major crop of rabi basically. If we put together all this sucking pest segment, it is a very big segment in India. Around 1/3 of Indian market comes from the sucking pest segment only, which is around INR 8,000 crore. Chili is a very important crop where, you know, more than 25 rounds of sprays are going to control sucking pest only. This product is proving promising for chili crop, which will play important role in third quarter and fourth quarter. January also, this will go. This is whole year product. Both season products basically. A good revenue from Ronfen will come in Q3 and Q4 also. Okay. Not major seasonality kind of things, one can expect in that, right? No. Sir, second thing was related to, as you said, that it has been stretched, the working capital for H1. What kind of sustainable working capital would be there? Secondarily, regarding debt also. From INR 90-odd crore, we have seen an increase to INR 200 and then INR 430, INR 450 crore debt. What kind of debt we can assume by end of this year? I'm asking for working capital debt. On the working capital size side, the inventory constitute a major part of the working capital, which we have, as we said, that we are looking by early January this year, the major of the inventory would be sold off or it will be liquidated as per the plan. On a normalized basis, since we are launching new products and new expanding new geographies, opening sales depots across India, this has been a little bit stretched. From a target perspective, we are looking from 90-100 days kind of working capital, which is in line with the industry trend. We are working on that. Since on a growth phase, there was this little stretch which we are addressing going forward. On the debt side, the 90 crore which you are referring to is on a standalone basis. On a consolidated basis, the debt was around INR 215 crore, which in this quarter is around INR 430 crore, which is predominantly working capital as you have seen. I think so. That's also a comfortable leverage overall. That's around 0.7, 0.8 kind of thing. Going forward, since it's the realization quarter is now Q3 and Q4, this will ultimately be, I would say, the inflation level will come down. We are not looking at majorly raising our debt beyond these levels. Around these levels, obviously based on a specific quarter business requirements we do, but there is no major plan to increase the debt levels beyond this current level. I would say that kind of debt level is something we should be working around. Okay. Great, sir. Thank you. Yeah. Thank you. The next question is from the line of Ashish Rathi from Lucky Investment Managers. Please go ahead. Hi. Thank you for the opportunity. Sir, could you help me understand about, you know, CTPR product as to what will be the kind of launch timelines here? You know, how is the competition scenario likely to be in, say, year 1 and maybe 2, 3 years after that? What kind of sales, what kind of profitability can we expect? Thank you. Hello. Basically, CTPR is definitely a good product and the market size is biggest, we can say the single molecule in India, this is INR 2,800 crore. As a second player and is a first player in manufacturing for this product, and second we can say is after the MNC company. Definitely in this year, because we got very late registration and then patent clearance. Definitely, we are third quarter and fourth quarter will give us a very good revenue. Like, I cannot say number, but it will be very good because we are number one after them. The next year, FY 2024, it will be really, really a big number. We can say in total, our revenue, we will get at least 20% minimum for this product only. Of course the EBITDA margin will be better because we are number one again, I'm saying here. Sorry, sir, 20%, what did you say? I could not get that point. I mean the total market size, whatever the total market size, more than 20%, we will get here. Okay. Sir, on the strobilurin chemistry side, you know, I understand it's very difficult to crack chemistry from what I heard. What gives us the confidence that we will be able to do this? And what is the market size opportunity in this chemistry? Again, sir, what is the kind of timelines we should work with as investors into understanding when can we get to launch these products? Any direction on this, please. Basically strobilurin chemistry, you know, as of now there are five strobilurins which are registered in India, which are going in various crops. We will see, one multinational, each multinational is sitting with one strobilurin. We have, you know, license of all strobilurins with us and there are intermediates. There are every companies, multinationals are bringing basically formulation for that of strobilurins. Indigenous manufacturers also for intermediates, they are depending on China only. We are working on core basically intermediate manufacturing, where our dependency on outside for any kind of raw material in strobilurins will be zero very soon. In this year, 70%-80% of job will be done in that. We are going to be totally independent of any, you know, dependencies for any intermediate is going to be zero and we'll manufacture all the strobilurins here. This give us altogether different strength. It will open up open us for not only for domestic market where strobilurins play a very important role. You know, a big revenue in multinational is coming from this, strobilurin chemistry only. This will also open for us. Other than this also we will become much stronger to, you know, get a substantial share in export also through this, development to this, big in strobilurins basically, which is very important. The strobilurins in fungicide market today more than 60%, 65% share is in strobilurins only. These are like pyraclostrobin, trifloxystrobin, azoxystrobin, picoxystrobin, and kresoxim-methyl. Five strobilurins are registered in India. Altogether, fungicide market, more than 50% is from these five products or combinations of these five products, basically. Where no one else is working, basically. Yeah. On R&D part, on lab scale, it is already clear. This 2023, 2024, basically, we will start production of most of the strobilurins. Okay. Next year we can expect contribution from this. Yeah, yeah. Minimum 4/5 production will be started next year itself. FY 2023 by FY 2024, all that intermediate which we are talking about, 70%-80% dependency we will finish from outside. That will in FY 2024, we will do that. Vimal Alawadhi, most of these products which we are launching are new one. Do we have dependency on outside or are we like mostly backward integrated for the new products? Yeah, like, 28 product. Of course, 28 product, combination product we have, you know, many technicals we need there. Definitely most of the product we have in-house only, but you know, 30%, you can say 25%-30% we have to buy from outside also. Okay. Okay. If you talk about total 28 products, but right now which we are doing, that is 100% in-house only. Right now which we are doing. Understood. Thank you, sir. Actually, these products, these formulations, patented formulations, we are bringing from those products which have become just off-patent. Up to some level dependency is there, which we are trying to come out from that. Got your point. Thank you, sir. I'll join back the queue. Thank you. The next question is on the line of Siddharth Gadekar from Equirus. Please go ahead. Hello. Yes. Yeah, hi, sir. Sir, I wanted to understand in CTPR, we will be manufacturing the product or we will be sourcing it from somewhere, one. Secondly, when we spoke about strobilurin capacities, can you give a sense in terms of our capabilities or what kind of growth term do we have in terms of manufacturing and what are the peak revenue that we can do from those assets and are we expanding any assets? Yeah, definitely. CTPR, that is we are technical, like AI also we are manufacturing and the formulation also we are doing the same. There are two formulation. One is granules, another is active formulation. The both we are doing in-house with our company Sudarshan Farm Chemicals India Private Limited, and that is subsidiary of Best Agrolife. The same technical we are manufacturing in-house. You are talking about the strobilurin, that total gross sales you can say is approximately INR 180 crore. Definitely there is very small expansion we have to do for these all the product that we will do with our own resources only. Definitely, we don't need any new big CapEx for that. Small CapEx will be there that we will manage by ourselves. What would be the peak asset turnover from our capacities that we can expect? The peak, say with our both technicals and formulation product separate, turnover as you get it. On an average basis, we can say it would be around the range of 13%-15%. But it depends on the products. As we are changing the product lines, the realizations are almost more than double or in some of the products, 4x the current product realization. Like, some of the products like Ronfen is something mentioned. So our capacity or the revenue growth is not entirely linked to the capacity. Reason being, we are also changing the products and as the new products are at a significantly higher net realization. But just to your answer, it will be in the range of 13%-15%. This will change as we go on launching new products which have a higher realization than most of our base products right now. Sorry, I didn't understand. What do you mean by 13%-15%? What would be asset turnover? I didn't understand 13%-15%. With the current set of gross block of INR 180 crore, we can go up to the range of INR 2,500 crore-INR 3,000 crore kind of turnover, and with the product line which we are changing. That's where I mean to say with the current gross block, what is the asset turnover we are looking at. It will be in the range of 15% right now, but it may improve as we are going to launch new products with a higher realization. It's good. What would be the CapEx for the debottlenecking? Pardon, didn't catch you. Can you speak again? What would be the CapEx for the debottlenecking? For the de? For the debottlenecking of the plants. You said you were doing some debottlenecking, so what would be the CapEx amount? Yeah, so that's not a major amount. There are c ertain things, kind of, restructuring some of the units which we are doing, but that wouldn't be the major amount. The major CapEx would be adding some new units and new formulation lines as such. The debottleneck that won't be the major amount. Okay. Got it. Thank you. Thank you. Thank you. you. The next question is on the line of Darshit Shah from Nirvana Capital. Please go ahead. Yeah, thanks for the opportunity and congratulations on a wonderful set of numbers. Sir, just to understand, on our business since we are launching new products. I mean, we had a great kind of revenue in Q2. Is our business kind of seasonal, where few quarters contribute maximum revenues or it would be evenly kind of spread across quarters? Yeah. The same question we got earlier also, but anyways. Definitely, the second quarter always is the best in India, Indian market. Indian market as industry, the agricultural industry, second quarter always is the best. But, this is a product which is known when we are talking about that have a market size more than INR 8,000 crore for the sucking pest segment. And this is going in the sucking pest segment in the vegetables, in cotton, mainly chilies, which we already mentioned. It is the same question basically. Definitely, that is a big scope, and each quarter, there will be revenue for this product. Okay. You mentioned that this Ronfen is almost around INR 8,000 crore kind of opportunity. What kind of market share do we envisage in this product over the next maybe few years, 2, 3 years? Yeah. In fact, the INR 8,000 crore is the sucking pest market as of now. Each year gradually i t is growing 9%-10% also. We are hoping whatever the increments in is coming in this segment all we can capture with this because this is very unique combination. We can say we can capture sizable market share. In three years you can say 8%-20% like this in the total market share. Which is again increasing 9%-10% or like this. Got it. From itself. Yeah. Got it. Sir, the second question is on the export market, which itself is a huge market. What are some of the strategies you could broadly highlight there, and when do we see meaningful export revenue starting to contribute to our top-line? Very major revenue you can see in FY 2025 only. Very major if you want to say. If you say starting, FY 2024 it would have started in some of Southeast countries and some Middle East countries. That will be good amount but not very big. FY 2025 you can see very big because it is all registration process which is going on in the other countries. Once we will get, then we'll start. It is not only one product. There are many products in the pipeline which we will start exporting. Mainly which we are producing the our R&D based product as a formulation. Of course the strobilurin, again, we are seeing strobilurin chemistry that we are very strong in that. Same like CTPR, also we are very competitive. We have very good technology to produce. All these products, one by one we will start exporting. FY 2025 will be the year where you can see very significant growth in the exports. Sure. Lastly, on the margins front, we did 26% this quarter and we have annual guidance of 20% kind of EBITDA margins. With newer products being launched every year, where do we see margin trajectory, if you could broadly highlight that? Definitely, 26% because there is no surprise for us because 26% was easily because the same I'm saying. The new product we have a good like 40% gross margin on the formulation, 40%-45%. So under technical, you can say, which we are doing in-house, that also again have 10%-15% margin. So it is not, no surprise for us, 26%. But definitely according to product, like new product is coming. So definitely this will keep growing. But same we will give guidance at the same, like 30% and 20% of the EBITDA margin we will at least, we will achieve like that, 30% of growth each year. This year growth will be higher, which we can see everybody because in the H1 even, all, we have done more than INR 1,100 crore. Definitely this year it will grow more than 30% from last year. Definitely it will be continued from next so many years. Yeah. Thanks. Lastly, I'll just add one more question. Sorry to interrupt, Mr. Shah. We request that you return to the question queue. Sure. The participants waiting for their turn. Thank you. The next question is from the line of Rohit Nagraj from Centrum Broking. Please go ahead. Yeah. Thanks for the opportunity and congrats for a very good set of numbers. First question is, what is our marketing strategy for the new set of products? I mean, we launched Ronfen during this quarter. CTPR we are planning next. Here we are directly taking head on with the, you know, multinational innovators. How are we looking at the marketing strategy which will help us to gain, you know, a significant market share over the next couple of years? Thank you. Yeah. Basically, our marketing strategy, basically we have devised segment-wise. If I explain you, then we have, you know, chosen, we have worked in all, important segments, like, this was a sucking pest segment where Ronfen we brought. Same way, there is a caterpillar segment, bollworm segment, where we are bringing CTPR also. Further combinations of CTPR also we are bringing, which will be very big volume also. Same way, it is not only Ronfen, there are other, products also which were, good revenue we generated this year it also. It was seed treatment segment. We launched a product where two fungicides and one insecticide is there. A farmer was used to, you know, first he was using fungicide, then he was drying the seeds, then he was using insecticides. Then again, he would, you know, it was very tedious process. That combination of fungicide, insecticide also we brought. Same way in paddy, BPH is a very tedious pest which is very difficult to control. We brought a novel combination in that for BPH also. Various segments we are working. There is sugarcane. There is narrow leaf and broad leaf herbicides are there. It is, you know, sugarcane, weeding in sugarcane is very difficult to do. We are working on a product which will control both narrow leaf and broad leaf weeds together. That way we are working on our products also, novel combinations also, where it will create great value for farmer too. In marketing also we will get an edge because CTPR also if you will see, a big segment is sugarcane. It goes for a particular pest, stalk borer in sugarcane. This molecule is also 10 years old. Now little bit resistance farmer is facing in this. This product we have bought just now. But we have already 2 years back, we started working on combinations of various combinations to break that resistance also which was expected. Very soon we'll be sitting with a good combination which will be a part of IPM integrated pest management also and will break that resistance. We are thinking ahead of time little bit in resistance management. Same way we are you know planning, we are devising our marketing strategies also. We will easily mean if market is there, then easily, on the basis of performance of the product, we will in first year itself, in one quarter itself, we'll be very easily able to establish our product in a great way, and we could generate good revenue with launch itself. Right, sir. Got it. It was pretty comprehensive answer. Sir, second question is, we have got these 28 products in the pipeline. Just to get an understanding about what is the market size for these products and how many competitors are normally expected whenever these products are going off patent or for the combination products. Thank you. Definitely, this 28 products which we are talking always, out of that only one product we have launched, that is Ronfen, is a brand name in the second quarter only. These all 28 products are unique combinations product, which we are getting globally patent for 20 years. Definitely there is no competition directly we can say. Of course in the segment, like I told you, the Ronfen is a sucking pest. Definitely that market size is so big in India even. We are talking about India as of now only. As we talk about internationally, there will be big markets. For sure there is no competition for our unique combination. Definitely, they have solo product. There may be some competition, but that always we can say there is no competition because one solo product, of course, if we talk about three products we are combination giving, that is more lesser than if any farmer going to spray that three solo combination in the field. We are already in the very good pricing and good, you know, the synergy. Definitely there is no competition and yeah. Sir, just one last clarification on CTPR. As I understand, the innovator also has patents on the intermediates or key raw materials which are used for manufacturing CTPR. How confident are we that at any point in future there will not be any infringement or any legal issue on the CTPR product? Thank you. Definitely, it is already we have got the clearance from the court because the MNC companies which is there and they have done already. We got the clearance because our process is unique process. Already we have applied for that patent also on our process also. Definitely that clearance we got. Final clearance also we will get because already we got the permission for the launch from the court only, court itself. Right, sir. Got it. Thanks for answering all the questions and best of luck, sir. Thanks. Thank you. The next question is from the line of Mitul Mehta from Lucky Investment Managers. Please go ahead. Yeah. Hi. Good afternoon, sir, and congratulations on great performance for Q2. Sir, my question was pertaining to CTPR. Sir, we all know that there is one local company which is fighting against the MNC for the grant of patent and allow them to launch in the market. We of course are number one and he's number two. Do you feel that the competitive intensity in this particular product will increase? Can you share some granular detail on as to at what price we would be launching this product if I were to compare with the MNC? I mean, in terms of selling price of CTPR. And do you, d o you foresee any legal risk in times to come as far as CTPR is concerned? Definitely. The legal concern I just mentioned in the last question also. That is, definitely there is no concern because we already got permission from the court only. There is no question about there is because our process is already clear. We have also applied for the patent for this process also. That we always didn't mention. We have many processes which we have applied for the patent. We never mentioned because that is always a process. We don't think that is a big thing, so we never mentioned that. We have many, many processes in the process chemistry, even the CTPR manufacturing. There are many, many things we have applied for the patent, our own patent. That is one thing. You asked for the market size and what pricing we are selling and all that. Of course we are number one, and you are talking about some other player. Definitely there are other player also, one more other player. What I heard, what I understand what you're talking about, that company is not an agrochemical company. Of course they also will get some share, but according to like we have already big network, 5,200 big distributor we have, the retailers we have, then farmer is using our product like Ronfen and all other products also. We are really well-known for the farmer, well-known company, so definitely we will get a better share than any other company. First advantage also we will get, that is also we have advantage. Of course we will get better advantage. More than 20% of the market next year itself we will get, for sure. International business also will enter with the CTPR. Institutional business also there. Like institutional business means there are sugar mills, there are government business. That is again very big business and slowly that we will also capture because we are commercially also we are very strong in this product, in the manufacture because our process is really very competitive you can say. Nobody can compete with we think as of now the process we have to manufacture CTPR technical. Because basically technical if we are strong and intermediate we are strong, so definitely our formulation will be good pricing. Of course if you talk about the margins, because MNC company is holding big margin in that product, you can say it is almost 300%, like 250% kind of margin they are keeping, and we are farmer friendly company, so definitely we will not keep that much of margin. Our pricing will be always better for the farmers and you can say but still we will get very good margin out of that. Would it be possible for you to share, I mean, in terms of price between MNC and us, in terms of the price? I mean, how cheaper we will be? Definitely. Definitely, we will be 25% less than MNC company, 25%. Okay. Similarly in Ronfen, can you explain the competitive landscape in this product also? I mean, what kind of competition do we have? Yeah. In case of Ronfen, basically, the solo products are available. As a combination, because it is patented composition only, so no one else is there. As far as solo products are concerned, so difficult for him to mix, you know, three products also. If he tries that, then also his cost per hectare becomes more, you know, or it comes closer to our this thing also. When we are giving him in a premix, you know, biggest advantage farmer is getting with this novel combination is like, it is reflecting a very great phytotonic effect is there which gives, you know, great satisfaction to farmer because base of formulation, our composition is also making it altogether different. Where in solo formulation farmer is sometimes observing scorching in the field, our combination is bringing phytotonic effect which gives great value to our product. I don't think so that in this competitive space other products are there which can compete with this. We can keep on growing in this segment in next four, five years up to a great extent, I'll say. Also, as far as cost goes, we would be 25%-30% cheaper than the MNC? In this product, basically MNCs are also sitting with solo products only. Even MNCs also don't have combination. Same combination is not there with MNCs even. Like, one of the solo product is with one MNC, other solo product is with other MNC. Such kind of situation is there. If that solo also is being mixed, cost is coming higher. Okay. Sir, as far as our R&D expenditure is concerned, what kind of R&D spends do we do in a particular year? In the range of we do around 1.5% kind of R&D spends, but with the new product pipeline will be growing every year and we are adding new number of people in the R&D. In the coming years it's the range of around up to 4% maybe in the next 2 years it will increase up to 4% of our revenue. 4% of revenue would we spend on R&D? In the coming years. As of now in the range of around 1.1%-2% I can say, in that range. It's increasing and will be touching to 4% in coming year. Okay. Great. Thank you, sir. Thank you for. Thank you. The next question is on the line of Rikin Shah from Omkara Capital. Please go ahead. Hi. I'd just like to understand how much have we spent on R&D in the last 3, 4 financial years? As I mentioned, in terms of, percentage-wise, we have spent on an average 1.5% annually. Okay? Since the new product pipeline has been building also, this has increased from this year onwards as we added many new members and products. In the previous years it has been in the range of 1.5% kind of spend. With all these approvals coming in for such novel products, what would we attribute it to? To our R&D or do we have some sort of tie-ups? Yeah, definitely we have many tie-ups with universities, like government universities and the state universities. We have definitely tie-ups and outsourcing also we are doing some of the labs, which is toxicity lab, chemistry lab. Of course we have tie-ups with them. In-house also, we have very big R&D also. This new product line, yeah. Other than this, we are expanding much on, you know, we have big new product development team in the field also. The big number, big expense we are doing in that also, where we are, you know, testing the trials of these new combinations which we are developing. So that is also, there also we are incurring a lot. Because there are many processes, so very hard to explain now because it will take too much time and, time we have concerned, but there are many processes like chemistry, toxicity and, field data. Then, there is bioefficacy. There is many data we have to spread in various, you know, university also we have to do the trial and also our people. Like we have now, marketing, you can say sales and marketing and the field trial team in totality. If they do, you know, in the synergy and that is more than 400 people we have there who do that. Okay. We don't specifically have a tie-up with an MNC per se for these things? Tie-up. You mean tie-up? Uh, tie-up or. Tie-up for? A technology transfer, because we are able to innovate and able to, you know, form such processes which are different, and launch novel products. That is interesting with, you know, the amount of R&D we have done. Yeah, definitely. We are not with the tie-up, but definitely, many MNCs companies now interested in our products. They want to buy from us, but we will give them a branded product. We will pack in their brand, and we will give our exclusivity product. In fact we are giving as of now. We have, you know, the company like big company like Adama and there are other many companies. Adama. There are other MNC company also. They are asking products from us and we are giving some of the product, but that also again, we are giving a packed product to them for the sales. That packed by us only. All right. I think that's it from my end. Thank you. The next question is from the line of Rohan Ji from Nuvama Wealth. Please go ahead. Rohan, your line is on the talk mode. Please go ahead. Yeah. Hi, Sir [Vimal]. Sir, couple of questions, and first is on our global ambitions and exports market. You mentioned that going forward you would like to register in many countries, take the registration in many countries. As you see that it's a definitely time-taking affair and also very expensive in terms of getting the registration. Just wanted to understand how we want to go ahead about it. Which are the major markets we will be targeting earlier and what kind of the registration expenditures budget we are planning over next, cumulative over next couple of years. Definitely, because which products we are going to export in future, the same product we are getting in India, we already have. The same product we are going. The main data which we need that we already have, and that's first product we talk about. We have many data's already with us there which we needed for the export. But for the trial and their country requirements, for that expense we are doing. Each country have different kind of requirement. We cannot say really which country, if you go about any country specifically, we know that. As a whole, it is impossible to tell because, like Thailand have different requirements which we are covering up. Vietnam have different requirements. Brazil have different requirements. EU have different requirements. EU is the main expensive one because their data, which we generate inside the country, that is really expensive. Of course, like U.S. also have expensive, U.K. also have expensive. Definitely we are going all the markets, but each country have different data requirements and different parameters. That we have to cater in committees. We are on the job. Yes, sir. That on the other country, I wanted to get your sense on the regions. Like, you know, it will be EU focused, U.S., Africa. In terms of expenditure budget which you have planned, how much it will be over this. Actually other than expense, it is you know much time-taking also and like if we have you know if we are bringing a product focusing two crops here in India, suppose if we give an example of Ronfen or Warden. Like Warden we brought for seed treatment. Ronfen we brought for sucking pests in coconut and chili vegetables. The countries where these patents are also like global applications are also we have applied for PCT applications also of these products. We are filing global patents and where those crops are there, segments are there, we are registering those product also globally also. Main thing is if you have to register a new formulation somewhere, then you will have to register first three technicals are involved. First you will have to register three technicals there. You will be able to register your formulation. It is time-taking. That's why we have taken a timeline of, you know, FY 2025 only to generate big revenue from that, big revenue from specialty products only. That's why that timeline we have taken, but we are investing a lot in that. These are very costly, expensive affairs also and time-taking also. Definitely in export with a unique combination and unique product, margin will be far, far better. That's for sure. In our case especially. We are sure that we will develop our own formulations and register by ourselves and sell. We will sell also through our distribution network, rather than joining hands with any global companies and using their distribution network, or probably remaining in a B2B segment only and selling the intermediates or final AI to them, that's not the thought process. No, it is again same there. Again, country to country, I was telling you. Like some countries, we are going to open our own branch, our own staff who will help to the farmers, there only. Some of countries we are doing like that where expenses is less and market is big. Some of countries, we are having partner like distributor, you can say one of we will appoint. Some of countries we are making partner with a formulation formulator, one of good formulator in one country, so we are doing that. It is mixed kind of thing. There's not one way we are doing because globally it is a very big product and big market area. We are going, country to country, and strategy we are making, in country to country. Got it, sir. Our second question is on our dependency on imports of raw material and intermediates coming from China. You mentioned that you want to lower the share there and are working a lot on that front. I just want to understand what is our share in terms of material imports coming from China and how do you see that moving over the next couple of years. Also in terms of own manufacturing, will it be mainly completely backward integration from your side or you will increase sourcing within India from the domestic manufacturer? Yeah, yeah. Actually, we are known for you can say the Make in India company and definitely our main target is to get, you know, entire and that also we can say by FY 2025 the whole will be, you know, backward integrated for as a Best Agrolife because we are spending like anything and either it will be captive, either we are going with the collaboration with the partnership with the other player like Jubilant Life Sciences with SRF with Tecnimont. We are going to partnership with them slowly with some of the raw material which we needed here. Of course right now if you talk about there is around 25%-30% range which we are importing as of now even. If you talk about earlier, like five year back or seven year back, it was these products which we are doing 100% dependency on the imported product. Now we are able to, you know, you can say out of that 70% product we are manufacturing here either with our partners, either we are doing by ourselves. Our target is to by FY 2025, 100% will be the backward integrated and, will be in-house or with the partners in India. We are making. We are basically R&D and innovative company, so we will continue to do that. Sir, in terms of investment in CapEx over next couple of years, how much you think that you'll be able to? You have plans to invest in capacities? Yeah. In fact, right now, there again that question was because right now we don't have big CapEx plan because we have small that we can manage by our own funds only. Definitely when we will go with you know the big investment that of course we have to go in some other regions. Right now we are in UP, so definitely we have to go maybe Gujarat or other states with the greenfield project. Right now we can say there is no need. Maybe in future we need like 2 or 3 years. Fine, sir. Thank you very much. Thank you. Thank you. Ladies and gentlemen, that's the last question. I now hand the conference over to the management for the closing comments. Thank you everyone, for your questions, and we hope we have been able to answer most of your query. If we have missed out on any of your questions, kindly reach out to our IR advisor, email, Ernst & Young, and we'll get back to you offline. Thank you, to all. Good afternoon to everybody. Thank you. Thank you. Thank you. Thank you for your time. Thank you. Yeah. Thank you for this opportunity. Thank you so much. Thank you. Ladies and gentlemen, on behalf of Best Agrolife Limited, that concludes this conference call. We thank you for joining us, and you may now disconnect your lines. Thank you.