Please note that this conference is being recorded. I now hand the conference over to Mr. Advait Bhadekar from Ernst & Young. Thank you, and over to you. Thank you, Ryan. Good afternoon, everyone. Welcome to Best Agrolife Q4 and FY23 earnings conference call. Please note that a copy of our disclosure is available on the investor section of our website, as well as on the stock exchanges. Please do note that anything said on this call, which reflects our outlook towards the future, or which could be construed as a forward-looking statement, must be reviewed in conjunction with the risks that the company faces. This conference call is being recorded. The transcript, along with the audio of the same, will be made available on the website of the company and exchanges. Please also note that the audio of the conference call is the copyright material of Best Agrolife and cannot be copied, rebroadcasted, or attributed in press or media without specific and written consent of the company. Today, from the management side, we have Mr. Vimal Alawadhi, Managing Director, Mr. Sanjeev Kharbanda, Chief Financial Officer, and Mr. N. Surendra Sai, Head International Business. I would now like to hand over the call to Mr. Vimal Alawadhi for his opening remarks. Thank you, over to you, sir. Yeah. Hello. Thank you, welcome everyone to our Q4 FY23 earnings call. We hope you all are doing well. Before we share some insights on the business performance for the quarter, let me take a couple of minutes to throw light on some industry trends. The financial year started on a strong note, as we witnessed stocking up of inventories leading to kharif season last calendar year, with expectation of good monsoon season. This resulted in strong Q1 and Q2 for the industry at large. As the season progressed, low insect infections, coupled with excess and extended rainfall towards the end of monsoon season, lead to higher channel inventory. The H2 of the year, which is the rabi season, was expected to be a good season, extended monsoon and higher channel inventory placed forward spot. As we move on, which is around the time Quarter four started, China lifted its zero Covid policy and started exporting product at very low price, given the weak internal demand in China and overseas. In conclusion, during Q4, we witnessed on oversupply of agrochemical, coupled with high channel inventory, leading the high pricing pressure. While this was the scenario of generic agrochemical, the specialty agrochemical product fared reasonably well in the challenging environment. The inventory of specialty product was on normal levels, representing a strong demand environmental for this product. Looking ahead at FY 2024, one of the most important element that is being talked about, the El Niño. As per our understanding, El Niño is expected to develop between August and September of the current year, which means H1 of monsoon is not likely to be affected by El Niño. Whereas we might see some impact towards the end of monsoon season, indicating normal rainfall for the year. Yeah. I am handing over for the some financial and other thing to Mr. Kharbanda. Yeah, please. Yeah. Good morning, everyone. This is Sanjeev Kharbanda. I represent Best Agro with the capacity of Chief Financial Officer. As our Managing Director gave the opening remarks and gave some insight about the industry, as well as Best Agro Chemical, how the company performed and what all impacted the overall industry scenario. Let me, you know, give you a brief on the financial performance of the company. The company has delivered a, you know, a tremendous growth. In terms of number, if you say, company has recorded a 44% growth over last year and, you know, ended at INR 1,746 crore of turnover. You might recall, in most of our earlier communications with the investors and, you know, with the industry expert, we have been saying the company is confident to drive 30% growth year-on-year basis. This is the strong premise of good product mix and the channel. In line with that, we are happy to say, at an overall level on financial year, company has actually surpassed the expectations of growth in turnover, which is actually got delivered at 44%. In terms of profitability, EBITDA margin, the company EBITDA margin has also recorded a phenomenal growth of 89% over last year. The base was approximately INR 166 crore, and it has reached to INR 314 crore EBITDA for the financial year. It is pertinent to mention, the growth which we have been saying is sustainable is largely because company has created a niche with unique proposition and cost-effective solutions to the farmer. That is actually contributing, quarter by quarter and year by year. While at the same time, yes, one of the quarter, you know, we have faced challenge because of multiple factors, as Mr. Vimal also briefed. At overall level, company is confident of meeting the financial obligations and driving this growth along with a sustainable profitability. In terms of, you know, future outlook and the expansion plans, I would request Mr. Singh, who is heading the international business, he can give you some insight on the plans of company, how company is further forward-looking to expand its market footprint, not only in the domestic market, but also in selecting overseas markets. Mr. Singh would give you more detail about the product launch plan as well as the overseas plan. Thank you. Thank you. Thank you, Mr. Panda ji. What we have been doing over the past few years has been to be able to work on a transformational journey, where at the end of the day, we are looking at benefiting the farmer. In this particular process, as the observers would have seen, that we have been working on trying to get backward integration, work on patented molecules, work on novel formulations, combinations, which are single-shot solutions, which will bring benefit to the farmers, which are providing green chemistry. We are trying to look at the crops as well as what the farmer requires on an end-to-end basis. The success and the confidence that with our growth in the past few quarters and the past few years, has given us the confidence to walk the talk on international markets also. I might say, currently we are quite small on the international market. We are in the strategizing phase. What we have been seeing as it is normal in the agrochemical business, is that, expanding into the international market requires a significant amount of work on the registration and understanding the foreign markets. This is the phase that we are right now into. We are trying to identify onto the specific, regional specificity as well as the farmer requirements, where our products can show a significant amount of a benefit, and we can work on a collaborative top-line growth as well as a increase on the bottom line margins. As we have been over the quarter, are demonstrating that we are on the path for patenting, and not just in terms of the patenting, but in terms of trying to ensure that the patented molecules are both effective in the market, they meet the farmers' requirements, and they are providing a robust top-line growth to us. We also are working on certain ternary combinations. These combinations are expected to be a lot beneficial to the farmer. I might add that if we look at international markets, certain ternary combinations may have even more beneficial usage abroad also, especially if you look at the Far East. We have a significant pipeline of patented molecules and products. We will be introducing them as and as we understand the farmer scenario, we will be doing that. We also have a strong pipeline of all the product launches for the FY 2024, and there is a bucket of herbicides, fungicides, and nematicide registrations, which are there. Yes, that's correct. Yes. Yeah. I will just conclude here. Yeah, yeah. Of course, we are working towards, you know, producing branded products where we can say, you know, our branded sale, even we can say B2C. This year we have big plans for that because we have different kind of novel, you know, patented molecule with us. That is one main thing. Another, which molecule is with the uncertain company, we are the second largest in the country who is selling their product. There are many products, like in the rabi side, if you talk about there is Ametryne, if you talk about insecticide, there are many products which we are doing as of now. I think we can start with the question and answer. Yeah, please. 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 handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. Our first question comes from Anirban Manna, an investor. Please go ahead. Yeah, thank you for the opportunity. You have guided for 30% growth with 20% operating profit margin. My estimation is in FY 2024, the top line would be around 2,300 crore, with 450 crore margin. Is the estimation correct? Yeah. In fact, the estimated is the same, because 30% and 20% is okay, but the numbers to say right now is not very easy. Of course, we can say when 30%, you know, the growth on the revenue and 20% of EBITDA, we have very strong pipeline. Definitely, we will achieve that in spite of there is a, you know, pressure of the pricing. The product we have, the nice product we have, that also will give us a benefit, what pricing is going down, the raw materials. Of course, we have the plan is same, 30% 20+. Okay, out of which, what would be the projection for Q1 and Q2? We are facing some challenges. Q1 and Q2 would be definitely bigger one because you would have also noticed our branded products last year also supported the kharif season very well. Q1, Q2 definitely would be a bigger one. However, at the same time, you know, quoting the number for Q1, Q2 will be too early for this, but we will definitely drive 30% growth, which we have witnessed through FY23 as well. Okay. Okay. Means, in Q1 and Q2, we can expect around 30% growth year-on-year, with 20% OPM? Yeah. I would again repeat the same thing. In Q1 and Q2, we are confident the delivery would be even better as compared to... It is not simply, you know, total number divided by four quarters. The first two quarters are going to definitely drive higher numbers. No, I'm comparing, year- on- year, actually, for Q1 and Q2 FY 2023 with Q1 and Q2 with FY 2024. Definitely, definitely, because this year, Q2 is rabi season, and in rabi season also we have, we will launch this year, product, a very good product, is Pyroxasulfone suspension. This is the first year, and that is the big molecule in India. Right now, some companies importing, and we are the number one who is manufacturing as a technical AI and a formulation in India. We are the number one in that. That product also we are going to launch in Q3 also, as well as Q4 also, that effect will come. Yeah. I thank you for the question. I would like to add that the Q1, Q2, Q3, Q4 revenue numbers would be a lot should depend upon the rate of our introduction of new products and the adoption rate of those, and the recovery of the sales as the time goes by. As we are introducing new products, there may be little variation in the Q1, Q2, Q3, Q4 numbers as compared to previous years. Hence, we are not able to right now say that it will be better, it will be 40% Q1, Q2 year-to-year growth as far as Q1 is concerned. Overall, in the terms of the year growth, we are confident on the numbers that we have already reached. The reason I am asking is, we are facing a lot of dumping from China at lower prices. In Q4, we witnessed the same. Now in quarter one, we have gone past two months already, so is there any sign of improvement as compared to Q4? That's why I asking. Yeah, definitely. Your question is very valid. Please rest assured, the dumping from China, which is happening, however, on the other side, our Q1, Q2 is supported by most of the branded products, not by the generic molecules. Branded product space, which we are moving on a right pace, you know, is going to help us to safeguard our growth and our margins. All right. Got it. Got it. My second question would be related to stake increase. I have seen, you have increased your stake in Q4 also. Is there any plan in Q1? What increase, sorry? Didn't get you. Sure. Share percentage increase, stake increase, promoter stake increase. It got increased in Q4 also. You have been increasing stake for last two quarters, and it happened in Q4 also. Is there any plan in Q1? It is like, you know, promoters are always at number one to support the company's requirement to, you know, sponsor the growth of company. It is not per se any mathematics which can be given at this point in time, but promoter is always standing for driving the growth of the company. Whatever is required, promoter is always there at the front. Thank you. Our next question comes from Srishti Jain with Monarch. Please go ahead. Thank you for the opportunity, sir. Could you give me the sales number for Ronfen and CTPR for the year, for FY 2023? Ronfen and CTPR have been our flagship products. They're driving very well. In terms of numbers, the contribution is very high from Ronfen and CTPR, two products standalone for driving the branded space. In the FY 2023, there was a sale of Ronfen, but CTPR was less because we got CTPR also, you know, at the Q3, where there is no season on the CTPR. This is the Q1 where the sale is increasing of CTPR. There is two formulation. If you talk about Ronfen, that is around INR 200 crore or INR 220 crore for the year, full year, did you know? Now full year, that also we got in the Q2, Ronfen, that was also delayed. In the, you can say from second to Q4, the total sale is INR 220 crore for the Ronfen. Sure, sir. The same for CTPR? I missed that number. Sorry, say again, please. Sir, for the, your sales number for CTPR, if I'm not wrong, for Q3, it was, by Q3, we had done INR 45 crores. Yeah, that was, that was not very, you know, you can say because, then the rabi also goes sometime, but it is INR 45 crore for the Q3. Q4, we don't have very big numbers, so the Q1 becomes, the big numbers. This Q1 was twenty- Sure. A follow-up on that, we actually in Q3 were expecting Ronfen to significantly contribute, and we were expecting revenues of around INR 300-350 crores. What were the challenges that we faced and why, you know, what were the challenges that we faced? Yes, see. See, whenever we are introducing a new and novel combination into the market, there is obviously a adoption cycle and which follows the initial enthusiasm. We are going to follow up on this particular product because we see the significant amount of value in Ronfen. There are certain things which in terms of a sales initial sales push, followed by adoption, followed by an effect on the field, followed by a higher adoption rate. It's a gradual process, and this process is normal for any product which is introduced. I would say that it would require at least a couple of quarters for us to be able to understand the stabilized peak or I would say the stabilized revenue, which is coming from these new products. That would be my guidance, that we need to wait for two quarters to be able to understand how these molecules are performing on their opportunity. Definitely, what you number you are talking about in FY 2023 was not there, but in FY 2024, definitely it will achieve because we have, you know, that very good success for Ronfen in the market, that is also true. Absolutely. Moreover, you know, the distribution penetration is also, you know, it's a journey you would appreciate within, you know, less than a year, company has already achieved a level of 5,200 plus distributors. Once you get a success in one state, you start replicating in other states. There are so many different part of the country which where, you know, the substantial number of Ronfen and other branded products is yet to come. Because you cannot go full-fledged in one quarter itself for entire length and breadth of the country. Numbers would be really good in quarter one, quarter two, both. Sure, sir. Our debt has increased significantly. What are the plans on reducing debt, if any, or is this a sustainable level? Let me just, you know, bring it in a different aspect. Debt has increased. The answer is yes and no, both, because the debt is increased only for the working capital support. Please understand we are a company where there is no long-term debt. It's almost negligible. Debt-to-equity ratio is in fact 1 of the healthiest ratio, and we still have leverages to support the growth of company. Yes, working capital pressure has gone up because of the reasons, you know, when you start a new segment in terms of, you know, from moving away from generic molecule to branded, you have to have a plan for the raw material, you have to have plan for the FD, you have huge inventory to be supported for the distribution pan-India. When you have that much of inventory, at the same time, your cash conversion cycle in this industry is slightly higher because you are working with the farmers, and farmers pay back as per, you know, when they get the yield of their crop. It's a temporary issue only, that working capital has created a pressure on the short-term debt, but it will be taken care. As we are moving in a right direction of, you know, having a better realization and better margin product in the market, the pressure will also go away in another two to three quarters. We are quite confident FY 2024 balance sheet will be comparatively very, very different, with even lower working capital pressure. understood, sir. Sir, lastly, on the CapEx, can you tell us the timelines of the expected, of the announced CapEx? Most of the CapEx would be completed this year itself. The total CapEx, which we have planned. [Inaudible] The critical part will be in FY 2024, and some part will be in FY 2025. That time, you know, this is towards capacity enhancement and backward integration. Sir, you are also going to launch a new fungicide, plan for a new fungicide, new herbicide, if I'm not wrong? New herbicide means, our patented one you're talking about or something? Yes, yes. Yeah, definitely. Definitely, we have many molecule right now. First of all, in the month of June, we are expecting one registration, and we will be launched. That Tricolor is a product which is again bigger than Ronfen. That is a fungicide, basically, a trifloxystrobin plus azoxystrobin plus sulfur. That is our, you know, patented one, and that is really a good molecule, and we are expecting a big number with this molecule also. That we are launching in the month of itself, June, this month, June. We can say the Q2 results will come for that product. Understood. Sir, one last question: Can you give the breakup between of technicals and formulations, and within formulation, brand and B2B? This year, what we are planning, that is, biggest is B2C, and B2B will be lower side, because B2C, when we say there is one segment where we directly sell to our distributors, dealers, channel network, to the farmer, and other we are talking about, when we are selling to some of our B2C customers, that also we are giving them our main portfolio product, like we are talking about Tricolor. Maybe we will give some of the MNC company of like this way, or either Ronfen also we are giving to some big companies. This only we will sell that as B2C. That will be drastically a big number, and our B2C will be big number. Apart from that, if you talk about the technical, not will be very big number. We can say, the total, sales will be 35%-40% of this technical sales. Sure, for FY 2023, what was the similar number? For FY 23, the technicals and formulation. The formulation, Q2 onwards itself, formulation picked up very well. We can say approximately 60% business was driven by formulation. within formulation, brand, branded and B2B? Almost on the same ratio. B2C, the branded segment, is nearly 60% within formulation. Thank you. Thank you for answering all my questions. Thank you. Thank you. Our next question comes from S. Ramesh with Nirmal Bang Equities. Please go ahead. Good morning, and thank you very much. Are you able to hear me? Yes. Yes. You mentioned Pyroxasulfone, which is a large molecule, on the CSM company. If you're looking at your efforts there, what are the kind of revenue you're generating from that, and what is the market size in domestic and international markets? Pyroxasulfone you are talking about, which is a rabi wheat herbicide. Yeah. Yeah. Pyroxasulfone total market size is approximate INR 450 crore, which was reported in maybe 2022. 2023 number was maybe a little higher, but I have number of 22, that is INR 450 crore around the market size for Pyroxasulfone. As a Best Agrolife, because we are the number one who is, you know, manufacturing AI here, as well as formulation in India. We are expecting this year, at least INR 150 crore we will get this market share. Some market share will also increase for this year, this Pyroxasulfone, because of our entry. This is a product which was patented by Kumiai of Japan. Are you having agreement with Kumiai, or have you got the technology from someone else, you can share that? No, no. That is our own technology, in-house. Developed by us only, and there is no technical issue, technical support from Japan or anywhere. If you're looking at Pyroxasulfone globally, what will be the size, and are you exporting that to international markets? Yes, that, we are, we are in the process for the registration for the many molecule, in which Pyroxasulfone is also one of the, our, will be our big product in the future. This is very big, if you talk about, all over, global market. Approximately, I can say I don't have the real number in front of me, but I can say this is a very big market, and of course, we will, we are with the Pyroxasulfone, with some combination also we are working, which will be our patented molecule, and that also we will, go in the market and, start there also. As Pyroxasulfone, solo, as well as, the, our novel, patented product also we will, give in the, global markets also in future. Okay. Similarly, in CTPR, now we know that DPL has a tie-up with FMC, there's a pharma company, Natco Pharma, which is entering that market. What is the size of the CTPR market in India, and what is your revenue there right now? In fact, the CTPR market, if you talk about 2023, approx market is INR 2,800 crore, which is a very big number, if you say, as a total agrochemical division in India. INR 2,800 crore, if you talk about any other companies, every company have their different strategy to sell this product. We are selling with the two product, which is two mainly. One is GR, which we called the Vistara, our brand. The other one is Citigen. That is our SC brand, that is again, big molecule. You know, our strategy is very clear. This year, we are targeting a good number for both of the product, but we have different kind of, again, novel combination, our patented product, which will come with the CTPR. Like one is CTPR, two will be a different molecule, we are working on that. Once the many people will come, we will be able to launch our patented molecule in the same segment, and that will be much higher in the coming years. That is our strategy. CTPR. In CTPR, are you also making the AI? Yeah, definitely. We are making AI. AI and formulation both. Okay, how does it compare with the, you know, products offered by FMC? Because it's one of the largest companies in the world, making CTPR. How does it compare with FMC and other competitors in terms of the product and the market response? Compare in the sense of, quality you are asking? Yeah, because, in terms of the efficacy, the, you know, the Oh, definitely. Our any product, you know, we have, you know, each product we have, data at the laboratory is very, very highly tuned, so there is undoubtedly our product is fantastic in the market, any of the product, either CTPR or any of the product. We cannot get even single problem, any single complaint we are not getting for any product, not even CTPR. That is our main key. That's why we called as a Best. The Best quality also we are providing farmers. Just a couple of thoughts more. We are looking at 30% growth in FY 2024, on a base of 40% growth last year. What are the volume growth in FY 2023, and what is the volume growth you would expect in FY 2024? Volume of a product, specific? No, product-specific volume, it will be too early to mention because it's a mix of, products, and products are crop specific. kharif and rabi, both the seasons we have to take care, but certainly we are. I'm speaking most of the company, the overall revenue is about 30% growth. It's a mix of volume and price impact. On a blended company-wide basis, you know, if you can just tell us what was the volume growth overall for the company last year? What is it that you expect? Because for the 30% revenue growth, there will be some volume growth, right? Especially because prices are coming down. If you can share how, where you expect volume growth, and what kind of volume growth you expect for 2024, and how much was it in 2023, please? Let me explain you. There is a, you know, you are talking about prices are going down. Actually, we have to understand the prices is going down for the raw material. Finished good prices is decided by the companies where we call generic. There are many people in there, so definitely that is market-driven. Market-driven, price-driven. If you talk about that way, definitely price is down. The company like us, any of the company like us in India and in the global also, who they have their own patented, like if you talk about CTPR, if we are talking about the FMC. You know, for them, for us, you know, the product when the raw material prices are down, our margins will be better at the end of the day. If you talk about generic, of course, yes, we are also selling maybe, in our total portfolio, 40% of the generic. 80% which we are selling, that is our exclusive molecule, where our benefit will be more rather than any loss, according to, you know, the pricing of raw material. Actually, that is the price of raw material which is in the stress, not the final formulation, you can say. Thank you. Yeah. Thank you. Ladies and gentlemen, a request: please restrict yourself to two questions and one follow-up question. Our next question comes from the line of Siddharth Gadekar with Aquarius. Please go ahead. Hello. Hi, sir. Sir, I just have one question. If I look at FMC's commentary in Q4 and Q1, they have pointed that there are significant high inventories in insecticides in India, specifically. In light of that, how should we look at growth in FY 2024, given that channel inventories will be relatively very elevated compared to the normal levels? Are we still confident of growing in CTPR at the rate we are talking about? Secondly, in terms of the price decline, like if you look at the way the prices have declined, what kind of a realization decline are we looking on our overall portfolio in FY 2024? In fact, for the FMC you're talking about, they of course have inventory maybe, you know, but if you talk about specifically CTPR molecule as a, there is a formulation in, you know, granule. If you talk about this, we are not taking very high number for this product for FY24, and we are not depending on the CTPR at all. There is a, we are a manufacturer. We have really best quality, as earlier, you know, question I was answering. Definitely we are hoping this year, we will cross at least 400 crore of CTPR sales. That is, that is easy for us because we are the old company and we were the first one who had launched this product. That advantage also we will get. We have now distributor pan-India, approximate more than 5,000 distributors. Definitely 400 products we will do, but we are not hoping, like, you know, for the INR 1,000 crore somehow, for the CTPR. Next year, we will launch our own product with the CTPR, which will be our patented product. That is our strategy. Again, on the price decline, if you would want to comment, like on a portfolio basis, what kind of price decline can we see for FY 2024, even if we assume that current prices sustain for the entire year? Price declining largely happened in the generic molecule. As you know, we are mentioning, we are driving, you know, specific formulations, our own products. In that case, we are not going to have any adverse effects. We are not seeing any adverse effects in FY 2024 on our branded products. Yes, end of the day, it is the volume and value both, which plays a role in the overall turnover. The volume drive is also there. However, maintaining a value driver through the specific unique formulation branded products, we will be able to deliver the growth target which we have taken. Also specifically, like if I want to look at Ronfen, it is a combination of three products. All three are generic products, so their prices have declined substantially. On a formulation of Ronfen also, we would be able to maintain our existing prices, or there also we will have to take some lower prices for this year? No, we will not reduce our price, because last year we, our price was whatever the price. This year, even we can increase. Definitely we will not increase the price. We will not reduce at all, because that is acceptance is very high for our product, and that is again our patented, so there's no point to reduce the price. Even raw material cost will be lower. Again, I am repeating this. Our raw material price may be lower. We will not reduce our specialty molecules, any of the molecules, even Ronfen. All right, sir. Thank you. Thank you. Thank you. Our next question comes from the line of Rohit Nagraj with Centrum Broking. Please go ahead. Yeah, thanks for the opportunity. My first question is on the gross margins for Q4. They have gone down considerably. Was it a one-time impact because of maybe high-cost inventories, which are completely absorbed now, and incrementally this will not be there? Yeah, you rightly pointed out, the Q4 margins have gone down because of the, you know, price dynamics in the market. It was just a one-time jerk, which has taken care, and the correction on the inventory prices have also been taken care following the accounting principle. We are completely, you know, compliant organization in terms of following different accounting principle and norms. It was just a one-time job, which is taken care in Q4. Way forward, quarter one, quarter two, we are expecting better realization and better margin. All right. Thanks, sir. Perfect. Thank you. A price stress was there, so definitely, the correction was quite important, whatever the raw material we have, whatever the technical we have in hand, because again, we said, you know, in the Ronfen, there is a three product, which is AI product, and the prices are down. Definitely we have stock of that product, so that we have to keep in the report that, drop that price only. As per the accounting system, we have to take that load. All right. Got it, sir. Thanks. The second question in terms of the growth guidance, if I consider a 30% growth, we are talking about incremental revenues of, say, INR 500, INR 550 crores. As for the commentary we have talked earlier, Ronfen probably will give total revenues of close to about INR 500 CTPR. Hello? There was a background noise. Can you repeat your second question? Yeah, yeah. Is it audible now? Audible. Mm-hmm. On the revenue front, the guidance which we have given, we will probably do close to about INR 500-550 crores of incremental revenues in FY24, based on 30% ± growth. Earlier we had indicated from Ronfen, we can do INR 500 crores, CTPR, we just indicated about INR 400 crores, and Pyroxasulfone, about INR 150 crores. If I add up these numbers, I think and based on CTPR of INR 200+ crores last year, the addition itself comes around closer to INR 600-700 crores. Am I missing some numbers in between? Yes, we. The forward guidance for the next year's growth is not just on, based on the Ronfen and the CTPR, but it is a mix of the added portfolio and the new launches and the new products that are going to come into the market. While you may be calculating a 30% on the Ronfen's revenue growth, there may be variations with respect to Ronfen growth, and new products will be launched. Calculation for product-wise, calculation will be different. Right. What I was trying to come at is, our incremental revenues for FY24 will be, say, INR 550 crores. As far as CTPR and Pyroxasulfone itself is concerned, we will have additional INR 550 crores, plus from Ronfen, based on the last year base of INR 200 crores, we will have, say, INR 500 crores. Additional INR 300 crores will come from Ronfen. Does the guidance of 30% remains conservative, given that the additional revenue from only these three molecules itself could be, say, INR 700 crores-INR 800 crores, or there would be some drop from the earlier molecules, and that's why we are considering only INR 500 crores-INR 550 crores of incremental revenues? Yes, Rohit, I will explain you. In fact, you are talking as a, you know, product to product, so definitely it will be a larger number. If you see last year also, we have given, you know, a direction of 30% of the growth, where we got, you know, 44% of the growth. Definitely this can be happened, but conservative, we have to go because we are changing our products also, you know, where we are leaving our all the generic products. You know, this year you can see how bad it was because of the who the company are holding the generic. They are going drastically, they are going, you know, at a downfall. This year also will correct our all the portfolio. Only we want to create our company as a specialty molecule company at the end of the, you know. Next year also, each year if you see, last year, there was a clear question. We talked about, you know, how much percentage we are talking B2B, B2C. That is increasing drastically. Next year, our target by FY 2025 should be, you know, all should be FY 2025, all should be our exclusive molecule, our potential molecule. Either we will be the number one or two or three in India for any molecule. That is our long-term vision. To look after that vision, we will cannot say each number like this, which is incremental, so definitely we will decrease whatever the generic products are there. Maybe later in, later years will be, you know, the product like some product will be generic in two or three years. That also will leave, and we will come up with our own potential molecule. That is our vision. Right. Right, sir. Got it. Got it. Just one last clarification. On the CapEx front, what was the number for FY 2024? Earlier, we had guided working capital to normalize to 90-100 days. Given that our business is increasing, whether we will come back to that 90, 100 days, or will it be at elevated levels? Thank you. Two part of your question. On CapEx, as we have announced, INR 200 crore of CapEx, recently we have announced. That INR 200 crore of CapEx, most part of this CapEx will get completed in FY24. There will be some spillover to the FY24, sorry, FY25, for the completion. As far as working capital, cash conversion cycle is concerned, it's a journey. We are very much committed, and we are working towards those levers that can actually drive the cash conversion cycle. As you know, company is building up its strength on the specific molecules and unique solutions. Gradually you would see the driving credit terms in the market would also, you know, be possible for the company. working capital pressure will ease off. What we expect is by Q3 of FY 2023, 2024, the working capital scenario will be slightly different. Sure. Thanks for answering all the questions, and best of luck, sir. Thank you. Thank you. Our next question comes from the line of Ashish Rathi with Lucky Investments. Please go ahead. Yeah, hi. Thanks for the opportunity. Sir, question is largely on the inventory built up. You know, we had around INR 700 odd crores of inventory sitting in the books as on Q4 ending, versus, say, a sales reported of INR 250 odd crores. That seems to be a very stretched number, around 200 days of inventory, what we are carrying on an annual level also, if I see. What is the kind of sustainable inventory days number that we should assume going forward? Mr. Rathi, yes, certainly the inventory number is high. There is no denial about it, and internal deliberations and working is also going on. Fact of the matter is, within this INR 700 crore of inventory, the typical split is like 60/40. It's like raw material, and work in progress is around 60% of the total inventory, and 40% is DLC. Because in Q4, there was so much pressure from the market, and as in the initial remarks also, we mentioned the China's, you know, dumping also played a role. Gradually, this inventory, in fact, in Q1 and Q2, the branded product sale, which we are targeting, any which way this will get reduced, and it's a seasonal impact. Quarter four was just one of the jobs, which has actually created this pressure on inventory. We are working towards reducing inventory as well as receivable, both the sides. For the preparation of the quarter 1, FY 2024 and for the quarter two also, we have to build up that inventory, because otherwise, how we will sell it? Because if you see... Correct. the Q1 sales will be, our target is, you know, 30% of the growth, where number is coming, very high. To achieve that number also, we have to keep inventory, for the, you know, possibility two, three also. Yeah. That's why I said the typical split is 60% is self is raw material and category. Can you quantify what you said? You know, you said there was inventory, write down, which was taken, because of lowering of AI prices. Can you quantify this, that to help us understand, you know, in terms of the gross margin, which was reported at 19%, you know, what is the kind of, one-time hit that we took so that we can understand the. That is why I would say it is not inventory write off, it is actually. Exactly. If you talk about the purchase prices and the purchase value of the goods, that is, you know, approx I can say, I don't have real number in front of me. Approx, I can say there is a INR 760 crore, which is our purchase value of that product, and which we are taking up INR 700 crore. You can say like this. Okay. Okay, the hit is around INR 60 crores. Accounting system, we have to take the lowest price till May, where, when we have, you know. Yeah ... announced the result and all that. Till May, that was the prices which has reduced, so we have taken the number in the balance sheet. It is a NRV testing, which has been accounted for in the inventory. Okay. The CapEx funding of INR 200 crores, which you mentioned, is it largely tied up with the banks, or is it sorted? Yeah, it is. It was always sorted. It was not a problem. It was always sorted. As I mentioned, in our balance sheet, there is hardly any long-term borrowing. Bankers are very much, you know, there and very much happy to support the CapEx with the long-term borrowing. It's only that internal evaluation we are taking, which route is more beneficial for the company. You're also evaluating, equity base? We are open for both the routes, but as far as CapEx funding is concerned, bankers are always happy. Bankers, and we have good bankers working with us, so term loans are always there. Okay. Okay. Thank you. Sir, just a feedback, you know, we're happy with the growth and other things on a YOY basis, but the working capital still seems to be pretty stretched, both on inventory days and, you know, at an overall level. A better, you know, management of that and cash flow generation would really help, you know, us as investors to look at the stock. Feedback is very well taken. Feedback is really welcomed, and we, as management also internally, we have been deliberating this. We are very much committed to bring down the working capital pressure and all the aspects, not just inventory, the best case scenario, inventory, as well as the cash flow version cycle. We are working on all these fronts. Yeah, you can see very well. Visible. You can see very positive in FY 24. Yes. Results will be definitely visible. By the closure of quarter two itself. Thank you. We look forward to that, and wish you the best. Thank you very much. Thank you. Thank you. Our next question comes from Vignesh Iyengar with Sequent Investments. Please go ahead. Sir, thank you for the opportunity. Just to understand, I joined the call late, and then apologies for that if the question is repetitive. Just to understand, we've done margins of around 18% for this year. Just to know, what would be the kind of margin profile we will be looking on a blended basis for the entire year in FY 2024? The overall EBITDA margin, we are driving to achieve 20%+. For the financial year, if you look at, if we have delivered 18%, however, by Q2, the EBITDA margin was even higher because most of the branded products were supporting the current season. It is actually a full year, keeping in mind the seasonality, keeping in mind the different channels, product mix, we are making this commitment that company is confident of delivering 20% margin or 20%+ margin. Okay, okay. Sir, considering you have got a target to complete by FY 2025 to switch to only R molecules, what would be the kind of, I mean, if I'm not wrong, generic business around 20%, what would it be now around like 10%, 12% in this year, or I mean, just to understand, what would the movement would be towards FY 2025? FY 2025 or 2004? No. Just to get the idea how the movement would be from FY 2023, 2024, 2025 for the generic business as part of portfolio. We are talking about our journey, which we are saying from generic to specialized products by FY25, as we are saying, we will be largely a specialized product-driven company only. See, it's, as it is, it's only two-year plus journey which we are talking about, so this will not be probably a right time to mention that how much would be converted within this year. It's a journey, and it's actually milestone basis. We are confident, within FY24 itself, there will be a remarkable shift from generic to specialized products, and we have actually delivered on our commitment in FY23 as well. Right, sir. Right, sir. Thank you, sir, and all the best, sir. Thank you. Thank you. Thank you. Our next question comes from Darshil Jhaveri with Crown Capital. Please go ahead. Hello, good afternoon, sir. Thank you so much for taking my question. Sir, I just, you've given all detailed questions. Most of my questions have been answered. I just want to talk, what do you see and what could be, you know, in our terms, you know, kind of a speed component that we envision that could, you know, hamper our 30% revenue and 20% EBITDA guidance or something that, you know, we foresee can have a negative impact? You know, that's the only thing that comes. Thank you, sir. If I understood properly, you are saying, what could be the hindering sectors on driving this 30% growth and 20% EBITDA? Is that the question? Yeah. Yeah. Just what could be a speed bump on our, you know, journey towards about anything? Yeah, yeah. There is, there can be, you know, agriculture sector and, of course, like you have seen the quarter four, as you can say, you know, but already this year it is a drastically, you know, prices down for the AI and as well as raw materials. We don't think any challenge about the growth of 35%, 20% for this year is in the domestic market, but definitely from next year onward, we are also starting our exports. We are, whatever we are taking as a conservative number, but definitely quarter to quarter, we cannot compare sometimes, but as a financial year 2024, we can say that number is easy to achieve. The last question, I also spoken, you know, if you go product to product, that number will come very high, but we are still taking, you know, the lower side number. Number to get is, not any challenge we are looking in the numbers. Okay. Thank you so much for that answer again, all the best. Thank you. Thank you. Thank you, Mr. Darshil. Thank you. Our next question comes from the line of Abhijiit Mitra with Aeonian Alpha Investment Management. Please go ahead. Yeah, I hope I'm audible. I have two questions. First of all, on the inventory loss, sorry if I missed it, can you quantify the inventory loss that you had in Q4? The second question is: what is the percentage in a generic in the revenue as far as Q4 is concerned? And, you know, how to sort of avoid this cyclicality, because I know we are heavy on the current season and rabi season, we are sort of more on the generic side. So how to sort of avoid this? Otherwise, you know, the cyclicality will repeat every year, and that's, that will make a difficult investment case for many, if not all. So what are your thoughts on that? lastly, if you can address, you know, what is the percentage mix of insecticide, herbicide, and pesticide in your total revenue, and whether there is particular pressure in any of those segments that you're seeing, which you would like to sort of address in a different manner. These are the questions which I have. Thank you. Your first question, earlier, in earlier question also, we have many things we have again. Again, I'm repeating the same thing, that because of our new product portfolio, you know, there we can talk about, there is no pressure will be there because if you talk about the inventory, whatever inventory level, inventory loss, in the, you know, FY 23. Again, I'm repeating, there is a raw material cost which have stretched down, but we have to purchase because we are preparing for Q1, Q2, which is the FY 24 and aggressive sales. There is no problem with the numbers, which we can achieve very easily, Mr. Abijiit. Definitely, your second question, your second question was. On the percentage of segment. Segment, segment percentage. Segment percentage, if you talk about the insecticide, herbicide, and fungicide. Each segment we have different strategy. In fungicide, if you talk about the total number, if you talk about there is around 50% of the insecticide, and you can say fungicide is around 30% and 20% herbicide portfolio, which one we are by. 50, 20, and 30, you can say. Approximately, I'm telling you. Insecticide, herbicide, and fungicide. Each segment we have, you know, all the pipeline we have in the fungicide also, if you talk about, you know, strong chemistry, backward integration, there are many things which we are doing in each segment, and definitely the growth path will be, yeah. My second question is actually, you know, how to develop this, you know, branded product portfolio within the rabi season, so that, you know, you don't see such sharp fluctuation in profitability in Q4? Yeah, that we are working, you know, that well, you know, I have told you that process is the one ready product for the week. That is, again, very good product. That is one product. Of course, in the Rabi, there is an insecticide market is also there, herbicide market is also there. You talk about herbicide market there, you know, we have many, you know, products is coming in the upward that, you know, from is there, is there, and, you know, is there. So many products which is in our pipeline, which we are launching just in FY24. Definitely, that the growth path will be there. In the Rabi season also. That would take care of the seasonality impact? Yes. The major one is Pyroxasulfone, but, many product, there we have. Thank you. Our next question comes from the line of Giriraj Daga with Bysaria Family Trust. Please go ahead. Yeah. Hello, Tim. Just some clarification. Did you quantify the INR 60 crore hit on the inventory, or is it more of a just hypothetical example, 760-700? I would say it's a directional number which we have given. As per the accounting principle, you must be there. The NRV testing, which happens, is for the finished goods, which is, you know, your cost of manufacturing versus net sales realization. If any of the dip is expected, looking at the substance over form, the auditors, you know, ask you to take a knob of it. That has been taken care. Okay. Okay. Secondly, you mentioned, raw material and, work in progress is 60% of total inventory. Yeah, really. Right, finished good is 40%? Yes. Okay. Okay. Third, like, you did not give the CTPR number in this year. Like, last year quarter, you were INR 45 crore. Was Q4 sales were, like, completely nil or? No, we cannot say there is sales, but major sale will come in the FY 24, 1st and 2nd quarter for the CTPR, major sales. like FY24, Q1 and 2Q, right? Yeah, first and Q2, FY 2024. Okay. Okay. Okay. Lastly, on the inventory, INR 60 crore loss, you have mentioned we have taken care prices till 31st of May, end, right? See, what we are saying, the prices of May, we have calculated. You know, there is an accounting standard, you know, we have to take the lower side price. Either it is, our purchase price is lower. The market realization. Market price is the lowest. Whichever the lowest, we have to take it in. Till the date of signing of balance sheet. Yes. That is the reason, you know, that May. If we sign, you know, in the March, there will be not that much of loss. If you talk about in the April, there will be again, there was a profit. If we sign in the May, that is the lowest price you can see. Correct. In other months. Correct. Okay. Thank you. Thank you. Ladies and gentlemen, we have reached to the end of the question and answer session, and now I hand over the conference to the management for closing comments. We are very happy. You know, we had a very interactive session, very meaningful session with the investors, with the, you know, experts, and all the questions, and we hope that, you know, have been answered to the satisfaction of the people, and feedback is also well taken. Confident to deliver on our commitment, 30% growth with sustainable margins, 20% EBITDA margin. More important is, as we move forward, we should be seen as the name says, Best. You know, we should be seen as, specialized molecule company, best in the domestic market, and gradually the footprint will be visible in overseas market as well. Thank you very much for all the support extended by each one of you. Thank you very much to all of you. Thank you. Thank you. On behalf of Best Agrolife Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines. Thank you.