Ladies and gentlemen, good day, and welcome to the Rallis India Limited Q2 FY 2025 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 touchtone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Gavin Desa. Please go ahead. Thank you, Ryan. Good day, everyone, and thank you for joining us on Rallis India Limited's Q2 and H1 FY 2025 earnings call. We have with us today Mr. Gyanendra Shukla, the Managing Director and CEO, and Ms. Subhra Gourisaria, the Chief Financial Officer. Before we begin, I would like to mention that some of the statements made in today's discussions may be forward-looking in nature and may involve risks and uncertainties. A detailed statement in this regard is available in the results presentation. I now invite Mr. Gyanendra Shukla to begin proceeding with the call. Over to you, sir. Thanks, Gavin. Good morning, everyone, and thank you for joining us today on our Q2 fiscal year 2025 earnings call. As mentioned by Gavin, I have alongside with me Subhra, our CFO. Let me begin the discussion by delving into the industry landscape initially, post which I will discuss Rallis' specific developments. We continue to witness mixed signals across agrochemical demand recovery in global markets. Volumes are lagging back across key markets, and AI is through lower pricing. Low, lower pricing continue to impact realizations. Production from China continues to be high, and margins are stressed across geographies. In domestic market, rainfall was erratic, with the spatial distribution causing floods and dry spells in different parts of the country. On an overall basis, monsoon season 2024 concluded with roughly 8% above normal rainfall, impacting key agricultural regions like Rajasthan, Gujarat, western Madhya Pradesh, Maharashtra, Telangana state and AP. Kharif 2024 sowings as of September 20 reached about 110 million hectares versus 108.8 million hectares last year. Area under paddy has gone up by 2%, pulses by 8%, maize by 4%, whereas area under cotton has declined by 9%. Extensive rain in some part of the country, especially during mid-August to September period, which is the key demand period for agrochemical companies, did create growth challenges for the industry at large. Continuous rain resulted in lower application of pesticide sprays, which in effect led to lower volume growth, especially in the herbicide category. The IMD predicts October to December rainfall to be 112% of long-term average, potentially affecting Kharif crop harvest. La Niña conditions, which may cause a below normal temperature in northern and central India, could lead to cold wave events. Export market demand recovery is still not very promising. Lower prices and volatility are making chemical players cautious in inventory buildup. China continues to keep the market well supplied. Demand in the U.S. has been relatively better. Demand remains uncertain in Europe due to operating challenges, with unrest in Middle East further adding more pressure. Moving on to Rallis' specific developments, we had a robust Q2 performance on the back of a strong double-digit volume growth in domestic market. Our revenue stood at INR 928 crore versus INR 832 crore of Q2 2024, and profit after tax at INR 98 crore, which is 20% higher than the previous year, similar quarter. Crop care delivered a strong volume with revenue growth of 7%. Within crop care, growth is domestic-led, with export business continuing to remain under pressure. Seed revenue is up by 48% due to better Kharif liquidations. EBITDA for quarter two, fiscal year 2025, stood at INR 166 crore, higher by 24% compared to Q2 previous year. Moving to the individual businesses, business-wide performance. Our export business has displayed resilient performance with focus on maximizing volumes and driving capacity utilization for our clients. In Metribuzin, we have done highest ever volume in first half 2025, and half volumes surprise with half year volumes surprising fiscal year 2024 volume already. Hexaconazole is also showing good momentum, and we are working on expanding debottlenecking to serve the increasing demand. Pendimethalin is around good track with long-term demand being steady. Our workaround capacity expansion with new efficient technology should also be commercialized by the end of financial year. Acephate market continues to be under pressure in U.S. and Brazil, with key protonetrol at our lowest ever price. Across technicals, we are also steadily working on expanding customer base and securing registrations with more global players to improve our share. In CSM, we are working on new relationships and alliances with global players. On the back of three new contracts in fiscal year 2024, we have further successfully completed pilot scale production of pre-commercial quantities of Flavocide, a novel insecticide, for Bio-Gene Technology Limited, an Australian company. We are confident that these new partnerships will meaningfully contribute to both top line and bottom line in the years to come. Moving into domestic crop care, our growth was 11% with volume growth of 17%. Quality of growth was also good, with future growth categories like herbicide and crop nutrition witnessing 25% and 29% growth respectively. Herbicide category is under indexed within our business, and we are consciously working on improving the share progressively. Within crop nutrition, GeoGreen did highest ever volume in H1 with organic category volumes. Our new product launches, such as Clasto for cotton whitefly and Mustard, Presid soybean herbicide, showed good promise, and we are confident of the potential for a scale-up. Within crop nutrition, Neozinc and water soluble fertilizer, which is a portfolio, are scaling up fast. We also conducted our key dealer and retailer meetings to improve the engagement. Our efforts around expanded, expanding targeted reach and penetration, leveraging digital is also in good momentum. We have commenced the work on rationalizing the portfolio and sharpening focus across key markets, and you'll hear more of it in the quarters to come. Moving to seed business, it recorded INR 1,041 crore revenue, with 48% growth over previous year, mainly due to lower Kharif 2024 volume returns resulting from calibrated placement, leveraging SeedSafer digital tool. SeedSafer is an AI/ML-based sales forecast modeling tool based on historical, same and other business factors. We'll further work on improving the tool to keep sales return under check. The near-term outlook for the business, particularly export business, remains challenging. Domestic business has positive outlook on the back of good reservoir level. Our efforts are now directed towards improving customer centricity, sharpening the portfolio choices, expanding alliances, and leveraging digitalization across the operations. We launched Anubandh Edge, a unified retailer management app for both crop care and seed business. That concludes my opening remark. I will now hand over to Subhra, our CFO, for a detailed analysis of the finances. Over to you, Subhra. Thank you, Dr. Gyanendra Shukla. Good morning, everyone, and thank you for joining us today for our Q2 and H1 earnings call. I'll walk you through our financial performance for the quarter, post which we'll commence the Q&A session. Starting with the top line for the quarter, our revenue stood at INR 928 crore as against INR 832 crore for the same period last year. Volume growth has been encouraging at 17%, with pricing challenges impacting overall growth. EBITDA for the quarter was INR 156 crore as against INR 133 crore for the same period last year. Profit after tax for the quarter stood at INR 98 crore as against INR 82 crore for the same period last year. Moving on to business-wide performance. Domestic crop care registered growth of 11% with 17% volume growth. Domestic demand was buoyant with positive monsoon and better commodity prices. Overall, Rabi outlook is also positive, with increased water reservoir levels. As far as seeds is concerned, our calibrated placements in Kharif helped us maximizing liquidation in the context of short stock shortage to ensure more effective utilization of the inventory. Seeds business has grown by 48%. We are significantly pleased with the response we're getting for our cotton hybrid, Vikas, and believe it a significant growth runway. Our focus will primarily be on five key crops, cotton, maize, millet, mustard, and rice. We believe focus on such selective crops will aid in driving scale. We aim to gradually build a presence across these five crops, which focus on profitability. In exports business, lower prices continue to impact revenues and demand recovery continues to be slow. Sales of Metribuzin and Hexaconazole maximized, whereas for Acephate specifically, consumption still remains soft. Our efforts on expanding customer base and product portfolio going to help build more resilient business. Our efforts continue to be directed towards driving focused execution both at the front and the back end. This includes portfolio optimization, territory rationalization, removing overlaps, and driving cost efficiencies and simplification across the value chain. Our actions towards portfolio refresh also continues, with two new products in crop nutrition and three products in seeds launched during the quarter. We also continue to be relentless on improving capital efficiency, both for fixed capital and working capital. We plan to adopt a measured approach in export segment and will not set up capacities till we have contracts in hand and have improved utilization for already set up capacities. Inventory levels have moderated. Collections have also improved. Though in some stretched markets, collections improvement will continue to be a focus. We have a healthy cash and liquid balance of INR 229 crore as of September 30. We emphasize that spends on CapEx would be around INR 100 crore. We also expect to commence the construction for integrated R&D center and seeds manufacturing. In summary, we are implementing various initiatives to mature towards achieving consistent, competitive, and sustainable profitable growth. That concludes the opening remarks. We can now commence the Q&A session. Thank you. Ladies and gentlemen, 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, a reminder, please restrict yourself to one question and one follow-up question. One moment, please, while we poll for questions. Our first question comes from the line of Tarang from Old Bridge Capital. Please go ahead. Hi, good morning, and congratulations for the strong set of numbers. Couple of questions. First, on the seeds business, what do you think drove your volumes? I mean, you've indicated enough that it was because of calibrated placements, but would it therefore be fair to presume that your expectation of sales return for Q2 was materially lower than what actually turned out? And second, within the seeds business, how are the volumes for Aatish and Diggaz for FY 2025? Because the commentary seemed to suggest that you are quite optimistic on the offtake of Diggaz, but the fact of the matter is that cotton across industry was pretty bad for Kharif of 2024. Yeah. So thank you for your comments. I think, you know, what growth volume, I think, one of the thing we have been saying is, look, we are trying to be better in forecasting, how much we place and, where we place. The investment we are making on digital capabilities, we talked about, you know, seed sale. That basically takes into account what is likely to be, you know, accepted in the market and the other parameters which we are using, that helps us in placing the product in the right quantity at the right places. Now, these are still early days, but I would say that that certainly has helped us in placing the product at right place in the right markets and helping reduce the return. The difference between previous years and this year is a significant low return compared to the previous seasons, and that led to overall net realized net sale going up. Coming back to the specifics, I think because, as we have said earlier, also, Acephate has done very well, literally, we had negligible return, I think. Now, this is one product which has crossed more than INR 50 crore, brand of the total cotton, and we are very bullish on Diggaz for the north. Aatish, of course, is a product I think is a mature product, is rather on decline. We were very careful about building inventory of that. As we move forward in the seeds, I think I've been talking about managing this business for profitability, and it comes from also managing operational efficiencies, and that's where a combination of digital tool, better planning, and better placement will go a long way. Making sure that we are not burning money on one side as we try to generate revenue. Sure. Just to follow up on this, I mean, typically from what I understand is that your seeds portfolio is skewed more towards rice and maize, followed by millet and cotton, right? If I look at H1 acreages for maize and rice, generally, it's been a good Kharif for both these crops for various reasons. So how much of your performance in H1, rather than looking at it in Q2 and Q1 basis, would be a function of those end markets really doing well? And how much would you attribute it to because there is you know, the function of the market having done really well, rainfalls being fairly dispersed, fairly continuous, which hasn't been seen in the last three years at least. Yeah. So if you start looking at portfolio, I think, look, so rice, obviously, we didn't have enough seed, otherwise we would have sold more. So rice has done, overall, well for us. So, so whatever quantity we had, I think we have been good in liquidating that. Cotton, though, is one crop, it has gone down from 12 million hectare to 11 million hectare, but 11 million hectare is still a very large crop, right? So from that perspective, I would say, we were still able to capitalize, you know, because of the good demand of our products. So, so market has gone down by 10%, but the products which were in demand, they have still done well. That explains cotton and rice. Millet, our portfolio, I would say, is still not competitive to be in the leadership position. We are working on it, and the same applies to the maize. But maize, because we didn't have a lot of inventory, we were still able to sell. We could have sold more if we had inventory, but yes, as we move forward, I think we are getting good traction in our cotton. And I think our biggest hope, our biggest success will come when we are able to crack a good product for South and Central, which we are working on. Rice, we have a good portfolio. Millet, I think we are working on, and maize is something also work in progress. Thank you. The next question is from Nirbhay Mahawar, with N Square Capital. Please go ahead. Good morning, sir. Thanks for the opportunity. Just to follow up on the Diggaz, what is its target market size right now, and what is our market share as of now? What is our aspiration of it? Diggaz market primarily is targeted towards northern part of the country, which is three adjoining states of Punjab, Haryana, and Rajasthan, where cotton is grown. If you say how much India is grown, Punjab grows about 2 lakh hectares, Haryana grows about 5 lakh hectares, and Rajasthan has similar areas. It's about 1.2 million hectares. 10% of the total cotton area gets planted in that place. That's where this product is, you know, getting planted. Now, that area, particularly in Punjab and Haryana, has been under pressure, but it's still, I think, 1 million hectare in a concentrated pocket is a sizable area. We believe we still have significant room to grow given the performance of Diggaz, you know, in coming years. Sir, could we give these numbers in terms of number of packets we are selling versus total market share? If it is. I, I think, you know, look, we are in production right now, right? We would have a fair estimate of how much inventory would become available by February, March. So at this point of time, you know, if I have even, say, 2 million packet, I can say sell all of it, right? But I know we are not going to get that kind of production because of this wet season. Also, production becomes very challenging. So I guess this question, if you ask me in the month of February, March, I'll be able to give you a better projection. Thank you. The next question is from the line of Siddharth Gadekar with Equirus Securities. Please go ahead. Oh, hi, sir. Good morning. So on the seed business, just wanted to understand that have you taken any price hike, given the shortages seen in the market? And can you quantify between value and volume growth during the first half of five 2025? Subhra, you want to- Yeah. Talk about break. So price hike, we took, so because the mix also changed significantly, because cotton as a portfolio has become our largest crop in the portfolio. So there's a combination of price and mix sitting there. But if I slice it, there's a large part of the gain which has come from volume, price and mix, and not so much from volume, because inventory was already constrained. But, cotton has done well. Paddy, in the circumstances that Dr. Shukla spoke about, given the constraints of inventory, we were able to liquidate whatever we had. Maize, where also returns were very low. So, it's a combination of both price and mix, which has contributed to the growth. Secondly, in terms of our sales return, can you quantify the number that was there in the last year's base number and this year, what was the sales return? So I wouldn't be able to quantify, but if you look at first half returns, first half performance itself, as I said that, if you look at, if I give you some products, for instance, because we were sitting at almost zero returns, it was practically zero returns. Paddy was also no net return except for some small returns we had to take to the... and maize as well, maize very low returns. So it was largely millet compared to last year. Last year we were, as Dr. Shukla alluded, there was also technology which helped in terms of digital placement, plus also some interventions we did in terms of identifying the right distributors, placing it with the right kind of inputs in terms of marketing inputs. So all of that helped in reducing the returns. Thank you. The next question comes from the line of Abhijit Akella with Kotak Securities. Please go ahead. Yeah, good morning. Thank you so much for taking my questions. Just a follow-up on the previous question. You know, on the seed revenue growth for the first half, which is about 2%, you know, for the first half I'm talking about. If you could please just split it out in terms of volume versus price and mix, that would be helpful. Abhijit, large part of it, as I said, has come from volume and mix. High single digit would come from price and mix, and volume would be largely flattish. Okay, got it. Thank you. Similarly, possible to just, you know, split it out for the domestic crop care business as well, please, Subhra? And then I just have one quick follow-up. Sorry, domestic crop care? The same split between volume and price. The domestic crop care first half you wanted, right, so domestic crop care has had a minus 6% price-led growth. I'm talking about formulation business, and the volume growth is positive at 18%. Right. And just one last thing. On the Bio-Gene project we have, if you could please just help us understand the revenue model that we are kind of envisaging there. Will it be, you know, do we derive, you know, some cut of the royalty that Bio-Gene makes from its licensing to its commercial partners? Or do we instead supply the molecule directly to Bio-Gene's licensees? So, you know, how exactly do we make money in this project? I think, look, this is a new arrangement. The way it starts in the beginning is, we set up a facility produce for them, and we make margin there. But in future, there may be a possibility of getting distribution rights of these products. Thank you. The next question comes from the line of Rohit Nagraj with Centrum Broking. Please go ahead. Yeah, thanks for the opportunity and congrats on very good set of numbers. So first question is on the industry front. So in your commentary, you also mentioned that there has been, you know, the market is well supplied from China. However, our performance is otherwise in such a, you know, challenging environment. So what is your understanding in terms of, A, immediate impact of the well-supplied market on the volumes across different geographies? And B, when we will see any pricing improvement given this context? Thank you. So I think now, given that there was a good rain and commodity prices were favorable, that led to obviously a volume gain. Pricing is something very, very difficult to predict, because no matter how much we continue to undermine China, China has capacity and they have ability to supply, you know, at very competitive price. So I guess that's very difficult one to predict. I think what is easy for me, and I have been saying in the past, is that I'm going to focus on domestic branded business, where I have to make sure my product is being used more by the same farmer and on the more crop acres. That's where our focus is, because price are the variables. If I'm in a domestic branded business, that also allows me to charge some premium at the brand level. So that's our main primary focus. Because that something China, we're not going to control, we're not going to really, we're not going to stop China. Right. Got it. At the same time, we're also trying to diversify some of our supply chain domestically to say, how do we balance the reliance on China versus domestic player, those domestic suppliers, including our own production capacity? Sure. So second question is on the balance sheet front. So the trade receivables seem to have gone up to about INR 850 crore from about INR 580 crore on a Y-O-Y basis, and top line has gone up by about INR 100-odd crore. So is it due to maybe leaner credit terms offering, or is there any other reason? Thank you. So trade receivables have gone up from INR 773 crores to INR 852 crores, Rohit. So there's an INR 80 crores increase. A part of it is contributed because of the increase in the domestic sales, but there's no concerns, there's no pocket of concern. And there's also an element of some discounting that we had done in the base period for export receivables, which is not there. Thank you. The next question is from the line of Viraj from SiMPL. Please go ahead. Yeah, couple of questions. First is on the seed. What you said is the volume is flat, and the growth we have seen is largely a function of price and mix. Am I right? Yes. So, you know, if we look at last year's same quarter, we had seen a very strong growth, and the reason for that was that there was a delay in the season from Q1 to Q2. So even on that higher volume base, you know, we have seen a very healthy growth, and this is in background of us seeing a supply shortage in seeds in Q1. So just trying to understand, you know, if you can give some perspective in terms of crop wise growth performance, and when we say the price or the mix element, you know, which is of the two, which is the larger factor? I think we have been taking significant steps. I think couple of years back, we spoke about that in seeds business, we will first reset the business and look at profitability and then start working on growth. As you mentioned in multiple calls that are cotton hybrids, especially North one, have done well. There are multiple other hybrids and paddy mates which are also doing very well. I spoke about that cotton has now become the biggest crop for us. We have touched along with pickles and other brands, we will do almost INR 100 crore. We've almost already touched INR 100 crore of revenue this year. So it's a combination of... And that's why when you said that on the back of a good FY 2024, FY 2025's performance has also been good. We are hopeful that many of the launches that we have planned, we'll be able to scale up. Yeah. So that does that answer your question? No, actually, I was just still trying to understand. If you can just still give some perspective in terms of crop wise performance. And let's also come back to the second question, which I also had on the margin front. See, if you look in terms of the order, pecking order, cotton has usually the lowest margin profile in the segment for seeds. Now, for us, when we say cotton is, cotton is the one which has given the highest growth for us, still despite that, we are seeing a very healthy improvement in operating margin. So I'm just trying to connect, you know, just understand better in terms of both the sales mix profile and similarly, the impact on margins. You know, when we see the price or the mix, how is that driven the margin part? Yeah, the cotton indeed has shown the highest growth, both in terms of top line and bottom line, and it depends on the mix of the products that we have. So you're right, in the industry level, maybe cotton is making lower margins, but it depends on the products that you have in the portfolio. So for us, both a combination of revenue growth and the operating leverage and the fact that we've been able to hold overheads or optimize them has helped in operating margin improvement. Thank you. The next question comes from the line of Himanshu Binani with Anand Rathi. Please go ahead. Thank you, sir, for taking my questions, and congratulations on a good set of numbers. So sir, I have just one question in terms of the seeds business. So I think last quarter, there was a commentary from us as well as from the industry, in terms of, like, the supply side concerns which we had. And as per my understanding, first quarter happens to be the heaviest for the seed industry. So during the last quarter, we have, like, posted a decline into the seeds business, and that was largely led by the supply side constraints. And all of a sudden, we have been, like, able to post somewhere around a 40%-50% sort of growth in the seeds business, considering and higher base of last year also. So maybe if you can, like, help me in understanding this. Himanshu, we're not able to follow clearly, but I think your question was that despite shortage of seeds, how we were able to deliver a better performance in Q2? Yeah. So I think it's very simple. I think in seed, what we call is before season, you do the placement, right? And then farmer buys the seed, and unsold inventory comes back, and that gives you a net return, right? So a net of returns, I think, while we had shortage on the seed, but our supply levels were, I mean, were not enough to take benefit of the demand, but they were good enough to really, they were probably at the similar- Level in terms of liquidation, yes. Mm-hmm. But because we were able to reduce significantly return, that allowed us in still coming to the level of, you know, previous in terms of, you know, volume and some price benefit, combination of that. So in fact, Himanshu, one thing that really will help all of you guys, our channel inventory are one of the lowest across various years now. So the inventory levels have significantly come down. So we have been able to sell whatever was there. Or whatever was sellable. Whatever was sellable, yeah. Got it. So due to the supply side constraint, the growth of this sort of number is largely led by the prices, basically. It's not much, Lesser returns, actually. Actually, if you look at first-half level, we are flat, so first-half level, we are 1%. Our Kharif liquidation has been in line with last year, but it is where the placements were lower because of the inventory and because of effective use of technology and better marketing and sales efforts, we were able to reduce returns. Got it. Got it. Thank you. Thank you. You're welcome. Thank you. The next question comes from the line of Darshita from Antique Stock Broking. Please go ahead. Yeah, hi. Thank you for the opportunity, and congratulations on good numbers. My first question was regarding the current channel inventory that we have for the domestic crop care business. Is it on a higher end, and are we expecting a lot of sales returns of the Kharif inventory that we have? I mean, a lot of sales returns reflecting in the third quarter of the Kharif inventory that we currently have. So again, look, I think this year, planting is higher of overall crops. And also because of continued rain, we expect. So the Kharif season doesn't end in September. Kharif season, particularly in some crop, in pulses, even in some late rice and cotton continues till October. So obviously, there's a required level of inventory in the market. But we are very careful and calibrated, and I think we have a system of making sure we provide based on our best estimate, and this is something we keep trying to learn and improve more. At this point of time, I don't think we have any excess inventory which we would like to leave in the market, because leaving excess inventory also has a lot of other repercussions. All right. Okay. And, the second question was regarding the higher tax rate during the quarter, if you can, give us some idea on that? So Darshita, because of this long-term capital gains tax reduction by Union Budget, there was an unwinding of the deferred tax assets created for both carry forward of losses and long-term capital gains. So that's a one-time impact which has come for the effective tax rate. Thank you. The next question comes from the line of Saket Kapoor from Kapoor & Co. Please go ahead. Yeah. Namaste, sir, and thank you for the opportunity. So firstly, in your opening remarks, you did allude to this extended monsoon and waterlogging and other issues that affected the aftersales, that is moisture still remaining in the agricultural field. So taking these factors into account, sir, and the reserve levels, what should be the growth that we are eyeing for the current year, taking into account the changing Rabi season and also the extended Kharif part, which just our MD alluded to? I think all I have been saying, our attempt is going to be we grow better than the market, right? That's our attempt, and that's what we are targeting. I'm certainly not in a position to put a number or give a number. Thanks. And sir, lastly, we have also been looking to tolling the active ingredient part with other manufacturers. So what kind of business are we outsourcing in terms of we looking into the B2B segment of formulation and the active ingredient portfolio being managed by other players? So what kind of business have we outsourced for the current year? And if you could mention who are the key players with whom we are engaging for the same? Yeah, I think we always talk about our crop care business in a few key buckets. First bucket is really domestic formulation. As I've been saying in the past also, that's my number one priority. Now, that obviously I have to find an optimal point, make versus buy. So those decisions we keep making. Obviously, because of many confidential agreements we have with parties, we are not able to disclose those names and all. But for us, it's an optimal make-or-buy decision. I'll make on that what is right for me, because we have capacities and we want to use the capacities. Now, then we also have a domestic institutional business where we sell some of our technicals we make on a bulk basis to parties. That's a business for us, but it's, that is not something we are very aggressive about it, and we are well, we participate in that market, but we are very calibrated because those markets also we want to make sure now we are not overexposing the, you know. The third business is basically international business, where we sell, and that market remains subdued, but there are nuances there. So, Metribuzin has done well for us. Pendimethalin is doing okay. We have done, you know, on fungicide we have done well. I think where we have challenges is really SSRI, and we're trying to address that. I've been very candid about it. Do I have a solution? I think we have certain options we are evaluating, and as when those options become, you know, executable, we'll certainly get back. Thank you. The next question is from the line of Ravi Purohit with Securities Investment Management Private Limited. Please go ahead. Yeah. Hi, thanks for taking my question, and congratulations on good set of numbers. Sir, since you've joined the company, the last couple of quarters, you've alluded to changes that you're looking to make, both in terms of, you know, making our seeds portfolio more profitable, pruning the loss-making parts of it, and also kind of working on getting the missing decade back on the current side, like contract manufacturing or timing up or make or, you know, buy or, you know, distribute rather than, you know, make certain products on the, on the agrochem side. So if you could just kind of give us a brief update on that strategy and what kind of pruning or what kind of things we've already done on the seeds side, and what are the opportunities that we are working on, on the agrochem side, working with MNCs particularly, both in terms of licensing to sell in the domestic market and exporting, you know, for the requirements. I can give you just a general observation. The way we are working is, one, we need a product, product sourcing, so we are aggressively reaching out to discovery-related companies all over the world to really make sure that we have a pipeline, and that pipeline remains robust. On the CSM side, I think we are very selective. As I said, we have enough capacity on the ground. We will be very calibrated. First priority to use the capacity to maximum and then get into any new contract before we set up the capacity. That, that's our strategy is. I believe, you know, we also talked about this domestic formulation making more efficient. That work we did not want to touch because the season was going on, but we're in the midst of exercise, and that exercise should get completed in couple of months. So as we enter the new year, we would be able to actually go with a completely what do you call it? Streamlined portfolio approach, where we may be we may be looking at tail and saying, "Look, whether this tail is desirable or not." So we're in the process of doing that exercise, and we'll take every step, because ultimately, goal I've been saying, look, for me, ultimate measure of success is going to be return on capital. Right, and that, that has to come from various measures, you know, including revenue costs and optimizing, you know, profits wherever possible by looking at the portfolio. Right. Thanks on that, sir. We'll appreciate if you could kind of, you know, give a brief update on that, you know, in every quarter. I don't know, maybe part of the presentation or, you know, part of the press release. So my second question is on, you know, on seeds portfolio, right? You know, I think you of course run a fairly large and profitable seeds business under Monsanto or, you know, Bayer combined. So what is the sense that you get here in terms of the potential scalability of the seeds portfolio? We are really subscale in that sense, and at higher scale, seeds is a very, very profitable business if done right. If you could just kind of share as to what would be your medium-term to long-term strategy would be on scaling of the seeds business? Fundamentally, we said we are going to participate in five crops, right? And I can give you, I mean, these numbers keep changing, but back-of-the-envelope number, our cotton seed market is about INR 3,000 crore. Hybrid rice seed market is about INR 2,500 crore, so that makes it INR 5,500 crore. Millet market is about INR 1,500 crore. Sorry, about INR 700 crore, not fifteen. It's 1,500 tons. So, about INR 400-INR 500 crore there, so that makes it 6,000 tons. And then there's another mustard of around INR 500 crore. So, we are operating in a universe of around, and then add the other crops like maize, in a universe of INR 10,000 crore of seed market, which is almost 50% of the total seed market. Now, if you see our market share in that is, roughly 4%, right? Of INR 20,000, 2% of INR 10,000 is 4%. Our our objective should be that we start growing our market share in that segment, and I guess, different crops are at different stages. In terms of portfolio readiness, I think right now we are slightly better in cotton, followed by rice, followed by, I would say, maize and millet. That's where we are. And so increasingly you will see as we try to grow our volume and market share, you say next one to two years, more gains are going to come from cotton, a little bit from rice, and then subsequently from millet and maize. But our aim would be that, look, we come to respectable, at least a high single digit, you know, low double digit. Thank you. The next- It all depends on the portfolio, because I, I think the cotton costs, I mean, every seed business is a product business. There's nothing called two-tier. Your product must perform, otherwise even you can give it free to the farmer, won't buy. Thank you. The next question is from the line of Bhavya Gandhi with Dalal & Broacha Stock Broking. Please go ahead. Yeah, thanks for the opportunity. Just wanted to know what is the absolute export number for the quarter and for the first half? So you can go ahead. Please give me a minute. So, Muninder, you can ask another question. My computer is having some issue. Sure, I'll wait in the queue or maybe whenever you can answer the question. Yeah. Yeah. Yeah, Yeah, Operator, you can take the next question. That. Thank you. The next question comes from the line of Somaiah with Avendus Spark. Please go ahead. Yeah, thanks for the opportunity, sir. So just want to understand on the domestic crop care, a strong volume growth there. One, just some color on them in terms of industry growth rates are also similar level or there has been market share gain. That is one. Any part of the portfolio that has done, you know, very, very significantly, kind of growth or between formulations, I mean, the B2B, I mean, each of these segments have kind of done very well with very good volume. Actually, I don't know. I couldn't hear the question clearly. Do you mind repeating the question? Yeah, yeah, I, I can. Am I audible now, sir? Yeah. Yeah. My question was on the domestic crop share, the volume growth, quite a strong growth. Just wanted to understand, is this more of an industry trend or we have had market share gains? That is one. And, second, any part of the portfolio or any regional, you know, region has shown strong performance that has led to this kind of a growth that you want to highlight. And also between, B2B and, the formulations, which of these segments have kind of really done well, to get this kind of, growth? Two things I can tell you. Look, so it's very difficult to say if I have gained market share or lost market share because Kharif season is on. I think that clarity will probably come by November and December. The segments which have done well for us is really herbicide, relatively, and also our crop nutrition business. Yeah. And between the B2B and the formulations, any color on that, sir? I think I won't boast a lot about B2B. I think it's really, you know, as I've been saying, our story, first has to be, you know, about how do we strongly continue to grow our domestic business. Thank you. The next question is from the line of Ritik Jain with Nirmal Bang Securities. Please go ahead. Yeah, hi. My first question is on, when can we expect export to see normal volume growth? Well, I think, look, export is a very competitive business. I think what we are trying to work on, and I've been talking about, is that we are working on multiple fronts. One is just existing product portfolio. So I think we are having a really good traction on metribuzin, pendimethalin, and hexaconazole. But we have challenges on. But having said that, we are also looking at various levers such as, first of all, how to optimize and increase the sales of existing portfolio, and then start working on some of the pipeline product. We don't have, you know, like, big, big products, but there, there's a decent pipeline developing. Our team is working on the ground. It will only show improvement in the coming years. Having said that, as it will continue to be troubled, but I think it's a troubled size, I would say. We have to work on it. Okay. Okay. And, yeah, if the seed business sustains its growth of first half of FY 2025, what is the ROC one can expect from the seed segment on a sustainable basis? Yeah, I think, you know, we. First thing I made a statement that, look, we want to manage this business for profitability and what I call fit to run, right? I think we have to get to a fitness level where we reach to a stage where our business doesn't make losses at all, and I think we are slowly inching towards that and consolidating that position. And we are also stepping up our R&D efforts so that we are able to launch new products at the same time and are able to take out older products. I think if we just get that cycle right, I think, as I said, look, in a ten thousand crore segment we operate, we are just 4%. There's a lot of room to grow. I think in seeds, I think what you should understand is the large CapEx investment is only working capital. There's no fixed capital as such. So what Dr. Shukla alluded, it's more important for us to drive profitability and keep the working capital under check. I think both the actions have started showing some momentum, and we should be able to hopefully improve. More important is that the seeds should not be a drag on the company profitability. So we have to first move to a positive zone and then keep improving it from there. Thank you. The next question. Just one minute. Somebody had asked the number on international business, so we did a 143% growth of revenue in Q2. The next question is from the line of Manish Shah, an individual investor. Please go ahead. So Manish, I've already answered this question. Thank you. Thank you so much. Thank you. The next question is from the line of Bhavya Gandhi with Dalal & Broacha Stock Broking. Hi. Thanks for the opportunity. So, on H1, I mean, you just answered on the Q2 export data. On the H1 also, if you can share what was the export data? And on the Acephate as well, I just wanted to understand, it's a big product for us in the export market, whereas other companies are still struggling, maybe the likes of UPL, Syngenta and all this. What strategy are we adapting that our product is still surviving in the export market? Yeah, that's it from my end. First half revenue for international business is INR 275 crore. As far as herbicide side is concerned, I think it's a smaller, it has a smaller overall market, but we are the market leaders there, and we do have strong customer relationships and good registrations even in Southeast Asian markets. I believe it's a small market, it's a small business, but we are working almost like maxed out capacity today. In fact, we have debottlenecked some of the capacity, and we're also looking at alternate ways to expand the capacity. Okay. In short, we have some pricing power when it comes to the export market, when it comes to exact orders on, because of our relationship and maybe because of registration. Yeah, it's a small market, though. It's a combination of registration, customer relationship, quality of the product. I think several factors play together. Yeah, and also the dynamics that it has with other molecules, other competing molecules. Thank you. The next question is from the line of Tarang from Old Bridge Capital Management. Please go ahead. Hi. Two questions actually, both on crop protection. One on Acephate. Sir, I mean, given your vintage with the molecule, and my sense is, your experience and scale with the molecule, what do you think right now has happened in the marketplace, which is specifically rendering this particular molecule as a problem child? I mean, has there been a technological shift? Do you see widespread competition which is driving the prices down, higher inventory in the marketplace, or there are only specific players in the manufacturing value chain which are being extremely aggressive? So that's one. And second, overall crop protection, if I look at, you know, the domestic and the exports business, volumes have done reasonably well, and this coming from a fairly soft previous year, where inventory was sort of a challenge both in the international and domestic marketplace. So therefore, would it be safe to presume that, while pricing continues to be a challenge for the broader industry, but the destocking challenges that were being witnessed in the previous year, they have come to, they are effectively addressed? So two questions. Thanks. So, see, related to Acephate, I think one of the things we have to understand, it's a very concentrated market. This product is primarily consumed in Brazil, U.S. and a little bit in India, right? These are the three primary markets, where probably are 80%-90% of the total volume. Now, our competitor here are actually Adama and UPL. Now, both of them are significantly backward integrated from a manufacturing perspective, as well as they have a significant B2C market as well in these markets, and that, I think, puts us at some disadvantage. So we're trying to figure out, you know, how do we solve this? Because, A, we don't have B2C presence in these markets, so, so we're looking at relationship and what kind of relationship we can develop to, have, B2C indirect presence, you know, by having a supplier relationship with the local, people there. Other thing is we are also looking at, you know, how can we, do some, cost engineering on the, manufacturing operations we have there. So a couple of options we are evaluating. I don't have a clear answer. Obviously, we know few things can be done. As I said, you know, earlier also, I think we would like to have a clarity, you know, sooner the better, but I think it just takes time because, you know, the things we have to understand global dynamics. The easier option is that we're not making big get out of the product, right? I think we're not at that stage yet. We have to just whatever we do, we have to make sure, you know, we have all the information, and we have considered all the options. Sure. And, for my second question, sir? Sorry, second question. Global crop protection market. See, global crop protection market, if you see, is primarily driven by two factors, you know. So obviously, North America and South America become very, very important, and commodity prices also play a very, very important role. Now, there was an uptick in commodity prices beginning of the year, but I think, with good production estimates coming out of the U.S. and, rainfall situation being better in Latin America, commodity prices are relatively softer, particularly, for key crops like, maize and soybean, including cotton, right? So, yes, you are right, the destocking is by and large done. As a result, current year numbers should look better. But, we have to understand, well. It's not a very buoyant demand. It's not that suddenly 20% more crop is being grown all across the earth, right? And China continues to supply at a very competitive rate. So I'm not expecting any miracle to happen in this market. I think it's going to be a normal growth period. Prices will continue to remain subdued, with given the commodity prices and supply situation. Thank you. The next question is from the line of Abhijit Akella with Kotak Securities. Please go ahead. Thank you so much. Just, quickly follow-ups. One is, with regard to the newer products in the domestic crop care business, would it be possible to, just share the kind of growth we've experienced from that in the first half of the year? Number two was just on the categories. You did give us some numbers for herbicide and crop nutrition growth, but if you could also please just specify insecticides and fungicides, that would be helpful. Thank you so much. I don't know if we have a specific number today to share, but maybe we can share later on. But I guess some of the product launches we have made this year, they are looking very good. Particularly we had a soybean herbicide launch that seems very promising. As I've been saying in the past, the herbicide becomes very, very important for me, and luckily, we had a good launch. Now, I think if you wait till maybe November, I think I'll have clarity on Kharif. That might be the best time for you, you know, for us to give you some clarity. At this point in time, I would say, herbicide and nutrition have done well. Fungicides are okay, so are insecticide, and that is reflected in our numbers. Abhijit, I think we publish this ITI on an annual basis, in which turnover index, which will reflect. But it's safe to say that in first half as well, it's tracking well above our. It's tracking in line with our expectations. Herbicides as a segment, we don't have significant, our portfolios are under index, but we have done well. Fungicide followed by fungicide and then insecticide. Thank you. The next question is from the line of Viraj from SiMPL. Please go ahead. Yeah, just one question. Both in seed and domestic crop care, you know, when you say portfolio rationalization, what kind of a churn in the portfolio we have, we would have seen in last six months? Absolute, absolute cost. Are you talking about what we have done or what we are expecting? What we have done and what, both. So I think what we are looking at is scale portfolio rationalization, which is where either the scale-up does not happen as per expectation or it's adding to the complexity. We are yet to complete the exercise, but I wouldn't say that it would have a meaningful impact on the bottom line. Thank you. The next question is from the line of Saket Kapoor, from Kapoor & Co. Please go ahead. Yeah. Thank you, sir, for the opportunity again. So, madam, if you could give me the CapEx numbers which we have done for the last three years, and what kind of capacity augmentation has been done in the agrochemical space? We have done about INR 660 crore of CapEx out of the INR 800 crore of CapEx that we spoke about in the last five years. And if I slice it, the big one had gone behind multipurpose plant, which is around INR 200 crore. Multipurpose plant, as Dr. Shukla alluded, there are some challenges in getting higher capacity utilization because of the global situation as well. So we hope to improve the utilization as we start seeing more contracts for it. The next INR 100 crore went into formulation plant, which is helping us, which is working at in line with our expectations or in line with the business case that we have done. Still, there's significant headroom for expansion of capacity there. The last few months went into capacity expansion, debottlenecking of existing capacities, some of the sustainment CapEx we did, and digital investments that we spoke about in both front-end and back-end. Ma'am, just to add to it, for the multipurpose, can you elaborate where, which market, which products are we addressing to, and what kind of asset turnover can we expect at the optimum utilization level? See, multipurpose plant by nature, name itself is a multipurpose plant, so it's supposed to help you do multiple chemistries before the scale-up of the volume happens, and then you can set up an individual or standalone capacity for it. So we have done multiple products for it, both for contract manufacturing customers and also the difenoconazole product, the fungicide that we launched last year. So there are a few more products in the pipeline, both from our international business and contract manufacturing, that we'll put there. And depending on how they scale up, we move it to the standalone plant. As far as asset turnover is concerned, it's difficult to comment on it today, but I think what we are going to work on is how do you keep improving utilization, and hopefully some of these products will contribute to our top line in years to come. Thank you. The next question is from the line of Somaiah with Avendus Spark. Please go ahead. Yeah, thank you for the opportunity, sir. So, quickly on the CSM part, CSM business, so what is the strategy next year in CSM? Two years, how do you see, you know, CSM as a percentage of our total revenue share? That is one. And also, if you could just help us with what is the current contribution of CSM in our overall portfolio? ... and also, I think you mentioned in your opening remarks three contracts. If you can talk about opportunities based on the three contracts, that would be helpful. be helpful. Thank you. Yeah. So, look, our CSM strategy is, I think, very simple. We are not touching everybody. We are looking at. I guess big deals I don't think are available at this point of time. We are having multiple conversations with, you know, various parties. Yeah. And the different conversations are at very different stage. All I can say is, we are generally getting encouraging response. At this point of time, very difficult to put a number, but maybe as things mature, we will start getting more clarity. But things seem to be slowly building up. We certainly are not negative. Thank you. Ladies and gentlemen, that was the last question. I now hand the conference back to the management for closing remarks. Okay, so, so I think, you know, thanks, everybody, for joining. As I said, agrochemical is witnessing mixed signal of recovery. Intermediates business continues to be under pressure, while volumes are better across most technical margins are lower due to competitive, you know, context. In domestic market, the current liquidation slightly delayed, so we said no way because the rainy season ended. We are optimistic the causes of the placement. Our endeavors would be to continue running the business to improve market share across verticals. While in the short-term, margin will be under pressure, long-term, prospects continue to remain good. So, thank you very much, for joining. Thank you. On behalf of Rallis India Limited, that concludes this conference. Thank you for joining us. You may now disconnect your lines.