Ladies and gentlemen, good day, and welcome to Sumitomo Chemical India Limited Q2 and H1 FY 2025 Earnings Conference Call. This conference call may contain forward-looking statements about the company, which are based on the beliefs, opinions, and expectations of the company as on date of this call. These statements are not the guarantees of future performance and involves risks and uncertainties that are difficult to predict. As a reminder, all participant lines will be in a 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. From the management today, we have on the call Mr. Chetan Shah, Managing Director; Mr. Masanori Ozawa, Non-Executive Director; Dr. Suresh Ramachandran, Deputy Managing Director; Mr. Kunal Mittal, Senior Vice President, Planning and Coordination Office, Mr. Anil Nawal, Chief Financial Officer, Mrs. Deepika Trivedi, Company Secretary and Compliance Officer, and colleagues from SGA, the investor relations advisors. Now, I hand over the conference to Mr. Chetan Shah, Managing Director of Sumitomo Chemical India Limited. Thank you, and over to you, Mr. Shah. Thank you. Ladies and gentlemen, a very good afternoon to all of you, and wish you a very, very happy Dhanteras. Welcome to the conference call to discuss the Q2 and H1 financial year twenty-four, twenty-five financial performances of our company, Sumitomo Chemical India Limited. India's monsoon rainfall, according to IMD, over the country from June to September two thousand twenty-four, was 107.6% of its long-period average. India received 11.6% more rainfall than average in September month alone, following 9% and 15.3% above average rainfall in July and August, respectively. This excess and uneven rainfall disrupted the timing of crop protection activities. Farmers faced difficulties with agrochemical applications, resulting in missed or delayed spraying schedules, which affected the consumption of agrochemical products. Additionally, cotton acreage declined sharply, especially in North India, where the reduction was nearly 40%. Many farmers shifted away from cotton, one of the crops with the highest pesticide consumption, toward other alternatives. Delayed monsoon withdrawals also damaged some Kharif season crops like rice, cotton, soybean, corn, and pulses in certain regions of India. Recognizing the challenging market dynamics, we focused during the first six months on volume growth. Through close monitoring and suitable corrections in both purchases and sales pricing, we successfully maintained stable profitability for the first six months. Our gross margin expanded by 421 basis points year-over-year to 42.6%, driven by introduction of new products, normalization of export markets to some extent, and which had been impacted by high inventories last year and vigorous cost optimization in procurement. Thus, despite headwinds, our focus on maintaining profitability through volume growth and managing margins demonstrated strong results. Our Everyday Farmer's Day campaign of hundred days continued to foster deeper engagement with farmers, enhancing product awareness and adoption. Notably, new product launches such as Moshi, Orne, and Porson gained significant traction, driving 65% year-over-year growth in sales of these offerings. The export market, which faced challenges last year due to inventory overhang, has normalized significantly. We experienced a robust sales rebound across key geographies, including Japan and South America, reflecting a positive shift in global demand. At the same time, we continued to maintain strong focus on financial discipline through tight controls over collections and ensuring timely payments, as well as minimizing sales returns through proactive inventory and liquidation tracking. The water level in 155 major reservoirs in the country is at 87% of the capacity, which is higher than last year's level, as well as the normal range. The higher storage level will encourage farmers to go for higher acreage in Rabi season. Besides, better soil moisture on account of above will also aid in higher planting of the crops. The government also has set an ambitious target of 341.55 million tons of food grain production in 2024-25, representing a 3% increase from the previous year. All these factors will potentially drive agrochemical consumption in the upcoming Rabi season. In summary, despite a volatile market environment, Sumitomo Chemical India Limited has demonstrated resilience and adaptability, balanced short-term challenges with long-term strategic priorities. Our focus on profitability, new product development, market recovery, and financial discipline has positioned us well for the future. With that, I now hand over the call to Mr. Anil Nawal to please take you through our Q2 and H1 financial year 2024- 2025 consolidated financial performance. Thank you. Thank you very much. Thank you, sir. FY 2024-2025 financial performance. We recorded revenue of INR 988 crore in Q2 FY 2024-2025, up by 9 as compared to 903 crore in Q2 FY 2023-2024. Sequentially, the revenue was up by 18% from 839 crore in Q1 FY 2024-2025. Gross margin in Q2 FY 2024-2025 are 42.6%, which is up by 421 basis points as compared to 38.4% in Q2 FY 2023-2024. Gross margin were also witnessed sequential improvement of 365 basis points from 38.9% in Q1 FY 2024-2025. EBITDA came in, INR 245 crore in Q2 FY 2024-2025, witnessing a jump of 31% as compared to INR 188 crore in the same period last year. Sequentially, EBITDA was up by 52% from INR 161 crore in Q1 FY 2024-2025. EBITDA margin in the current quarter stood at 24.8%, up by 402 basis points, as compared to 20.8% in Q2 FY 2023-2024. Employee and operating expenses remained stable, ensuring that increased gross profit translated directly into higher profitability. Profit after tax stood at 193 crore in Q2 FY 2024-2025, as compared to INR 143 crore in the same quarter last year, a jump of 34%. Sequentially, PAT was up by 52% from INR 127 crore in Q1 FY 2024-2025. PAT margin stood at 19.5%, up by 360 basis points, vis-à-vis 15.9% in Q2 FY 2023-2024. Now, coming to our consolidated performance for H1 2024-2025. Revenue from operations in H1 FY 2024-2025 stood at INR 1827 crore, up by 12% as compared to INR 1628 crore in H1 FY 2023-2024. In H1 FY 2024-25, domestic agrochemical revenue contributed about 33% of overall revenues, with export contributing the rest. In H1 FY 2024-2025, insecticides contributed about 39% of total revenue, while herbicides, plant growth regulator, and fungicides contributed about 26%, 11%, and 9% of total revenue, respectively. The proportion of export earnings as a percent of total revenue has experienced a notable increase, jumping from approximately 11% in H1 FY 2023-2024 to around 17% in H1 FY 2024-2025. This was on account of normalization of export demand compared to last year, wherein excess inventory had to constrain sales, with overall sales rebound across key geographies. H1 FY 2024-25 sales to South America and Japan increased by 167% and 1%-2%, respectively, as compared to the same period last year. EBITDA stood at INR 402-406 crore in H1 FY 2024-25, witnessing a jump of 51% as compared to INR 269 crore in H1 FY 2023-2024. Our EBITDA margin stood at 22.2% in H1 FY 2024-2025, as compared to 16.5% the same period last year. The profit after tax for the H1 FY 2024-2025 amounted to INR 319 crore, reflecting an increase of 56% as compared to previous year's figure of INR 205 crore. With that, I would like to hand over now to Dr. Suresh. Thanks, Anil. Good afternoon, everybody. First of all, wish you all a happy festive season. So in this call, I would like to highlight you about a unique hundred-day pan-India campaign that we focused on during the last quarter. Starting from June, I would like to talk about that little bit. We took a hundred-day campaign, pan-India demand generation campaign, namely Everyday Farmer's Day campaign, also termed as EDFD campaign. EDFD is a flagship outreach initiative by Sumitomo Chemical India Limited, designed to enhance connections with farmers and distributors. The objective of the campaign was to build sustained momentum in the field and market through high-intensity demand generation activities. Meetings with twenty-five or more farmers and channel partners were qualified as EDFD meetings. About 17,000 meetings were conducted during the 100-day period from early June till the end of September across various parts of the country, ensuring direct interaction and fostering engagement. Over 5.5 lakh farmers were engaged during this campaign through these meetings, facilitating awareness and knowledge sharing. Almost 17,000-plus channel partners were involved to strengthen relationships, enhance product visibility, and improve the distribution network. A significant number of meetings were held with farmers across multiple regions, offering insights and technical training to enhance their productivity. We also connected with an impressive network of distributors, ensuring they were well-equipped with product knowledge and ready to serve farmers effectively. Our emphasis was more on intensive training and equipping farmers with best practices in crop management, pest control, and sustainable farming techniques. Distributor trainings were undertaken to ensure the product knowledge is always at the forefront. The campaign resulted in a 144% increase in our website traffic, highlighting the impact on online presence and resource consumption. The campaign extended the reach on Facebook by 205%, substantially increasing engagement and visibility among the agricultural community. There was a 54% increase in YouTube subscription, reflecting greater interest in Sumitomo digital content. The company's new offering products, such as Meshi, Orne, and Porson, contributed to a 65% growth compared to the same period last year, reflecting successful adoption of these newly launched products. The campaign strengthened trust with the farmers and channel partners, promoted better agricultural practices, and positioned Sumitomo as a reliable industry leader. The campaign embodied the company's commitment to empowering agricultural stakeholders with advanced product knowledge and agronomic best practices. On account of this campaign, farmers and channel partners have come closer and trust us more due to the consistent engagement and support. Our frontline managers received direct recognition from top management. To conclude, the EDFD campaign elevated demand generation activities to the next level. The success of this campaign has laid the foundation for EDFD Season Two, planned from November 2024 to February 2025, coinciding with the Rabi season, aiming for further scale-up and engagement and impact. The EDFD Two campaign will also serve as a pre-launch initiative for some of our highly anticipated blockbuster product launches in India, along with actively promoting our existing products. So with that, I turn over to the moderator, please. Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on your touchtone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Prashant Biyani from Elara Securities. Please go ahead. Thank you for the opportunity. So we have done pretty well on the margins, and that has been when exports have more than doubled. Is it that the new export orders are of high margins and will continue to be the case? Because historically, we have been saying that exports as well as domestic would be around 20-odd% EBITDA margin, but we have easily crossed that this time. Yeah. So, you are right. Typically, the Rabi season margins are always lower than the Kharif season. However, having said that, I think we are... We believe that we are in a position of a very, very sustainable input costs, and we don't see our selling prices going down at all during Rabi season. So with this combination and also the product mix of Rabi season, which we are planning, I think our margins should be definitely superior to the historic levels. I cannot guarantee that it will be to the level of Kharif season or not, but they will be definitely better than Rabi season, historic Rabi seasons. And we are hopeful that our endeavor will be to you know, maintain these margins altogether. Just to add, I think what you had asked is that exports margins specifically were higher. So that was not the case. I think what Mr.. Shah commented gives a good comprehensive picture of the total business, both domestic and exports, and it was not like few particular exports order of higher margin. This was comprehensive growth in the business, and it should be read that way. Sure. And, sir, how are you looking at H2, but demand-wise, both domestic and export market? We are very optimistic about the second season. As I mentioned earlier, there is enough water, and there is even a lot of moisture in the soil, which is very conducive for the second crop, and we expect that the sowing by the farmers will definitely increase, and we feel that there will be a robust demand in the second half. Sure. And lastly, on the Dahej plant, have we got EC approval, and have you firmed up any plans on the CapEx there? Yeah. So I'm happy to inform you that, yes, last month, or during this month, we received the EC clearance, without any specific conditions. And, so as it is, whatever was our application, we got clearance on all our products. Now we are in the process of deciding the cluster of products to be manufactured in the first phase, second phase, et cetera. There is one phase which is, you know, that we want to manufacture the products of, manufactured or introduced by Japan. ... and that is under deep discussion as of date. As soon as we clear that and some of the generic product portfolio that is within ourselves, we have to decide which cluster of products to go for. We will be. Now that the environmental clearance is out of the way, we are now on a speedy path of deciding this and, you know, getting ready to implement the project. Okay. Sir, like earlier times, it should be north of INR 300 crore? Yes. In phase one. We are planning. Okay, thank you. That's it from my side, and congrats on good set of numbers. Thank you. Yeah. Thank you so much. The next question is from the line of Yash Gaonkar from Awriga Capital Advisors. You may go ahead, sir. Please go ahead. Audible? Yes. Hi, Hello? Hello. Yes, yes, we can hear you. Okay, okay. Can you break up the export business, which goes to the parent and export of technical, which was first while Excel Crop business in H1, and how does it... how both of these business look for the next twelve months and the long term? Yeah. So see, when we look at our exports, large part of this exports is for the, for the off-patent segment, which you actually rightly mentioned, it is from the ex-Excel Crop Care portfolio. And that business has contributed to the large part of the exports which we had during this quarter, while the exports of the specialty products to our parent company, Sumitomo, in that regard, that business is also continuing, but that business is continuing at a normal level, while exports of the basic business is contributing to the large part of the growth which we had. Yeah, so out of these numbers, about 75% is coming from third-party exports, and about roughly 25% coming from us. So, okay, and outlook for this for next 12 months and long term? See, the outlook, you know, the inventory situation is seasoning out in, in those markets, and we expect to continue the volume growth. Of course, price, may not grow or probably may take a slight beating also, but overall it looks optimistic, I would say. Okay, and my second question is, on the LatAm agri season, which is starting in September, how, what are the early trends you can see there? LatAm, the season will start. So the early signs from LatAm market are positive, and that is something which is contributing to this growth in exports, especially in the off-patent segment. If you see our geographical break up, there are good shipments to Latin America market. And while we don't think the problems are fully solved in terms of the inventory situation and all those things, but at least whatever we are hearing, there is a volume uptake in the market. Yeah. Okay, thank you. Thank you. The next question is from the line of Priyank Chheda from Vallum Capital. Please go ahead. Yeah. Hi, this is Priyank from Vallum Capital. So my question is on domestic industry. If you see, we have growth for H1 at 5%, that is on a lower base. Last year, we did see almost a price declines of 25%-30%. And on that base, we have just grown at 5%. Without this, we were looking at a point of time to grow at 12%-15%. So how should we look for a domestic industry in terms of value growth? I'm sure volumes would be higher. So in terms of value growth, what should be the growth that we should look out for in FY 2025? So I see what you are asking specifically is about, let's say, quarter-to-quarter situation. We have always maintained that for industry like ours, I think quarter to quarter is very difficult because I think like in this particular, the monsoon season in India, which is a very important driver, spreads over two quarters. So quarter to quarter, we should not look at it. But if you look at it comprehensively, the performance for the entire monsoon season, kharif season, first half, then the numbers are, I think, encouraging. And we have grown volumes I think significantly as compared to last year in that regard. Just to add to that point, you know, in the first quarter, yes, volume growth was very good. In the second quarter, it, because of the continuous rains in August and September, the traction got interrupted at the ground level. That impacted one to two sprays of overall spraying, crop protection activities that are impacted in August and September in terms of overall growth. Yeah, so I was looking- The volume growth is upwards of 15% plus. So what you mentioned, like a single digit, low single digit, that could be like a one quarter kind of phenomena. But, we kind of would like to analyze the performance for the six months basis. And in that, I think this 15%-16% kind of a volume growth is quite encouraging for us. Definitely, sir, we understand. I was looking out for whole of the season, which is H1. H1 to H1, the value growth is around 5%. That's what I was alluding to. But yeah, I got the. So what I was looking out for is that, how should we look for the full year? Would it, would our aspirations around 10-12% growth or twelve to fifteen percent growth continues? Because we had a couple of good product launches in FY 2024 and a new product launches lined up in FY 2025. So given the new product launches, which have a more focus on specialty, how should we look for the growth, for domestic industry, for domestic segment for the full year? Given that in the first half, as you said, we have recorded about 5% growth, you know, on a full year scale, if we are looking at 12% growth, that may be too stretching. Probably I would look at about 9% to 10% growth on a full year basis. Perfect. My second question is on the Tarapur plant, where we had a few products which were exclusive for the parent. Because of the macro environment that got shifted, the targets got shifted to FY 2026 in terms of full production. So any challenges, any revisions on that side, or are we on track to do that full utilization in FY 2026 onwards? So the situation remains almost same as we had mentioned on the last call, and there is no change in the situation. And as you rightly mentioned, at this point of time, that plant is not having a very robust level of production, and we are waiting and watching the situation, how it progresses. Okay, and just last question on the glyphosate industry. Overall, if you can just allude more towards how has been the supply and demand side of glyphosate in terms of supply from China, demand from Latin America or from the African markets, how has that been over the last six months? See, glyphosate, the domestic market is the first half, up to H1. You know, the product has been by and large stable, and the volume consumption has increased. Of course, price has dropped compared to last year, but in terms of overall growth, volume has grown definitely. The second half is the general export market. We generally export only to African countries and some few other countries, but not to Latin. African countries' demand also looks good. Of course, now only the, you know, things will start moving in Africa. In terms of pricing, it's by and large stable for the last few months. All right. Thank you for answering all the questions. Thank you. Ladies and gentlemen, please press star and one on your touchtone phone to ask a question. The next question is from the line of Bhavya Gandhi from Dalal & Broacha Stock Broking. Please go ahead. Yeah, hi. Thank you for the opportunity, and congratulations on a good set of numbers. So my first question is regarding the gross margin and EBITDA margin, because we've clocked the highest ever gross margin and EBITDA margin. I mean, considering the new product launches that you've done, is it fair to assume that these kind of margins are sustainable? Not absolute numbers, but at least this kind of range, is it possible to sustain? Yeah. We feel that, you know, with the kind of strategy that we have taken, on both purchases and sales and positioning our products and improving the product mix, we feel that the margins are sustainable within a range. And surely our endeavor will be, now that we have achieved this, our endeavor will be to sustain this, going forward. Okay. Sir, another question is on the domestic quarterly numbers. I know you said that it's better to look at the annual numbers, but if I look at the only domestic number for the quarter, revenue has declined by 3%. So is it possible to give the split between volume and value? Just to understand if the volumes have grown, has there been a decline on the prices? So, prices have declined on an average by 15%, for sure, in the quarter or right from the first quarter itself. And whatever, I think we have grown our volume by at least 26%. Twenty-five, twenty-six, twenty-six percent, we have increased the volumes. So, even in the Q2, if you are saying that it is 3% lower, that means that we have grown the volumes by almost 10%. Got it, sir. And another thing, with respect to environmental clearance report, which is available in the public domain, as I see that the CapEx amount mentioned over there is closer to INR 600-INR 650 odd crores, if I'm not wrong. So is it like a phased manner in which we are going to do the CapEx? Because you are mentioning about INR 300 crores of CapEx. As I mentioned that, you know, we are discussing the cluster-wise phase-wise production. Maybe the first phase or will be around this amount. And if we are going for the full site development, it can cost you 600-700 crores. Got it, sir. And this 300 crore CapEx is for the older molecules, which parent wants to shift to India, or are there any blockbuster new products altogether? It is a mix of both. What we are planning or what we are thinking is there is one or two old products, there is one or two new products, and then there are various generic products, which we would like to set up a kitchen plant, whereby we have a flexibility of manufacturing any product campaign-wise. These are the three blocks, basically, that we are looking at. One is the new products from Japan, one is the older products from Japan, and one, the domestic basic generic products. ... Okay. And sir, in the first half, previously we used to give the name of product that we used to launch. Is it possible to mention the number of product launches in the first half of this year? We have launched this Porson. I mean, it's there in the, I think, in your presentation. Porson, Orne, we launched. These are the two products that we launched, and towards the end of last year, we launched tribasic copper in the name of two brands. And also this year we launched an insecticide, Unico, two, you know, in two different formulations. About six products we launched in H1. Sir, all these products were there last year, if I'm not wrong. Unico, Orne, Porson, I mean, because the investor PPT says that you've already grown on that older base. Yeah, what it meant was, it was combined as the overall new product portfolio. This Orne and Porson were launched this year, Meshi also, whereas Unico also this year. Last year was products like tribasic copper was launched, formalin was launched. So it's overall combination of new products have grown by 65%. Got it, sir. And is it possible to quantify what this amount would be in terms of absolute number, the new product launches that you're mentioning? I don't remember off... Yeah, just a second. So see, we do not like to give the product-wise numbers, but as we have mentioned in the past, that we keep tracking all the products launched in last two to three years, kind of a new products which we have launched, and these products are contributing something between 8%-9% of our revenue in the current year. Okay, 8%-9%. So last year, probably we were closer to maybe 3%-4% of our overall revenue, right? Yes. Because you've grown 65% on the older base. On the products launched in last three years. On the products launched in last three years. Okay. And just one last thing: with respect to the farm equipment, what we've mentioned in the last couple of concalls, that we're even looking to add farm equipments to the Indian entity. So if you can throw some light or any progress on that front. So this is part of the Sumika. You want to explain, Kunal? Yeah. So I think we are still under the discussions and in the planning stage, in discussion with our parent company and our global affiliates, and that particular entity has both seed businesses and farm equipment. What we believe is that we have mentioned it as a strategy for the growth over medium to long term. We are not expecting that in short term they will really contribute a lot of, I think, our growth, because these things take time in Indian market. These products are made in Japan, a very high level of technology, so we will have to do a lot of evaluation, expansion, and understanding the market, which we are in the process of, and we should not expect too much revenues coming in the short term, but this is a more a strategy for the long term to medium term growth and diversification. Got it, sir. And just last thing to conclude, that anything on the IT chemicals or the semiconductor side are you looking at? Something exactly similar, like this thing. I think the discussions are on with our global affiliates and our global colleagues in terms of understanding the Indian market, the landscape, the opportunity size, and what will be the right time and the right business model for that. So still at the drawing board and discussion, but discussions are progressing on a regular basis. Got it, sir. Thank you so much. Really helpful. I'll get back in the queue. Yeah. Yeah. Thanks so much. The next question is from the line of S. Ramesh from Nirmal Bang Equities. Please go ahead. Yeah, hello. Thank you very much, and congratulations on the numbers, and wish you a very happy Diwali. So, if you look at the growth in exports and the absolute number, you've done about 300 crores, close to 300 crores, right, in the first half. In terms of the overall growth, if you say on an annual basis over the next two years, would you expect to maintain the domestic and export share at whatever you reported in first half? Or do you see exports actually growing faster, given that, you know, they're coming from a lower base, and perhaps in terms of volume growth, you may see a better traction. How do you see that, and does it have any impact on your margins? As you said, you know, the margin of export is lower. In terms of margin, if you look at percentage growth, yes, for sure, export is likely to be slightly higher than the domestic market. Sorry, I missed the other question. What was it? The growth in the exports will be more than the domestic one. Yeah, because the base is lower. As a percentage growth, it will be definitely higher. Yeah. But what, on your question that our margins will there be significant impact because of this, we do not believe, because broadly, our margins in exports and domestic are not significantly different. Some percentage points here and there, but, broadly, we would like to have good margins in both the businesses, exports and domestic. And exports growth is expected to be higher than domestic, as you rightly pointed out, because last year base was very low. And but in the domestic market also we want to continue our growth momentum in the second half because of various sectors which were mentioned by our MD, Mr. Chetan Shah, sir, and also Dr. Suresh. Okay. So if you look at your track record in terms of new launches in the last eighteen months, I think you launched thirteen products, if you take the last eighteen months, six products last year, and another three or six this year. So if you take the whole basket of new products, what is the kind of growth you would continue to expect, and what kind of share they could have in your portfolio, say, over the next two, three years? And would that give you higher margins? And what is the kind of target size you have for the three products you mentioned, Porson, Orne, and Meshi, in terms of the market size? The market is enormous. You know, it fits into multiple crops. You know, it could be in thousands of crops, but obviously, can we do everything? It's not possible to have, you know, address everywhere. If we get at least 20-25% growth on these molecules or these brands year on year, I think that itself is a very decent growth. We want to grow these newer products, which are new chemistry, and some of them are patented also, and that's what our endeavor is. Okay. So, in terms of your plans to supply the five molecules to Japan, when do you plan to start that, and what's the business plan for next year? And when do you think you'll reach that full target of INR 220-250 crore? So as we had explained, I think in the last call also, let's divide our business in two parts, and one plant out of these two has started full level production and full level business. Last year, we booked little bit revenues, but current year we are targeting full level of production and full commercialization of these products in terms of shipment to our parent company and global affiliates. And the second plant, so this particular first plant is at Bhavnagar, which is doing the full production this year. The second plant, which is at Bhavnagar, as we mentioned earlier also in one of the questions, I think the production level currently is low in this particular plant because of various global, market situation and registration kind of a delays. We are monitoring the situation, and hopefully, our plans are that if next year we can use this plant for to some levels. Okay. If I can squeeze in one more thought, any thoughts you can share on how Barrix has performed in the consolidated results, and when you see that, you know, giving a meaningful impact on your revenue and bottom line? We believe that by end of this year, I think it should start giving us contribution. Keeping in mind the overall size of Barrix. In terms of the total SCIL numbers, it's still the impact is likely to be not material for next two or three years, kind of a period. But on a standalone basis, we are showing significant growth in the current year. Very good growth as compared to their past trends in the current year. Also in terms of both top line and profitability level, we believe that they were very close to break-even levels till last year. In current year, whatever growth they are having, which is a significant growth over last year, it is adding directly to their bottom line. So by end of this year, we believe that as a standalone entity, Barrix would have completed this year with a significant growth over last year, with good profitability levels, and much higher the profitability level would also be at a very, very decent level. But in the overall numbers of SCIL, they will not be material for next two or three years. Yeah, just to recollect, the strategic intent of this, you know, acquisition was to enter into a new segment, green chemistry, environmentally safe chemistry, and it'll add, like Kunal said, you know, midterm to long-term strategy, and that was the intent behind that. Okay. So, how many of your new products will be in the bio and sustainable category? Because SCC Japan has a lot of strength there. So, and in the products you've launched, as on date, how many of them are bio, and what is the thought process in terms of biological products in the next coming years? You know, we have, globally, we have another group company, which is called Valent BioSciences, which only specializes in biostimulants or biological products, you know, the so-called green chemistry products. And we are in discussions with them. Some of the products we have launched already, some of the products are under development, some of the products are under pipeline, which will all come eventually. They also acquired globally, another company, another green chemistry company last year. We are evaluating that portfolio also currently to bring into India. So it would, it would definitely add to our portfolio as we move forward in the coming years. Every year, at least one or two products we would keep adding in that segment. Thank you very much, and wish you all the best. Thank you. Thank you so much. The next question is from the line of Darshita from Antique Stock Broking. Please go ahead. Yeah, hi. Thank you for the opportunity, and happy Dhanteras wishes to the team. My first question was regarding the price decline impact that we have seen in the first half. Should we expect... Can we expect it to normalize or the base to normalize in the second half of the year? Sorry, can you please repeat the question? So the price decline impact that we have seen in the first half of the year, can we expect that all of it is already priced in, into the base, and that the second half should not have any price decline impact any further on YOY basis? Yes, that is true. Yeah, that is what our managing director also commented at the beginning or in his opening comments or during the question and answer. Yes, all are factored in, and we don't expect any further price drop in the second half. Yeah, but as compared to last year, second half, there will still be the negative delta of the prices, but it will be lower than the impact which we had in the first half. Because if you remember, in some of the earlier comments, he commented that the price drop in first half was between say 10 to 15% on an average. So that much delta will not be there in the second half. It will be lower than that. Okay. With respect to our market share, in the first half of the year in the domestic market, what would it be? It's too early to talk about market share because we just closed the quarter, and we don't look at quarter-wise or half-yearly market share. We look at full year market share once a year gets completed, maybe after three or four months, only those kind of data would come out. My third question was regarding the CRAMS contribution. While Kunal did explain that the Bhavnagar plant is at full level production, are we still expecting INR 150 crore of revenue to come through from the CRAMS product portfolio for FY 2025? We would not like to give the specifics about any product or any particular plant. But yeah, all the plants which we had for that particular Bhavnagar plant, that kind of a revenue we are expecting currently, yeah. Got it. Okay. And, my last question is regarding the scale-up that we have seen in the off-patent portfolio, that Suresh, sir, mentioned that contributes about 75% to overall export. Is it safe to assume that this is the sourcing shift benefit that we were expecting from the Nufarm business that was, you know, acquired by the parent? Is it a part. The strong growth that we are seeing, is it a part of the sourcing shift benefit that we were anticipating to come through from to come in from China to India? Yeah, actually. Yeah. So see, this particular portfolio, which Dr. Suresh mentioned earlier, off-patent segment, which is the erstwhile Excel Crop Care portfolio. So this particular portfolio, they have third-party customers, and yes, they also do shipments to our affiliates in Nufarm, Latin America. But, so that business is both ways. It is growing both in third-party customers, because it has a very wide portfolio in terms of products and countries and geographies and administration. So it is growing in third-party customers, and it is also benefited by some of our affiliates taking more shipments from Sumitomo Chemical India, and that is also. So they're getting benefit because of that. But whether the entire growth is coming only because of Latin, that is not the case. They are also growing in other products, other geographies, other customers. Sorry, just one last question, if I can squeeze in. So, Chetan Ji mentioned about the EBITDA margin to be in a certain range. The range that we usually follow is about 18%-20%. For FY 2025, are we expecting it to probably be as high as 20%-22% odd or something, some number like that? No, I think as, our MD, sir, mentioned, I think, we would, I think, like to believe that our EBITDA level margin should, I think, continue in that same range, 18%-20%. And, in the past also, we have seen that certain quarters in certain situations generate EBITDA, which are higher than this range, but on a full year basis, keeping in mind all the factors of domestic market, off-patent products, specialty, new products, exports, everything together, we should somewhere be in the similar range, 18%-20%, kind of a EBITDA level growth, EBITDA level margins. Got it. Got it. Perfect. That's all from my side. Thank you so much. Thank you. The next question is from the line of Viraj from SIMPL. Please go ahead. Yeah, my question has been answered. Thank you. Hello? Yes. Yeah, my question has been answered. Thank you. Question is already answered. We can move to the next question. Okay, thank you. The next question is from the line of Himanshu Binani from Anand Rathi. Please go ahead. Thank you for taking my question, and congratulations for a very good set of numbers, and happy festive season to the management. So sir, my first question was largely on the CapEx side. So what has been the CapEx amount for first half FY 2025? This will not be a very material level because we have not added any kind of capacities or anything like that. It would be in the nature of maybe some sort of a maintenance CapEx in the range of maybe INR 20-30 crore max. And if you remember, in 2023, 2024, our capacities level were certainly lower because of a lot of global factors and lower volumes. So overall capacity utilizations has come down. So this year we are trying to increase the capacity levels, but we are not planning any kind of a significant CapEx in current year. We have done a few CapEx projects in last two years or three years in terms of new land and new plant setup. And this year, the plans are more to ramp up the volumes from that CapEx, which is already done. And the next cycle of CapEx, as Chetan sir mentioned earlier, is likely to come at Dahej, but we are still in finalization of the plans for that. And once the project plans are finalized, approved by the board, it will be announced in due course. So this year, I think in the first half, we have not incurred too much CapEx, and that is how we are seeing this current year. I got it, sir. And sir, secondly, continuing with the previous participant's question on the EBITDA margin side. So what I understand is that during the first half, we did upwards of 22%... And, going by this current trend, basically, what we have done in the last year, second half, is somewhere around the 17% sort of number, and we are still sticking to somewhere around an 18%-20% sort of like a FY 2025 EBITDA margin. So to have this sort of, like, range, so we need to, like, actually, we are declining during the second half as compared to the last year lower base of second half in terms of the margin. So what is, like, restricting the management in terms of the margins, basically? What? So maybe if you can, like, clarify on this side. Himanshu, we would like to be more, I think, realistic, and, I think while we have got very good EBITDA margins in this particular quarter, almost to the extent of 24-25%, as you rightly mentioned, but, we will keep trying. I think, we are not saying that we are, going to drop this EBITDA level margins, as I think we already explained in detail by both, I think, Mr. Shah and Dr. Suresh, that we are trying to maintain this superior performance. For sure, we will take our best, and we are not expecting that the margins in H2 are going to be historically lower as compared to past. But on a fundamental basis, what we are saying is, if you look at all the quarters in the investor presentation, also on 18, slide number 18, I think all our margins have broadly remained in the range of 18-20% on full year basis. And there are patches of quarters, even if you look at Q2 in 2022, and also Q2 in financial year 2023, we had done 23-25% kind of EBITDA levels. So, even in that year, on a full year basis, we did 18-20% kind of EBITDA level, because in some of the quarters which are lower in terms of sales, like Q3 and Q4, the EBITDA levels drop. On a full year basis, we will try to maintain this 18%-20% kind of a range, which we believe is a very healthy profitability range. But then, sir, I completely take that. But then, sir, if you look at the last year second half, so we have, like, a lower base of last year second half, and maybe the last year number can be, like, treated as an aberration. So maybe if I compare that with FY 2023 numbers also, which happens to be, like, lower in terms of the margins. So basically, in terms of math, basically, if I actually try to work out with the average numbers, so the last year second half, despite all the difficulties, we did somewhere around the 17% sort of margins. So if we are, like, sticking with that range of 18%-20% of annualized or an FY 2025 numbers, so maybe we have to, like, decline basically as compared to the second half second half last year. So, Himanshu, what we are looking is, we are looking at last three years average. So let's say last year could be aberration. In certain quarters, there were very low profitability, in certain quarters, there was high profitability. So we honestly don't track quarter to quarter. And even if you look at 2023, which you rightly mentioned, in the second quarter, we had done 24.8%, exactly same what we have done in this quarter in terms of percentage, 24.8% EBITDA level margin, which is so far our highest in last so many years for us at one particular quarter. So in the- that, that year also, but in the Q3, Q4, if you see on actual basis, then the margins EBITDA level was 16% and 10%. So we have to be really mindful that certain quarters where the volumes are very large, the EBITDA level can go up, but, but we have to be more realistic that 18-20% kind of is what we are looking for. But certainly, we will see and try whatever best is possible, given the demand and the supply situation, the input pricing, output prices, so we'll keep taking efforts, but it is very difficult to commit that we will be having EBITDA at that level. Himanshu, I will only add one thing over here. Yes, sir. Last two years or three years, there were a lot of fluctuations from quarter to quarter. Like, the prices suddenly of input cost suddenly went up, you know, every quarter it was keeping on increasing. Then all of a sudden, in one quarter, it just started dropping. People were left with high inventory. There was a confusion in establishing the selling prices of the products in the market, et cetera, et cetera. So there are, there were many, many challenges in the past due to external reasons, either weather or inventory or prices fluctuation, et cetera. What I can tell you is that this Rabi season, that is third and fourth quarter, I am personally seeing a lot more stability, a lot more clarity on both the input cost as well as the selling prices. I don't think personally that input cost is going to go up significantly, and I don't think that the prices of products in the end market is going to fall drastically, so it's a very healthy, balanced situation that we are in today, and so hopefully we'll beat the historic numbers, but we say that we are still haunted by Rabi season figures always being lower than Kharif, so we need to be mindful of that because the companies or the competition, they behave little differently in Rabi season, so even though I am confident that the input cost and the selling prices is not going to change. Right. But in spite of that, if competition reacts adversely, we will have no choice but to match it. So we are taking more of a historic trend rather than an optimistic trend, which is truly there today. Got it, sir. Got it, sir, and so last question from my side, so if I actually look into your PPT, which is in slide number 16, so in the working capital side, what we see is that the reduction in the working capital is largely due to the prudent inventory management. However, if I actually look into the numbers, both in terms of the inventory days as well as in terms of the absolute inventory value also, so it largely remains flat on a YOY basis, so maybe if you can, like, clarify on the same. So we have invested in higher inventories this year because of the purely commercial, it made commercial sense, to get the products at reasonable prices, and keeping in stock so that we don't get into that volatile position of, you know, price adjustments, et cetera, or getting stuck with high cost inventory or anything of that sort. So yes, we have definitely, by design, we have invested more money in raw materials, and intermediates. Actually, the number is, as you rightly mentioned, absolutely similar to September 2023 number. In both September 2023 and 2024, about INR 560 crore to INR 565 crore kind of inventory and 96 days of inventory days. So very similar to the past trend as on September. Right. But then, sir, if I actually look into the key highlights, basically in that slide only, so the working capital, the reason basically written over there is that is a decrease in the inventory days on account of improved inventory management and faster inventory turnover. So that is actually what I read. Yeah, because you can look at it, but basically, see, the inventory amount, in absolute terms, is exactly the same, INR 564 crore, in a situation when we are growing the business by about 10%-15%. Got it, sir. And sir, last, just last question from my side, if I can, like, squeeze in. So, sir, how do we actually see the LatAm market excluding Brazil during the second half? So in terms of the inventory position, demand revival, as well as the pricing out there. Thank you. See, if I may, even though everybody talks about LatAm, LatAm, LatAm, out of that, 80% comes from Brazil only. You know, something there in Argentina, some in Colombia, some in small, small countries, Paraguay, Mexico and all those things. So when people say LatAm, primarily, it refers to Brazil, okay? Brazil so far looks good. The demand, volume demand looks good, so the season is about to open up. And, yeah, Argentina is there. Argentina has its own issues in terms of foreign exchange and all those things. The rest of the markets are really small. So, from our company point of view, there is no significant impact from any of those markets, but what we keep hearing from our affiliates, the situation in those countries continue to be challenging. Got it, sir. Thank you. Thank you. The next question is from the line of Dhavan Shah from AlfAccurate Advisors. Please go ahead. Yeah, thanks for the opportunity, sir. So my question is on the export side. Can you help us to understand which product category led growth for the first half? Is that, like if I look at, you know, the breakup, I think the fungicide shows the strong growth for the first half. So can you help us to understand in terms of the export business? Both fungicides and herbicides have grown. You're specifically asking about exports. Both fungicides and herbicides are grown for export. Product wise, can you help us to understand? Because, you know, if I even go to the geographical breakup, I think the South America revenue for the first half is roughly INR 130 crore, versus it was roughly INR 50 crore last year, first half. So here also, I mean, product wise, if you can help us, then, you know, you also mentioned that there is some resourcing strategy, which led the higher growth for the LatAm business. So if you can, you know, break it up, what kind of revenue growth came from the sourcing side of the business, and what was the organic growth? See, all our portfolio compared to last year has grown, whether it's fungicides, herbicides or insecticides. If we are specifically talking about products, Azoxystrobin, Chlorpyrifos, chlorotaxifer and of course, Clothianidin, okay? In terms of overall region, LatAm, South America, registered almost double the growth. Last year, you know, if you look at last year, they were having a severe inventory situation. That's why the business was significantly down in H1. Now it is getting back to normalcy. In all the products, whether it's insecticides, fungicides or herbicides, in all the products, it is coming back to normalcy. Okay. And this INR 130-odd crore versus INR 50-odd crore in the LatAm business or the South America business, how much is that because of the sourcing side of the business from China to India? So there is no shift in terms of any new product being shifted from China to India. All these products we were doing last year and current year, it is more a situation of better demand and better volumes. They were carrying inventory last year, first half. This year, that inventory slowly, you know, washed away, and that is helping us in this, registering this business. And- Got it. All the regions are showing growth. If you look at, like, say, Africa, we have already given the numbers in the presentation. It has from INR 35-40 crore level, it has gone INR 60 crore plus. ... Japan from INR 25 crore, maybe 50, 55, 60 crore, and even the Latin America business, which was between INR 45-50 crore last year, it has almost become INR 125 crore. So all these regions are contributing to the growth, and as Dr. Suresh mentioned, it is wide base. I think there are four or five products which have registered very good growth. So we don't feel that export growth was dependent on any one particular country or geography or any product. It was a very wide concept-based growth because the fundamentals of the business is coming back and some of the issues getting reduced as compared to last year. Got it. Got it. And out of that INR 100 crore CapEx for five molecules, you are expecting roughly INR 200-INR 250 crores kind of, you know, the peak revenues. So out of that, how much revenue do we expect, you know, can materialize in FY 2025 and 2026? I think we have already mentioned this in few questions and in the last calls also. This revenue can be divided in two parts and two plants. So one plant should, full revenue should come this year. He's only talking about Tarapur. He's talking about INR 100 crore revenue, which is CapEx. Is that this both products together. Out of this, like what you said, 200-250 crore, whatever the projections were given that time from these projects. So out of this, one plant will have the full production and full revenues in current financial year. And that will continue even next year. And next year we will see the second plant, how much it can be used and commercialized, and we are monitoring the situation, but there will certainly be growth next year over current year. At this stage, we should be fully there. Okay, and what is the size of that one plant you mentioned, Tarapur or- Fifty-fifty, roughly, in terms of revenue potential. Fifty crore? 50, 50%. Whatever is the total revenue potential of these products- Got it. You can take 50-50%. Got it. Got it. So this is largely going to Japan only, right? Yeah. It is shipped to maybe various subsidiaries, but our arrangements are with our parent company. So we ship the products and we invoice it to them, and then the actual shipments goes to different countries. Got it. And this INR 300 crore CapEx you mentioned for the first phase, so, this is going to be announced in the second half itself, and the construction activity would start maybe in 2026? So we are not in a position to give any fixed timelines. As it was mentioned, earlier on the call, right now, we have got the environmental clearances. We are in the drawing board and feasibility study in terms of, which product, combination of SC/SE products, some of the new products, some of the existing products, and also some of the off-patent products. And once the feasibility studies in terms of technical analysis, a lot of work has been done in terms of the financial feasibilities, in terms of the volume projection from this, registration timelines, everything is being worked out. And, once comprehensively the proposals are ready and they are approved by our shareholders and our board, then we will be announcing it. We would not like to commit any fixed timelines that it will be done in one month or two months or three months, but the overall CapEx cycle is expected to run in two to three years, the phase one itself. So if your question was that whether we'll start construction in 2026, the answer will be definitely yes. That would be our endeavor, that I think one and a half years is a, or one year and three months will be good enough a time for us to, you know, close in all the issues and all the question marks and we should definitely start the construction beginning 2026. Got it. Got it. And the asset turn will be two X only here, or should we assume the same asset turn? Yeah, two X of the CapEx size should be the revenue potential, but on a maturity level, it may not be because these, some of these are new products, so the volume of it cannot be like immediately the plant will be fully 100% utilized because all the other products are existing products. So there, then suddenly, immediately we can produce and go to 100% level. These plants will take its own time, let's say two, three years, for full 100% ramp up of capacities. Got it. So maybe by FY 2029-2030, we can assume INR 600 crore kind of repeat the revenue. Hello? We will not be in a position to give any fixed... No problem. No problem. That's all from my side. Thank you, sir. Thank you. The next question is from the line of Faisal Hawa from H. G. Hawa & Co. Please go ahead. Sir, are we doing any key hirings also on the sales, marketing, distribution front from outside organization or even from outside industry to give this a very large impetus or kind of a very different sales approach to our existing approach? We do, you know, hire people. Obviously, at the frontline, we do hire people on a regular basis. We prefer agrochemical industry background or agriculture background or working in allied industries. That would be the first preference, because it's easier to get them integrated into the system faster, and they can start contributing. But at the same time, we are also looking at people from outside the industry to bring in new perspectives. So it's a combination of both. I would say maybe about 80-85% would be from the agro and allied sectors, maybe about 10-15%, from non-agri background. And then, are you also looking at some kind of combination with drones or with any company which do drone marketing to really spruce up our product acceptability, also, like, you know, added service to the farmer? And thirdly, sir, are we targeting something like a... ... doubling of sales every five years, in our company as a business plan? Yeah, we have our internal targets. Obviously, no, I can't comment whether it's five years or three years or seven years. Definitely, no, we do have a mid-range plan which we discuss periodically and, you know, update it. That's an internal, you know, target. In terms of drones, yes, there has been a lot of talks on drones, and even we have applied for some registration for drone spraying, and we have got a couple of products already endorsed for drone application. But we are not partnered with anybody specifically. Eventually, in our view, it's like going to be like any other spraying operation. People will rent drone and take our product. The product is going to make the difference. Today, you know, people are spraying using hand sprayers. Tomorrow, it will become drone, maybe in three years, five years, seven years' time. So it's not really required that we need to partner with somebody to really utilize the drone application. But if there is any opportunity, you know, definitely, if it's going to give us additional business benefits, yes, we will surely look into that. I appreciate you answering my question, sir. Okay, thank you. The last question is from... The next question is from S. Ramesh from Nirmal Bang Equities. Please go ahead. Hello. Yeah, thanks for the follow-up questions. So one is, you mentioned that there was a problem in the cotton acreage with the decline, and that impacted, insecticide consumption. So is that a structural issue, or do you think, it will possibly get sorted out over the next one or two seasons? And secondly, on China, what is it that you're hearing in terms of their excess supply and any capacity rationalization? Because we see a lot of new capacities coming up. So if you can give your thoughts on these two aspects, will be grateful. Yeah, I can comment on, you know, cotton cropping area, which reduced, declined by about 10%. In the last season, the commodity price of cotton was low, so the farmers switched to some other crop, maybe corn or paddy, those kind of crops. And what is happening, primarily, cotton is a major crop in northern state, couple of northern states, where there was a unique pest that came up infesting last year, which was called pink bollworm. And there is no... I mean, it's not easy to manage unless you have very specific technique. There is some techniques required to manage that pest, which northern farmers were not exposed to, because they never had this problem in the past. Because of last two years subsequent year, there was infestation, farmers left or reduced drastically the area, one, because of commodity price, second, because of this pest infestation, it moved into some other crop. In South India and Western India, what had happened was the continuous rains damaged the crop, you know, especially in Andhra, Telangana, and in Maharashtra, continuous rains damaged the crop to some extent and subsequently the pesticide consumption. So the overall, the cotton area should bounce back to normalcy in other geographies of the country. But in North, I don't really see North cotton bouncing back. The area continues to decline or maybe at the current year level. So the second question was on China. Sorry, China excess capacity. Yeah, I mean, I think that what's happening in China, only the, you know, Chinese would know. But really, you know, whatever we understand is that, yes, there has been excess capacity, and, they are continuing to supply to the market, depending on the situation. But we have our own strategy to counteract that, and we have our own customer base. How do we position ourselves? Showing the premiumness of our product, that's what we are continuing to pursue. And, so far we have been successful in that, but, yes, China plays a role also in this whole game. Okay, thank you very much, and wish you the best of season's greetings, and congratulations once again. Thank you. Thank you. Thank you. The next question is from Siddharth Gadekar from Equirus Securities. Please go ahead. Hi, sir. So the first question on the export business, can you just quantify, in terms of, in the first half, what is the volume growth and how much is the pricing decline? 95% is the total growth and- Volume. Around 15% is the price reduction. 20%. Twenty percent. 20% price- 20% price reduction and 95% growth. So volume growth is around 95%. So secondly, in terms of our per kg EBITDA, have you been able to maintain a per kg EBITDA even in the export business? Yes. Okay, got it. Thank you so much. Thank you so much. As there are no further questions, I would now like to hand over the conference to Mr. Kunal Mittal for closing comments. Thank you, everyone. We thank all the participants for joining the call and also asking some interesting questions, and we thank our colleagues for replying the same, and we hope we could address your queries. Despite facing some global headwinds, the overall outlook for both Indian agriculture and the agrochemical sector overall remains positive in India. Our strategic focus on maintaining profitability has been proven effective in last six months, our performance, and this was largely driven, as mentioned in the call earlier, by our commitment to high-margin products, including new products, volume growth, which was led due to the extraordinary demand generation activities at the ground level, and effective management of variable costs and maintaining our, our fixed operating expenses at a stable level. Looking ahead, we are encouraged by favorable conditions, such as above average monsoon rainfall and high reserve levels, which are expected to significantly benefit the agriculture landscape in India in upcoming Rabi season. We recognize that while global challenges continue for some more time, we are committed to navigate this global dynamics in a strategic manner, and we will continue to engage with our farmer community through our initiatives. Like we mentioned on the call, Everyday Farmer's Day, and phase two of the campaign is going to start very, very soon. And through this initiative, we will look to foster awareness of our product offering in the farmer community and also use these initiatives to support farmers' education and learnings for betterment of the Indian farmers. The last, we would like to extend our warmest wishes for a joyful Diwali and prosperous New Year to all of you. Thank you for your time for joining the conference call today. We really appreciate your participation. Thank you very much. Thank you. Thank you. On behalf of Sumitomo Chemical, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.