UPL posts 95% fall in profit to Rs 40 cr in Q4

Mumbai: Agrochemicals major UPL Ltd on Monday reported a steep 95 per cent decline in net profit to Rs 40 crore in the March quarter.

The company had posted a net profit of Rs 792 crore in the year-ago period.

Revenue during the quarter under review was Rs 14,078 crore, a drop of 15 per cent from Rs 16,569 crore achieved in the fourth quarter of FY23, the company said.

The drop in revenue was primarily due to lower prices in the post-patent market while volumes were largely in line with LY, UPL Ltd said.

EBITDA in the March quarter stood at Rs 1,933 crore as against Rs 3,033 crore in the corresponding quarter a year ago, while Ebitda margin stood at 29.4 per cent during the reporting quarter from 34.4 per cent in Q4FY23, it said.

The company also said it is looking to come out a rights issue around the end of the second quarter and beginning of October quarter for which it has already secured the board's approval for raising up to USD 500 million.

Besides, UPL has also lined ip a capex plan of USD 210 million for this fiscal and a part of this would be towards adding capacities.

"We delivered significantly improved financial results in Q4 versus the two preceding quarters, inspite of the prevailing volatile and challenging market conditions," UPL Corporation Ltd CEO Mike Frank said.

As compared to the December quarter, volumes recovered well and were in-line with last year, largely led by the strong performance of the company's high-margin differentiated and sustainable portfolio, which contributed 36 per cent of crop protection revenue against 29 per cent last year, he said.

"Our recent launches of Evolution, Feroce and Shenzi did exceedingly well, growing volumes by more than 50 per cent," Frank said.

In addition, Europe and rest of the world regions, had a strong performance posting double-digit growth, he added.

Furthermore, Advanta, UPL Ltd's global seeds platform, continued to see robust traction delivering revenue growth of 34 per cent and 38 per cent, respectively, for the quarter, he said.

"As we look ahead to FY25, we expect a return to growth and normalisation in margins driven by the agchem market returning to normality. Further, our foremost priority remains to deleverage our balance sheet which we plan to achieve through operational cash flows, completion of rights issue, and pursuing capital raise opportunities within our platforms," Frank said.

The company expects its revenue growth at 4-8 per cent this fiscal driven by volume growth.

The company said the previous fiscal was one of the worst years for its India business in many many years but added that it expects FY25 to be better with the overall predictions on monsoon looking good.