UPL Q2 results: Firm posts net loss of Rs 189 crore; revenue down 18.7%

The agrochemical industry is going through a phase of demand downturn on the back of heavy inventory destocking from China.

Trade

• Watchlist
• Portfolio
• Message
• Set Alert

 

 

Choose Stock Exchange: BSE LIVE NSE LIVE

26 Aug, 2025 12:21

Volume

Todays L/H

More

×

Agrochemical player UPL Ltd on October 30 posted a net loss of Rs 189 crore for the July-September quarter on October 30. The company had reported a net profit of Rs 996 crore in the year-ago period.

Revenue came in at Rs 10,170 crore, down 18.70 percent from Rs 12,507 crore clocked in the same quarter of the previous year.

Shares of UPL also reacted negatively to the dismal earnings as they slumped 4.4 percent to Rs 534.20 on the NSE as of 3.26 pm.

The weak performance of the agrochemical player was on account of subdued global demand as inventory destocking continued in this quarter as well.  impacted by global channel destocking and elevated pricing pressure.

“The global agrochemical industry continues to go through a difficult phase with prices coming off significantly vis-à-vis the high base of the previous year amid the elevated channel inventory levels and intense price competition," Mike Frank, CEO – UPL Corporation Ltd. said in a press release.

"Given this backdrop, the distributors prioritized destocking, and focused on purchases at lower prices to bring down their average inventory cost. In particular, destocking had a significant impact in the US and Brazil during the first half. Our revenue and profitability for Q2 were significantly impacted by these factors in line with rest of the industry," Frank added.

On that account, the company cut its revenue growth guidance for FY24 to flat as against the previously guided 1-5 percent.

Margins also remained under pressure due to adverse geographical mix and currency headwinds. As a result, EBITDA margin contracted sharply to 15.5 percent in Q2 as against 22.5 percent in the base period.

EBITDA guidance for FY24 was also revised lower to 0 to -5 percent as against the earlier guidance of 3-7 percent.

Meanwhile, the company is also pushing hard on its cost-reduction drive to cut back on its mounting debt levels. The company plans to reduce its expenses by $100 million over next two  years which is on track. Out of the total, the benefit of $50 million will be realized in FY24, wit the bulk in H2FY24.

As of gross debt, the company aims to reduce it by $500 million by the end of the current fiscal.

Going ahead, the management expects to see a recovery in demand. "Going forward, we are optimistic of progressively improved performance in H2 FY24 as key geographies of North America, Latin America and Europe enter their major cropping season," Frank stated.

"The elevated inventory levels are expected to gradually subside with the farmgate demand continuing to be robust. In Europe, Asia, and Latin America (ex-Brazil), channel inventory levels have largely normalized while in North America and Brazil, the scenario continues to gradually improve," he added.