Dhanuka Agritech (507717) Q2 24/25 earnings summary

Executive summary

• Achieved 6% year-over-year revenue growth in Q2 FY25, reaching INR 654.28 crore, with EBITDA up 13% and net profit up 15.5% compared to Q2 FY24.

• Board approved unaudited standalone and consolidated financial results for Q2 and H1 FY25, with strong revenue and profit growth year-over-year.

• Strong market acceptance for new product launches, especially LANEvo, MYCORe Super, and Purge, driving margin expansion.

• The company continues to focus on innovation, expanding R&D, and global partnerships, with a robust product pipeline.

• Appointment of Mr. Himanshu Singhal as Chief Internal Auditor effective 6th November 2024.

Financial highlights

• Q2 FY25 consolidated revenue: INR 654.28 crore (up 6% YoY); EBITDA: INR 159.58 crore (up 13% YoY); Net profit: INR 117.52 crore (up 15.5% YoY).

• H1 FY25 consolidated revenue: ₹1,14,785.65 lakhs, up from ₹98,698.81 lakhs in H1 FY24; net profit: ₹16,641.33 lakhs, up from ₹13,470.81 lakhs.

• Gross profit margin improved to 42.18% from 40.29% YoY; EBITDA margin rose to 24.39% from 22.91%; PAT margin increased to 17.96% from 16.47%.

• Basic EPS rose 15.7% YoY to ₹25.83; operating cash flow for H1 FY25: ₹7,482.29 lakhs, up from ₹6,070.83 lakhs in H1 FY24.

• Sales returns exceeded INR 100 crore in Q2, up over 40% YoY, mainly due to lower weedicide consumption from heavy rains.

Outlook and guidance

• Full-year revenue growth guidance revised to 16%; EBITDA margin guidance now 100 basis points higher than last year.

• Expecting at least 100 basis points gross margin growth for the year, with further improvement in product mix.

• Inventory expected to normalize by year-end; most sales returns and inventory buildup addressed in Q2.

• Results note that demand depends on monsoon, pest infestation, and crop patterns, leading to potential period-to-period variations.