Insecticides India Q1 Review - Higher Institutional Sales; Lower Margins: ICICI Securities

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ICICI Securities Report

Takeaways from Insecticides India Ltd.’s Q1 FY22:

1. 28.7% increase in institutional sales and ~180% increase in exports resulted in revenue growth of 14.3%, YoY. However, branded product sales grew just 2.1%,

2. the working capital investments increased due to higher inventory levels, and

3. Ebitda margin declined due to increased employee and other expenses.

While the company did not launch any new product during the quarter, it plans to launch five to six products in FY22.

We remain positive on Insecticides India due to-

1. focus on increasing farmers’ penetration,

2. removal of generic products from the portfolio and focus on differentiated products and

3. backward integration of technical.

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