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 PAT up 15.5%.

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

• Strong performance driven by new product launches, robust demand for specialty products, and ongoing innovation with expanded R&D and global partnerships.

• Aggressive market cleanup and inventory management ensured reported sales reflect true market demand.

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

Financial highlights

• Revenue from operations: INR 654.28 crore (Q2 FY25) vs INR 617.92 crore (Q2 FY24), up 6%.

• EBITDA: INR 159.58 crore, up 13% year-over-year; PAT: INR 117.52 crore, up 15.5% year-over-year.

• Gross profit margin improved to 42.18% from 40.29% year-over-year; EBITDA margin rose to 24.39% from 22.91%.

• Basic EPS rose 15.7% year-over-year to ₹25.83; H1 FY25 EPS: ₹36.56, up from ₹29.56 in H1 FY24.

• Sales returns exceeded INR 100 crore in Q2, up over 40% year-over-year, mainly due to weather-related factors.

Outlook and guidance

• Revenue growth guidance revised to 16% for FY25, with 100 bps EBITDA margin improvement expected.

• Expect gross margin to improve by at least 100 basis points for the full year.

• Inventory expected to normalize by year-end.

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