Thank you. Thank you very much.

Good afternoon. I welcome our investors, analysts, and shareholders to the Q2 FY26 earnings call.

Thank you for joining us today and your continuous trust in company. This year the Kharif season has once again reminded us that the Indian farmer are heavily dependent on monsoon.

The rains have been very difficult and very seasonal. Many parts of the country experienced heavy and untimely rainfall.

Several key regions experienced floods, causing crop damages and losses. According to the Indian Met Department, the country received about 8% above normal rainfall during August and September 2025.

However, Punjab and Haryana recorded 40% to 50% higher than normal rainfall, leading to floods. Rajasthan, Haryana recorded 40% to 50% higher than normal rainfall, leading to floods.

Rajasthan received 30% excess rain. In Maharashtra, more than 6 million hectare of farmland were affected by floods, waterlogging, and submergence.

Overall a challenging situation for the farmers. These extreme conditions caused serious damage the major Kharif crops such as soybean, maize, cotton, and pulses.

Many fields remained submerged for long period, and many farmers faced delayed harvesting and crop losses. At the same time, heavy rain also washed away pest infestation and with fewer number of sprays.

As a result, demand for agrochemicals remains weak in several regions. The early rains were good for the Kharif sowing and supported the crops, but then the excessive rainfall at the large stage of harvesting washed away all the gains.

Unseasonal rain condition till late August, September, and October, these rains resulted in substantial crop losses, especially for cotton, soybean, pulses, groundnut, and vegetables. Looking ahead, the positive for the Rabi season are plenty of ground water and dam full of water, but the poor Kharif season lead to delayed Rabi sowing and farmer losses and financial stress.

Overall, we have seen the demand for agrochemical been disrupted. Despite these challenges, Best Agrolife has navigated the season with discipline and resilience.

We carefully managed our operations, maintained strict control on inventory, and stayed close to our customer through our strong field presence. Our focus has remained on maintaining leaner inventories and financial discipline in every aspect of our operations.

This year we did significantly less pre-placement and sold our products closer to liquidation period. This strategy has been a great positive for us.

Traditionally, the agrochemical industry experiences the bulk of sales return in the third quarter. However, with our revised sales return policy and our reduced pre-season order placement strategy, we expect significantly lower sales return in Quarter 3 FY26 compared to previous years.

This reflects our proactive approach and strong operational planning. Our focus will be profitable and long-term growth.

Another major strength this year has been our growing portfolio of patented products. Patented product now contribute to more than half of our brand portfolio.

This shift is slowly enhancing our brand value. Our margin profile will continue to improve, and our competitive advantage will continue to grow.

Today, whenever I speak with our customers, I hear only positive feedback about our products. Despite the lower revenue, the quality of our revenue mix has improved.

We are selling more of our patented products. Looking ahead, I am optimistically positive.

The outlook for the Rabi season is cautiously favorable. With focus on research and development, operational discipline, and significantly lower sales return in Quarter 3, I am confident that Best Agro is well-positioned for growth and profitability.

Thank you. Now I request our CFO, Mr.

Vikas Jain, for the detailed financial performance.

Thank you, Vimal ji, and good afternoon to everyone. I will now take you through the financial performance for the quarter and half year ended September 30, 2025.

For Q2 FY26, the company reported a revenue of ₹515.8 crores compared to ₹746.6 crores in Q2 '25, marking a 30.8% year-on-year decline due to unfavorable weather conditions. The moderation was expected as we consciously focused on optimizing inventory, streamlining channels, and aligning production with actual market demand to reduce working capital stress.

Gross margins stood at ₹169.6 crore compared to ₹252.1 crore in Q2 FY25. While the absolute margin declined, the product mix improvement towards higher-value patented formulations supported overall profitability resilience.

EBITDA for the quarter was ₹77.5 crore as against ₹147.1 crore in the same period last year, translating into a EBITDA margin of 15% compared to 19.7% in Q2 FY25. Sequentially, however, margins have shown improvement, reflecting the impact of tighter cost controls and efficiency measures.

Profit after tax for Q2 FY26 was ₹38.3 crore compared to ₹94.7 crore in Q2 FY25, resulting in a PAT margin of 7.4% versus 12.7% last year. For H1 FY26, revenue stood at ₹898.1 crore, EBITDA at ₹123.3 crores, and PAT at around ₹58.2 crores, reflecting a phase of realignment and strategic consolidation.

During the quarter, we maintained a strong focus on cash flow discipline, expense rationalization, and balance sheet efficiency. Our efforts on reducing OPEX and improving collections from trade partners have started yielding results, helping us sustain financial stability in a volatile environment.

The business is steadily progressing towards stabilization with notable improvements in key operational areas, including lower sales returns and optimization of operational expenses, as well as a tight control on inventory. Inventory levels have decreased by ₹207 crores from ₹873 crore in H1 FY25 to ₹666 crores in H1 FY26, marking a 24% year-on-year reduction.

Through strategic restructuring across regional operations, the company has achieved an OPEX reduction of 13% compared to Q2 FY25 and 11% compared to H1 FY25. We believe this belt-tightening will be base for our future.

As we enter the Rabi season, we expect volume growth to recover, driven by improved farmers' sentiments and stronger demand for wheat and potato related crop solutions. With reservoirs filled and soil moisture levels favorable, the outlook for the next quarters is positive.

Moving into the second half of FY26, our primary focus will be on returning to profitability in Q3 and Q4. We are aiming to achieve an EBITDA margin of around 13% to 14% with an approx turnover of around ₹1,500 crores for the fiscal year.

In summary, while Q2 was impacted by short-term challenges, we are confident that our strategic focus on operational efficiency, innovation, and financial prudence will help us deliver strong performance in the second half of FY26. With that, I'll hand over to Mr.

Surendra Sahni.

Thank you, Vikas ji. Good afternoon to everyone on the call.

Notwithstanding a tough half year, we remain positive about our future direction. Agrochemical business, globally, is subjected to unexpected peaks and troughs.

We are cognizant of this unpredictability, and the management focus has been towards building a sustainable and a predictable business. It is this endeavor that will be our focus.

We believe that the steps taken by us in terms of expense reduction, sales policy, inventory control, and focus on analytics and the use of R&D will weather us through the H1 storm, if I may say so. Our IT systems are maturing as we roll out SAP automation and analytical dashboard.

Each step will strengthen the organization. We are determined in setting the direction for becoming an agritech, R&D-based company.

Our R&D and IP teams were successful in garnering a new and novel Nano Urea patent. This is our first foray into the field of nanomaterials.

In H1, we added four more patents to our IP portfolio. Our basket of intellectual property now includes synergistic patents, synthesis patents, nano formulation patents, and we hope to make more breakthroughs with agritech patents.

Our ability to synergize these R&D efforts into a sustained top line and bottom line will be our goal. As a forward-looking company, our commentary would be incomplete without mentioning the role of AI.

Developments in the arena of generative AI are transformational. Every week there are new foundational models being released and use cases for AI are being conceptualized.

There is a significant scope for adoption of AI in the Indian context. We are cognizant of this transformation, and as a company, we will adopt, develop, and benefit from this revolution.

Exports is an area for focus, and our business in Africa is continuing. As previously stated, after the successful completion of three consignments, we have been awarded further orders based on our quality.

The feedback from the customer has been overwhelmingly positive. This year we hope to do around $1 million business with this customer alone.

We have started generating revenue from our China subsidiary and look forward to end the year with $6 million to $8 million in revenue generation. In terms of international trade, we are actively looking at rupee and RMB RMB trade as a natural hedge against dollar volatility.

Our patented product registration in Mauritius, Sri Lanka, and Vietnam are progressing. Our active ingredients and formulation products are moving through the approval process in Taiwan, Mexico, Thailand, Vietnam, and other key markets.

With these efforts, we are strategizing on creating additional revenue streams in the coming years. We are actively pursuing opportunities in the Kenyan market to commercialize our patented products and establish a market presence in East Africa.

I thank all the participants, investors, shareholders, and well-wishers for taking the time to attend this earnings call. With this, I will conclude the short update, and we are now open for questions.

Hi, sir. Good afternoon.

Good afternoon. Sir, thank you so much for the opportunity.

Coming to my questions, sir, my first question is related to our patented revenues. We have done around ₹290 crores in H1 this year compared to ₹357 crores last year.

In the AGM call, you were mentioning that you are placing few patented products before the season. Can you give me breakup of this ₹290 crores, how much you have placed before the season?

Hello. You are talking about only patented products?

Only patented products, yes. Patented products are strategic.

This year we had decided that as against placing 50 to 60 products, our focus would be only to place patented products. The placement had happened before the start of Kharif season.

Now for Rabi, the placements would start from November end and the main sales will happen in December. Okay.

How much of this ₹290 crores is liquidated till now? What is the retail [unclear]?

We have almost in October, we got 90%-95% of our sales return back, as was endeavored this year by changing our policy. Whatever we have got back was around 10% to 12% of our sales from the patented products.

We have got everything back, there's hardly anything left from the Kharif season in the market. There might be something where small here and there liquidation might be pending, but other than that 90% to 95% everything is liquidated.

For the sales return what we had in October, we had adequately made provision in September itself. We have made enough provision for the actual returns what we are supposed to get in October, and our returns are a little lesser only as compared to what provision we have made.

What is the provision for Q2, sir? In

September, we have made a provision close to ₹80 crores. Okay.

Coming to the Q1 numbers, if we include the provision of ₹50 crores, we have done around ₹430 crores. How much of this ₹430 crores is liquidated till now?

What is the sales return?

Liquidation is, as I said, for Kharif season almost most of our returns have been come in October, and there's hardly any liquidation which is pending. Despite because of the delay in season in south, they might be some where the season is going on a little bit, but most of it has been liquidated, and whatever is not there has already been returned.

Okay. This includes the generic products as well, right?

Yes. Our overall strategy was to ensure and have a much lesser sales return, which includes for both generic as well as our patented products.

Okay. With the new approach, we might do well in Q3 this year with all this changes whatever we have done.

If we see our Q4 revenue last year, only ₹90 crores came from branded revenues and balance ₹180 crores came from technicals. If we see, our technical margins are very less compared to branded revenues.

We need to do at least ₹27-₹28 crores PAT in Q4 to be PAT positive. What will be the approach for this year to be PAT positive for Q3 and Q4?

Last year what you see of ₹90 crores is not just ₹90 crores, but gross was much higher, and we had sales return also in Q4. Now this year, we have ensured that all the Kharif-related sales return has already been closed.

Last year we had certain material which came back later on in Q1 as well. Which we would not see this year.

This year our so last year also our branded sales was much higher. It was almost double, but because of sales return, it was only 90 what we could have seen.

This year we'll not see such kind of sales return, and the sales of branded itself will be higher. The technical sales will be a little lower as compared to previous year.

Okay. Next question is related to this patented launches.

How many were planned in the next 12 months,

patented? You are talking about new product which we have to [unclear]?

New products, sir, yes. How many were planned?

No, this year we already have launched our product like Bestmen, we have already launched, and one product which we have launched is 034+ which we have the brand name Shotdown, which we have launched already. For this year we have launched, but for next year we have planned for new product also, next financial year.

Can we expect three to four products, sir, in the next 12 months? No, maximum two product we will launch in next financial year.

Looks like Bestmen has done very well this year. Congratulations for that.

Definitely. Bestmen, Fittagen, and Shotdown, these three products have done fantastically really good in field.

These three products, Fittagen, Shotdown, and Bestmen. You're correct, we're getting very good response especially on the thrips, which was a really serious issue for the farmer this year for some of the reason.

Our Bestmen has done really good especially for the thrips and mites. Sir, and my last question, sir.

If we see our products like Ronfen, Bestmen, and upcoming product Cubex Power Extra, all of these were related to sucking pests. What kind of challenges you see in terms of scaling these products in the next two, three years?

No, it is not like the same because if you talk about Fittagen, that is mainly the crops it goes in the paddy. No, I am talking about Ronfen, Bestmen, and Cubex Power Extra.

Actually Cubex Power Extra what you are talking about, definitely, and Bestmen if you're talking about and Ronfen. If we talk about the Ronfen, it goes mainly on the whitefly and the sucking pest, in jassid if we talk about.

Bestmen have tolfenpyrad in it and abamectin and fipronil. There are two different chemistry.

You can say as a broader way, both are working on the whitefly and both are working on the sucking pest. If you go specifically, the Bestmen is for aphid, jassid, thrips, whitefly, mites, and borer.

Depend the climatic condition and area to area. It is different sales than Ronfen because Ronfen mainly is with the diafenthiuron, which goes on the whitefly, if we talk about Ronfen and Bestmen comparison.

Okay. Sir, and in terms of this top line target for this year, in the previous call, you were mentioning you will do around ₹1,700 crores.

Any reasons for the reduction to 1,500 now?

Yeah. No, this is only because of we are going conservative, and our total debtors and stocks have reduced a lot if you see.

Even in last 1 and 1/2 year, we have reduced our debt of 150 crore. That is also there.

If you talk about that way, so that is the positive side, which we are controlling our debtors and the stocks. Sir, but if we see the average, if it is 600 crores for next two quarters, we will do only 300 crores per quarter, and we were not able to do positive margins with these numbers from past two, three years.

How confident are you this year to be PAT positive for both quarters? Definitely.

We have changed our strategy for this year, which we already told in my commentary also, that we have changed our strategy. According to our strategy, we are going in a right direction.

If it is a 1,500, 1,600, not because of the only we are reducing our sales return and controlled, also it is a season failure also in the some of region. That is also one of the reason for the sales.

We are doing conservatively. That is also effect.

At the year end, I think all will be satisfied with our numbers and EBITDA margins, that I can say. Either it is less or more, but each numbers will be satisfied in the terms of inventory, in the terms of debtors, in the terms of creditors, in the terms of our total, you can say, debt.

If you talk about total, in totality, it will be a good number, I would say. Sir.

That's it from my side. Thank you so much.

Thank you. Thank you.

Thank you.

Yeah. Namaskar, sir.

Namaskar, Saket ji.

Sir, as you were replying to the earlier participants that we have made the necessary course correction wherein we are confident that going ahead, we will be reporting sustainable and predictable numbers going ahead. Sir, firstly, if you could just allude to it in a much descriptive way.

What are the few key changes other than the one which you have just explained, anything else you would like to say, that how will we investors will get the sense of your this sustainable and predictability coming into force? Because this is the first quarter wherein that the quality of statement has changed as definitely from earlier conversation.

Secondly, my question to Vikas sir is, sir, in the cash flow, we have seen provision for expected credit loss at 8.5 crore. We have been speaking about sales return, then provisions, and then again this expected ECL also.

If sir could explain the nature of this line item.

Yeah. With respect to your first question on the predictability.

As we had been discussing since last two meetings that this year we are realigning our quarters. You would have noticed that we are doing higher sales and higher profit in Q2, and then in Q3 and Q4, we are suffering because of the sales return and incurring losses.

This year the realignment has already been done, and we already start seeing the results. As you mentioned, inventory and debtors and all those numbers are already under control.

Sales return also has gone down by 50% compared to last year. This will help.

Also with respect to the profitability number, because we are increasing our patented portfolio, and whatever reduction we see in sales number are either because of the generic products going down or there is lesser sales of technical sales. Otherwise, our patent portfolio is still strong and almost similar to last year.

This is on your first question. For the second question, it's just a temporary provision which has been done because we have put a formula that beyond certain number of days, we need to provide for the debtors.

November and December being the key collection months, we'll be able to collect those and these provision would be reversed. You will see in December that there will be reversal because we use certain formula above a certain days of outstanding, we provide.

We have on a conservative basis provided, and which is signed off by auditors as well. These are not actually bad in that sense because most of our collections generally comes in November and December when the harvest season is on, and the cash flow moves in the market.

Rest assured that would be reversed in December. Sir, if you could just give the number for sales return for the second quarter and the first quarter and the provisions which we have made accordingly?

Provisions for sales return and the actual sales return, yeah. Second quarter anyways, it's mostly some part of Rabi.

We had around ₹30-₹40 crores, and we had a provision of ₹50 crores. For September, we have done provision of ₹80 crores, and what we are expecting is our returns would be around 60.

Same thing last year was actually around close to ₹140 crores of sales return.

Okay.

From about 140 last year, we are going to have around less than 70, around ₹60 to ₹70 crores, for which we made a provision of ₹80 crores.

When you mentioned, sir, ₹80 crore as provisions and the actuals will be ₹60 crore only, there will be a reversal of ₹20 crore going ahead from the provisions account?

We will wait for November, December as for some part of sales, still there is liquidation happening in south. In case we don't receive much returns, then obviously you're right.

It might be ₹20 crores or it could be 15 or ₹10 crores also. Reversal will happen in December.

Anyways, our provision is much higher than the actuals.

Right, sir. Sir, my question to Sahni sir about the international business that sir had alluded to, and I think so he mentioned about one of the clients from which we have also got a million dollar contract.

I missed that number. Out of the total sales for the first half, what portion is towards the international business?

How should H2 shape up in terms of we eyeing the international space?

Yes, please. From one customer for which we have already completed the registration process.

We have done approximately around 600 to 650k USD of business with this customer, and we look forward to another 350 to 400k of orders in the next H2. This is our optimism.

The key point being that this is just from one single customer. There are other customers with whom we are working.

This will be a little slow. What we hope that once we are able to start with the customer, our product quality will be beneficial and our pricing will be beneficial that will continue to grow.

This is an early start. As far as our total overall sales numbers are concerned, $1 million international sale is relatively a very small drop in the bucket.

This is a segment that will continue to grow. This is just one aspect of the international business that we are looking at.

There is some amount of a institutional trading business that we are doing through our China subsidiary also, and that is also sort of generating a revenue. Our ability to be able to get a profitability and better bottom line being generated and supported from the international business will be something that we will be looking forward in the next few quarters.

Okay. Right.

Can you quantify for the first half, what is the contribution in revenue terms?

In the revenue terms, I had already mentioned that approximately 650k was with one customer, and overall around $6 million top line was from our Chinese subsidiary.

In dollar terms, $6 million?

I'm speaking in terms of dollar terms.

Yeah.

In terms of profitability [unclear]. Yeah.

Sir, last two points I completely missed out. Come again.

Yeah. As I mentioned, in H1, we have done around 650k with one customer, and we have around a top line of around $6 million from our China subsidiary.

This is only purely from a top line perspective, yeah.

Bottom line, sir?

Bottom line, at this particular point of time, we still has expenses. We are still trying to get these things into a better shape.

This will happen over a period of time.

Okay. They're not contributing to the bottom line.

This is what you are attributing to.

Not much. Not much.

Not much. Very marginal, very marginal, wafer-thin margins at this point.

Okay. What steps have been taken, sir, to improve on the same and going forward, what can we expect?

Oh, definitely. Definitely, I think international business will become one more pillar over a period of time based on all the steps that we're taking.

In terms of the registrations that we're going on, in terms of our ability to have a subsidiary do an opening innings of a top line, that itself is a good step. We also hope to look forward to our technicals and intermediates to come online because that is one area of R&D which has been going on for the last two years.

We hope this will also start off. By next year, definitely, I think we should be able to see some positivity from the technicals.

Okay. Sir, last two points.

Firstly, on the CAPEX part. If you could just explain where are we in terms of the CAPEX that we have outlined earlier?

Because in the capital work in progress, we are unable to find any meaningful number. Just a second, sir.

The capital work in progress statement is only ₹1 crore.

You're absolutely right. You're absolutely right on the CAPEX front.

We have been a little bit slow, in a sense that the monsoons were so bad that we thought we wanted to focus on our regular business and the financial belt-tightening to be able to invest immediately on the CAPEX front. We have been slow on that aspect.

I agree. We hope to be able to start very soon.

H2 mein, what should we expect, sir, the CAPEX to be?

The plan was only for this addition in our Gajraula plant. As we said, we are going slow because the focus is more on stabilizing the business.

We don't want to focus on that part on the CAPEX immediately. That we have put on a second priority.

It would take anywhere from three to six months for us to start this project. Other than this, we don't have any other CAPEX.

Okay. Just to in nutshell, we will be taking a second look again for when to start that CAPEX?

It will not happen in H2 also?

Yes. This is for sure that we want to do it.

It's only the timing part, which you mentioned rightly that we are relooking. It could be three to six months, yes.

Okay. Then the fundraising exercise and all, whatever we have done, that fund is also not being utilized for the purpose as such for which we have drawn.

We will relook on yeah.

We didn't wanted to take additional burden of all these, including to spend a lot of efforts on starting this plant, plus financing and everything. Since this year, as you see, the numbers have been tough for us to realign, to do a lot of discussion with the sales team and everything, we decided we'll delay by three to six months.

It's possible. Finances is not a problem.

Already, we had confirmation from financing earlier to start as well. It's only from our side that we want to just take some few more months so that this Rabi season also doesn't get affected.

Then post that, we'll be able to start.

Okay. Just to conclude, sir, as Vimal sir was mentioning in the opening remark, we have put the house in order, if we can say, from the earlier experiences what we had for the last 12, 18 months.

Now going ahead, we might look at a better H2 in terms of a good bottom line that we can expect, which was not the case earlier as we have already made the necessary changes with respect to the sales return and provisions. This understanding is correct as of now?

Yes, and already so we have put three important steps for this year. On all those three steps, we are pretty happy that we are able to follow it.

One was reduction in OPEX, that we have reduced by 11% to 13%. Next was reduction in inventory, we have reduced by close to ₹200 crores.

The third was reduction in sales return, we have reduced our sales return by more than 50%. We are pretty happy that all these steps are not only planned and have been implemented properly.

Okay. Lastly, sir, how are generally sales for the H2, means how does in the total proportionate of businesses that we do the December quarter and the March quarter generally plans out?

I think the December would be wherein the pre-purchases for Rabi commence, and how should these two quarters behave as a business for business sentiment?

Rabi generally mostly depends upon the water which is there in the dams. We are pretty optimistic because the dams are at good levels, which will help the Rabi crop.

Too early to give on any number, but as we said, if we are going to do ₹1,500 crores around 1,500, we have good ₹600 crores to cover in next six months. The proportion could be little higher or lower, but this is what 600 we are going to do in H2.

Okay. It was mentioned 16 to 17 now.

Yeah. No, no, you can't have this.

You were answering.

Sorry,

you were telling something? No, no, I interrupted you, sir.

You were telling something.

What I was saying was ₹600 crores plus a better patent portfolio, which will help us to, and much lesser sales return, which will help us to have profitable quarters, yeah.

Fine, sir. Let's see how things shape up going ahead.

Sir, for the debt part, sir, it is all the working capital and the ECB part, foreign currency loan that we have currently in our books? See,

we don't have any foreign currency loans. Entire thing is working capital.

We don't even have any term loans as well.

What is the cost of funds, sir, currently?

We are on an average between, you can say, around 9.5%.

Okay. Our rating, sir, lastly?

Rating is BBB.

When are the revision due, sir?

Revision will happen again next year. We had our rating close to four, five months back.

Another six to seven months.

Okay. Right, sir.

Thank you, sir, and will join the floor. Thank you to the team.

Thank you.

Thank you.

Hello. Good afternoon.

Am I audible?

Yeah. Mr.

Sanjay, yeah, please.

Yeah. Because of this extended rain, definitely many regions got impacted and even there Rabi has been again pushed, right, compared to earlier years.

Which regions we are seeing now which are getting ready for Rabi? Are we seeing that many regions are impacted and Rabi will be now again pushed into Q4 or some states are now we are seeing that Rabi will be starting in Q3?

That's the first question. Are we seeing that because of all this extension of monsoon and even harvesting is getting delayed and everything is getting delayed, are we seeing that the Q4 is going to be better than Q3 or Q3 is going to be better than Q4?

Yes, Mr. Sanjay, thank you for your question.

Yes, your question is genuine, but which I said in my commentary also that Rabi season in Q3 for the herbicide, it is going on as of now. That is a delay for one month, but still we can say which was the sales in October and that will be in November end, but definitely it will come under Q3 only if we talk about the herbicide of the Rabi season.

If we talk about insecticide and fungicide, that will come in the Quarter 4. If you talk about year end, then there will be not any push of quarters.

Quarter 4 will be just some of the sales. Generally, we have insecticide, fungicide sale in Quarter 4 only.

It is a month-to-month change, which was impacted on the second quarter to third quarter, but it will impact for Quarter 3 or Quarter 4. It will be in Quarter 3 only and Quarter 4 only.

Okay. On the ground, are we seeing now that the regions are getting ready, many regions are getting ready for Rabi or many regions are not ready for Rabi?

No, no. As per as per our understanding, Quarter 3 will be Quarter 3 and Quarter 4 for as industry will be better because of the over rainfall.

There is a moisture and which is needed for the Rabi crop, that is already on the ground. We can say it is a it is for the betterment only, which excess rains was in the Kharif.

That is some damage in the Kharif crop, but if you talk about Rabi, it will be beneficial for the crops.

All right, yeah. Thank you, and all the best.

Thank you. Thank you, Mr.

Sanjay.

Hi, sir.

Yes, Mr. Vijay.

Hello.

Yes, please.

Yeah. Sir, I just have two questions.

My first question is in January or February, we have raised a warrant with the investors at the price of 640. Today our share price is trading ₹300.

How confident are we to get back the remaining 75% from the investor?

Yes, Mr. Vijay, in fact, that you're talking about preferential which we have done in January, February.

Definitely there is a 18 months of time as per the guideline, and I think till that time it should be okay because all the participants had paid up to us 25%, which was ₹750 crore. We have already got 30 ₹32 30 how much it is?

25% ₹37 crore. ₹37.5 crore, one ₹112.5 crore, it has to come through that, and there is a time.

Let's see. I think in the third quarter performance, I hope it should be there.

Yes, sir, but my question is because we have a fixed cost of ₹120-₹130 crore per quarter in Q3, how confident are we to break even?

Definitely, as of now we are confident because Rabi season is going good and there is no extra burden which last two years we are facing the extra sales return that was impacting our profitability in Quarter 3 and Quarter 4, which is not here in this year, which we already told that under provision it is coming. Whatever the return are coming, which is under provision only.

Even we have some excess amount, which we will add in Quarter 3, which is not returned yet. That is our strength for the Quarter 3 results and Quarter 4 results, which was not the last two years.

It was

Just to clarify, our fixed cost during season was close to that number, but off-season generally we are around ₹80 to ₹90 crores. We have reduced our OPEX.

Earlier our last year total OPEX was around 420, which is an average of 100 per quarter. This year we have reduced it by around 12% to 13%, we'll be at around for full year close to ₹380 crores also.

Which comes to around 80 to 90 crores.

Sir, my another question is we had a inventory of ₹666 crores. I just want to understand how much is the finished product and how much is the technicals?

Out of 666, now in September, we have ₹666 crores. In ₹666 crores, close to ₹300 crores would be our finished goods, and balance would be in technical and bulk form.

Intermediates. Anything.

Sir, do we have anything which is getting expired, finished product?

No, no, we don't have any such inventory.

What we actually do if some product gets returns for two two three years, and then if it gets expired, what actually we do with it?

No, Mr. Vijay, this is not like this way.

Maybe you have aware about our industry also. Returns, whenever we calculate return, it is calculated return from the one distributor.

It doesn't mean it is returned to the company directly. It can return to the depot, and it resell also.

We calculate as a return because once we sold, it got returned, we calculate as a return, but after return, it comes to the stock and we sell it immediately or we try to sell it in the same season only. We never carry one season product

[unclear]. Do we have any provision for that in our balance sheet whether if it gets expired or something?

No, we always keep tracking. We have SAP system, very strong system.

We never come that way, and there is no expiry at all. We always sell before the expiry of all the goods.

Even some type of product has expiry [unclear]. Yeah.

Sir, I'm an investor since last three years or four years maybe. In 2022, '23, when our company was at all-time highs, ₹1,500, ₹1,700, you keep on saying that our branded margins business is around 35% to 40%.

Now all the patented products we have and we have a good sales from the patented, why our margins still in 12%, 13%?

What you said in the last line, Mr. Vijay?

No, I'm just asking if our patented product mix is going higher, but in 2022 or '23, I don't remember, you told that our patented products have an EBITDA margin of 30%, 35%. Why our entire business is now only ranging between 13%, 15% EBITDA?

No, actually if you see, our total gross margin, if we talk about, that is around 45%, but on an average if in total balance sheet, our gross margin is more than 36%. If we talk about this first half results, this is a 30 more than 36% is our total gross margin, which is there.

Definitely with the expenditure and if you talk about the total top revenue, if we match it, then it's reduced in the EBITDA. In the next years, you will see when our sales will grow, the totally will come into EBITDA.

Whatever our additional gross margin will come because now it is 36%. Now this six months, last six months, we have changed a lot.

Again and again, we are trying to say that we have changed a lot in our strategy to reduce our inventory, to reduce our debtors, to reduce our cycle, and to better cash flow. We are doing that effort.

Last six months we have done, and that result we will show in the next six months as well as next year. It will be because when we are pushing to patented and we are keeping not selling generic products, that results you will see in next one year.

What you are asking for the total gross margin, how it will effect. Total gross margin when it will increase, definitely EBITDA will also increase.

Sir. My next question is, are there any plans to increase the shareholding in our company as a promoter?

No, as of now we don't have the plan.

Sir. Thank you.

That's all from my side.

Thank you. Thank you, Mr.

Vijay.

We thank all the people on the call for their participation. Predictability and resilience in our business will be the goal.

Every quarter we will focus on our sustainable business and we will drive for long-term growth. I thank everybody once again and we look forward to next few quarters.

Thank you.