India Pesticides Limited: Strong Q2 and H1 FY26 Performance Driven by Exports and Strategic Expansion

India Pesticides Limited (IPL), a prominent agro-chemical manufacturer, has reported a robust financial performance for the second quarter (Q2) and first half (H1) of fiscal year 2026. The company's unaudited consolidated financial results for the period ending September 30, 2025, showcase significant growth in revenue and profitability, primarily propelled by strong export demand and strategic operational efficiencies.

For Q2 FY26, IPL achieved a total revenue of ₹295 crore, marking a substantial 26.0% year-on-year (YoY) increase. This growth was accompanied by a notable improvement in profitability, with EBITDA rising by 37.6% YoY to ₹54 crore, and EBITDA margins expanding to 18.3%. The net profit for the quarter stood at ₹32 crore, up 22.0% YoY, with a PAT margin of 10.7%. The half-year performance for H1 FY26 further solidified this positive trend, with total revenue reaching ₹579 crore (26.4% YoY growth) and EBITDA at ₹108 crore (52.1% YoY growth), yielding an EBITDA margin of 18.6%. Net profit for H1 FY26 was ₹67 crore, an increase of 46.6% YoY, with a PAT margin of 11.5%.

Driving Growth: Exports and Operational Excellence

The strong performance in Q2 FY26 was largely attributed to a significant surge in export sales, which nearly doubled to ₹140 crore compared to ₹74 crore in Q2 FY25. This export momentum was supported by stable pricing and improved demand from key international markets such as Europe and Australia. While the domestic market experienced a marginal decline in revenue to ₹150 crore due to delayed monsoons, restricted farmer access, and disruptions in the pesticide application cycle, the robust export growth effectively mitigated these domestic headwinds.

IPL's diversified product portfolio, encompassing technicals, APIs, and formulations, played a crucial role. Technicals and APIs collectively contributed 66% to the total revenue during H1 FY26, underscoring the strength of the company's core offerings. The improved profitability and margin expansion were a result of a better product mix, enhanced operating leverage, and ongoing cost optimization initiatives.

Financial Summary (H1 FY26)

Strategic Initiatives and Future Outlook

IPL continues to execute its strategic roadmap with a focus on capacity expansion, backward integration, and R&D-led innovation. During the quarter, the company commissioned an expanded formulation facility, increasing its annual capacity from 6,500 MT to 10,000 MT. This expansion, funded through internal accruals, enhances IPL's ability to meet growing demand. Furthermore, the Board approved a new backward integration project at Sandila for 26 DEA, a key input for herbicides, with a proposed capacity of 4,000 MT and an investment of ₹65 crore. This project is expected to strengthen the supply chain, reduce import dependence, and improve margins, aligning with the Government's 'Make in India' initiative.

The company's subsidiary, Shalvis Specialties, is progressing well and is expected to contribute approximately ₹100 crore in revenue in FY27, further bolstering IPL's specialty chemical roadmap. The PEDA plant expansion to 8,000-8,500 metric tons is also in an advanced stage and is projected to contribute ₹250-300 crore in revenue at 75% utilization. These initiatives reflect IPL's commitment to strengthening its self-reliant manufacturing capabilities and expanding its market reach.

Revenue Mix (H1 FY26)

Capital Efficiency and Sustainability Focus

IPL demonstrated strong capital efficiency, with Return on Capital Employed (ROCE) improving to 18.8% in Q2 FY26 from 17.6% in Q2 FY25. The company maintains a robust financial position with a low debt-to-equity ratio of 0.03x in H1 FY26, funding its growth primarily through internal accruals. Working capital days also saw a significant reduction from 255 days in March 2025 to 174 days in September 2025, indicating improved operational efficiency and cash flow management.

Beyond financial metrics, IPL remains dedicated to its CSR and sustainability initiatives. Programs like 'Chuppi Tod; Halla Bol', 'Samagra Sudhar Project', and 'Nirmal Jal Pariyojana' are advancing initiatives in education, community welfare, and environmental sustainability, contributing to select UN Sustainable Development Goals. The company's focus on 'Food Forestation', Miyawaki technique, 5Rs principle, and advanced waste management systems like ETP and RO underscore its commitment to environmental stewardship.

Looking ahead, India Pesticides Limited is confident in sustaining its growth trajectory, supported by consistent export demand, gradual recovery in domestic markets, and the benefits derived from its ongoing capacity expansions. With a diversified portfolio, integrated value chain, and a strong focus on operational excellence, IPL is well-positioned to deliver steady growth and create long-term value for its stakeholders, aiming for a ₹3,000 crore revenue target by 2030.