Coromandel International, a leading Indian agrochemical company, has reported mixed results in its second quarter of the fiscal year 2024. The company's Profit After Tax (PAT) saw a modest 2% year-on-year increase to reach Rs. 755 crore. However, this figure fell slightly short of projections due to challenges faced in the Crop Protection Chemicals (CPC) business segment.
Despite these challenges, the CPC segment did manage to register a 3% year-on-year revenue increase. However, it also experienced a notable drop in EBIT margin by 297 basis points to 11.9%. This dip was attributed to margin difficulties within the CPC business.
On a broader scale, Coromandel International experienced a significant decrease in revenue across nutrients, allied businesses, and CPC segments, witnessing a 33% year-on-year decline. This substantial fall has been attributed to reductions in subsidies.
On the brighter side, the company's EBIT margin increased to 15.7%. This improvement was driven by stable raw material prices and benefits accrued from backward integration.
Looking ahead, Coromandel International is planning to maintain an annual fertilizer margin of Rs. 5,000 per tonne. In addition to this, the company is also shifting its focus towards specialty chemical/CDMO, drone technology for agrochemicals, and innovative products like Nano-DAP. This strategic move indicates Coromandel's commitment to diversifying its product portfolio and integrating advanced technologies into its operations.
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