Thank you very much. We will now begin with the question and answer session. Yo ur first question comes from the line of Rajas Joshi from ChrysCapital. Please go ahead.

Good afternoon, team. I was going through your parent's presentation for the full year that ended recently. And in the presentation, on the slide on ICT and mobility solutions sector, which is for semiconductor materials, there's specific mention of the parent planning for commercialization of high purity semiconductor chemicals in India in their deck. So I just wanted to get your color or your thoughts on how you look at this development and what plans, if at all any, would be for us in this segment?

Yes, you are right. There was a mention by our parent company in various forums about this topic. We are working very closely with ICTM department of Sumitomo Chemical, Japan. And so far, all the meetings with the government officials, the customers, or whatever you may call, it's all happened jointly with us. And we are, as much as you are, maybe little more than that, we are also looking forwa rd for this project to fructify and lot of work and lot of inputs are being given by us on this project. So hopefully, very soon, you may officially hear from us about the project of purified chemicals for semiconductor business.

And sir, secondly, on the export piece. Given the recent tensions in the Middle East, there's been an uptick in prices of certain products, both technicals and correspondingly from this as well. So how is that expected to feed into both demand and correspondingly the elevated prices helping us in the margins front to some extent on the export side?

Yes, in overall, if you look at it, there has been cost escalation I described during the commentary, so which we are trying to pass on as much as possible. Yes, the price realization has been better, especially from let's say, late of March. But it may not translate completely into percentage margin because the cost is going up and the price is going up. So, it's probably along net neutral or plus or minus few percentage point , that's about it. It all depends on how the situation is going to be. If the war continues, if all the costs are going to keep going up or remain at this level, the pricing may be able to continue. More than the pricing, the supplies, which supplier is able to make the supplies as per the customer demand will play a crucial role in terms of the business.

And in terms of volumes, is there any movement expected there on the export side?

It's too early to comment for the current financial year. The indications are there. It all depends on how the logistics situation is going to pan out, how the cost escalation is going to happen, how those country customers are going to afford to pay , in the current situation of cost. If they are willing to pay, then there would be upside. It all depends on how the situation is going to unfold in the next couple of months.

And lastly, if you could please call out the revenue number for sales under the custom synthesis kind of division that we have wherein we sell products to our parent. If you can just call out that number, if possible, which is classified as CRAMS or CSM, how you call it?

It is roughly in the range of INR100 crores to INR150 crores, depending upon the market situation in terms of volumes at this current level. And as we have explained, that some of the projects are underway in the implementation side. And once those projects are implemented from next financial year onwards, we are expecting some growth in those numbers. But for the time being, this number is roughly in the range of INR100 crores to INR150 crore.

Your next question comes from the line of Probal Sen with ICICI Securities.

Sir, a couple of questions. Firstly, the commentary obviously did talk about the kind of monitorables and constraints that may be there in FY '27 despite demand being resilient, the kind of monsoon uncertainty as well as the Gulf pricing -- the Gulf confli ct and all. Is it fair to therefore look at margins a bit more cautiously for this year? I understand that you did mention that cost increases are being passed on. But with the kind of momentum one sort of sees in margins being probably constrained by these situations, how should we actually look at the margin trend? Flattish versus this year or even a possibility of some decline that can be there? Just your thoughts on that. That was my first question?

Many years, I mean, not many, but few years back when our profit margin increased, I was asked questions by lot many people whether this is one -off or this is sustainable. And I very confidently, at that time, had said that the margins which we are getting will be the most sustainable margin and they are all achievable every single year. And I am happy to note that because of our groundwork, because of our product mix, because of our flexibility of giving the right product at the right time and concentrating on our portfolio in a much, much better manner, we are able to give or ensure the margins on a sustainable basis. And we will do the same thing continuously to ensure that margins are sustainable. I understand, like even when we got our cost increases in the month of March and all that, we were very uncomfortable as to how these costs are going to be passed on and how the market is going to react. But we have had, on 15th of March, a price increase, on 1st of April, a price increase, on 1st of May, a price increase, and now we will see whether we can increase the prices on 1st June. So it is a very, very cautious approach. We control our cost, but certain costs like raw material prices going up or the freight charges going up or solvent prices going up because of the naphtha and oil prices, all that is not in our hands. So we have to be very cautious in ensuring that this cost does not go out of our sustainable margins. It has to be passed on. And we have, as I gave you an example, that we have already increased the prices 3 times within this, 15th March till now. And that is what we'll continue to do, but we'll ensure that our margins are sustainable.

My second question was with respect to inventory levels and working capital. Again, coming back to the uncertainties with respect to the supply chains of raw materials and imports. Has there been any change in the kind of days of inventory that we are holding as of now, particularly for the first quarter?

What has happened is that we have deliberately purchased more and deliberately produced more during the fourth quarter in order to be ready for the new season. So while we do that every year, but this year, the focus was more, like we saw the trend of packing materials going up. So instead of 90 days inventory, we went for more number of days of inventory. Even certain crucial raw materials, which was oil or naphtha based, we have extra inventory. So all those things actually ultimately will benefit us because prices of this packaging material or raw materials are constantly still going up. So as a matter of fact, it is better for us to have a little bit more inventory rather than depending last minute on the raw materials and packing materials. And what has happened, I mean what it has really proved to be a boom for us is that currently the freight or the transportation lead time has increased for every shipment from abroad and more so every shipment within the country. So even if you want, say, packaging material, the people say we are not getting the trucks. Instead of 4 days, it will take 8 days. Raw materials, same thing. Within India, the movement has, you know the lead time has gone up and we are far better off in having the inventory, that extra inventory to meet out that extra lead time.

Third question, if I may slip one more in. With respect to the new product pipeline, I believe Kunal did mention about the 3, 4 new pipeline molecules that have been under development, of which Excalia Max has already been launched and is showing great res ults. Just wanted to understand for FY '27, can we expect any one of these molecules to be commercialized and launched? If you can provide some color on that?

Yes. As I said, Excalia Max was launched during last kharif. But I also mentioned another molecule, which is a group company molecule, Sumitomo Biorational Company, TopGrain, a biostimulant. We got the registration towards the end of last year, which we expect to commercialize in the coming kharif. And there is one more product which we are expecting registration. Obviously, once the registration we get it, our endeavor would be to launch within this financial year.

The next question comes from the line of Animesh Jain with Dalal & Broacha.

Thank you for the opportunity. So can you tell me about our facing any disruption in procurement of raw material or technicals? Because we have taken permission from our parent company for importing technicals from third party. So it's for the formulation part or new launches or any disruption in the raw material?

So these are for existing products, not for new products. And we are not facing any constraint on our supply chains. We are getting the materials as we want. And also we have prudently stocked up the materials as well. So I can say that, and this has been also from our side, we have promised the sales team that no order of the customer will be turned down. So we are not going to say, sorry, we don't have materials, we cannot supply. So that confidence has been even given to the sales team, and we are very, very confident that there will be no situation that we'll have no materials and we will not be able to supply the goods.

And this clarification, this point which you mentioned that our parent company has allowed, as Shah-san mentioned, this is for the existing product and only for 2 or 3 very specific products where this is available. So generally, the terms and everything remain same except these 2, 3 products, wherein our parent company has allowed us more flexibility.

And my next question on Barrix's portfolio, because in last concall, you have announced that we are facing some regulatory challenges. It's solved or it's still going on?

I think most of the regulatory challenges which were started, I think this is something which the entire industry faced, including our company and our subsidiary, Barrix, especially in the bio kind of a product. So those challenges were faced from middle of June towards end of last financial year. At this point of time, largely, most of the approval have been received to restart the business and it has been restarted now from the recent past. So this year, we are not expecting those regulatory challenges to continue or impact us negatively.

Your next question comes from the line of Siddharth Gadekar with Equirus.

Sir, just first on the domestic market, what kind of price hikes do we need to take, assuming the raw material basket stays where it is today to pass the entire thing to the end customer?

It's very difficult to generalize. Product to product, it varies. Formulation to formulation, it varies. Active ingredient to active ingredient, it varies. On a large scale, can we say maybe 10%, 15% cost escalation depending on the product. Some products have even gone up to 20%, 25%. So it's very difficult to generalize. It varies from product to product.

But would it be a fair understanding that the revenue growth will be much higher given that raw material prices have moved higher for FY '27, at least for the first half?

It's very difficult to say. The reason I'm making that statement is suddenly if there are -- see, there are 2 issues. One is we don’t know about the fertilizer supply. We don't know how the monsoon is going to play out, what the crop shift is going to happen, what the farmer demand is going to be there. If competition, companies start reducing the price then we will also are in the same market, we'll have to drop the price. The second thing is the war situation. If the war stops tomorrow, yes, it may take a few weeks or couple of months for the situation to come back to normal. The minute the war stops and the things started improving then competition or people may not want to hold the price and want to get the volume. So it all is going to be played on all these developments, which we will have to wait to see the situation, how it evolves.

The second question on the capex side, we had announced a INR150 crores capex for Dahej, and we highlighted that we are in advanced stages to announce the second phase. Can you give some sense of what are we planning to do in the INR150 crores also and on the second phase, how large that opportunity could be?

So, as we mentioned last time, in the last, I think, quarter back, we have announced this capex of INR150 crores to be developed at our Dahej site. This is the first project coming at Dahej, and it is expected to be commercialized in next 2 years or so, and that continues on the track. I think we have started some of the development work, and it seems that it should be on the track currently. And as we had mentioned, that next phase is expected. We are doing a lot of feasibility studies as we mentioned and covered earlier. And the quantum of that is expected to be similar for each of these projects, with little bit higher up and down. But the quantum is expected to be similar for each of these projects and we are expecting a pipeline of such projects over next few years.

So this was largely -- sorry.

To be announced one by one. So what we are saying, first project we have announced at Dahej for INR150 crore, and then we are expecting a series of projects over next few years.

Sir, and in this INR150 crores capex, what kind of product would we be doing? Because we have only highlighted it would be a intermediate for the herbicides. Will we be doing the N-1 or we will be doing a KSM type intermediate in this?

We will not be able to disclose because this is a business confidential information. But to some extent, it is before integrated, may not be KSM, but a good level of integration.

The next question comes from the line of Ankur Periwal with Axis Capital.

Ankur, if you have closely observed the last year, the prices of most of the agrochemicals were largely stable, by and large stable. So there was a minimal growth in terms of price. Most of the increase that you see in terms of revenue is primarily from volume.

And also, as I think Mr. Shah also explained, and Dr. Suresh and Anil sir also covered in their thing, while the top-line growth is 3%, however, there were some negative factors of, like, say, this animal nutrition business discontinuation, which we mentioned. So if you look at our pure agro business, it has grown roughly in the range of 5% -6%, and almost everything through volume, as Dr. Suresh mentioned.

Just within the portfolio, while herbicide has done good for us, will the growth over here will be largely led by the new products or even the existing ones ramped up? And secondly, specifically on PGR as fungicides. A fungicide may be seasonal but PGRs had been growing reasonably well earlier, but they witnessed a sharp decline this year. Anything specific here?

Yes, I can explain it to you. See, in terms of herbicides, it's a mix of both generic products as well as specialty products. Specialty products, our flumioxazin soybean herbicide grew significantly. Second, a newly launched rice herbicide, Lentigo, contri buted to the overall herbicide growth. Apart from our key branded molecule, Mera 71, a different formulation of glyphosate, recorded a very good growth. So, the herbicide portfolio growth is on account of mix of both specialty and generic portfolio. In terms of PGR, mainly gibberellic acid, GA, again, a big product for us, declined on account of really bad grape season. If you had observed at that time in the grapes, there was continuous rains, a lot of grape area got damaged and the spraying itself did not happen. That had a direct impact on our PGR, that is gibberellic acid portfolio. That's the reason you see a decline in the PGR portfolio.

And just to add, there was also this regulatory challenge, what we mentioned about biological. So in PGR, this one particular product, which is very important, gibberellic acid, Dr. Suresh explained the market concerns. But for several other products in this portfolio, which are bio in nature, including we and our subsidiary, Barrix, we both faced regulatory challenges. Many of these products could not be sold right from June to, say, December or January. So for 6 months, the sales and the distribution was disturbed for these products. Herbicides part, what Dr. Suresh explained about the products, both generic and specialty, there was also a factor of weather. Because if you see the Q1 was very good and till that time, the monsoon rains, everything was well covered in India and that is why we saw a lot of herbicides. And other portfolios like insecticides, fungicides, were more severely impacted by extraordinary rains in the later months, like August, September, October. So herbicide portfolio did not get negatively impacted due to weathe r while other portfolios did get impacted because of these weather factors.

I'm sure you are aware that the industry as a whole has unprecedented return of herbicides from the channel all across the companies. And as compared to that , we have not taken even 1 liter herbicide back from the market. So whatever we could sell or whatever we could sell, it was sustained. There were no returns at all of our herbicides.

Thanks for the detailed answer. Second bit on the capex side, just as a follow-up to the earlier question. What number should we take for, let's say, over '27 and financial year '28? Because earlier we also highlighted that there were some products at an approval stage from Japan, which can be possibly backward integrated in India. So any status update over there?

So Ankur, whatever capex we have mentioned, they continue to be on timelines and any additional projects which we will announce in future that will anyway take 2 years plus to be commercialized. And as we have mentioned, I think whatever capex projects we have announced, we are not expecting any incremental revenues in current financial year. So current financial year, our endeavor will be to maintain the sales which we have, like as I mentioned earlier, it is between INR110 crores to INR130 crores, INR140 crores level at this point of time. So that we are planning to maintain in current year. And from next year onwards, as some of these capex projects get completed, some incremental revenue should be added. But large part of that increment, because this INR150 crores of large Dahej capex, that is expected to take from, say, due to financial year '28, '29, the revenue side.

And just last one, if I may squeeze in. Going back to the Sumitomo Japan's sort of presentation, highlighting India to be a hub there from a semiconductor production, et cetera, perspective. Two parts. One, the cash that we have on the books, will the large part of that capital allocation will be getting funded here? And secondly, from a technology point of view, from an R&D point of view, from a capability side, where are we? Do we need a significant investment from Sumitomo Japan to be transferred here or the existing team on the R&D side, if y ou can share some thoughts there?

No, it will be existing team only. We are very good at it and as a matter of fact, even Japan has now developed confidence in our R&D and they are pushing us that even if the technical knowhow comes from Japan, if we can improve it would be better. So they are giving us all the free hand as far as R&D is concerned and it will be all ours. We don't need any capital from Japan or any manpower from Japan.

And on your first question, Ankur, about the investment. So you are right that we are accumulating a lot of cash at this point of time. And as our parent company also announced that they want to use India as a manufacturing hub, especially our sector, agro and life sector has clearly mentioned this in the past in a lot of forums and that is something which we have committed. And as we also mentioned that we are expecting to implement several new capex projects, especially at our Dahej site for our parent company's global requirement. And we are expecting that a lot of our capex can be invested into that , through the funds which are accumulated in India.

Thanks a lot for all the answers and congratulations Dr. Suresh for your new role and responsibilities. Thanks.

Thanks for the opportunity. Now we are talking about the RM inflation and the cost passing to the farmer. So how are we confident of passing cost to the farmer? So far we have done that. But if we look at in terms of the overall economics of the farm, fert ilizer price already hiked maybe in last one and a half months. And also if you look at the other ag ri commodities, the prices are already soft. So like even though we pass on our prices, is it possible that the volume can taper because farmers might shift towards the generic product, not the specialty or branded product because of the cost pressure and the inflation.

Yes. As I explained, there is a lot of dynamics that is playing on. One is monsoon, that can change the cropping pattern, number one. N umber two, fertilizer availability. Even before talking about fertilizer price. Fertilizer price anyway mostly it is subsidized and I don't think it's going to significantly increase to the farmer. In terms of supply, fertilizer supply availability can impact the cropping pattern. If you look at way back '22, '23, all the agrochemical prices have shot up significantly but still farmers were able to buy and invest in their crop and got good crop. So similarly, we will have to wait and see how the competition is going to play, how the monsoon is going to play out, what is the fertilizer supply situation. Al l these things will play a role in terms of how much the farmers can absorb the cost. As I mentioned, we are not taking a one - shot decision and trying to see that recover everything. So we are taking a calculated decision based on the product, based on the brand, based on the popularity of the brand, we take that call, and that's how it will be. It's a dynamic situation, so the decisions have to be fast, and we are geared up for that. We're reviewing the situation on a weekly basis, if not on a daily basis, and take those calls and implement the decisions.

Also the agrochemical is the least of the cost to the farmer in his overall cost. I think farmer will be more worried about at what price he will get the fertilizers and other inputs. But agrochemical is not a very big part of farmer's cost. So when the time to use the agrochemical comes, farmer only sees to save his crop and the price to him at that point of time really doesn't matter in his economics.

And sir, second part is that, if I look at your herbicide portfolio, growth in the Q4, that was very strong. Can we assume that it partially driven by the price hike that we have taken over in the month of March, and also partially supported by the intermediate rainfall during the late rabi season, both have influenced the growth?

See primarily it is volume growth. Yes, price increase happened, that was towards the middle of March or third week of March. The major contribution would have been volume and probably to some extent, I would say that since the war situation was emerging, channel was little bit skeptical about the availability of herbicides and probably they bought little early compared to what they would have done in a normal year.

And also, if I look at some of the herbicide prices, maybe one of our most demanded herbicide product, glyphosate, the prices have shot up more than 40% to 50% over last few months. So was that a kind of a pre -buying in the channel more of than the actual demand driven growth that we have seen in the Q4?

See mostly glyphosate starts getting used only towards the end of April, early May. Before that, it's all stocking up except maybe little bit of usage would happen in north. So I would say the cost of raw materials of, not only glyphosate, all the raw materia l costs have gone up. Yes, glyphosate has also gone up. So we also increased the price and the entire glyphosate industry increased the price. And there is stocking up of some of the products by the channel also.

And sir one last question regarding the capex that right now we are talking about the semicon capex and some other capex. But if we look back at past year guidance about the INR300 crores capex at the Dahej plant, so far we have only announced INR150 crores capex. So in terms of how are you confident to announce another capex at the Dahej plant for the agri intermediates in the near term, and in terms of the product that are already in process of getting the approval from the parent company. So how was the status for those products?

So at this point of time, based on whatever technical feasibility studies we have done and discussed, technically, we are very, very confident. And overall, we are cautiously optimistic that some of these capex projects should get approved and we should start the implementation.

And sir, any kind of a timeline or stage that we are into this process of approval?

So as we have mentioned that we are not looking at one particular point of time to announce a very large capex. We announced one project just, say, 3 or 4 months back, and periodically, let's say every year or so, we are expecting or maybe earlier than that, we are expecting next project to be announced. Because implementation of, say, 5 projects cannot be done t ogether. So let's say, every year for next few years, we can keep announcing one project.

The next question comes from Hardik with ICICI Securities.

Thanks for the opportunity, sir. Just want to know if you can just give a breakdown between what was the volume growth and the pricing increase in Q4 and full year performance that driven the revenue?

So I think this point was already addressed by Dr. Suresh earlier. If you look at our agro business, overall from a full year basis, the growth was approximately 5%, 6%, and which is fully from volumes. Pricing was stable, if you look at the full year basis.

Thank you. As there are no further questions, I would now like to hand the conference over to Mr. Sushil Marfatia for closing comments.

Namaste, everyone. Thank you all for asking some very interesting questions, and our colleagues for replying the same. We hope we could address all your queries. FY '26 was a generally difficult year for the Indian agrochemical industry. Adverse weather, r egulatory constraint, global uncertainties, and cautious channel sentiment, all occurring in the same year. And yet, in that environment, Sumitomo Chemical India delivered its highest-ever profitability. That outcome speaks to the depth of the franchise we have built. Looking ahead, our priorities for FY '27 are clear - scaling up our recently launched products, continuing to invest in farmers' engagement and demand generation. Advancing our manufacturing expansion program at Bhavnagar, Tarapur, and Dahej, and sustaining the financial discipline that has consistently underpinned our profitability. We remain watchful of the monsoon outlook and the broader operating environment, and we are well prepared to navigate whatever conditions the year brings. I also want to express here my deep gratitude for the privilege of having been part of this organization's journey. The company that Sumitomo Chemical India is today a INR3,200 crores business with a strong parentage, strong products and brands, strong people and team, and strong plans. All these strong Ps helped us generate strong profit for our shareholders, which is one of the highest profitability level in our history. It is collective work of every person in our company who have given their best to this organization. I am proud to have been one of them. Thank you once again for your time and your continued trust in Sumitomo Chemical India. We look forward to staying engaged with you throughout the year ahead. Thank you very much.

Thank you. On behalf of Sumitomo Chemical India Limited, that concludes this conference. Thank you everyone for joining us, and you may now disconnect your lines.