Best Agrolife Ltd (NSE: BESTAGRO) Q1 2026 Earnings Call dated Aug. 08, 2025
Corporate Participants:
Unidentified Speaker
Vimal Kumar — Managing Director
Vikas Jain — Chief Financial Officer
N. Surendra Sai — Head Strategy and Overseas Business
Analysts:
Unidentified Participant
Hemant — Analyst
Nishant Bhatt — Analyst
Saket Kapoor — Analyst
Sanjay — Analyst
Presentation:
operator
Ladies and gentlemen, good day and welcome to the best Agrolife Limited Q1FY26 earnings conference call. As a reminder, all participant lines will be in the listen only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during this conference call, please signal an operator by pressing star then zero then on your touchstone phone. Please note that this conference is being recorded. This conference call may contain forward looking statements about the company which are based on the beliefs, opinions and expectations of the company as on date of this call.
The statements are not the guarantees of future performance and involves risk and uncertainties that are difficult to predict today. From the management side we have with us Mr. Vimal Kumar, Managing Director, Mr. Surendra Sai, Director and Mr. Vikas Jain, Chief Financial Officer.
I would now like to hand the conference over to Mr. Vimal Kumar for his opening remarks. Thank you. And over to you sir.
Vimal Kumar — Managing Director
Thank you. Good afternoon everyone. Thank you for joining us on the. Quarter one financial year 26 earning call. From Best Ever Life Ltd. This monsoon we observed a mixed season with most part of India witnessing normal to above normal rainfall with the expectation. Of Telangana and Maharashtra. In certain regions this variability impacted swaying activity. Despite these regular climatic variations, this is. A fair year for agriculture. We are pleased to report that our newly launched patented products are performing well in their debut season this quarter. We have taken multiple steps to strengthen our sales performance from the Groupon. Given our path to the disciplined approach in sales, we are reducing inventories and improving margins as per our expectations. We have seen a margin improvement on a Lower base of Quarter 1 revenue numbers when compared with year on year, quarter on quarter. We view this in alignment with our strategic decision to implement revised sale policies with the aim to increase profitability, reduce excess placement and reduce inventory level across the value chain.
And focusing on our patented molecules, we made a deliberate shift from early product placement to focus on more sales during this season. This we believe is a critical step toward building a learner and more sustainable business model. While this has resulted in a dip in Q1 revenues, we see this approach toward positive outcome in terms of lower sales return and lower inventories. In addition to that, this year season is little bit late because of the monsoon delay in various states. Our patented formulations shut down Potassium Best men along with Hustler, Suplex and Executive under the Sudarshan Palm brand have received positive feedback from the Field Channel partners and farmers have found the products to be excellent.
Over 5 lakh acre coverage was achieved by shot down and Hustler in their very first season which is again our patented molecule for the soya bean herbicide. Farmers are trusting our products and our innovation based approach. Overall market feedback and sentiment towards the best and production brands is positive. We received two new patents in quarter one, both of which are Novolin, Septicide plus Fungicide combination. One patent is for a novel formulation combining nitinparam, pimetrogine or Dinutuferone and Isopropyl. This combination offers broad spectrum pest and disease control across key crops such as paddy, cotton, brinjal, groundnut, soya bean.
This formulation designed to target multiple major pests like brown blood, copper, white flies, jacid and diseases including blast and powdery mice. This second patent granted this quarter was for a unique combination of Flupsaferon, Thiomuktuam, tabuconazole. This combination can provide comprehensive management of white crops, thrips, food bora and fungal infections like leaf spores and this product. Will be applicable across a wide spectrum. Of crops such as chili, soya bean, maize, mango, tea and grapes.
This quarter we received new film registration which we call 93 FIM registration for Cubex Power Extra which is three way formulation containing spermacithin, HgSajox and abamectin. This product is useful against blackfrips and yellow mites. Our product Ishunkou which is an advanced combination of dolphin, parrot, Pyriproxifen and Nicitamilpride is now approved for crop like chili and cotton. This product targets aphid, black, thrips, white flies and jessup. Looking ahead, we remain optimistic about the creep’s vision and confident in our ability to sustain momentum through a combination of product innovation, margin improvement and operational efficiency.
Now I will hand over the call to our CFO Mr. Vikas Jain who will take you through the financial highlights. Thank you very much.
Vikas Jain — Chief Financial Officer
Thank you Nimalji and good afternoon to all the participants. Let me walk you through the key financial and operational performance for Q1FY26. As mentioned, coming to the first point with respect to the dip in the sales there were various reasons so the most important were the shape by our strategic shift in sales policy which deferred a portion of our order placements closer to the season along with the details mentioned by Vimalzi wherein there was a considerable delay in season especially in the south and also our strategy to place less raw fund during June and mostly to do it in cash sales closer to the season in the month of July and August.
So these were the reasons and these were even explained in our earlier calls as well that will result in much lesser sales in June, but also that this will give a good benefit and a good quarter for Q2. So coming to despite this, the overall reduction in the sales was 2527% year on year from 519 crores in Q1 FY25 to 382 crores. This quarter we were able to maintain profitability and improve margin metrics, a significant validation of our margin focused execution strategy for this year. Even though we believe that we will have much lesser sales returns this year, we have done provision for sales return on a higher side on a conservative basis.
So for this quarter we have made close to 50 crores plus sales return provision which is there even though we believe that this actual sales return will be much much. Despite the year on year dip in revenue, the company’s profitability improved driven by a richer product mix and disciplined pricing. Gross margin stood at 111 crores with the margin percentage improving to 30% from 24% year on year. EBITDA for the quarter came in at 46 crores compared to 55 crores in the same period last year with EBITDA margin expanding by 140 basis points to 12%. Profit after tax remains stable at 20 crores resulting in a PAC margin of 5% up from 4% in Q1FY25.
On a sequential basis, operating efficiency improved significantly with the EBITDA margin expanding by 960 basis point and PAC margin improving by 1300 basis points highlighting a strong turnaround from Q4FY25. We believe the implementation of our revised sales written policies will yield clear benefits with a significant reduction in sales return in the upcoming quarters contributing to improved inventory hygiene and enhanced profitability. Strategic restructuring across regional operations have also led to reduced operating expenses and tighter cost control. Our pivot towards in season execution continues to prove effective enabling us to respond more accurately to real time demand, minimize exposure to excess placements and enhance working capital efficiency.
This has resulted in much lower sales return in this quarter itself. So last year similar quarter we had crores to 35 to 40 crores return whereas during this quarter it was only 13 crores. Looking ahead, we anticipate a revenue pickup in Q2 aligned with seasonal trends and a delayed curry sowing. We are targeting a conservative annual revenue for FY2627 which can be in the range of 1600-1700 crores. With an annual EBITDA margin expected to exceed 15% plus. We expect our strong margin profile to be supported by the growing contribution of patented high margin formulations. So for this quarter our patented portfolio within the brand sales was close to 45% as compared to 29% last year.
Accordingly, we foresee continued improvements in the operating leverage as a result of optimized field operations and more efficient marketing spend. These factors collectively positive position us for sustained growth and profitability in the coming quarters. In closing, Q1 results underscore our ability to deliver profitability and margin expansion even in a transitional phase. We are confident that the operational foundation this quarter will translate into stronger performance in the coming quarters.
I will now hand over the call to who will take you through the international business highlights.
N. Surendra Sai — Head Strategy and Overseas Business
Thank you Mr. Vikas for the update. We thank you for your efforts to improve margins through financial discipline. We continue to work on developing the international business segment. We have successfully completed three assignments to an African nation with advanced payment terms and we are expecting repeat business based on our service and quality. We have received interest in registration of patented products in African countries which is including for Ronfin and we will be pursuing registration with our customers. Looking ahead, we are looking to register Nanourea as well as biofertilizers and biostimulants in Mauritius which happens to be a gateway to the neighboring African countries.
The registration process for our patented products has been initiated in Sri Lanka while the export registration for Nanourea is underway in Australia where we have an approved label. Customer and field demonstrations are ongoing as we speak. We have ongoing trials of our products in countries like Thailand and Cambodia. Additionally, we are commencing the registration process for our patented formulations in South America starting with Bolivia and Brazil. Our active ingredient and formulations are also probed to the same through registration in multiple countries including Taiwan, Mexico, Thailand, Sri Lanka as well as other global regions. We have made global filings for patents during the quarters in jurisdictions such as us, eu, Brazil, Vietnam, Egypt, Indonesia and others, reinforcing the company’s focus on innovation led international growth. The technical manufacturing units strategy is aligned with these global potential markets.
With this I will conclude this short update. We thank you all for your participation and time to attend this quarterly earnings call. We now welcome your questions. Thank you.
Questions and Answers:
operator
Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press Star and one on their Touchstone telephone. If you wish to remove yourself from the question queue, you may press STAR and two participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles the first question is from the line of Hemant, an individual investor. Please go ahead.
Hemant
Hi sir. Good afternoon. My first question is related to this sales for this quarter. I understand that we are trying to stabilize our branded sales. But in this space why aren’t we not concentrating on technical sales to be on par with our business? This point I’m not understanding.
Vimal Kumar
Yeah, thank you Mr. Hammond for your question. Yeah, definitely your question is relevant. When we have brand we are changing some, you know, for positive for in the brand business. And we are doing some, you know, big change in the brand business. So because that is a. Mainly because last year and last last year we have learned because each fourth quarter, you know, the first two quarter is very strong. The next two quarters sometime come, you know, because of sales return, because of many things. So definitely we have changed that policy and now come to your question. Like why we are not into the technical sales.
Definitely technicals we have. We are also selling some of technical. But the main thing technical doesn’t have that much of margins. If you see our total margins is around 29, 30% as a gross margin. We talk about the technical sale, their margin will be very less. So we are now moving towards profitable organization rather than to keep it only the sale revenues. That is our idea for this.
Hemant
Okay. We were supplying this drawn pen to other B2C players, right? Five to six B2C players. And they were selling this product with their brand name. So when will you start supplying other patent patented products to other B2C players?
Vimal Kumar
Definitely, because any new product either we have very great product. If you see in the agrochemical industry there is any of the company whatever they bring either in MNCs or in Indian companies or any of the companies. When they bring any molecule it need. Tested trial with the commercial, you know, the commercial use of that product. Then only farmer have confidence, dealer distributor have confident. So of course in last four, five. Years we have many, many new product. Which is really really commercially very good for the farmers as well as for the distributor dealer good margin they are having on this. And they have of course monomalies because of our patented patented product. So in this way if you see to give to any B2C you know, B2B plan for this.
Generally we call it principal to principal sales which we are talking in that way. We are noting very hurry. Because first we have to establish and make it as a big brand in the in the farmers and distribute distributor. Then only we will give to some of the co partners like big companies. Because many small companies Many mid sized companies asking us. But we are always aiming, you know, for the MNC company like that. That is the only reason.
Hemant
But this will happen in coming years, sir?
Vimal Kumar
Definitely, definitely it will come.
Hemant
Most, most of the patents, whatever we have today, those were mostly used in Chile and cotton, right. So if we see the cotton acreage in Q1 it was down 3% year on year. And sentiment for Chile is also very very bad this year, particularly in South India. So how do you see Q3 and Q4 this year?
Vimal Kumar
Definitely your question is relevant of course. And you have good knowledge about this agriculture. Happy to answer you. This is a quarter one generally don’t have any kind of sales in South India. That of course you know, because we have aware about some right information. Quarter one doesn’t have any kind of sales in the south India. Definitely it will go in Q2 and mainly in Q3 and that we are balancing. And in my commentary also I said we are not doing any kind of dumping. We are not giving any material to any distributor dealer for sale. Just we are selling whatever we are selling. So that is where we have changed. And definitely chili prices have some issues in the market and cotton acreage has less. But that doesn’t make any big difference. The market still has a big scope for both the product cotton and chilies.
Hemant
Is this the main reason sir, for decrease target of our top line this year or any other?
Vimal Kumar
Not at all. Not at all. Mr. Hayman, this is not like that way because our total market share, if you see as a test tag or not that big that will influence directly. Not at all.
Hemant
Whatever sales return number you told for Q1. Can you repeat that, sir? I could not understand in your comment.
Vikas Jain
To add in the previous point. Although our sales are down by close to 27% our patented portfolio compared to Q1 25 is higher by 14%. So you can understand the patented portfolio keeps on growing. The other material, the other differentiated odds in the product which we used to place little earlier those we are doing now in Q2. Otherwise the patented product has gone up by 14% this quarter. Previous quarter. And for the sales return last year we had a sales return of close to 35 to 40 crores in Q1. And this quarter in Q1 we have only 13 crores.
Hemant
1, 3, 13 crores. And there is a provision of 15 crores. Right?
Vikas Jain
The provision one we are getting the 50.
Hemant
Okay.
Vimal Kumar
We are hoping that is that will not come and that provision we have to reverse.
Vikas Jain
In this general what happens is the auditors have to have averages of whatever has happened in the previous history. Now since we have changed the policies this year, the history doesn’t support to say that okay, we are going to get lesser so we have been forced to keep little higher sales provision. But we are confident that our lesser placement and sales closer to season will help us to have much much less.
Hemant
Okay. One last question from my side. If you compare your B2C revenues for your distributors with competitors it seems to be very less on year on year basis. If you compare to other companies like Danuka and insecticides. So where do you see this number moving towards maybe in the next two, three years.
Vikas Jain
What was your first sentence? What sales you mentioned?
Hemant
Actually whatever sales you are doing per distributor per year. If we compare that with other listed players like Sadhanuka and they were doing more than 20 lakhs per day per distributor per year. If we see our branded revenues we were doing only 10 to 12 lakhs per per distributor per year. So where do you see this revenue going towards maybe in the next two, three years?
Vimal Kumar
Yes Mr. Amand, you have right information. Definitely this company have little generic product which is accepted by pharma long back like 40, 50 years and what we are doing that is mostly patented molecule and which is the different kind of product and is a kind of revolution I would say which some Indian companies are doing like us and definitely I. Would not say the name. Of course all company have their USP and they are doing well in their area. But if we talk about as a best agro definitely where our total sale is 10 lakh per distributor average it is coming definitely it is grow too much because if you talk about total number of customers we have hundreds of customers which they are doing more than you know 1 crore sales per distributor. That level we have as of now. But definitely gradually it will grow in the next two, three years. Definitely it will grow.
Hemant
Okay, so there is a lot of commentary about international business also. So where do you see best track grow maybe next five years in terms of revenue?
N. Surendra Sai
Thank you for this question, I really appreciate. So I’ll just give a little background on this. While we see that the Indian internal consumption business is great we also see that there is a potential that needs to be exploited across the world. And the reason is that there are good products that we are doing A in terms of the patented formulation and B also to be able to support our patented formulations. What we have been doing is to be able to align the technical manufacturing for these products and to be able to do that we have been identifying new processes for off patent molecules and.
To be able to create a portfolio. Of technicals which will be useful for RPA tinted molecules as well as across the world. So for this, as you know, this. Is a heavily regulated field where multiple registrations are required. Registrations are required for both patented molecules which come under the category of new molecules, as well as the technicals which are just off patented and very new. Some of the technicals that we are working on are right now yet to be registered in large geographies such as eu. So over the next four to five. Years, we do feel that there is. A great potential for this in terms of absolute number. It will be a little premature to. Be able to make any prediction. But we do hope to see that this will be our strategy and it. Will contribute to a percentage of our. Revenue in the next four to five years. We are very hopeful on that and. We are taking all the relevant and. Reasonable steps to be able to meet. This particular goal and achievement.
Hemant
Okay, so that’s it for my.
operator
Thank you, sir. The next question is from the line of Nishant Bhatt from Equity Works Ltd. Please go ahead.
Nishant Bhatt
Am I audible, sir?
operator
Yes, sir.
Vimal Kumar
Yes.
Nishant Bhatt
Thank you. Thank. Thank you. First of all, I want to congratulate. The management on the improvement in margins. And if I understand right sir, we have actually recalibrated our business model from a push to, you know, pull models. And that’s why we have been, you know, there has been a decrease in revenue, right. Because because of the focus on patented, it takes a little bit of time to have a ramp up. And I if I just wanted to ask this question that in the coming next quarter, I think even in that quarter we should see a little bit of reduced revenue compared to previous year because of this recalibration which we have. Done in the business. Is my understanding right, sir?
Vimal Kumar
Yes. Mr. Shant. Yeah. Your question is relevant when you see There is a Q1 decreasing say less. So you can say another, another quarter. How it will be. But you know, our understanding, what we. Understand from the market that we learn. Like how we change. Because earlier any company, if you talk about best table of any company generally. We do placement in quarter one directly. If we talk about insecticide and fungicide, there is no direct sale in Q1 in entire India only except some vegetable beds. If you talk about there is no direct consumption at the farmer end in Q1. But if you talk about all fungicide. Insecticide and of course some of the herbicide, like I told you, short down that also liquidated directly on the July only again it will be the quarter two. So if we delay and we are not placing that material in quarter one doesn’t, in my understanding, it doesn’t make that much of difference. And that sale has to come in the quarter two which is not coming in quarter one. That is my understanding.
Nishant Bhatt
No, I understood. I understood sir. Because see this was a management’s decision, right to. Because if the first model we were kind of, you know, pushing sales and now we are, we are going into, you know, improving the quality of earnings. That’s why we have been focusing on, you know, patented products and everything. And. Like, I think the rewards of what we are doing should be actually visible in FY27 onwards. If I, you know, if I think that’s where the business is going this particular year should be little bit muted compared to the previous year because of the change in the market. Even the quarter on quarter there might be some improvement. But the actual growth will start coming onwards of FY27. Is that understanding? Right, sir.
Vikas Jain
So just to. For this year, what will happen is one is there’ll be a recalibration of our top line over the quarters. For example, as we just mentioned, Q1 was heavy because of which we are not doing. So there will be recalibration because in Q3 and Q4 there used to be huge sales returns which used to reduce our sales drastically. So you might see different numbers coming. So it might be possible that Q2 we might be similar or little lesser than previous Q2 but still for full year even though we will not have the growth.
But what we will have is a drastic increase in our gross margins and a huge improvement in our profitability. So the impact is starting this year itself because once we have much lesser sales return, it will give a immediate impact on the cash flows as well by way of lesser inventory where we can manage our inventory as well. Otherwise to push much heavy inventory, we had to bring a lot of inventory earlier and then wait for the season to happen. But now we are buying just closer, not even buying, but selling closer to the season. So sales return also expected to be lesser. So there’ll be huge improvement in the gross margin and the profitability. This is what will happen. And with respect to top line, there will be recalibration of the top line throughout the quarters.
Nishant Bhatt
Okay, okay. So so basically the thing is like in Q3 usually there was the seasonality. Q3 usually is a little bit subdued, but going forward that will change if I’m getting it right. And plus There will be obviously there will be improvement in, you know, gross margins. But even on a distinct basis revenue basis going forward there shouldn’t be significant dip in Q3.
Vimal Kumar
Yes.
Nishant Bhatt
Yes, I continue. Okay.
Vimal Kumar
Yes, okay. Absolutely. Absolutely. You are watching us very clearly and I thank you for that. And this is really what your observation is. I would say it will be really, really I would say you are saying correct because in other sense, if you see generally what we sold in quarter one, we got some share later in the quarter two, what we sold in quarter one and quarter two, quarter three, you can see the last year was badly impacted because of this, all the reasons. So this year we are just keeping it for the again and again our CSL mentioned that inventory management and our cycle of the payment cycle, the debtor side that we are improving and for that somehow for one quarter we have to do that.
But according to the seasonality and the demand of our product that has increased a lot and that will impact you can see in quarter two, quarter three and of course in quarter four also. So we are balancing this year rather than two quarter is very good and two quarter is bad. So definitely this year would be better for the company that I can say.
Nishant Bhatt
Okay, okay. Now that clears a lot of questions. Another you know point I wanted to ask is you have received an award also this year in that chemical synthesis, right? Congratulations on that front because your focus on R D is improving currently. How many scientists do we have in our R and D team?
Vimal Kumar
Yeah, thank you. Thank you for as of now if you talk about the scientists there is a two kind of scientist like one we talk about the synthesis and the technical or maybe backward integration. When we Talk about N -1 and -into that in that area we have around 45 number which are really highly qualified and most of are the a PhD. If you talk about that level of and if we talk about the formulation where we do patented molecule, there are other more than 26 people which are working for the formulation R. There is two different kind of R.
Vikas Jain
Got it. Thank you. Thank you. That’s from my. Thank you.
Vimal Kumar
Thank you.
operator
Thank you sir. The next question is from the line of Saket Kapoor from Kapoor and Co. Please go ahead. Mr.
Saket Kapoor
Yeah, yeah you can hear me now. So my first question is for Mr. Jain. When you are referring to the number of the of the Nova at 1600-1700, what are you factoring in in terms of the actual money sales returns for the year, how do we arrive come to this number?
Vikas Jain
See last year one is we are expecting that Our new products which has already shown that there is a good acceptance. So for our other products which are differential or generic products where our sales would be little lesser. Why? Because we are not pushing too much of those products. So we believe our patented product will portfolio will go up the other portfolio because we are expecting our sales team not to push too much and not to take sales return. They might be little hesitant in placing full fledged but there will be little lesser sales. So we believe even though our patented portfolio will go up, that generic portfolio will go down a little bit.
So we might might be similar revenue or little lesser. That’s why we are giving a guidance of 1600-1700 crores and for sales return. Since last two years we have been facing this issue of anywhere between 20 to 24% of sales return. So this year our target is not to have more than 10 to 12%. So we want to test about half our sales return from previous years. And that is why the huge change in policies what we have done this year to kind of from last year.
Saket Kapoor
Okay, so so 10 per 10% of it. That means we are closer to say 17, 1800 crore. That is factoring in 10% comes down to 1600. That could be a fair assumption that.
Vikas Jain
You are factoring in 1700 crores after. Reduction of all those taking considering the sales returns. Okay, so previously we had 1800 crore which was after reducing all those 20% plus sales returns. So this year we are saying Here I say 1700 it is after reducing the 10% sales return. But this will be much better because we have much better control over the inventory and profitability.
Saket Kapoor
Okay. J, you mentioned EBITDA margin of 15% whereas for the first quarter we are at 12. So do you think that overall on the remaining nine months our margins will improve higher than 15 so that the average comes out at 15. Is that understanding correct?
Vikas Jain
Yeah. So for example as we said Ronfin, we didn’t place much so in Ronfin and other patented products where our potential is much higher, we were conservative in placing this June. That means you’re not placing much in June. So now all those sales will happen this quarter. So this quarter we’ll see a huge jump in the gross margin as well as EBITDA much higher than 17 18%. So this will take care of the 15% plus for the year.
Saket Kapoor
Okay, which product you mentioned? Sir, I missed the name. Please speak closer to the mic. Hello. Okay. Okay. And so you are alluding to the fact that with the product name which you mentioned and the higher sales will contribute to higher gross margin and that will that will result in better profitability. What we are ensuing for this current quarter. That is what the understanding should be.
Vimal Kumar
Yes, yes. Yeah. And moreover I would say if you. Talk about our quarter portfolio according to the RB side and fungi side, our the major product which is end use for the farmer that will come into Q2 and Q3, the major our profitable. Product and our patented one which is. The liquidation and the real sale will. Come into the quarter two and quarter.
Saket Kapoor
Okay. For the month of July. That that understanding you can share now.
Vimal Kumar
Definitely, definitely, definitely what you are thinking. That is in that same line and. July we have got good response. And in August and September also we. Are getting good signals from the market.
Saket Kapoor
Just to come to the point that when we are I think so that it is the sales return component only that is differentiating our numbers to the other companies. That is that understanding also correct. Because when we see whether. Firstly correct me whether our earnings are comparable to people like India Pesticides and not they also came up with the number yesterday and the numbers were totally different for both the entities. So are we. Are we these comparable with the entity firstly, then I can put forward my next question.
Vikas Jain
Yeah, so we are comparable and to your previous what I understand your question is to like even though sales return was a problem which was affecting our inventory and profitability. So that correction we are doing. But when you compare on the product wise, the potential of our products is much higher. It’s only that we have been coming to the market with this patented product since last two, three years. So other players are there since 30, 40 years. So they might be. And we have pushed our brand in last two, three years and huge marketing spend.
So with respect to our numbers, yes, we have few great potential. But here our OPEX also was higher since last two years because we had to spend a lot in the marketing. So this year not only sales return, we are taking care of our operating expenses as well. We are more considerate and trying to manage our OPEX much lesser than previous year. And you will see a stark reduction as well in our OPEX as well.
Saket Kapoor
Can you dwell more on this OPEX part, sir? I think so. For this quarter we have seen the finance cost, I think so going down. The other expenses are also down with with the down in turnover. And. And because there is also always an impact of forex translation in our numbers. So if you could just allude where do we stand there? And also in your opening remark, kindly cover the point of forex. I think ECB per side foreign currency impact her quarter.
Vikas Jain
So we don’t have a foreign currency loan. So we have, we do import from, from, from China and then the payments happen during the due dates and they might be sometimes foreign gain or sometimes for a loss based on the situation. So other than that for opex we already gave a clear guidance to say that our last year spends on the marketing was little on the higher side because we were coming up with a lot of new products, especially patented products. So this year from this quarter itself you saw that there’s a reduction of crores to 8 to 9 crores reduction in our opex. So we believe for full year our OPEX will be lesser by anywhere between 30 to 40 crores compared to last year.
Saket Kapoor
30 to 40. What was the last year number sir? And which line item we will take.
Vikas Jain
Reference for all effects including depreciation and interests put together close to 420 crores this year we should be anywhere in the range of 380.
Saket Kapoor
Okay sir. And can you give the number for the debt number, the inventory number and one more point. So you, you mentioned about EBITDA margin. What should be the trajectory for the PET margin? How should we look at the pad shaping up since that is also the number which investing community keenly looks into.
Vikas Jain
So mostly more or less. If you see our ebitda margin being 15% plus our depreciation and interest is more or less fixed at around 100 crores per annum. So accordingly we can calculate that what. Will be a fat margin. So, so this will be our number.
Saket Kapoor
And the debt number and inventory you can share sir.
Vikas Jain
So interest and our depreciation is close to 100 crores. 8 to 10, 8 to 9% of PBT. PBT percent. And our income tax is on a range of around 2022 percent.
Saket Kapoor
So I was looking for the absolute net debt numbers in rupee terms and also the value of inventory which we are carrying as on the 30th of June.
Vikas Jain
So last year was the inventory was pretty higher because 2324 was a bad seasonal condition. So we had to carry higher inventory. So this year across all the quarters you will see a drastic reduction in our inventory compared to 2425. So already we saw in March itself. In March 24th we had an inventory of around 950 crores. In March 25th we had around 750 crores. So since our season is beginning we had around 800 crores as of June. But those most of the inventory will get liquidated during this quarter itself.
Saket Kapoor
Okay. And my next question is for Mr. Sai on in terms of the strategy outlined for especially for the patented patented part in looking into the new geography and the overall overall change to improve the profitability, where are we sir, at today’s venture and what are the remaining steps, remaining things that are there that will start to flow into the numbers and the profitability going ahead.
N. Surendra Sai
Thank you for the question. This is a forward looking question and this is something that will be done in the coming year and these are the actions that we have been taking in this particular direction. What we recognize is that there is a significant global market for off patent molecules especially in the fungicides and the herbicide segment. The insecticide segment is quite strong in India. The initial patented products that we have been able to get some success are having based on the India consumption. We see there is a significant interest on patented insecticide fungicide combinations in the global market.
But the caution I would like to mention is that the time for registration of this is a little bit longer than our normal registration process. And the reason for this is the fact that these are new molecules and new formulations so they take a longer duration and longer time of field trial. The markets I had already previously mentioned where customers have shown interest in patented formulation registration, these continue to be Sri Lanka, Vietnam, there are ongoing ones which are going around in Thailand. There are ongoing registration processes in places like Australia. We are focusing on the new.
I mean the Brazilian market is something that no agrochemical company can avoid focusing on. So we are focusing on that and we have started work on that particular geography. This is as far as a patented formulation is concerned. There is the second part of the whole story as far as the international market is concerned and that is related to technical. I will come back to the initial statement that the fungicides and herbicides in the international market technicals for this there is a good demand for high value low volume technicals and this is an area which requires significant amount of an R and D in terms of processes and also in terms of being fully backward integrated.
And that is where the technical plant is completely focusing itself on to be able to be produce these technicals at occupation at the time that these become off patent and to be able to have good partners and customers to be able to take this to the global markets. So we see good exciting times in the coming years to come. We have been taking small steps in both the registration process as well as in the terms of doing some patents in terms of both synthesis as well as being able to identify new Processes So. So I hope I was able to answer your question.
Saket Kapoor
So I will try to get the things written down because you have spoken a lot and let me reconcile the same two small questions for Jain sahib also. Firstly on the capex part how much are we spending for this year on Capex and the new facility? I think so some capex which we have done earlier years. When are the new facilities getting commissioned? And third question is sir this 50 crore that sales return provision which we have taken by which quarter we will be getting the actual sales done and the reversal happening will it be in the second quarter itself or if you could just give us some understanding on the sale.
Vikas Jain
So on the capex part we should be starting anytime. So it’s a project of 90 crores wherein funded by a financier by 60 crores. So that will start anytime. Now for the other sales return related part this 50 crores since there is a little delay in the season what we are expecting it should either it should be by September or October. We should have an idea about this sales return actual sales returns.
Saket Kapoor
Okay sir and the capex I missed your comment. 90 crore will get what kind of effect turnover ratio for this year sir and whether it is for backward integration or whether you could just give some more color on this one.
Vikas Jain
So this is. This is an additional plant in our existing facility itself in Gajarola here it will take close to one year for us to get this completed. So the benefit of it which will only come in 26, 27.
Saket Kapoor
Okay right sir. I will join the cube sir. And both science are because Ji and Vimalji B we investors, all investors look for modeling pattern wherein the predictability with variations is what a market is all about and that is what gets factored into the earnings. So. It would be ready. It would be very grateful if the steps which you people have outlined will give us will give us industry comparable predictable number and not haywire as has been the case earlier. Sorry for my words but this is what is not allowing investors to model out how will best agros earning trajectory would be if you take the comparison with other listed companies and the type of valuation that today we are commanding.
So would request all three of you and the other team to take those steps wherein the predictability model starts play starts to play out in the mind of the investors and hence giving us the respect in terms of the enterprise value which is which is absent today. I hope that I’ve tried to convey what my thought process is and hope it. Hope it makes you deliberate on the Same and hope it makes some sense also. And.
Vikas Jain
This is our DBS for this year. That’s why you see all the changes, whatever we have made, because we want to have a predictable results wherein the investors feel confident and accordingly the valuation also follow.
Saket Kapoor
Okay, sir. And hope so that next quarter also when September results are there, we do not remain at the fag end part because at that time we will be also coming up with our balance sheet and cash flows. So last year I think so because of some issues or some in internal meetings we had late results declaration. Hope that we.
operator
The line for the current participant is dropped. The next question is from the line of Sanjay, an individual investor. Please go ahead.
Sanjay
Good afternoon, can you hear me?
Vikas Jain
Yes.
Sanjay
Yeah. First of all, congratulations to your team for a good operational performance. Though the top line was, I mean less compared to last year. But really the margins have improved. So good work. And we are hoping that this will really help in future quarters, preferably mostly in Q2 to get better margin. So my question is about. You mentioned that there is a some deferred placements happen in Q1. So what exactly is that and how is that going to impact impact in Q2? And on the Q2 side, on the Q2 side, are we seeing that the margins are really going to be better than last Q2 of last year?
Vikas Jain
Yeah. So with respect to defer placement, what we meant was that in previous years, for example, as Vimalji mentioned, the sales of insecticides and fungicides, the consumption, the liquidation actually at the farmer level happens in the month of August and later on. But we used to place all those material in June itself in previous year. So now we are going to do all this closer to the season. So if it is August, then we will place in July. If it is September, we will place in August. So this is the placement is what we meant by deferred placement.
With respect to margins, as we mentioned that even though our sales mix is going to improve because for Q1 itself, as I mentioned, our patented portfolio, even though my sales has gone down by 25%, my patent portfolio has gone up by 14%. That means I’m improving my sales in the patents products. And that’s why you see the improvement in the margin itself in this quarter from 24 to 30%. And also since we are doing a lot on the OPEX part, the operational expenses, you will see a drastic improvement in the profitability for full year.
Sanjay
Thank you. And we used to get a lot of press releases about new product releases or any patent granted. But in Last quarter there was not a single press release though. Like we have launched multiple products and even we got a patent. So is there any strategy or has change to not have more like a press releases or anything has changed there.
Vikas Jain
So we continue to put all those press releases in the market whenever we get the patents for example for our three products which we had launched. So we had done enough not only the press release but also in the field itself doing all the trials and all because trials and all that will actually bring us more revenue. So we have done all those efforts and we already see good response to our product especially Shutdown which is a RB site which was a little missing in our portfolio which we added and the response was pretty great. And we see good sales of shutdown this year itself.
Sanjay
Sure. I mean the sales is happening. I’m just talking about the informing to exchange or doing a press release shutdown and There are multiple 2, 3 products launched in Q1, Q1 or even some products are going to get launched in Q2 and the patents received. So there was no press release. I think I’ve not seen any press release into the exchanges. So is it any. Okay. Okay. And the last question is about as now things are really improving margin. I mean the operational performance is improving. So are there any going to be efforts to get more like investor. I mean institutional investors on the board or having more connect with institutional investors or HNIs to get more on this with the company.
Vikas Jain
We generally continue to have our investor engagement. So what we do is after the end of quarter and after our earnings call we generally do a visit in Mumbai that is also informed to the exchanges. So two, three, two days we are in Mumbai and meeting all the investors. But as almost you can understand from almost all the investors that they are waiting for us to do all the changes to do improvement. So possibly people are on the sidelines and we are hopeful that investors will show confidence this year. But we continue to engage with them. So this after few we can see within next two weeks also we will see that we’ll be coming to Mumbai and we generally meet a lot of investors on every quarter basis.
Sanjay
That’s great. And just last question about are we trying to launch any new products in Q2 and Q3?
Vimal Kumar
Yes, I’ll answer that. Thank you. This is quarter two definitely we are launching our bestman. In fact we have launched but sales will start in the quarter two only for the our bestman product. That is again our patented molecule.
Sanjay
Okay, great.
Vimal Kumar
Also I mentioned there is one more product that we will going to launch in quarter three.
Sanjay
That’s really great. Wishing you all the best for the remaining of the year. Thank you.
Vimal Kumar
Thank you.
operator
Ladies and gentlemen. Due to interest of time, that was the last question for today. I now hand the conference over to Mr. Sai for closing comments.
N. Surendra Sai
We thank our partners, customers and investors. For their continued support in an uncertain geopolitical environment. We feel that our current focus on internal consumption as well as backward integration. Will help us be able to be immune to these changes. And all of us are seeing how the tariff changes are going around between India, US, China, etc. We will continue our path of financial discipline. We will be continuing to take short. Term actions as well as we will continue to focus on medium and long term strategy.
With this I will conclude. Thank you all and thank you for your time.
operator
Thank you sir. On behalf of Best Agri Life limited that concludes this conference call. Thank you for joining us and you may now disconnect your lines.