Best Agrolife Ltd (NSE: BESTAGRO) Q4 2025 Earnings Call dated May. 27, 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
Saket Kapoor — Analyst
Ankur Agarwal — Analyst
Abhijit Mitra — Analyst
Presentation:
operator
Ladies and gentlemen, good day and welcome to the Q4 and FY25 conference call of Best Agrolife Limited. 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. These statements are not the guarantees of future performance of the company and it may involve risks and uncertainties that are difficult to predict. As a reminder, all participant lines will remain 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 the conference call, please signal the operator by pressing Star then zero on your touchstone telephone.
Please note that this conference is being recorded today from the management side. We have with us Mr. Vimal Kumar, Managing Director, Mr. Surendra Sai, Head of Strategy and Overseas and Mr. Vikas Jain, Chief Financial Officer. I would now like to hand the call over to Mr. Vimal Kumar for his opening remarks. Thank you. And over to you sir.
Vimal Kumar — Managing Director
Thank you. I welcome all to the quarter four and financial year 2025 earning call. Thank you all for joining today’s call. Agrochemical industry in India is in need of transformation. Unseasonal rains, sudden climate changes, unusually hot weather are impacting the crops in a way they are unexpected. Farmers in India continue to be dependent on rainfall, irrigation. A farmer first spends on agriculture inputs using credit. But how much the farmer can earn from the crop is not predictable. This unpredictability is impact the complete ecosystem associated with agriculture. These are the facts in this challenging environment. We are working to achieve business profitability by introducing farmer oriented products.
Our aim is to release three to four patented product every year. Product that are farmer oriented and well earned. The trust by farmer. Our research and development is working with the mission of creating the best brand. Best Agrolife will continue to focus on product innovation for brand business. This quarter we have reduced our costs, changed our credit and return policies and improved the operational efficiency in our brand business. We have reduced our quarter four loss as compared with quarter four of last year 24. Our loss has been reduced from 92 crore in quarter four financial year 24 to rupees 20 crore in the quarter four of financial year 25.
We are on turnaround path in our financial and operational performance improvements. We hope to see good result in the coming year with the new challenges in forecasting sales, demand or inventory management and new sales policies. In the full year we have improved our gross margin from 2.4.7% to 29.5%. This is a reflection of our Commitment to sustainable growth with focus on inventory management. We have reduced our inventory position by rupees 185 crore an improvement of 19% year on year and reduced our working capital by rupees 146 crore which is a 54% year on year improvement.
This year we improved our operating cash flow position to rupees 192 crore which is 550 40% improvement from last year. We have also reduced our total borrowing by rupees 161crore which is a 25% reduction from last year which is a significant amount our borrowing had reduced. Sales return has always been a challenge major concern in the agrochemical industry. For the FY25 26 we have introduced strategic sales policy designed to drive demand of our specialty products. We expect to see a reduction in our sales returns. At the same time we are actively monitoring the demand and supply.
We expect to drive profitability and accountability across the sales channel with our new changes. Field trial of our patented product Short down has earned very good feedback from farmer across India and we have officially launched this product. Short down is a combination of Aloxiform and Amazeta pad and is a powerful media site for use in crops like groundnuts and soybean. We have aligned our backward integration by producing the technical Haloxifo in our Vajrola plant. Building on this momentum we will be launching two more patent products. One is an advanced insecticide brand name Bestman which is a combination of Fipronil, aromactin and dolphin.
Parent is an SC formulation. This product controls aphid thrips and fruit borrel. This is a single shot solution for important crops such as Psylli. We will also be launching another powerful insecticide Fritagene which is a combination of ctpr, Imamectin and Fipronil in a GR formulation. For this formulation I mentioned in last two earning calls also that we are going to launch. So this time we have launched this product also. This product is for sucking pest and borrower in crops such as paddy and vegetables like this. We have many more in the pipeline with the CTPR combination.
As I said many times in the call, this is one of that. Moreover we will be launching an exciting range of organic fertilizer and biostimulants. These products represent the next wave of our research driven approach and are designed to support farmer in achieving higher yield and support sustainable farming practices. Our dealers, distributors and farmers are requesting us for new product that can solve their multiple problem with one shot for which best Agro is famous in the farming community. We will keep up with our commitment to delivering three to four cutting edge patented crop protection solution every year.
Our technical research and development team has taken up the challenge of fully backward manufacturing of new herbicide. We were the first in India to develop fully backward production of Diphenthrone which was a core technical in our brand Ronfin our first patented which we launched in 20212022 we will soon be the first of make fully backward top Ramon RB side. Also this year we are planning to brownfield expansion of our technical plant with a capex investment for the project will be tuned to 90 crores. We will strategically expand our R and D capabilities with new product release.
We will be committed to developing safe product for the benefit of the farmer and the environment. In summary, at best Agar Life Limited we are well positioned to expand our combining innovative products, regulatory momentum and strategic partnerships. Our commitment to never come studies, patents and brand business will lead us forward as we look ahead. We are fully aware of the short term headwinds that we are facing, but we are equally confident in our ability to weather these challenges. Despite the fluctuation in financial performance, we continue to focus on long term sustainable growth. Our commitment to innovation, strategic investment and customer centric approach remains stronger than ever.
We are confident that the foundations we are laying today will enable us to achieve sustained profitability and create value of our shareholders, customer and employees in the years to come. In our slogan we always say Farmer first, always invest. Thank you once again for your attention and we look forward to addressing your question. Thank you very much. Now I hand over to Mr. Vitas. Thank you very much.
Vikas Jain — Chief Financial Officer
Good afternoon everyone. Thank you for joining us with us today. Let me start by sharing the financial performance of the fourth quarter of FY25. Revenue from operations for Q4 stood at rupees 274 crores as compared to rupees 135 crores in Q4 FY24, reflecting a year on year increase of 103%. This increase was due to the fact that in the previous year, which is Q4FY24 due to unfavorable seasonal conditions. However, this quarter had been a mixed bag. We saw that market conditions were more challenging than what we had anticipated, particularly in terms of demand in certain key segments such as cotton where the aggregates were lower and also there were issues with the chili produce price that impacted the company’s performance.
However, as Vimal S mentioned, despite the we have delivered an improvement in our financial and operational performance for Q4FY25, our focus initiatives on cost optimization, strategic restructuring and enhancing operational efficiency have yielded encouraging results leading to a significant reduction in losses from a negative EBITDA of 67 crore in Q4FY24 positive EBITDA of 4 crore. In this current quarter we improved the results of Q4 performance. Previously our Q4FY24 PAT was negative at rupees 72.5 crores as against a reduced loss of 21.6 crores in the current quarter. Despite these challenges, we remain optimistic about our strategic direction.
The direction is to invest in building a stronger brand presence in our key long term priority for the company and we believe it will position us for sustainable growth in the future. While these investments have contributed to short term cost pressures, they are essential to our brand focus model. Looking at the full year performance of FY25, revenue from operations was 1,814 crores which is 1814 crores as compared to 1873 crores in FY24. We saw revenue growth coming from a strong performance in the branded sales. The volume growth in branded sales was 14% but due to the price decline in various non patented portfolio the overall revenue from branded sales was flat at rupees around 1190 crores.
Branded sales was the primary revenue generator when compared to the institutional sales segment contributing in a ratio of 6634 marginal gain from the previous year which was 64 and 36%. This shift to a branded product reflect our strategy to focus on premium value driven offerings that cater to ever evolving market needs. For FY25, EBITDA stood at rupees 200 crores as compared to 225 crores in FY24. The contraction in EBITDA is mainly attributed to the increased cost associated with the strategic pivot to branded products. This transition involved higher employee cost particularly as we expanded our marketing sales and especially the geographical expansion in south and the support teams to manage the growing brand portfolio.
In addition to this, other operating expenses also rose due to the incremental travel and marketing cost as we scaled our market presence and engage more actively with our customer base across various regions. The focus on the branded stage has led to improvement in margins from 24.7 to 29.5% and this is likely to improve further in coming years. Cash flow from operations saw a drastic improvement from 35 crore in FY24 to 228 crores in FY25. This led to a reduction of our short term borrowings from 670 crores to 453 crores. Based on our learnings from the years that have gone by, we have done various changes to the policies to improve the performance for 25:26.
We will continue to concentrate on the branded business and improve our gross profits. We have strong patented product portfolio as of today and as has been discussed, we’ll be launching another three to four products this year. In addition, we’ll also be launching a range of biosimilars. We are on the course of cost optimization drive for financial year 2526. Our investment last year in brand focus has helped us to create a brand pull. We would now be spending much later this year. Also we are restructuring and merging various regions so as to reduce our OpEx. Additionally, we have made several changes in our policies for majority of our products to reduce the sales returns.
Our key focus would also be to reduce the working capital cycle and especially within better inventory management. Once again, thank you for being with us today. We look forward to your continued support as we move ahead with our transformation. I now hand over to Mr. Sai for updates and concluding remarks. Good afternoon everyone.
N. Surendra Sai — Head Strategy and Overseas Business
Thank you for joining us today. I’m pleased to give you an update on the progress in our international efforts and the strides we are making to. Build our presence overseas. We have made progress in expanding our portfolio across countries such as Vietnam, Sudan, Australia, New region, Guyana, Bolivia, Thailand, Cambodia, Mexico, Taiwan, Mauritius and Sri Lanka. We have started our exports to Africa showcasing early traction in the MENA region. International customers in countries such as Sri Lanka, Vietnam, Thailand and Bolivia are interested in our patented products and they are interested in going ahead with the registration of these specialized products. Also, we see significant amount of interest in our own nano urea formulation. This year we were granted an international patent in the OAPA Group of Nations for one time.
Additionally, collaborations will play a key part in our international expansion this year. As we had already previously stated, we had signed the MOU which Shanghai Eton Chemicals Co. Ltd. Based out of China and this was aimed at exposing joint registration opportunities, potential partnership and an exchange of technical know how. I’m pleased to give an update that early work on intermediate collaboration is in progress for the technical manufacturing. Likewise, our R and D is a fully backwards Technical manufacturing is progressing well with pilot production of newer chemistry, these herbicides and fungicides. Based on the good progress in the technical manufacturing and R and D efforts.
We are now going ahead with our. 90 crore brownfield expansion at the Gajoola plant. This primarily will lead to us having three Functionally separate blocks for the production of insecticides, fungicides and herbicides. After the success of our fully backward manufacturing of Diokanthon, the plant is now on plan to develop a fully backward process for the manufacturing of high value herbicides. The cup of which, as Mr. Vimalu. Already mentioned, will be talked on the ground. Meanwhile, while we focus on our India operations in the short term, we believe overseas market is an important lever for us in the medium to long term. Specialty formulations, newer chemistry based fungicides and herbicides will be our product for the four piece market. Thank you again once again for your attention and we all look forward to addressing your questions. I now hand over to the event moderators.
Questions and Answers:
operator
Thank you ladies and gentlemen. We will now begin the question and answer session. Anyone who wishes to ask a question may press three star and one on their touchstone telephone. If you wish to remove yourself from the question queue, you may press star and 2. Participants are requested to use their handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question comes from the line of Hemant, an investor. Please go ahead.
Unidentified Participant
Hi sir, good afternoon. My first question is regarding this patent which we received for Ronson in Africa. So what kind of revenue we are expecting in FY26 for this product?
Vimal Kumar
Yes, while we have got the patent for Ron Sen in Africa, I would like to advise that this will take a time for registration. As you know there are two types of registrations. One is equivalent of what is called as a me too registration and another is what is called as a newer chemistry registration or a newer formulation registration. Patented products and formulations like Swan Pen fall into the category of newer chemistry and which have a longer duration of time frame for regulatory approvals. Hence this will take at least a couple of years before we see the revenue stream from product like content in Africa.
Unidentified Participant
Okay, and regarding the sales return that we had in FY24 and 25 number is too big. So what kind of policies we have this year so that we can decrease those sales returns?
Vikas Jain
So we have made a couple of changes. So as you know that we have grown pretty fast in the last two years and increased our brand sales tremendously. So whatever we have understood in these three years we have changing a little bit of policies. For example there close to 5060 specialty products where we had based on whatever seasonal condition in last week years might have taken little higher sales return. But this year we have put certain restrictions that we are not going to take more than 5% and accordingly have planned our numbers with the sales team to say that, okay, the demand planning would be much better so that our sales return will be much lower.
So this is one. And secondly, few of the key products also we have put under cash sales which were having certain issues with respect to undercutting the market in the market. This also will help in reducing the sales return. So these policies we have done for the current year.
Unidentified Participant
Okay, are you planning for any additional incentives for dealers to reduce these numbers?
Vikas Jain
It doesn’t depend upon the incentives to dealers. So rather it will depend upon the work which we put along with the farmer. So we have close to a huge number of field staff or the demand generation executive, what we call. So their primary task is to go and educate the farmers. And once the farmer is educated and there is a demand which is created, the sales team will accordingly do the sales. So this combined effort will help in much reduced sales return.
Unidentified Participant
Okay. One number was surprising to me when I saw today’s presentation. The patented revenue for this year is only 357 crores. So is that number correct?
Vikas Jain
Yes. So our patented products is close to that number. Correct.
Unidentified Participant
If I am not wrong, we were expecting around 300 crores of revenues from Ronson itself. Then why this kind of less revenue is set up? Patient products.
Vikas Jain
So Ronson, as I mentioned in the previous year there is certain pockets. One is with the cotton acreage itself had went down by 30 to 40%. So there was a huge reduction in the cotton acreages in the last year. That was the main reason because of which the sales were lesser as compared to what we thought. But this year we see that the acreages are increasing compared to last year. So we are hopeful that this year we should be coming back to much higher numbers for the gated production.
Unidentified Participant
One last question from my side. In Q1 and Q2 last year we had cost inventory. Is that fully completed now?
Vikas Jain
So last year when we started, there was a big issue with the China dumping in India market and there were many products where the cost had gone down by 30 to 40%. But this year when we begin, there are hardly any such dumping. What we see, there might be some model action here and there, not talking.
Unidentified Participant
About that dumping in the Q1 and Q2 last year we had high cost inventory in our books which was sent to the dealers. But few sales returns were there, right in Q3 and Q4. So did we get those high costume inventories back to our books? That’s the question.
Vikas Jain
Okay, so whatever returns we had. So mostly it is from the patented product. And those patented products was always at our lowest cost. Only we didn’t had the correction was mostly from the specialty of the generic products where the price had corrected. So we don’t face that problem because mostly the returns were from the patented product and it is not at high cost.
Unidentified Participant
Okay, and what kind of numbers we are looking for.
Vikas Jain
So we are not giving any prediction with respect to what percentage increase we want. Rather our main focus this year would be with respect to the profitability improving the gross margins and reducing our cost and improving our cash flow. So the concentration is more on the bottom line.
Unidentified Participant
Okay, thank you so much.
operator
Thank you. Ladies and gentlemen. If you wish to ask a question please press star and 1. The next question comes from the line of Vansh an investor. Please go ahead.
Unidentified Participant
Yeah, thank you for the opportunity. So my question is on the what sort of revenue contribution do we expect from our additional launches? The new 2 production plus the C2CO patent target that we have. What sort of additional contribution and profit you know, do we you know see in future.
Vimal Kumar
Yes, Mr. Bunch, thank you for the question. In fact which we are launching this year more three product product which is our patent. Any product which we start in a first year revenue didn’t come like in three digit. It will come to only. But we are trying and our target is to achieve with this three product. Hello. Yeah.
Unidentified Participant
Please please continue.
Vimal Kumar
Yeah, yeah, yeah. So this three product will give us near about 150 crore additional revenue for first year that we are expecting. But in general any product like we launched first year our product own pen was also like less than 50 crore. Then next year it was 100 crore. This year you can send here about 150 crore. So each year it grows according to the market potential. But these three products are can be very big product for next three years. After three year. But right now only we can say this year we are expecting for three combined product 150 crore for the revenue.
Unidentified Participant
Yeah. Thank you. That’s it for my. Thank you.
Vimal Kumar
Thank you. Thank you.
operator
Thank you. The next question comes from the line of Saket Kapoor from Kapoor and company. Please go ahead.
Saket Kapoor
Namaskar Vimalji, Mikaji Kaitar and thank you for hosting the call and the question and everything else with the input. Firstly if we take the Q on Q performance we see in the P and L line item the other expenses line item showing a significant decrease. So if you could just give what kind of comparison should we draw? Q on Q basis because the revenue has been flat. But December vertex, March quarter I’m just alluding to the consolidated financial results. So first if you could just explain to us how comparable are these numbers.
Vikas Jain
So you’re. You’re talking about Q1, Q2 or Q3 and Q4 Q3, Q4, Q3, Q4. Right. So Q3, Q4 even though revenue is flat, so other expenses, the majority number which is included is the marketing expenses. I mean that marketing expenses also their major expenses is because of the demand generation executive, the off road employees. Now what happens is since it’s a seasonal business, so there is higher demand of these executives during the season. And based on this requirements, these people are reduced as and when the season is not there. So the majority expenses goes higher and lower based on that.
And since January is the most lean season, the number of employees for the executive will be much lesser. And also as we mentioned that based on whatever learnings we had, we are trying to restructure our regions and the areas. So we had restructured various reasons wherein which based on our expectations were not performing. So we had merged those reasons and reduced our headcount as well. So that is the reason you see much lower other expenses in Q4 as compared to Q3.
Saket Kapoor
But when we take this number for a year as a whole, although our top line has remained flat or reduced, but this line item has moved up significantly from 151 crore to 224 crore. So with the type of cost optimization you have spoken, what should we look into this going ahead? If you could just throw some light. And also one point was about the Forex impact. Also how have forex impacted BPML for this quarter and year as a whole? If you could just outline these two sectors.
Vikas Jain
So for this coming to the increase in other expenses compared to last year. So as we mentioned that because we had launched four patented products, so there is obviously initial higher marketing costs and the branding expenses because you need to launch these products across India. And that was the reason that our cost was higher. Also we were setting base in various regions which were not present earlier. And we had hired a lot of people last year. This was also one of the reason that our expenses was higher. With respect to Forex. Yes, because of volatility.
Between from November till just about February there was a lot of volatility in forex and we had incurred for almost about 10 to 12 crores per annum. Which also is included in other expenses.
Saket Kapoor
Right. When investors look at companies or sectors, there are factors which we investors also need to understand wherein we can model out how the working of the sector and the company in specific will be. So taking into account the type of lumpiness in the numbers, the nature aggregate of the industry, where we operate and if you refer to the previous calls, also we have fallen short of in various aspects for whatever good or bad reason, what should exactly investors be looking forward for from the management in terms of the operational and financial performance for the current year? If you would have definitely budgeted and worked out which is achievable, taking into account the exigencies of the businesses.
Vikas Jain
Yes, so there are few points. One is with respect to the projections and our actual result. So one is because we have put ourselves a very high expectation that we want to grow pretty fast and obviously we are on that course. There might be chances that okay, we might miss the number because our number or the position itself are very high. So many companies which would have taken close to 5, 7 years to achieve similar kind of numbers, we are trying to achieve those in two to three years. So now that we have found that base in last 23 years wherein we are able to put our brands and we are able to put the entire setup, we are confident that going forward our numbers would be as a year on year or quarter on quarter will be much better.
So last two years, obviously as you would have seen, our branded business has grown from almost 400 crores to 1000 crores. So you might see certain ecuads where our projections are pretty high and there might be some shortage here and there. But with respect to agribusiness, again few points is the whole USP for us is we are launching with various patented products. So as and when the company grows and if you are only stuck with only specialty or generic products, then it becomes difficult to grow in this business. But since we are growing, since we are launching various patented products, we are actually capturing market share of various MNCs.
So this will help us grow and also to avoid this seasonal factor. Because once you have more patented products, the acceptability of the brand by the farmers, once it is established, it becomes easier to grow for next year. Which is not the case with generic cotton specialty products. So yes, we are in the seasonal business. But the answer to is that the patented products is our main strategy wherein we want to grow pretty fast and also not to deviate from these, not to have issues with the seasonal conditions.
Saket Kapoor
A small point and then I’ll join the queue. Sir, we are already 2 3rd into the first quarter of the current financial year. And also we have seen that monsoon’s advent has been a week or 10 days earlier when it hit the show for Keral and the southern region. To taking these factors into the premises, are we in line with what we have anticipated for the Q1 at least in terms of what we have planned? Are things in the right direction? Or here also there we are. How are we positioned in terms of. Since we are almost done two thirds of the quarter.
Vikas Jain
See, this is the time May, or rather I said end of May, is the time where the big flow of placements and sales will start. So yes, we are geared up and almost the entire factory is working full time. The warehouses have been sent all the materials. And the good part is that the season is good. So once the season is good, so you can assume that the sales also will happen. So there is no specific number which we can give because as you mentioned that we have done some changes to our policies wherein we don’t want to come to a situation where we push too much and then take that later on.
So there might be a situation wherein okay, we are selling. But suppose some sales which we are supposed to do in June might come in July or based on seasonal condition might happen in June as well. So we are tracking it on daily basis. And since the season is good, rest assured that the numbers also will be good.
Saket Kapoor
Right sir. And sir, can I take one more question about the finance cost that has also moved up for this financial year. On a confirmed basis it is up to 107 crore from 82 crore as of now. The what is I think to be what would be our net debt and the cost of fund. I think it is only the working capital requirement that we have that is in foreign currency.
Vikas Jain
So last two years because of various reasons, especially the seasonal conditions, we have been having pretty high working capital, especially the inventory. But as you saw that just about the March. In the March end our inventories were lower by 185 crores and even our borrowings were lower. So the present borrowings, what you see will mostly remain the lower number what you see will mostly remain because we will need that for our growth. So our loan borrowings have gone down by more than 100 crores. So the present borrowing will remain for this year and accordingly the finance cost also will go down.
Saket Kapoor
Sorry sir, I mentioned the number.
Vikas Jain
Just to add our cost of capital is between 9.5 to 10%.
Saket Kapoor
Okay sir, I. I have mistaken in mentioning the finance cost at 170. It is 66 crore. So it is. It is similar to that last year level. It was the employee cost. I think so I just mistaken. Remember this will remain flat only because quarterly run rate is 17 crore.
Vikas Jain
Yes.
Saket Kapoor
Correct. And lastly about the brownfield expansion and the money which we have put in 90 crores was mentioning about it. So what are we. What what will be achieving through this 90 crore investment in terms of the top line and if you could just elude this brownfield expansion and what is the cut effects that we have outlined for the current year.
Vikas Jain
So the overall project cost is 90 crores and this will mostly start within a month or so and it will take close to one year or so to complete. So the effective generation or revenue or on the profit will start only from 2627.
operator
I would request you to please join back the queue.
Saket Kapoor
Yeah, yeah. That is answering. Okay.
Vikas Jain
Yeah. So with respect to top line what I can mention is the products, what we are planning to manufacture. This will the revenue and the EBITDA will be much higher than the average what we have presently. So this obviously will be increasing our EBITDA percentage overall.
Saket Kapoor
I’ll join the team for the following.
operator
Thank you. Ladies and gentlemen. In the interest of time and fairness to others we request you to restrict to two questions per participant and rejoin the question queue. The next question comes from the line of Sanjay and investor. Please go ahead. Please go ahead.
Unidentified Participant
Yeah yeah. First of all congratulations on a good operational number as compared to last Q4. The numbers have been updated. My question is about in Q4 what were the contribution from the export revenue and how are we seeing export doing in Q1 and Q2 of this FY23s?
Vikas Jain
Yes please. So I am happy to say that we started our exports. Currently we have had a few smaller orders. So the range of exports currently the. Order value that we are seeing is. In the range of around 250,000 USD. We have completed two consignments. We are expecting another consignment in the. Order range of around 150,000 USD. These are initial and starting steps. Over a period of time we will. Obviously see a good amount of product. Traction based on the fact that the quality of the products that we have sent has been accepted and been appreciated. There will be a larger amount of exports which will kick in when this. When we are able to send across more of our specialized products product and for that work for that. In terms of getting the registration is the ongoing process which we had mentioned that over a range of countries the registration work for our specialized product is.
What we are looking for. I might take a special mention of a couple of countries where we have seen a good Amount of attraction. The first is Vietnam and the second is Sri Lanka. In both these countries. Our partners have. Shown significant amount of interest in registering our patented formulation to be able to take across in these countries. And they are willing to be able to fund the completion registration process itself which if I may say so is significant when these are not of the me too variety. That said, when it comes to the actual number and what we sort of expect in this year and in the next year that will slowly grow over a period of time while we take the low hanging fruits of using the existing registration for export, the higher value registration of the patent end in specialty products will kick in over a period of time.
Unidentified Participant
Okay, and this time I think you. Are not planning to give any guidance. That’s what I’m hearing from you at all. The constraint now almost two months are over and the monsoon started early. Are you seeing that Q1 and Q2 is going to be better than last financial year’s Q1 and Q2?
Vimal Kumar
Yes, Q1 and Q2 based on seasonal conditions we see as of now looks to be good. And as you mentioned based on whatever we have had in our previous year we are concentrating more with respect to quality sales especially with respect to our patented products to avoid sales returns and to reduce our cost. So yes team is geared up and already all the infrastructure with respect to inventory and warehouses and the sales which are already started happening. So we see a good Q1, Q2 numbers. Yeah.
Unidentified Participant
And the last question is about. We have launched shutdown recently. Was any PR done or it was just launched and that’s pr. Whether any PR was there and new products we are going to launch. Are we going to launch any products in Q1 and Q2 or it will be in Q3 and Q4.
Vimal Kumar
So as we speak sort down must be sold from our warehouses as of now too. So shutdown is one arbitrage which was which we were not having in our portfolio and it was a pretty big market. So shutdown is being presently sold from our warehouses and other two products. Bestman will also come by Q2 and we take a little more time possibly in Q3 or Q4.
Unidentified Participant
All right, thank you very much and all the rest for the FY26. I’ll be back in the queue.
Vimal Kumar
Thank you.
operator
Thank you. The next question comes from the line of ankur Agarwal from RC Business House Private Limited. Please go ahead.
Ankur Agarwal
Morning sir. In 2223 we we are from 18% margin in our balance sheet and today we are on 11%. This is any possibility this year 25 26. Can we go to 18%?
Vikas Jain
Are you talking about EBITDA margin?
Ankur Agarwal
Yeah, yeah, yeah.
Vikas Jain
So as I’ve been clearly saying that Our target for 2526 is to improve the profitability. So you will certainly see a drastic improvement in our EBITDA percentages this year. So the. The key would be the profitability to improve our profitability this year.
Ankur Agarwal
better than 15%.
Vikas Jain
I do not want to give any specific number but yes some gap, some.
Ankur Agarwal
in the range of 15 18% or maybe 11 12%.
Vikas Jain
In that range of 15 to 18%.
Ankur Agarwal
And the volume increase top end will be somewhere 20% improvement. Growth in top line.
Vikas Jain
Top line. Clearly we are not giving any numbers to say what we would want to achieve because we have done certain changes so we would want to see how it happened this year. So we are pretty hopeful to say that we should not be having much sales return. So and also based on the new products which we are launching less the biostimulants we should see growth in our business this year.
Ankur Agarwal
Main focus in bottom line to improve the bottom line. Thank you.
operator
Thank you. The next question comes from the line of Saket Kapoor from Kapoor and company. Please go ahead.
Saket Kapoor
Yes sir. Thank you sir. 90 crore which you have mentioned about the capex we have last year in the plant machinery we had spent 21 crore and the previous year was 45 crore and our property, plant and equipment is closing balance is 177 crores. So can you give where this 90 crore figure has been subsumed how much have been spent and when will the entire amount be spent?
Vikas Jain
So we have just about spend close to 7 to 10 crores. This will be extension in our existing plant in Gajrola which is in up so we have a technical plant there. So these 34 products the setup which we are going to do so the base of 7 to 10 crores is just an initial expense which we have recently spent. The actual full fledged will start only from I can say in the month of June possibly mid of June or end of June. So we have not full fledged started it Full fledged we got it. We got the sanction from the. From a financing company and starting June.
Saket Kapoor
So how much will be spending for this year on this 90 crore project wherein you have spent seven.
Vikas Jain
So if I go by the target mostly we should be closing this completion by March or April so it will take between 10 to 12 months.
Saket Kapoor
Okay. And when we look at the this line item of right of used assets these are any Turning toning services that we do or what does this amount signify? A closing balance of 66 crore.
Vikas Jain
So sorry I missed your question but.
Saket Kapoor
In the non current asset we see closing balance of right of used assets. So are there any trolling activities that we do? What, what is the significance of this amount lying in the non current assets?
Vikas Jain
So these are mostly during the acquisition what we had done for various entities last year in March 24and before. So those have come along with those acquisitions.
Saket Kapoor
And lastly sir, can you for investors and what should be we look at the peer comparison. So in the phase where we operate where we compete with other midstrech players who are our key competitors, wherein a like to like comparison in terms of product profile can be made through. And also in terms of the raw material basket, how what kind of integration do we have backward integration currently or are we in the process going ahead and how are the raw material prices currently shipping and the key ingredient for that.
Vimal Kumar
So I’ll answer the first question. So with respect to the kind of portfolio we have, most of it we are gaining our market share from the MNC because those are the players who were having specialized products and a market was there. So we are getting from there. This would include various MNCs plus if you see various Indian companies almost it’s not that one to one comparison of just one or two companies because each state there are different crops and within the different crops there are different companies who are selling higher or lower. So we compete in each state differently with different companies.
So almost if you take all the listed peers there are competitors in one or the other way in one of the other states. So that’s the peer comparison for second question.
N. Surendra Sai
Yes, your second point was if I’m right was regarding the cost of raw materials and its impact on us. So if I may say so, one of the key raw material providers was China and it continues to be China in terms of the intermediate. Now over the period what we had seen was we had seen a significant amount of crash in the prices of both the technicals as well as the intermediate this year. I would say somewhere between Q4 till now what we are seeing is we have seen prices stabilizing at least on the upward trend, but we do not see much of a crash continuing which we had seen previously.
Now that said, what we have been doing over the past couple of years. Has been to try and reduce our. Dependence on the China intermediate market. And this is an ongoing process. And when we had talked about a fully backward integrated technical manufacturing which Mr. Vimaji and I had mentioned previously we are 100% using raw materials and intermediates. Which are based out of India. So certain processes we will try to be able to see how much we can be completely independent of intermediate market from abroad that we. At this particular point of time what. We will be doing is we will. Be working on producing these technical primarily. To be able to drive our brand. Business in terms of the patented and specialty products. But over a period of time technical manufacturing unit will be able to produce more amount of technical for global market which is essentially aligned with our complete strategy of specialized materials for India market as well as for global overseas market.
Saket Kapoor
What is the percentage of integration.
operator
Queue? Thank you. The next question comes from the line of Abhijit Mitra from Ioneos Alpha Investment Management. Please go ahead.
Abhijit Mitra
Thanks for taking my question. My question is more on the cash flows. If I see post September, that is. In the second half it’s almost a. 400 crore release in receivables and 100 crore release of inventory. So just you know, wanted to understand that what kind of measures you have taken to see this kind of significant reason cash flows in second half and how much of that would sort of you feel can carry over, you know, how many of those measures can you carry over in the next year as well? So just your thoughts on them.
Vikas Jain
Hi Adijit. Since I think beginning of the year we had been discussing that we were beginning was at pretty stress level especially the inventory also was at highest level and including the receivables. So as the year went by we had improved on and we had clearly given the guidance that we the working capital will improve going forward. And that’s what you saw that throughout the year almost we had more than improvement cash flow by 200 crores compared to last year. Even presently what you see still we feel there’s a lot of scope, a good 20% or so reduction.
What we feel should happen throughout this year this will absorb the cash flow further for this year as well. With respect to receivables, yes, there might. Be certain times where we are little higher or lower business based on the condition there might be certain receivables which might take time to recover also. But it is pretty clear that with respect to inventory from this present number also you will see a lot of improvement going forward and the new policies which you are bringing for this year will certainly help.
Abhijit Mitra
Got it, got it. And you know, just to confirm or sort of, you know, few questions, what was the final, you know, sales return number for the full Year. And what was the discount and reverse number for the full year if you have those handy.
Vikas Jain
Overall the sales return for this year was anywhere between 17 to 18%. And with respect to discounts and all generally for this industry is between 12 to 14%. So that remains to us.
Abhijit Mitra
Understood. Understood. Great. And we can see a substantial reduction in this percentage of at least the returns over next year, right? In terms of.
Vikas Jain
Yes, we are going to have a substantial reduction.
Abhijit Mitra
Okay. Okay. Any percentage that you have thought of. So 70 and a half can go down to say 10% or you know, 5%. Any numbers that you’re sort of.
Vikas Jain
We don’t know how the market will pursue and what will happen, what might happen. But we feel that the election should come because election should happen. That the goal of the company that we want to come to a place where our returns are much lesser because it creates a lot of issues with respect to inventory, with cash flow. So reduction will happen. Now what percentage what we are we have to see this year.
Abhijit Mitra
Got it. Got it. Understood and appreciate. Thanks a lot and wish you all the best.
Vikas Jain
Thank you.
operator
Thank you. We take the last question from the line of Sanjay, an investor. Please go ahead.
Unidentified Participant
Last I think December Q3 there were convertible warrants were issued about 31 lakhs 75,000. And it was mentioned in the last release that about 25% the warrant money was not listed due to some technical issues. So if the money received completely and what is we are seeing that remaining 75% of the payment will happen in which finance we are considering the market condition and drastic reduction in the sale price.
Vimal Kumar
Yeah. So we had got a. We have got commitment for 150 crores for the overall QIP and the 25% of which interest growth we received it fully. But there was some technical issue at that time from one or two of the investors which we got after a week or so. So we got 25%. Now as you rightly mentioned there is certain challenges in the market wherein we cannot go and take the balance 75%. But as and when we feel there’s improvement in the market we’ll certainly go back to our investors to take the balance 75% as well.
Okay. We are hopeful of closing this and getting the money raised.
Vikas Jain
Yeah. We should be open to raise it this year.
Unidentified Participant
All right. Thank you very much. All the best.
operator
Thank you ladies and gentlemen. With that we conclude the question and answer session. I now hand the conference over to Mr. Surendra Sai for his closing comments.
N. Surendra Sai
Thank you. Thank you very much for the questions. And we hope that we were able. To address the questions in completeness. Feel free to be able to reach out to us on our investor relationship channel for any follow up and for the questions we will always be Open. To this. Q4 may be called as a cusp as we continue to focus on financial, brand and sales discipline. Work on profitability, cash flows, inventory and returns is what our direction will be for Q1, Q2, Q3 and Q4 of. This year.
If I say so. Today we are very positive on FY2526 as we are affirmative on our disciplined approach and yet we will continue to have an aggressive R and D and a product approach. Our products we believe are still valued by our customers and we see a certain strength in the brand. Best. I will conclude that our commitment to our stakeholders is our primary goal and we look forward to a very positive 2526 thank you very much. With this we conclude.
operator
Thank you on behalf of Best AgriLife Limited that concludes this conference. Thank you for joining us and you may now disconnect your lines.