Insecticides (India) Limited (NSE: INSECTICID) Q3 2026 Earnings Call dated Jan. 30, 2026
Corporate Participants:
Rajesh Kumar Aggarwal — Managing Director
Sandeep Kumar Aggarwal — Chief Financial Officer
Sandeep Aggarwal — CFO
Analysts:
Unidentified Participant
Sejal Bhattar — Analyst
Shubham Jain — Analyst
Bharat Gupta — Analyst
Kunal Tokas — Analyst
Rajat Setiya — Analyst
Presentation:
operator
Ladies and gentlemen, good day and welcome to Insecticides India Limited Q3FY26 earnings conference call hosted by MUFG Engine. As a reminder, all participant lines will be 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 an operator by pressing star 100 on your touchstone phone. Please note that this call is being recorded. I now hand the conference over to Ms. Sejan from MEFG. Thank you. And over to you ma’. Am.
Sejal Bhattar — Analyst
Thank you. Welcome to Q3 and 9 months FY26 on Fall of Insecticides India Ltd. Today on this call we have with us Mr. Rajesh Kumar Agrawal Managing Director Mr. Sandeep Agrawal, Chief Financial Officer Mr. Devendra Kumar Ray, Chief Operating Officer and Mr. Dushyant Sood, Chief Marketing Officer. Before we proceed the call, I would like to give a small disclaimer that this conference may contain certain forward looking statements which are based on beliefs, opinions and expectations of the company as of date. These statements are not guarantee of future performance and involve risk and uncertainty which are difficult to predict.
A detailed disclaimer has been given in the company’s investor presentation which is uploaded on Chalk Exchange. Now I would like to hand over the conference to the management for the opening remarks. Over to you sir.
Rajesh Kumar Aggarwal — Managing Director
Thank you. This is Jayesh Agarwal MD of the company. Good evening everyone. Thank you for joining us for the Q3 earning call of Insecticides India Limited Q3 paid out in challenging operating environment. The quarter was marked by weak farmer activities, cautious channel behavior and weather issues along with no incidents of pest. Despite these handwritten, I demonstrated resilience delivering 8% growth driven by proactive market engagement and strategic business decisions.
Let ME briefly summarize Q3 performance of IIL demand conditions remained subdued and recovery being uneven across region and crops. Growth during the quarter was volume led rather than revenue led in Q3. Largely growth came from B2B segment which helped sustain growth momentum. B2C demand remained muted due to broader industry challenges. Now I would like to comment on margins and profitability. From a profitability standpoint, gross margins moderated due to number one higher B2B share. Number two pricing power remained limited in comparison with the higher base of last year having 36% gross profit. Next, EBITDA and PAT reflected the mixed impact of Q3 with higher finance and depreciation cost.
Here the very important lines I would like to say we maintain strict cost controls, capital discipline and working capital management liquidity remains comfortable and balance sheet strength continues to be a key focus area. I would also like to discuss about the new products and the brand momentum. A key positive in this quarter was the strong traction from new project launches. Sparkle, a broad spectrum insecticide for brown plant, hopper control and rice was successfully launched developed using advanced chemistry from Proteva, strong pharma acceptance supported by ielts, distribution strength and brand credibility. Other recent launches like Centran Million also witnessed encouraging pharma response and are building momentum.
Established brands like Tori Tori Super Explore have entered the next phase of Berlin expansion. During the first nine months, company launched five new products, significantly strengthening the portfolio. The adoption of new edge technologies reflect the strength of our network, field execution and farmer current about the International Business Update International markets showed early signs of recovery, though momentum remains gradual. We expect exports to stabilize first before contributing meaningfully to margins, which is more likely beyond the immediate quarters coming to Q4. We expect Q4 to remain like Q3 with continued impact on margins on a higher base of last year.
Key factors which impact the Q4 include continued wheat farmer sentiment, high dependence on genics given demand, sustained pricing pressure, higher resilience on high reliance on B2B sales to achieve top line objectives. Given these conditions, gross margins are expected to remain under pressure and maintaining 35% level in H2 will be difficult. Clear vision of Q4 to protect top line market share so we have a strategy actions action points so we have to we have selective aggression not blanket discounting focus sales push on identified geographies, crops and accounts with faster conversion avoiding margin destructive broad based discounts B2V with margin guardrails scale B2B volumes only where contribution margins are positive with strict pricing floors and order wise profitability tracking.
Product mix sharing as a field actively push relatively higher margin SKUs particularly the Maharatnas and the focus Maharatnas within the generic basket supported by micro incentive and weekly mix renews. We’ll also work on inventory and working capital tight controls. Q4 is about control, defense preparation and not short term optimism. Priority remains in preserving long term competitiveness medium term outlook end of Y27G while near term margins are under pressure, we want to clearly start straight. This is not a structural margin erosion. The current phase is driven by market conditions, product mix tactical business decisions. We expect profitability improvement over coming period supported by improved market sentiment, push towards specialty and branded products, operating leverage, benefits of investment made in brands, teams and systems, technological shift and market control measures undertaken by IL in form of the apps like IELTS Parivar, i360 I would like to share the takeaways again.
IL has given a resilient performance despite industry stress delivered 8% growth in Q3 and 5% growth in 9 months despite erratic rainfall and a muted spring season reflecting strong execution discipline. Demand recovery is gradually emerging while near term demand remains selective, stabilizing raw metal prices and inventory levels Improve visibility for a gradual recovery Clear growth revival roadmap is there targeting a return of 8 to 10% sustainable growth over next two to three years portfolio and the capacity alignment for growth portfolio Gap filling across technicals and formulations supported by capacity expansion at Dahed and Sultanalla so Dahed is expected to be operational by end of this fiscal and Sultanalla formulation activities also will be started in next three and I don’t think we are going to move in headlines Shift towards higher quality growth Increasing focus on our Maharatna criminalization of technology led products supported by strategic global collaborations including Corteva.
So we can expect the new launches coming during the coming season and in the past fiscal or the current fiscal year launched about five products and then again there is a visibility of launching another five products in the coming curry season. So the new launches which were there in the past season particularly Sparkle, Sentra and Million they have all done very well and as I told you Tori Tori Super a lot of products they are going in the next level or next phase of scale up exports are gaining traction in 180 plus registrations across 22 countries that position the company for well sustained export led growth.
The FTA agreements with Government of India signing particularly the one signed with EU is also going to support in a better way for the B2C segment deepening PharmaConnect and brand equity strong on ground engagement through ICS plots with the factor bank strengthening via innovation led differentiated marketing. So I would like to highlight this number one to market our products as Tractor Vent pesticide and Tractor Vent enjoys a very good position in the market with Visa vis the top leading brands and ICS plots. What is ICS plot? I have explained in the past also the integrated crop solutions it has attained a very good success because here we are demonstrating to the farmers the ROI on the investments we make with the IELTS solutions that is that how much investment we are making visa competition and what is the yield and ultimately how much they are earning more than the competition or than what they are following their own practice.
So this is giving very good image to the company and the plan is to at least double whatever investment we are making in this ICOs plot and we are going to do it in a big way for future and I believe this is going to help us in brand building in various crops and providing the complete solution for various crops across the country. So the next important point is disciplined capital allocation. Capex focused on capacity creation and maintenance along with medium term growth priorities will be the target and of course we will improve the capital efficiency and the organization readiness rose and roe up to 6 to 7% over three years is already visible as talent induction and organization spent underway to support the next growth phase.
The new formulation and technical plant in full action at the hit side is going to help us to improve our performance in so before I give it to the CFO for the results discussion, I would also like to give the concluding remarks about Q3 and Q4. Q3 and Q4 are about resilience and discipline. We have cautiously prioritized long term franchise strength over short term margin optics. I remains well positioned to emerge stronger as the cycle times with sharper portfolio, deeper market reach and stronger foundation for profitable growth. Thank you for your continued trust and now I hand over the line to the CFO to discuss the results.
Sandeep Kumar Aggarwal — Chief Financial Officer
Thank you, thank you. So good evening everyone and welcome to the conference. I am pleased to represent the company’s to present the company’s performance for the nine months amid Azer 26 as compared to other 25. Revenue from operation during the period has increased from 1641. Reflecting a growth of around 4%. Gross profit has improved from 509 crore to its size of etc showing a healthy growth of around 7% EBITDA to the 201 crore in every 26 nine months and packs to the 128 crores in nine months above 26 with growth remains flattish in nine months ABY 26 segment performance was well balanced with B2C contributing around 76%, B2D 20% and exports 4%.
This demonstrates the status steady diversification of our revenue stream with an increasing skill towards B2C segment. Within the B2C portfolio, premium products accounted for 59% and generate product 41% in first and matchup as a 26. The premium segment has sustained its strong growth trajectory, further reinforced our portfolio strength and positioning us firmly on cash towards the strategic goal of alongside financial performance. We remain committed to sustainability and ESV initiatives. Also we are focused on optimizing resource usages, reducing our carbon footprint through energy efficient manufacturing. I am pleased to share that three of our facilities in North India are already ZLD compliant, understanding our commitment to reasonable growth and long term value creation.
Overall, 9th month above 26 demonstrate resilience with revenue and gross profit growth. Stable EBITDA and a diversified segment. While PAD was impacted by financial costs, our long term strategy remains strong supported by both expression and sustainable. Thank you. Thank you. Now we are happy to take your questions. Please.
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 answers 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 Shubham Jain from Countercyclic. Please proceed.
Shubham Jain
Hello. Am I audible?
Rajesh Kumar Aggarwal
Yes, sir.
Shubham Jain
So I have few questions. So you have launched new products in HY FY26. I think that’s Altair and Sparkle. What is the revenue contribution from these segments in Q3? And what is the guidance for the half a dozen launches planned for the remainder of 2026?
Rajesh Kumar Aggarwal
Okay, Altair and Sparkle Q3, there was some season remaining for Sparkle but not for Altair. Altair will have seen some market in Q4 and Sparkle also is going to see the market for Q4 because both are steady in that product. Altair is used in the initial stages. So now the paddy sowing in the east and southern part of the country is going to take place and Altair will be used and Sparkle is going to see its demand in the later stages.
Then BPH or ground plant overcomes after 60 to 75 days of the crop. So at that time it will be used. So somewhere in March. So I see another sale of about 10 crores coming from these two products in Q4. I don’t have the exact number, but from these two products I believe hardly 2, 3 crores would have come. Okay, and the rest of launches we planned for 2020. What could the launches are going to come in the curry season if I talk about the desktop launches. But the launches which are done in FY26, I am going to get a sale again because various crops like pulses, vegetables, sugarcane, we are going to maize targets and the wheat sales is also going to start because it was.
It has rained in the entire north India and there was a cold wave as the cold web settles in this week. So from next week the sale should start being. Exactly. And we are waiting for the right time and right.
Shubham Jain
Okay. And sir, previously we have targeted around a double digit growth through Maharatna segment, the premium month. Has the share of these products improved in Q3 to offset the volume loss from something that has been banned previously like Nuvan and Kimet. What’s the split?
Rajesh Kumar Aggarwal
I’ll appreciate your question. Nuance Cement are old stories. We have already come out of it many years back. The new product which is going to get banned is Monocyl which will. Which is the final. This is the final year for that product and that will also go that when it will go the gross sales of that product will be around 75 crores. You can say about 50 crores on that product. So that will be the additional loss which is going to hit the company. But as you know that Luhan and Tamed when they went in the final year the sale, the gross sale was roughly 200 crores. And we never got a hit out of that.
So even with mono sale or going off anything, we are not going to get the hit. Because I’ve explained it many times that when generic molecules move, this relatively new generation Bendix takes its place. And as a strategy we launched new products to take its place. So we have already planned that there are going to be 5, 6 launches in the new season and we are going to start them in the current season. And apart from that, the launches which has happened in the previous year. The previous year again is not being a very good year because I explained in the Q conference also that there was a lot of heavy goes return because of the bad weather conditions.
So generally these conditions do not get a repeat year after year. So as why 25 was that? 26 is more difficult actually. So 27 should be air of makeup and we should show the resilience performance from Q1 itself. That is my belief. And we are I would say cautiously saying that we should see the starting growth from Q1 itself with our products and their traction. So quite confident on that. But yes, the specialty product, the premium products are little slow at the moment. There will be some momentum in Q4 which will try to build up.
But at this moment the demand for gender.
Shubham Jain
Okay sir. And next question would be what’s the current status of OR for fully automatic plant? The Sotal Nala I guess I have
Rajesh Kumar Aggarwal
secondary plant is going to take some time. It will take one more year. The target is to start it in 2027, not in 26. In 26 we will start the formulation facility somewhere in the Q1 of 27.
Shubham Jain
And what would be our optimal
Rajesh Kumar Aggarwal
formulation will start in Q1 or 26 and the technical will start in 27.
Shubham Jain
Okay. And what could be our expected impact on the overheads manufacturing guy?
Rajesh Kumar Aggarwal
That will indicate actually with time, but there may be some shift of product, some changes. So at the moment I’ve not worked out the impact but I think will make up the impact because we are going to work on various new products and other things. So that should get compensated with the increased volumes which we plant is going to get. So for the formulation. But when it comes to technical, technical supports will come with the cost. So when I do technical synthesis then yes, my power bill and both my oil they are going to increase. So the consumption I can assume will be in the range of 30 to 40 crore per annum for these sites on these two accounts.
Shubham Jain
Right. Can you provide some color on this raw material situation? How much could be impacted and how are we able to
Rajesh Kumar Aggarwal
more or less stable. So there was a decline which was taking place till December. January has started showing some increase. But again you cannot comment because what is happening is Chinese New Year is coming. So before the New Year they have their own style of. So international situation is also disturbed and the currency is also in very poor shape. So overall there will be a little increase but that will be marginal. But more or less I would say that the market is stabilized at the moment.
Shubham Jain
Right. Sir, I’ll join the queue. Again, thank you for the response.
operator
Thank you. Before we take the next question, we would like to remind participants to ask a question. You may press stars and 1. The next question is from the line of Bharat Gupta from Fair Value Capital. Please proceed.
Bharat Gupta
Hi, good evening. Rajeshi and Sandeep Ji. I hope I am audible.
Rajesh Kumar Aggarwal
Yes, yes, you are audible. Good evening.
Bharat Gupta
Yeah. Sir, a couple of questions. So can you just quantify like what would be the impact because of the pricing drop across our B2C and B2B categories and how much volumes we have been able to grow in the quantitative terms across both the segments.
Rajesh Kumar Aggarwal
We’ll give you the exact number but as I told that the growth has been the volume that growth. So in the B2B2B segment in particular it will be about 15% of B2B and in the B2C segment it might be about 4 or 5%, 3 to 4% growth. So yes, it is more limited in this quarter.
Bharat Gupta
And say what would be the impact of the pricing in this model.
Rajesh Kumar Aggarwal
Pricing since this is a low season actually so the pricing is not impacted much. But when the discounting prices started it starts in Q4. So Q4 will have some initial offer for discount because like it’s a Cyclic business. So here you have to show the advanced schemes and offer some preseason discounts and then the season is going to start in the month of May. So these three months during March and April you have to pass on some benefits to the market and since the cost of currency is going up and some expectation in the price rise and some other things.
So I would say generally 5 to 6% is the type of discount which is considered during this quarter. So let’s see where the markets bend as the market as the demand starts. So I believe that somewhere around 5 to 6% discount only will come, not more than that because at the other point the cost has also gone up by about 2% or 3%. So broadly this will be the market situation expected.
Bharat Gupta
Sir, I hope there won’t be sales event which we have witnessed during this quarter.
Rajesh Kumar Aggarwal
It has already happened so now it’s nothing major, it’s all my math.
Bharat Gupta
How much of the sales return would have come in in this portal.
Rajesh Kumar Aggarwal
This quarter Number I’ll just give you. Which we have received.
Bharat Gupta
Hello.
Rajesh Kumar Aggarwal
Yeah. Yeah. 50 crores is the number what we have received in this quarter making the total good return to roughly around 200 crores.
Bharat Gupta
So is it in line with the industry or RC trend would have been higher than what the industry levels would have been.
Rajesh Kumar Aggarwal
Should be in line with the industry. But for I standard it will be our highest good return which we have received in a single year. So it has increased over two years. It has doubled from last year. It has gone up by about 40%, 30 to 40% I believe. So it’s the very high good return what we have received from ILS tender.
Bharat Gupta
So primarily it is just because of the higher inventory out there in the Tutsamshel by the competitors. So primarily we are taking the heat because of this competitive identity.
Rajesh Kumar Aggarwal
It’s nothing like that. I is switching the heat. That was the market situation because we had focused a lot on herbicide. The entire herbicide market got a hit during the peak season of exposures and after that the insecticide market also got some hit. So due to where there were good data for these particular herbicides and insecticides so that we have to take that.
Bharat Gupta
And also sir, they have been talks in the industry about a higher agrochemical production which is taking place across the Chinese markets. So what’s your take on it? And primarily Chinese New Year is coming. But with your industry knowledge, how do you read the situation currently? And you mentioned that raw material situation has been stabilizing, is on a stabilization mode. So what’s Your expectation with regard to the next career season as well.
Rajesh Kumar Aggarwal
Like we have to plan the season in advance as we approach near the season because our cycle industry is cycling, the price keeps on increasing. So we have already made our buying most money by December. So by December we are. We have procured the product for next four, five months. So till so those agreements we have already signed in anticipation that the price start going up. So there will be one increase which is expected immediately after the Chinese New Year. One increase will come in the month of March when we go for the exhibition and then in April, May again there are chances of the prices going up.
So that is the normal trend. But if the market fails and there is very poor rainfall situation then only the prices remain same or they come down. So the prices are already near the bottom. So further deterioration is not expected because many of the prices are all time low. I can vouch almost two decades. So more than two decades the prices are for many products are the lowest. The chances of further decline from here is very minimal. So that’s why I’m saying the market is stabilized and already some signals of prices going up because our currency is going down.
Chinese currency has gone up so there are signals and in many products we are receiving higher cost. 3 to 5% type of increase is visible from China and the current moment. But it can be completely. It can continue for next one month or one and a half months. So we have to see.
Bharat Gupta
Right? And sir, because Kairos is something which we have been coming up with respect to procurement of raw materials primarily from Chinese market. I think so. Do you think that will synergistically play out for us in case if there is further hike and just wanted to check how Kairos has performed during this last nine months.
Rajesh Kumar Aggarwal
Cairo this is the establishing phase. So we have backed some registrations and small purchases we have started. So some transaction from China has already started and some are in process. So it’s taking some time because the registration in India also takes some time and documents coming from China take some time. So we are starting with three, four products and in these three core products I am definitely going to get the advantage. Instead of purchasing from the competition if we purchase from our own company the profit remains in house. So the rental sales during this quarter have been about nine imports.
The sale so far in nine months is roughly about 90 crores. We would have given the number in our. Okay, so three months I don’t have the number handy. It would be somewhere in the range of 15. 20 crores.
Bharat Gupta
15 for the full Year I think we were somewhere targeting 100 crore plus. So that remains on.
Rajesh Kumar Aggarwal
We’ll touch that 100 number because already 89 is up sir.
Bharat Gupta
Also with respect to the export side so I think we have been trying to set up or penetrate the Latin America as well as the Australian market. So what’s your take on it like are we price competitive and that’s why we have been able to take the market share from them. What’s the strategy out there across the. Across most of the markets overseas strategy.
Rajesh Kumar Aggarwal
Is very very simple. The strategy is registration. We register our product and we enter with the registered products into those market we are going to sign with the good customers who can afford a little higher price for the quality. So that will be division so that we don’t hit our profitability. So in Latam the business is already started in a small way and there will be some consignment which will be going during this fiscal action. And next year will be the deciding year. How much, how big the response we get. It depends on the first few consignments which goes to those markets.
Australia the registrations is not by yet we are working. We are in the final stages of the registrations. As we get the registration the business will start.
Bharat Gupta
As in terms of the overall revenue pile. So somewhere we are targeting 150 crores. I think for this fiscal year probably we are sticking to it or there is a downward revision on the numbers.
Rajesh Kumar Aggarwal
In the international business segment. We looks like we will be crossing last year but achieving 150 is not possible because so far we are plus off last year. But the game is not much
Bharat Gupta
like. With respect to Chinese players. Somewhat are pricing remains similar or like how much does the Delhi’s backward integration is likely to benefit us going forward.
Rajesh Kumar Aggarwal
Backward integration we are going to do for the specific products and not for everything. So the target of backward integration will be only for the products where we are able to compete well and the products which are well settled or where we can have the price of cost advantage. So all the investment features are based on rock and roe decisions. Wherever we get the profitability there only we will do the backward integration. Otherwise we are also seeing the opportunities to get the smaller activities outsourced where we think that making the investment is making not much business sense.
So these days we have become very very cautious and you see that in our results also falling. So cautiously work in these markets and we’ll try to improve the profitability.
Bharat Gupta
Sure sir, I will get that in the question queue for the follow up sir. Thank you so much.
operator
Thank you. Before we take the next question, we would like to remind participants to ask a question. You may press star in one. The next question is from the line of Praneet, an investor. Please proceed.
Unidentified Participant
Hi, thank you for the opportunity. So I was wondering in terms of the competitive, intensive competitiveness, was it specific to few states or was it more a broad based pan India situation?
Rajesh Kumar Aggarwal
No, it’s nothing like that. We are losing our market share. The market has come down by 2 to 3%. That is the industry estimate. In that scenario we have grown by 8%. So overall the performance of has been resilient. But yes we had to do a strong work. Like the team was ignited and they were working day and night for this performance. So little difficult market situation that has impacted so the company’s brand image it is getting good. The products, the new products which are being launched, they are getting very good image. Overall traction is good.
But this is all due to the market situation. You see the change coming in from Q1 itself.
Unidentified Participant
So we are pricing our product competitively so that we can gain more market share. Is that a fair understanding?
Rajesh Kumar Aggarwal
I didn’t say that. Because when you are working with the premium growth there is no competition. You have to price your product in your own way depending on how much you can expect from the market. So we are not to get the market share. I told that we are going to be very cautious approach where we will select the markets, we’ll select the product and we might give certain cash discounts to the parties who take those or who are better pay masters but will not pass on very big sales schemes so that the profitability remains intact.
Unidentified Participant
Understood. And in terms of the sales returns, do we expect this to be the new normal or how do you excel going forward? Because you also mentioned that the sales return is double what we had last year and much higher capital cost.
Rajesh Kumar Aggarwal
One of situation which has taken place, we are trying to rework our strategy. How we have to place the products in the market, what commitments do we need to take from the wholesalers or the distributors and how do we need to talk to our team so that they are more particular with whatever is the market situations. If somebody has taken the money, he has to own that material. So we are working out our strategy that how we have to go more stronger in the markets with the tighter credit limits at one place and also the tighter credit periods.
So we’ll try to get the investment from the network and we will be very particular that this situation don’t get repeated.
Unidentified Participant
So is There any cost associated with the returns in terms of product wastage or anything or is just the fact that we get that we get the product back.
Rajesh Kumar Aggarwal
The interest cost is the biggest loss. But yes, sometimes if the product has to be reformulated, there are certain cases where it has to be done, then it is a loss. But since the material was all new material which went to the market and came back, so I don’t see any other losses coming out the of. But yes, you have to keep it in the go down. You have to keep large go down for that. And then there is a replacement in the market. So that type of transportation loss interest.
Unidentified Participant
So the return product we got. So how long did it stay in the channel? So for how many after how many days did they return the product back to us?
Rajesh Kumar Aggarwal
It depends on the seasonal condition. If the product is used between 30 days to 60 days of a crop site, then after the crop achieves 6, 75, 90 days, the crop has to be taken back. If it remains in the market, it is of no use. So the stock reasons do not mean that it will be used after one year. There are many things which are used in next three months itself. Something will be used in four months, six months and something will also be there for certain cases. Very few which will be used after the year, particularly for the crops or the products which do not have any other option.
So such ports are on the herbicides or specialty products like cotton, like soybean, which do not have the immediate requirement, but rest of the products they see the second season. So the good return which came in the Q1, most of it will be used in Q2.
Unidentified Participant
Understood. So. And in terms of the push for generics, is it. Is it a conscious decision we took or is the fact that that’s the requirement at this point of time.
Rajesh Kumar Aggarwal
That’S a conscious decision that we wish to establish the premium business in the market. We have already crossed 60% of the premium business. When I say premium business, it is new generation generates their mixtures or the products of our partners, which are relatively new generation products. So we are working hard on it. We have achieved 60%. My vision for this year was to achieve 64 to 65%. We have not grown in this segment and that is reaching me very much because the mid term target is to achieve 70% out of the premium products. So it is the company’s cautious decision that wherever the margins are low, in whichever ske the margins are not working out, so we are slowly moving out or reducing the quantities of those products and Trying to build the brand image for the product with better contribution so that we can build up better value for the stakeholders.
Unidentified Participant
Got it. So in terms of generics you’re just cutting down the tail so you can improve the overall profitability of that particular business. So but is there a, is there an ideal proportion the management wants in terms of the premium versus non premium.
Rajesh Kumar Aggarwal
Like as we are? So when I’m saying this, I’m not reducing the value of the generation, I’m increasing the value of the. So I’m keeping the same number of generics intact and I’m reducing, increasing the value of the specialty. So the entire growth, the vision of the companies has to come from the specialty. We are working for the specialty because I believe the specialty products which are focused Maharatna and Maratna, they are the indents of the company and the followers have been following. So in some, in certain cases there might be some 5, 7, 8% increase in the genetics.
Otherwise we are in the tail cutting. So the number of products also that way we are trying to reduce so that we are in the range of about 100 plus minus products. In my list you will find 25 more products but they are ineffective. The total contribution is about 2 to 3% from this scale of complex product and they are continuously in cutting down waste.
Unidentified Participant
Understood? Got it. So and one more question is regarding the receivables and overall inventory. So how during the quarter how were our receivables? Because our finance cost was higher than last year. So could you give us some light on why exactly that’s higher?
Rajesh Kumar Aggarwal
We have been a zero debt collect company since last two years. This year, yes, we have utilized about 100, 200 crores of the bank. So that some finance cost is there which is coming. And it is also coming due to the currency change. Because the currency is increasing continuously. So we have to book the currency in advance. So booking cost is there and in certain cases we are also lost because the gain or this right has come very very fast. So these type of losses are there. But this 200 crore we have already brought down 250 crores.
And I’m quite confident that by the end of this quarter we’ll minimize that.
Unidentified Participant
Understood.
Rajesh Kumar Aggarwal
Overall in comparison to last year the sales is almost at par with the last year. The collections are also almost at par with the last.
Unidentified Participant
So basically the external finance cost was as a result of the even of booking currency before and the sales return which were not converted into cash. Is that a fair understanding?
Rajesh Kumar Aggarwal
Yeah. That increase the inventory level and we paid to our creditors. So if you find the creditors, the creditors are again very low because we have already paid them.
Unidentified Participant
Understood. And in terms of the technical side, so basically the market has not been great. So as a result, the raw material also not been. But the thing is in terms of supply, is it just because there was no sale, the supply is higher as a result, the prices are lower? Or is the fact that there’s a lot of increase in supply in technicals also in the market?
Rajesh Kumar Aggarwal
Actually, it is a matter of strategy. What we do is every year we introduce four to five new technicals and we try to push them into market. So our selection strategy is very, very simple. That wherever we can make a difference, I need to select wherever we can make extra profit by doing the backward integration, wherever, by introduction of the molecule, wherever we see that we can be China, we can be other Indian competition, then we launch that product. And wherever the prices and the profitability is changing, we drop that product. So we are very, very fast in that decision making that according every year we introduce certain AI and take it to the market.
So that gesture is very much appreciated by the industry. And there are many large partners which work with us. Because we only do the institutional business with very selective companies, hardly two dozen. And we share our products with them. And the business is continuously growing. And I think we spoke with these people because of our spend inward launches of the demand products. So that has helped in our business.
Unidentified Participant
That was great. But I was trying to understand that. I understand our strategy of technicals is wherever the opportunity lies, we will go ahead and backward integrate and get the margin. I got that part as more talking in the sense of the market. So have you seen an increase in technical capacity that has been building up in the country? Or imports increasing as a proportion or the quantity of imports increasing into the country because of lack of demand or whatnot? I was just trying to understand the overall amount of supply that exists and the amount of capacity that exists for technicals at this point of time that is impacting the price.
Rajesh Kumar Aggarwal
It is true that people are building the capacity, but again, the capacities are not officially known. And generally people build multipurpose plants. What they manufacture is not known. The import numbers also take some time to come. So I don’t have the exact data that how much will be increased, which has happened in the last fiscal or there has been an increase. So getting that data will take some time. I would say the market is more or less stable. This year the imports were low because the market sentiments were very Low initially, but some people would have done so difficult to comment on the industry in totality.
But as I told you that the industry also had a fall, expected to have a fall of about 2, 3% overall. So this is not a positive year. When the year is not positive, That much I can say.
Unidentified Participant
Understood. Got it. So, and just one more question regarding building up technical capacity. So you are. I understand that when the opportunity comes, you are making a concert, you know, to expand that particular technical capacity. How long does it take once you make a decision to build up that capacity?
Rajesh Kumar Aggarwal
It takes two to three years to build the plant. Because first you have to strategize, then you have to take the permissions. And after the permissions are received, you start with the civil work and then you start with the final placement of plants. So everything takes time. Only three years is an accepted norm in our industry.
Unidentified Participant
But let’s say we had to. I’m talking about more product range, since I understand was the first time. When you build up a technical plant, it will take time for the three years I was talking about in terms of expanding the product range, let’s say Instead of manufacturing 10 technicals for the 11th one, how long will it take you? Okay,
Rajesh Kumar Aggarwal
you have a kitchen, but in kitchen, if you have to change the utensils, so then it takes time if you have to. So same as with the case with the plant. So do you need more utilities, differential facility? Do you need to change the pipelines, something? It depends. Sometimes we are able to adjust the product in the same plant, what we have in the same lines. Sometimes it don’t get adjusted. Sometimes we have to break two products and make one product pipeline. So it depends. So sometimes we go as fast as converting one new product in one month itself.
Because the RD has already scaled up the product and they are made in the pilot, the piloting is complete, it makes it get easier. Sometimes it takes two to three months and sometimes even more it can take.
Unidentified Participant
Understood. Got it. And in terms of the pricing of the technicals as well as the imports, lowest priced imports, let’s say China, what will be the difference in terms of cost of production?
Rajesh Kumar Aggarwal
There is no defined formula. Generally Chinese are cheaper by 5%. You can say is considered okay. In many cases where you get what integrate or you do something special, you can be cheaper by 5 to 10%.
Unidentified Participant
And. Got it. And one last question regarding the guidance, you mentioned that for the next two to three years you expect around the 10% growth mark. So is there a reason for the muted like let’s say low growth numbers or what is the strategy behind that? Is it because of the tail cutting? Could you give some more light onto it?
Rajesh Kumar Aggarwal
No, the tail cutting will have an impact but it’s a cautious so we are going to make up. I don’t want to give aggressive figures because the last two years performance has been very slow. So I want to give a reasonable number and perform better. So we are looking for the opportunity as we get the opportunity.
Unidentified Participant
Got it. And in terms of margins, do we.
operator
Sorry to interrupt. Mr. Praneet, may we request you to join the question queue?
Rajesh Kumar Aggarwal
Margins? Yeah, just reply this margin. So margin will definitely going to be better than the top line growth. That is something I always say. I’ll continue.
Unidentified Participant
Understood. Thanks.
operator
Thank you. The next question is from the line of Rahel from Sofia Capital. Please proceed.
Unidentified Participant
Hi sir. Good evening. Yeah, so actually my question was on the same lines, you know, what kind of margin expectations do you have now going ahead in quarter four and then you say better than top line growth but then steady state. Any numbers you’d like to associate with the.
Sandeep Aggarwal
I not give any numbers but generally I say our business, cyclic business covering 75% and 35% business. When I say quarter by quarter, I said 30 expected what we get in quarter. So 60, 40 or 65, 30. But depends on how the rainfall is changing. How is the overall sentiment? What is the flood situation, what is the drought situation? So many factors govern this situation. So Again this quarter Q4 is a muted quarter for us with say about 20% plus minus type of sales. So we cannot expect. I already told that the H1 was 36% growth market.
So since the impact of the depreciation, the finance cost and other costs is going to be there. So I cannot say that we match the Same margins in Q4 also. So that’s why I said that there will be some muted profitability in Q4. But again we will show the sign of recovery in Q1 Excel for 2027 because that will be a bit.
Unidentified Participant
The. Given the current market sentiment and your positioning, FY27 will be a good year. Overall.
Rajesh Kumar Aggarwal
Your work was little slow.
Unidentified Participant
No, no, I’m saying FY27 will be one.
Rajesh Kumar Aggarwal
I can say cautiously that it should be a good.
Unidentified Participant
Okay, sir, thank you.
operator
Thank you.
Rajesh Kumar Aggarwal
And already like in this difficult year also the growth of IELTS has been about 2x of the industry average. Just to inform you about this.
operator
Thank you. The next question is from the line of Kunal from fvc. Please proceed.
Kunal Tokas
Hello sir, I’m audible.
Rajesh Kumar Aggarwal
Yes, you are Audible.
Kunal Tokas
Okay. Also sir, if you’d be kind enough to adjust your mic, it’s a little. You sound a little distinct. It’s a little difficult to hear you. My first question is on your EBITDA margins. We have been flat y for the first nine months earlier planning to achieve a 15% plus growth on EBITDA for the full years. What’s your. How’s your guidance being adjusted for the full year? Now.
Rajesh Kumar Aggarwal
The full year is showing to going to show a double digit margin. So the target for this year was to have a double digit margin. We crossed 12%. Now we are at 11%. So there will be some decline for sure. How much? It is difficult to say now. But of course we’ll be lending with double digit margins. I still maintain that.
Kunal Tokas
Okay, sir. And can you provide some updates on new product launches for the next year? For the future.
Rajesh Kumar Aggarwal
As the time comes, we’ll inform you. But there will be at least five launches in Q1 itself.
Kunal Tokas
Thank you. Will most of these be either 93 or. Sorry, sorry sir.
Rajesh Kumar Aggarwal
There will be one night three product and there will be two exclusive products from the large companies. So out of five, three will be exclusive products. Two might be generic.
Kunal Tokas
Okay. Three. Okay. And just an industry level question, sir. Do you perceive a threat from hybrid seeds gaining ground and reducing the need for agrochemicals?
Rajesh Kumar Aggarwal
No. Technology is a threat to anything. I’ll give a simple example. You buy a 10 rupees pen from the market you keep in your pocket and roam around and you forget it somewhere and you are not bothered. Now you buy a good pen, say Mont Blanc. You will always remember to keep it in your pocket. You will protect it. You keep an extra effort to protect that. It is the same way if the farmer is getting the seeds for free, when I say for free because it is coming from his own field, then there is zero value for the effort of the farmer, zero value for the effort of his family, zero value.
So not count the cost on that. So the za to protect is not there. But if he is paying 1,000 rupees or 2,000 rupees or 5,000 rupees per acre, then to protect that he is going to spend money. So these hybrid seeds in any form are going to increase the market for crop protection products. Not to defeat. They might be having the register for one pest variety. Or they might be having the resistance for the herbicide or a disease. But for other things there will be more demand, more demand for fertilizer. More. When I say fertilizer, it can be the pgr it can be the biostimulant.
There will be more demand for other things. So if you are investing something then definitely your protection will be there. So already the example of POTA is there. The number of states trees are gone down but the value of spray has gone up. Farmer has accepted high price products for every spray. And I have already given the examples like Group 30 compounds selling at 2000 rupees to the farmer per acre and very good acceptance across the country. Similarly the herbicides these days are launching in the range of thousand rupees to two thousand rupees per acre.
There are certain examples launched by the large companies which are even higher than these prices and things are being accepted. So this means that farmer is wanting to see the result from the solution and the advantage he gets in his pocket and not the other thing. So this shifting from a generic product to a specialty, even if it is a seed, this means the information available to him is going up and when he is investing from his pocket definitely he will invest more to protect that investment. This is my take on this. Thank you.
Kunal Tokas
Thank you for insightful. Just a clarification of what you answered before. Will the new product launches being Focused Maharatna category.
Rajesh Kumar Aggarwal
Like Focus Mahatma. I bring the product only when it achieve the target of 35 crores. So there might be possibility that one launch might hit the Focus Maratna this year itself. One product might hit the Focus Maharatna in the next year. So there will be at least three launches in the Maratna segment. I’ll not put them in Focus Marathna immediately but one product is expected to be in the Focus Marathna range because we are very very confident.
Kunal Tokas
Okay so at least two are expected expected to be here in the two next few years. Okay. And so just, just a clarification on ebitda. You mentioned achieving a low double digit epic the margin that translates into a flat absolute EBITDA for the full year, doesn’t it.
Rajesh Kumar Aggarwal
Might be, might be a temporary situation but the EBITDA ultimately is going to increase. It will see the rows. We are continuously trying to rationalize the business so we are continuously working to freezing the non essential capex improving the working capital efficiency. So with these measures I believe that we should improve the profitability of the company and that should help. And we are focusing around spending specific things. The better quality products, the better products which can derive better margins from the market. So it’s a continued focus of the company and it will be all the more focused in this next Fiscal because we have already got a hit in this year.
So we’ll be. I already told that. Especially targeting the crops, the geography, the network. We are tightening the credit limits. So everywhere we’ll be focusing on that. How we can weight our performance.
Kunal Tokas
Thank you very much sir and have a good day.
operator
Thank you. The next question is from the line of Rajat from. I thought pms. Please proceed.
Rajat Setiya
Hi sir. Just one small observation from the presentation that we. That we put up every quarter. So we used to put up a slide with freshness index. We have stopped doing that from the last two, three quarters. Any particular reason for that or if I can request you will be great if you can start putting that up again.
Rajesh Kumar Aggarwal
Yes, it is pointed out we’ll do that. So since this was a flattish performance actually in this year. So we might have not have put it. So I’ve not seen it. But as you have told. So I’ll make it particular that we put it for the whole year and we’ll continue that practice because it’s being appreciated by the market.
Rajat Setiya
Yeah. Thank you sir. That’s about it. Thanks so much.
operator
Thank you. Due to time constraints. That was the last question. I now hand the conference over to the management for the closing comments. Over to you sir.
Rajesh Kumar Aggarwal
Thank you very much for the active participation and keeping your contact with Mr. Pishar Ginger. I’ll assure you that the long term performance from the company and even the midterm performance is going to be good. This year is a muted year in particularly in the H2. It should not be taken as our continued performance. Our performance will be resilient and the results will be visible in the next quarter. Thank you very much.
operator
Thank you. On behalf of Insecticides India Ltd. That concludes this conference. Thank you for joining us. And you may now disconnect your line.