Punjab Chemicals and Crop Protection Limited (NSE: PUNJABCHEM) Q1 2026 Earnings Call dated Jul. 29, 2025
Corporate Participants:
Unidentified Speaker
Riju Dalui — Moderator
Vinod Kumar Gupta — Chief Executive Officer
Vikash Khanna — Chief Financial Officer
Shalil Shashikumar Shroff — Managing Director
Analysts:
Unidentified Participant
Jatin Damania — Analyst
Rahul Jain — Analyst
Rudraksh Raheja — Analyst
Naman Bhansali — Analyst
Viraj Mahadevia — Analyst
Dhwanil Desai — Analyst
Ankit Gupta — Analyst
Presentation:
operator
Ladies and gentlemen, Good day and welcome to the Punjab Chemicals and Crop Protection Limited Q1 FY26 Post Results Conference call. As a reminder, all participant lines will be in the listen only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during this conference call please signal an operator by pressing Star then zero on your touchstone phone. Please note that this conference is being recorded. I now hand the CONFERENCE over to Mr. Reju. Thank you. And over to you sir.
Riju Dalui — Moderator
Thank you. On behalf of Antique Stockbroking I would. Like to welcome all the participants on the call of Punjab Pen Grant Crop Protection. From the management side we have Mr. Salil Shah, Managing Director Mr. Vinod Gupta CEO and Mr. Vipash Khanna, CFO on the call. Without further ado I would like to hand over the call to Mr. Gupta for his opening remarks post to which we will open the floor for the Q and A. Thank you. And over to you sir.
Vinod Kumar Gupta — Chief Executive Officer
Thanks. So good afternoon everybody and thank you for joining the joining on the callers call today. It is my pleasure to extend warm welcome to all the participants in this season’s conference call. We genuinely value your time and appreciate your ongoing interest in our company’s performance. I trust you have reviewed the financial results and investor presentations that is now loaded on available on Stock exchange in the call today. With me we have Mr. Shahlil Shroud, Managing Director and the CFO Mr. Vikas Khanna. As most of you must have noticed by now that agrochemical industry has experienced early signs of recovery after a challenging period over the last few quarters and inventory levels have normalized.
The price decline has now halted. Favorable monsoon higher reservoir levels have also resulted in positive sentiments in the market. However, excess capacity continues to be a challenge. I am pleased to share that Punjab Chemical delivered a strong performance this quarter. Revenue stood at 319.5 crores making a 31.9% year on year growth driven by robust momentum in both domestic and export markets. Gross margin stood at 33.1% and EBITDA at 34.4 crores reflecting a 24.5% year on year growth supported by volume growth and a mix of product portfolio. EBITDA margins for the quarter stood at 10.8%. With recovery in industry cycle demand for most of our flagship products have revived to normal levels.
Our relentless focus on quality and cost is helping us to maintain market share in excess capacity scenario. New products introduced over last two years are received very well in the market and value addition on these products is likely to increase in near term. We continue to strengthen our customer reach, focus on research and development and add to our technical capabilities to win new businesses. We win new businesses, add new products and build new partnerships. Our chemistry portfolio is gradually expanding and is catering to large segments in specialty chemicals division. We also continue to pursue a forward looking strategy centered on infrastructure enhancement, talent addition and integration of various advanced chemical technologies.
In line with this, we are pleased to announce a strategic investment of rupees approximately 60 crores to expand and cater to business growth for global market. This capital expenditure will involve construction of new manufacturing blocks and also debottlenecking of certain capacities at our existing facility. The new products cater mainly to export market with a focus on Japanese and European markets. We have already. We already have environmental approval in place for this expansion and we believe this initiative will significantly strengthen our presence in these high value markets. The expansion planned over the next two years is expected to contribute anywhere close to 100250 crores in sales over next two to three years.
These promising collaborations underscore our growing credibility in high value chemical market and marks a significant milestone in our growth journey. On domestic front, we have successfully commercialized one herbicide in quarter one, further enriching our product portfolio. Additionally, we are actively evaluating a new site to support our long term growth in the entering. We are also exploring third party manufacturing for non critical processes to cater to peak demand which comes on a seasonal basis. Our strategic focus remains on identifying new products, exploring novel chemistries and expanding our customer base. I am pleased to share that we have a robust pipeline which develops several products on track for commercialization over the next two to three quarters.
We remain closely engaged with our customers to ensure consistent growth and respond to market needs. Our commitment to delivering a value to stakeholders is unwavering. We continue to prioritize innovation, quality, sustainability and customer centricity as a cornerstone of our growth journey. So thanks once again for your time and continued support. With this I hand over call to our CFO Mr. Vikas Khanna for giving more details on the quarterly performance. Over to you Vikas.
Vikash Khanna — Chief Financial Officer
Thank you Vinodji and a warm welcome. To all shareholders and investors present today. Good afternoon everyone and thank you for joining us on our Q1 FY26 earning call. I’m pleased to provide a comprehensive summary of our financial performance for the quarter. For the quarter our revenue from operations reached rupees 319 crores with a year on year increase of 31.9%. Analyzing the geographical contribution, the domestic market accounted for rupees 196 crores. While the international market contributed to rupees 123 crores to our total revenue. The gross margins for the quarter stood at 33.1%. EBITDA for the quarter reached rupees 34.4 crores. A strong growth of 24.5%.
Year on year, EBITDA margin for the quarter stood at 10.8% compared to 11.4% in the same period last year. PAT for the quarter stood at rupees 20.63 crores up by 52.8%. A robust growth year on year. PAT margins stood at 6.5%. An upstick of 90 basis points year on year. Capacity utilization across all three sites demonstrated a positive trend this quarter. Specifically, the agrochemical division in Dharabasi achieved a utilization rate of 79%. The Performance Chemical division in Lalru recorded 70% for the quarter while the industrial chemical division in Pune operated at full capacity utilization. With this, I now open the forum for question and answer session.
Thank you all once again for your time.
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 touch tone telephone. If you wish to remove yourself from the question queue, you may press star and 2. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Jatine Damania from Swine Investments. Please go ahead.
Jatin Damania
Good afternoon, sir. Thank you for the opportunity and congratulations on the strong sets of revenue. First wanted to understand that now we are already operating at 70 by 80% of our capacity utilization and our revenue growth was almost 30 and 50% year on year and sequentially. However, the commensurate growth in the EBITDA was restricted largely due to increasing the overall inventory. So can you help us understand what was the key reason for the inventory piled up during the quarter?
Vikash Khanna
Okay, so Jatin, thank you for this question. Now one of the reasons for this margin was that we had a higher closing stock in the previous quarter. We anticipated that there was a good market in the coming quarter. So as a result we created an inventory. We built up an inventory. Now as you know that the inventory is normally valued at cost in the books. Whereas when you actually, you know, realize those inventory, they are at the selling price. So obviously there was a higher cost factor which was involved in the closing stock. We finally got diluted in form of sales in the coming quarter.
So that was the reason why the percentage is a little lower but gets, you know, ironed out in subsequent quarters.
Jatin Damania
The entire 39 crores of the inventory got liquidated in the. In the month of July. Right? Fair to assume that.
Vikash Khanna
Yeah, I mean it would be in this quarter.
Vinod Kumar Gupta
I think if you see from quarter to quarter our inventory levels have gone down from previous quarter to this quarter quarter and that inventory level will continue to go down as we as we regularly do our business.
Jatin Damania
But if you look on the receivables levels also which had increased in the last financial year from 77 to 125 days. So what is the situation in the at the end of 1Q where do we stand in the receivables and the entire working capital cycle?
Vikash Khanna
See the net working capital cycle which we had in FY25 was 111 days which has come down to about 107 days. Which means that you know, the company has higher amount of capital tied in the business operation. The capital is being utilized for running the business efficiently.
Jatin Damania
Okay. And so one on the four product that we launched last year out of which one was a specialty chemicals which were largely targeted to of the Europe business. So can you help us in understand how big that specialty chemical product will be for us over the next two to three years? And are we manufacturing this for one particular customers as a CDFO or it’s a generic product?
Vikash Khanna
No, I think this product is first of all for a very special application under an exclusive arrangement for one particular customer. And we expect this product to give us a top line of about 30 to 40 crores over the next two to three years every year. So this year again our volumes are going to be double of what we have done last year. And gradually as the as the customer also takes approval for their various applications, this will continue to grow.
Jatin Damania
One more question now on your investments. Definitely the current existing land bank where we don’t have an excess land bank but we are doing a 60 crores of capex for our setting of one more new manufacturing blocks and the bottleneck which will help us increasing our capacity. But when do we see probably a greenfield announcement because we are talking this in last six to nine months and even in AGM we indicated near about another 12 to 18 months for the fresh investments. So can you throw some idea in terms of our greenfield projects what size would be when one can see some announcement on that front?
Vinod Kumar Gupta
See, I think we are continuously looking for good option and we want to look for a greenfield project which can actually take care of our business needs for next four to five years. I think as announced in earlier con calls we have shortlisted a few locations. There are some, we are at an advanced stage of discussions but at the same time because we have some space available in existing sites we are looking to acquire at the right time so that we put capital and don’t block it for a longer period. So yes, I think we are actively scouting for the right opportunity and that’s why I think you will probably have seen some delay but I think we are working hard on it.
Jatin Damania
Sure sir, that’s all from my side. I’ll come back in a queue again thank you and all the best.
Vinod Kumar Gupta
Thank you.
operator
Thank you. The next question is from the line of Rahul Jain from Credence Wealth. Please go ahead.
Rahul Jain
Thanks for the opportunity sir, the first question is on the capex. So we are doing a 60 crore capex. I understand this is a brownfield capex and in the previous call you had also mentioned about a total capex of roughly 250 crores or a period of next 3, 4 years so you could understand the exact kind of, you know the amount and the timelines involved in both this brownfield and the greenfield capex. And in what phases do we start commercializing this?
Vikash Khanna
I think currently the new manufacturing block that we are talking about and some debottling of capacities will be commercialized in next 12 to 18 months and that’s an immediate future that we can clearly see because based on our product pipeline and the demand that we are seeing the balance investment that we had projected was to start with a greenfield project where obviously land acquisition cost will be significant cost followed by all the approvals and then investment in the new facility that we are planning to planning in an integrated facility. So that plan for investing about 250 crores over the next year remains intact.
Once we sort of, as I answered in the earlier question once we finalize the greenfield location I think that detailed planning will be shared with all of.
Rahul Jain
You and this ground feed apex involve increasing capacity on the phosphoric side also.
Vikash Khanna
I think at the moment we are not looking at expanding capacity in the brownfield project. Brownfield project is mainly on specialty chemicals, intermediate and agrochemicals. So it’s a combination of all the three products for phosphorus chemical. I think we will basically we are planning to build a complex in the new integrated greenfield project that we are planning to announce.
Rahul Jain
Sure sir. With regards to the financial revenue and margin so yes we have done exceptionally well on the revenue side both domestic and export sales have grown and overall top 10 has grown. But sir, our gross margins at 33% are the lowest in last almost 15, 16 quarters. So generally we were in the range of around 3738 to 40%. And this has substantially come down to now 33%. You have mentioned in your PPT it is regarding the product mix. But with the new products contribution increasing and backward integration benefits coming in, cost optimization benefits coming in.
And on the basis of previous call also we were somewhere hoping that the margins will be stable or probably improve gradually from there. So if you understand why this sharp fall in the gross margin.
Vinod Kumar Gupta
So I think as Vikash responded to earlier queries and we also mentioned in our last con call, see in agrochemical what happens is there is a demand in a particular season and generally capacities are not able to cope up with the demand for that season. So we took a strategic call to keep produce some quantities in the previous quarter and then we basically sold it in this quarter. Now as per the accounting practice, what happens that the product gets built on the full cost in our inventory. So when you sell in the next quarter your margins are low.
So that has had a significant impact. I can only thing I can assure you that our gross margin levels are protected and intact based on the running business that we are doing.
Vikash Khanna
And even as we see for the Q2 Q3 we will be back at the margins which we are between 37% to 39% and moving forward as we do where we plan, which we have done an announcement for certain MOUs which we have signed. So those products will also give better contribution which we’ll see coming in Q3 and the next financial year.
Rahul Jain
And is that some product mix change because you mentioned that in your presentation.
Vinod Kumar Gupta
No, I think when we are saying product mix what we meant was a strategic decision taken to utilize the capacity in Q4 when the demand is low and carry forward that inventory in this quarter. I think that’s what we meant by product product mix. Otherwise our product mix is healthy. New products are giving higher margin than the existing ones. That is a clear sign we are seeing only thing is the proportion of the new product is gradually increasing and you will see our gross margin improving over a period of time.
Rahul Jain
I have a couple of more questions. I’ll come back in.
Vinod Kumar Gupta
Okay, thank you.
Vikash Khanna
Thank you.
operator
Thank you. A reminder to all participants. You may press Star and one to ask a question. The next question is from the line of Rudraksh Raheja from I thought Financial Consulting. Please go ahead.
Rudraksh Raheja
Yeah, thank you for the Opportunity. Sir, congratulations on a good set of results. My question is regarding our peak revenues that we can do at this existing capacity.
Vinod Kumar Gupta
I think, I mean obviously peak revenue is dependent on the product mix, market demand, product pricing because there are so many variables. But at current assume that the price levels are what they are currently from our existing assets. We can do every quarter with an optimum capacity relation roughly about 3 to 3, 350 crores per quarter. And so I think that will be the rough numbers.
Vikash Khanna
And as we have said that within the existing site we’ll be making these two the new block so that you know, because in agro and specialty chemicals it takes time for registration and all which is in place. And that’s where I mentioned that hopefully once we have the block ready that revenue will also be added to the quarterly numbers.
Rudraksh Raheja
Sure. And sir, when do we anticipate this block kicking in?
Vinod Kumar Gupta
Block should kick in from Q3 of the next financial year. That’s the target we have kept in mind. And I think till that time our product registrations and approvals will be ready because we are already giving some commercial loads from our existing multipurpose plants and pilot plants so that we are taking care of approval part in advance.
Rudraksh Raheja
Understood. So can you spare more details on the upcoming launches in the coming quarters? You have hinted something like that in your opening commentary.
Vinod Kumar Gupta
I think. We had indicated in the last quarter presentation that this year we’ll be commercializing at least five products. So we are on track to commercialize minimum five products. Maybe it will. The number will be four. And so the things are on track as per the whatever we have projected. And also the products that we have introduced over the last two years are showing good signs of growth this year. Demand is healthy.
Rudraksh Raheja
Understood. Thank you.
operator
Thank you. The next question is from the line of Naman Bhansali from Nine Rivers Capital. Please go ahead.
Naman Bhansali
Hi sir. Thank you for the opportunity. First question is on the proportion of new business or new product sales which was I think 12% for the last financial year. Can you share the number for Q1 and our expectations for FY26?
Vinod Kumar Gupta
I think because I’ll say that the share is growing but I think we’ll probably prefer to share this growth over a longer period of time rather than quarter to quarter. Only thing I can say that yes, the growth on these products is minimum 10% year on year. And also some of these products are seasonal products also. So some demand will come in Q1, some demands will come in Q2. So that’s why it’s not the right metrics to look at on quarter to quarter basis. I think we’ll indicate on year to year basis.
Naman Bhansali
And secondly on the MOUs that you have written in the press release, you’ve given a number of 120 to 150 crores scale up over the next two, three years. Is it specific to those three MoUs or it is overall about the new products which we talked about.
Vikash Khanna
So basically these are the three products which we have signed with these customers. So it’s pertinent to that. And as Vinod did mention that you know already there are five, another two products are already ready. But please understand that in certain parts registration takes place, takes time. And also as Vinod said that for commercial quantities, for do some formulation trials etc, we have done it from our existing site.
Naman Bhansali
Thank you.
operator
Thank you. The next question is from the line of Viraj Mahadevia from Moneygrow. Please go ahead.
Viraj Mahadevia
Hi. Congratulations on the improvement in results. We’ve seen a marginal uptick in meaningful uptick in revenue in first quarter from Q1 last year and from Q4 25. Is this driven by largely improvement in pricing, new product introductions or is it seasonal?
Vinod Kumar Gupta
I think this is mainly driven by two, three things. One is obviously the new product introduction and second is our if you look at our capacity utilization that has gone up so the demand is healthy and also some strategic call we had taken last quarter to basically optimally utilize capacity. So we foresaw we actually could forecast certain demand that will come in Q1, Q2 and we utilize our capacities in Q4 that actually resulted in giving us some extra sales in this quarter. So I think it’s a combination of factor. Unfortunately though we would like to see a price improvement but that is not the case here.
Vikash Khanna
Just to add even to that our R and D is working very strong and we are ensuring that that we do a lot of improvement in terms of our processes to ensure that we have better margins and to retain the growth.
Viraj Mahadevia
Understood. Sir. Would you say 300 to 350 crores would now be a new normal revenue on a quarterly basis going forward?
Vikash Khanna
That’s right.
Viraj Mahadevia
And in terms of the initiatives taken for future growth that you highlight in your presentation, the MOU for the export products, the domestic market expansion and the product pipeline commercializing what could be the incremental revenue delta that you could generate over a two year period over FY25.
Vikash Khanna
If you see our press release we have already mentioned that would bring in a revenue of close to 120 to 150cr on a year basis.
Viraj Mahadevia
Okay, thank you. All good.
Vikash Khanna
Thank you.
operator
Thank you. A reminder to all participants, you may press Star and one to ask a question. The next question is from the line of Vignesh Iyer from Sequent Investments. Please go ahead.
Unidentified Participant
Congratulations, sir, on a great set of numbers. Sir, two questions from my side. First question.
Vikash Khanna
Can you talk a little louder? Sir?
Vinod Kumar Gupta
Can you be a little louder please?
Unidentified Participant
Am I audible now? Hello?
Vinod Kumar Gupta
You have to either come closer to the mic or remove your headphone. I don’t know, we can’t hear you clearly.
operator
Hello, can you please use your headset? Yes.
Unidentified Participant
Yeah, I’ve removed my headset. Is it better now? Hello? Yeah, yeah, yeah. Thank you.
Unidentified Speaker
Yeah.
Unidentified Participant
So. So two questions from my side. So the first question, you know, to understand what would be the contribution of new products, maybe the product that were launched in last two years to our total revenue in FY25 and quarter one. And second question is more towards understanding of on the pricing side of it, when you say you feel the prices have bottomed out. So just wanted to understand, would it be fair to assume that there would be some uptick coming in by say at least end of this financial year?
Vinod Kumar Gupta
I think Ganesh, to the first question, we have already responded that I think last year will be at about 12% revenue from the new products. This year it will be higher than last year. But on quarter, on quarter it’s difficult for us to say because there are some products which are seasonal or are producing multiple multipurpose plant based on campaign. But overall we basically foresee that our contribution from new products will be increasing and this year will be higher than last year. As far as pricing is concerned, I think there will be an uptick, but it will be not a runaway.
Our assessment is it will not be a runaway increase in the prices, but gradual improvement in the prices is clearly will be visible because I think the profitability based on current prices is not great for most of the players. So gradually you should see some improvement, maybe 5%, 10% towards the end of this financial year.
Unidentified Participant
Okay, so when you say that on a peak revenue side we can hit somewhere around 320, 350 crores per quarter, which is the possibility of reaching that revenue. Is it on the prices that is prevailing in quarter one? Right. On basis of that the turnover you have given.
Vinod Kumar Gupta
Yeah, I mean that that’s a fair assumption.
Unidentified Participant
Okay.
Vikash Khanna
And also as we move, as we go to Q4 and next year, the revenue will further go because by the time the product registration commercialization, everything will happen.
Unidentified Participant
Right, Right, right. The product mix will change the thing. I understand. Okay, thank you sir. That’s all from this head. And all the best.
Vinod Kumar Gupta
Thank you.
Vikash Khanna
Thank you.
operator
Thank you. The next question is from the line of Dhuani Desai from Turtle Capital. Please go ahead.
Dhwanil Desai
Hi, good afternoon. So my first question is, you know, in the earlier call we have indicated that over next two to three years, you know, our, you know, milestone that we are looking for in terms of margin is around 17, 18. We ended at 525 with 11 margin. So the right part from 11 to 18 as I see it, is that current year, if you normalize the gross margin, we are already at 15, 16% kind of a number. And then as the new products scale up, we will move towards that 18% number. Is that a right way to look?
Vikash Khanna
I think that probably is the right way to look because I think what we are looking at is obviously as Mr. Sharil mentioned, we continue to focus on improving our cost position for existing products. So there is a lot of R and D work going on to see we do yield improvement or alternate supply chain that is going on. The new product addition is definitely at a higher margin. So mix of this and the contribution from new products will take us towards that journey. And then obviously we are looking also looking at some price improvement in the products going forward because the market is now stabilizing and demand is now picking up.
Dhwanil Desai
Okay, so what I’m asking is that even without those new products, et cetera coming in, we are still at 15, 16% kind of a margin on a normalized gross margin basis, right?
Shalil Shashikumar Shroff
Yeah, I think anywhere between 14 to 16%. That’s the broad range because it again depends on the product mix.
Vikash Khanna
And as we also have mentioned that moving forward the new products which are coming in where the margins are good. So hoping that for the next financial year that is 26, 27, we should be between that 16 and 18%.
Dhwanil Desai
Sure, very helpful. Second thing, sir, we are looking for around 15, 20% growth for FY26 and we did very well in Q1. So for us to get to that 20% mark, our base business also has to grow at 15 odd percent or slightly more than that. So what is the visibility on that wage business growing at 50 odd percent?
Vinod Kumar Gupta
I think our initial signals, what we are Getting in the Q1 is indicating that we will have that kind of a growth in this year where demand is healthy. And our forecast from most of our markets and customers is looking very, very good and very bullish. So I think we should be growing existing Product also anywhere from 10 to 15% during this financial year.
Dhwanil Desai
Great to hear and wish you all the best.
Vinod Kumar Gupta
Thank you.
Shalil Shashikumar Shroff
Thank you.
operator
Thank you. The next question is from the line of Ankit Gupta from Bamboo Capital. Please go ahead.
Ankit Gupta
Congratulations for good set of numbers, sir. On the domestic side, you know, we have seen a significant jump in revenue for us. And if we you know, hear the commentary of some of the formula formulation formulator players in the industry, we have talked about postponement of, of you know, the application of of of the various agricultural agrochemicals because of the onset of the early monsoon. So has that been a case in for us as well? Because you know the next since the demand for formulations have increased that will indirectly impact our demand also. So what is your view on the same and do you think, you know, the kind of performance we have seen in Q1 is sustainable over the next 2, 3/4 as well?
Vinod Kumar Gupta
I think first of all coming to domestic market, I think this year monsoon has been good and the overall demand in domestic market has been good. However, for us even the domestic sales is comprising of two parts. Some products we supply to local customer which the customer formulates and takes it to the next port market. So when we reflect our domestic sale it is not only for the India market, it’s also for the global market which is being taken by a customer formulated and exported. So I think significant revenue in domestic sales comes from that.
As far as the local market is concerned, whatever we supply in local market, I think we are seeing that yes, demand is healthy and that momentum I think this year will continue. Okay, as far as your second question around the momentum that we have generated in June, one, I think we expect the momentum to continue in this year. Obviously as we mentioned earlier this quarter sales was also capacity utilization of previous quarter. So that that kind of an impact will probably you’ll see in revenue being slightly on our lower side. But we see I think in the earlier caller asked us the revenue growth projection of around 20% is what we are clearly seeing achievable this year.
Ankit Gupta
And then on the export side, the direct export that we do, you know how is the market doing there in some of our top geographies like Europe and you know Japan and US is a relatively small market but on the Europe and the Japan side and how is the pricing there as well if. You can talk about it, I think.
Shalil Shashikumar Shroff
As far as export market is concerned, Europe demand is healthy this year. So I think that’s a very positive sign because a lot of our products are focused On Europe Japan market demand is also stable. So we don’t see a challenge from Japan market also. There is obviously some challenge which is coming from Latin America market where some of our products go to that market. But I think that is being offset by the demand that is coming from rest of the world. So rest of the month means Europe, Japan or India. So I think overall demand is getting offset and that’s why that gives us the confidence for the revenue increase that we are forecasting this year.
Vikash Khanna
And even just to add as you know that the tariffs from China into us that is also giving a good advantage to many of the Indian agro companies to get a good footprint into that market.
Ankit Gupta
If we look at our performance on the export side because of the challenging environment, last year we saw our Europe sales declining from 340 crore to almost 240 crore. So do we expect to go back to the FY24 levels or like it will take a year for that?
Shalil Shashikumar Shroff
I think this year we’ll reach FY24 levels. On exports market I think we don’t see and maybe it will be slightly higher but we’ll at least go back to the same levels. Please keep in mind, I think when the earlier high number was there that time prices were much higher. So in fact this year volume still is much higher but the prices are lower. So overall our market share and the demand is looking healthy.
Ankit Gupta
Sure. And how is the pricing? Any views on the pricing? Have we, are we seeing some signs of improvement in the pricing or you think the volumes have bounced back but the pricing is yet I think volumes have bounced back.
Shalil Shashikumar Shroff
And as I, I think volumes have bounced back. And the question I think has come again. But broadly we are seeing prices have stabilized at the bottom level for some products we have seen some 3, 4%, 5% price improvement. But I think as the year goes by, towards the end of the financial year, I think we should see pricing improving for most of the products.
Ankit Gupta
Okay. Okay. Okay. Thank you Nisha. All the best.
Unidentified Speaker
Thank you Amgit.
operator
Thank you. A reminder to all participants, you may press star and one to ask a question. The next question is from the line of Jatin Damania from Swan Investments. Please go ahead.
Jatin Damania
Thank you for the opportunity again. So just one question. Mr. Gupta in his opening remarks alluded that we are exploring a third party manufacturing option. So just wanted to understand definitely since our capacity has been restricted as of now till the new manufacturing blocks come, what types of order visibility that we have at this point of time where now we are looking at Exploring third party manufacturing options and what sorts of revenue this could be. This could probably add to our overall business.
Shalil Shashikumar Shroff
I think the way to look at this is that, you know, as we introduce more and more products, I think what happens is the plant changeover, equipment changeover and these campaigns. Because in the beginning when you introduce a new product, maybe the order will be say 10 tonnes or 20 tonnes to begin with, which gradually improves over a period of time where you can have a dedicated facility. Now when we have this kind of opportunity being explored, sometimes the equipment availability becomes a challenge. And what becomes important for us to keep our ip, that is the whatever in house research work that we have done is kept.
All those processes are done in house. Now in order to cater to any such requirement that we foresee coming, we actually are identifying some partners where we can take these processes out quickly and at least not lose any market opportunity that is coming up. So that’s the way we are looking at it. And this, any upside is again a. Part of the revenue projection that we have done. So if you have said that 20% revenue growth is what we are forecasting in this, I think everything is clubbed into this only.
Jatin Damania
Thank you. That’s all from my side.
Vinod Kumar Gupta
Thank you.
Shalil Shashikumar Shroff
Thanks Jatin.
operator
Thank you. A reminder to all participants, you may press Star and one to ask a question. The next question is from the line of Rahul Jain from Credence Wealth. Please go ahead.
Rahul Jain
With regards to the product side, last year we introduced about four products and the year previously we had five new products. I think total nine new products had contributed about 12% to your revenue in FY25. So and you have mentioned that we have a significant pipeline of new products over next six, eight quarters. So this year what kind of further product addition do you feel we are doing in the current year and maybe from 12%, what kind of further improvement do you feel is possible in this year as a percentage of revenue?
Vinod Kumar Gupta
I think I mentioned that we have responded to this query earlier also that this year again we see a very good product pipeline going for commercialization. So at the moment we are confident that we will commercialize minimum five or maybe more products during the year depending on. I think our R and D work is progressing very well. In some cases there may be some delay because of the customer approval and various application trials that are done. Once we submit some submissions. Sorry, once we submit samples. Okay. Now as far as revenue projection is concerned, I think it will be higher than 12%.
Obviously year on year percentage of contribution from these new products will Keep on increasing and that is our focus area for all the effort that we are making.
Rahul Jain
And some broad range in terms of the gross margin of this new products, the nine and further what have been introduced in this year. Can you give us some range whereby this gross margin of these new products, how much higher they are compared to our existing business, the base business.
Vikash Khanna
So basically please understand that this is, you know, a con call and such numbers as per the SEBI guidelines we cannot give you. But as I did mention that one of the speaker did ask us that you know what would be your gross margin going up. And as I said that as the new products come in we are at around 33 34%. We expect to go to 3738 and next year we’ll grow further. So we’ll keep you informed as it happens. But we’re very sorry but you know, certain things as per the guidelines, it’s a little difficult for us to really spell out the exact numbers.
And I hope you understand that. Please.
Rahul Jain
No, no, I do appreciate that. And lastly in your presentation you have mentioned about doubling the RD setup in the current year. So just to understand what do we infer from this, whether we are talking in terms of adding a new lab or doubling the headcount or spending X amount of money on the R D.
Vinod Kumar Gupta
Our physical setup will be double of the existing site, whatever we have. So that expansion is already in progress. And also because in order to get it increased physical setup we are adding new people continuously. So it means both when we say doubling, it is adding up people and assets, physical assets both so that we can take up more products at the same time for development.
Rahul Jain
Sure. Thank you.
Vikash Khanna
Just to add in R and D, it’s also very important that we look at the existing products, the products which we do for customers and the products which are going off. So for that we definitely need more talent and which we are working. And as you see the progress in the next couple of years we’ll be adding more and more niche products, you know, with better contribution for which obviously we need skill, manpower and which we are definitely working and we already have in place and we are adding more to get it more flourished in terms. Of new product development.
Rahul Jain
Sure. This last one thing, last thing, in the current quarter we have already grown much higher than 20%. It’s almost a 30% plus growth in terms of revenue. And we have been guiding in the previous call also and in the current call also in the previous questions you have spoken about around 20% top line growth. So given the kind of growth which we have had in quarter one. So do we. Are we guiding for a much conservative number? Is it a fair assumption?
Vinod Kumar Gupta
I think as a management we are supposed to be conservative. So that’s the basic principle we are supposed to follow. I think on a lighter note. But I think at the same time our effort has been to see how to smoothen the capacity utilization and take strategy call from time to time. So broadly, I think we stick to the number of 20% forecast for the year. And yes, obviously we are putting efforts to do better but I think we’ll keep our forecast at a conservative number of around 20%.
Vikash Khanna
And also as you know, being agrochemical, the registration time, so we are working in fact it’s quite on advanced stages. But this is in different geographical part of the world. So as and when the registrations take place, the product volume will increase, that will in turn increase from 20, we can go to 25 to 28%.
Rahul Jain
Sure. Thank you so much sir and wish. You all the best.
Vinod Kumar Gupta
Thank you.
Vikash Khanna
I think we can take two last questions please.
operator
Thank you. A reminder to all participants, you may press star and one to ask a question. The next question is from the line of Rudrak Shaheja from I thought Financial Consulting. Please go ahead.
Rudraksh Raheja
Yes, thank you again. Sir, one quick question on the manpower needs. You said that we are expanding there. Should we expect some major impact on the PNL because of this?
Shalil Shashikumar Shroff
See on the employee cost as you would see that, you know, while our top line is growing handsomely, our employee cost has not been that high. So if you see our fundamental financials, we were at about 11% of our total revenue in FY25 and which had gone up a little higher because we were recruiting a lot of people for this new businesses that were coming in. But we’ve been in the range of about 10% throughout. But this quarter because of our higher revenue, we’ve been at about 8% of revenue as our employee cost. So as the revenue keeps increasing, going up our cost, which is kind of a fixed cost for us, employee cost will not grow in the same proportion while it will grow with our growth in our top line.
But it wouldn’t be in the same proportion. Obviously there will be a benefit to the company in terms of reduced cost of manpower as a percentage of sales.
Rudraksh Raheja
Got it, sir. But this quarterly number in Q1 we have incurred around 25cr. Should we take this as a quarterly rate for employee expenses or do we see that rising?
Vikash Khanna
No. So you can take anywhere between 7 to 8% is where we are targeting. But yeah, on higher side we’ve never crossed 10% so. So we’ll try and you know, fix it up within that range. Good scenario would be about 8 to 9%. But yeah, we will restrict ourselves to about 10%.
Rudraksh Raheja
Got it, sir. Thank you.
operator
Thank you. As there are no further questions.
Shalil Shashikumar Shroff
Okay. Very good.
Vinod Kumar Gupta
Okay. Thank you.
operator
As there are no further questions from the participants I now hand the conference over to management for closing comments.
Shalil Shashikumar Shroff
So I thank everybody for your precious time. I hope me, Vinod and Vikas could help you with all the questions. But feel free to contact us anytime. And please be ensured that we as the management are doing our level best to ensure that on a year to year basis we grow not only on the revenue but even on the bottom line. Thank you once again and a very good afternoon to everybody. Thank you.
operator
On behalf of Antique Stockbroking Ltd. That concludes this conference. Thank you for joining us. And you may now disconnect your lines.
Vinod Kumar Gupta
Thank you.