Note: This is a preliminary transcript and may contain inaccuracies. It will be updated with a final, fully-reviewed version soon.
Rallis India Limited (NSE: RALLIS) Q4 2026 Earnings Call dated Apr. 28, 2026
Corporate Participants:
Gyanendra Shukla — Managing Director and Chief Executive Officer
Bhaskar Swaminathan — Chief Financial Officer
Unidentified Speaker
Analysts:
Viraj Kacharia — Analyst
Prashant Biyani — Analyst
Unidentified Participant
Unidentified Participant
Saurabh Jain — Analyst
Unidentified Participant
Unidentified Participant
Presentation:
Operator
Ladies and gentlemen, good day and welcome to Rallis India Limited Q4 and FY26 earnings conference call. We have with us today prior Dr. Ganendra Shukla, Managing Director and CEO and Mr. Bhaskar Swaminathan, Chief Financial Officer. Before we begin, I would like to mention that some of the statements made in today’s discussion may be forward looking in nature and may involve risks and uncertainties. A detailed statement in this regard is available in the results presentation. 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 the 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 invite Dr. Shukla to begin the proceedings of the call. Please go ahead.
Gyanendra Shukla — Managing Director and Chief Executive Officer
Thanks. Good morning everyone and for joining us today on Rallis India Limited Q4 and fiscal year 26 earnings call. As mentioned, I have alongside myself our CFO, Mr. Bhaskar Swaminathan.
Viraj Kacharia — Analyst
Good morning everyone.
Gyanendra Shukla — Managing Director and Chief Executive Officer
I’ll open with an overview of the industry landscape before addressing developments specific to rallies. The Indian agrochemical sector is currently transitioning from a buyer’s to a seller’s market due to war induced supply constraint and rising prices. Post Iran war, the industry shifted to a sellers market with signs of panic buying and hoarding. Supply chain disruptions persist, but inventories help most companies avoid damage agrochemicals, particularly glyphosate is facing. Sorry for interrupting speakers.
Your voice is breaking pass through. In China, supply chain disruptions Amid global tensions, the prices of other generic AIs like glufosinate, Mancos Aid, metrobezine, stroblarant, fungicides, pyrethroids, CTP. It’s a near term cost inflation wave likely to compress downstream margins. Quarter four is typically slow for the domestic market for agrochemicals. In addition, the Ruby season has not gone well owing to the unfavorable climate. As per the official data, the unseasonal rain and hail storms have damaged the wheat crop across 2,000 hectares, with wheat suffering the maximum impact at the end of March 26.
Summer sowing is progressing at a slower pace, down 4.7% year on year, primarily driven by decline in rice, cereals and oilseeds. Within cereals, bajra sowing has improved by about 9% while maize has declined by about 8%. In all seed groundnuts, sowing is significantly lower down by 12.7%. This is a bright spot with total area rising by 17% AMD is 2026. Monsoon falls at 90% of the PA signals normal reckoning. Agri continental effects like agricultural rising new odds drive early deficit in north and central and western India and which are key swaying areas while south and east may see a relative better monsoon.
Well distributed precipitation during key storage sowing windows can partly offset deficits, whereas erratic patterns such as prolonged rice pills or excessive concentration tend to be more disruptive. Erratic patterns risk 5 to 10% demand cut for herbicides and insecticides in integrated firms with balanced portfolios of seed, crop protection and soil and plant health tend to face less impact. Expanding irrigation coverage to 55% of the rival land has notably reduced monsoon dependence on key crops for India and also on the rural diversification into dairy, poultry and allied sectors now contributes roughly 1/4 of the income for households, providing a structural buffer against rainfall deficits.
The MSP framework key indicator for Karif 2526 is broadly supportive for oilseeds, pulses, millets and cotton, while the hike in paddy is relatively modest. From the agrochemical and seed industry perspective, this is positive for crops such as cotton, soybean, ground nut, maize, pulses and millets provided monsoon distribution and reservoir labels remain supportive. Sector Agriculture sector may see a 3 to 4% growth in fiscal year 27. Seeds category remain a structural 5 to 10% CAGR story depending on the portfolio of the companies.
Volumes might shrink due to less acreages, but margins are expected to remain stable to soft. The market should favor low cost producers with export breadth and tight working capital discipline. The near term outlook remains contingent on the evolution of Middle east conflict while healthy reserve levels of approximately 54% are supportive for ongoing season. Reduce acreage and forecast a below monsoon rainfall could possibly pose some risk. India’s FCO 2026 this was a key bill which was brought to regulate biostermint fertilizer, standardizing humic acid and seaweed formulations, thereby improving product reliability and regulatory clarity.
I think this is very good positive development for the long term. The global crop tax and market estimated at approximately 70 to $75 billion in 2026 and is projected to grow at a CAGR of 5 to 5.5% supported by rising food demand, limited arable land and need to improve farm productivity. On supply side, the globally China linked supply concentration remains a key issue especially for active ingredients and intermediates where export restrictions, price shifts or freight disruptions can quickly affect availability and cost.
Elevated raw material and logistics costs continue to pressure manufacturers while global weather uncertainty and changing crop patterns added demand volatility. Global recovery in this sector is visible but uneven. US demand is supportive. Brazil is weak. China led pricing pressure remains a key concern. India’s rising stock rice stock position remains strong, but the latest report does not indicate any fresh increase. From March to April, global rice stocks have increased, including a comfortable supply searches and a possible pressure on global rice prices.
So that’s a global overview. Moving on to Rallis specific developments we had a reasonable quarter for performance despite sort Ruby season and geopolitical unrest. Our quarter four revenue stood at 456 crore versus 43 crore previous year. EBITDA improved by 96% from to minus 1 crore from minus 19 crore in Q4 fiscal year 25. Profit after taxes stood at minus 15 crore versus minus 32 crore of quarter four fiscal year 25. Exceptional items include profit on the sale of some property lands for 3 crore in Aurangabad.
Across the technical portfolio, we are continuously broadening our customer base and securing additional registration with global players to drive share gains and metrobrazin. The volumes have decreased in quarter four in comparison to quarter 25 volumes. Pendimethylene volumes have increased, hexagon volume also have increased and there has been some decrease in the acephate volume so Pendi and Hexa has done overall well. There’s some shrinkage of volume in Metri and SF8. Overall annual capacity utilization has improved in fiscal year 26 compared to 25.
On new launches we have currently launched Alster, a dual X and granular insecticide and Fiplan which last year we had announced but we were not able to launch because of some quality constraint. It has been launched now. It will help in managing both a broader spectrum insecticide to manage both sucking and chewing pest. We have also obtained registration for a three way rice herbicide and in past I’ve been talking about growing herbicide segments so this is addition to that. It will be called a spiral.
We are working on the launch plan in Q4. We had launched an initiative called Idea to Impact to establish an open innovation system to source, validate and commercialize agri innovations. We have also launched Saksham, a GIS platform which enables scientific identification of high potential villages for target market expansion. On our new initiative, Sampar plus captures farmer level demand signal to generate actionable insights and improve sales conversion and move inventory as needed. We are also using tech assisted products in generate demand digital LED fee lab ban campaigns, farmer and retailer level digital schemes and enrollment of retailers on Anubanda platforms.
All these platforms are driven this is all for initial deliverable of centricity goals as well as retailer and distribution connect. As a result of improved manufacturing efficiency and operational excellence, Rallis has achieved record production levels. We have enabled digital led engagement that strengthens data driven decision making and enhances farmer outreach and our advisory productivity. We are also shifting towards high margin sustainable and pharma centric offerings including biological and next generation product.
That concludes my opening remark. I’ll now hand it over to Mr. Bhaskar our CFO for a detailed analysis the financial situation. Over to you vas.
Bhaskar Swaminathan — Chief Financial Officer
Thank you Dr. Janinder. Good morning everyone and thank you for joining us today for our Q4 and FY26 earnings call. I’ll walk you through our financial performance for the quarter post which we shall commence on the Q and A session starting with the top line. For the year our Q4 FY26 revenue stood at rupees 456 crores as against rupees 430 crores for the same period last year resulting in an overall growth of 6%. Overall volume growth has been 5% with pricing growth by 1%. Overall EBITDA for Q4FY26 stood at rupees negative 1 crore higher by 96 compared to last year of minus 19 crores of the same quarter.
Profit after tax stood at negative 15 crore versus negative 32 crore of last year which is 52% higher than the previous year. Same quarter crop care Segment grew by 5% to Rs. 425 crore in Q4FY26 from Rupees 405 crores in Q4FY25 due to volume expansion, new product promotion and increased digital engagement. Moving to domestic B2C,
Unidentified Speaker
A
Bhaskar Swaminathan — Chief Financial Officer
15% growth in Q4FY26 registering R2.55 crore revenue vis a vis rupees two hundred and thirty two crores in Q4FY25 which was driven by volume growth of 14% primarily led by in 65.
Unidentified Speaker
Soil
Bhaskar Swaminathan — Chief Financial Officer
And Plant Health category grew by 27% to rupees 47 crore from rupees 37 crore in Q4 of
Unidentified Speaker
FY26. In
Bhaskar Swaminathan — Chief Financial Officer
Comparison to Q4FY25 it registered a robust volume growth of 29%.
Unidentified Speaker
The volume
Bhaskar Swaminathan — Chief Financial Officer
Effect is due to growth in micronutrients and biofertilizers.
Unidentified Speaker
Moving
Bhaskar Swaminathan — Chief Financial Officer
To seeds business Seeds revenue grew by 23% to Rs.31 crore in Q4FY26 from rupees 25 crore in Q4FY25 due to 8% volume growth and 15% price growth mainly driven by cotton and millet exports. Top line degrew by 33% to Rs. 77 crore from 114 crore due to degrowth in volumes and revenue from metric division and pending talent CSM products custom synthesis manufactured products in Q4FY26 revenue displayed promising growth by lodging 59% growth to rupees 66 crore from rupees 41 crore of last year driven by both volume and price growth.
That will be revenue stood at rupees 170 crore versus Rs. 182 crore with a decline of 7% primarily to due to volumes for the full financial year period. Top line Revenue stood at Rs. 2,897 crore reflecting a growth of 9% year on year. Crop Care revenue stood at Rupees 2,416 crore reflecting 8% growth year on year driven by volume expansion. Despite price of softening and seeds, revenue increased to Rs. 481 crore delivering 15% growth year on year supported by cotton and maize along with improved contribution from in licensed products.
The B2C business recorded growth of 5% delivering rupees 1657 crore revenue primarily contributed by 9% volume growth. The B2B business recorded growth of 14% delivering rupees 759 crore of revenue supported by both volume and price, price growth and expansion of the customer base in the crop care segment. Expansion of our customer base and product portfolio is enhancing business resilience. We are driving focused execution across frontline and operational functions by optimizing the product portfolio, rationalizing territories, eliminating overlaps and simplifying costs across the value chain.
In the seed segment, our primary focus will be on five strategic crops cotton, maize, millet, mustard and rice. A selective and concentrated approach in these crops is expected to drive operational scale and efficiency. Overall, we remain disciplined in improving capital efficiency across both fixed capital and working capital. At the quarter end, our inventory levels remain slightly elevated in comparison to the same quarter of last year. Collection cycles remain smooth. We have healthy cash and liquid balance of Rs.
541 crores as at 31st March 2026. Our continuous approach towards improving digital LED initiatives is helping us reach targeted customer groups with greater momentum. In parallel, we are undertaking portfolio rationalization and sharpening our focus on priority markets to enhance operational efficiency, strengthen market presence and improve profitability. Thereby, we remain committed to achieving consistent and profitable growth. That concludes our opening remarks. We can now commence the Q and A session.
Questions and Answers:
Operator
Thank You. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on your touchstone telephone. If you wish to remove yourself from the question queue you may press star and two participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question comes from the line of Prashant Biani with Elara Capital three Square.
Prashant Biyani
Yeah, thank you for the opportunity. Sir, the first three bullet points of your commentary on slide 12 portrays a very pessimistic scenario but your performance was pretty contrary to that. And I just wanted to know especially on the gross margin part what drove healthy margin improvement at the gross margin level.
Gyanendra Shukla
So I think when we put a commentary it is based on what was happening in the market. Right. So you know last year we started with a very heavy early rainfall that impacted herbicide uses in crops like soybean and cotton. So that was a big impact. Then we came to end of Kareem season. Massive rain led to decline in consumption of insecticide and as you move forward towards Rabi actually rain suddenly stopped in September and as a result there was an impact on pest, disease, pressure and all. So if you see the context of overall year development has been a little bit choppy.
So it indicates that nothing else. Having said that I think our focus is to those events will continue to happen. How do we move forward and deliver better performance on ongoing basis. Now gross margin obviously is a combination of availability so two things, you know. So I mean again it’s a segment by segment. I think our contribution in seed and soil pen plan help business continues to remain robust. When we say crop protection as a category there’s always a mix of product and you might, if any one of you might remember I’ve been talking about two troubled child for us no class twin Benjula.
Right, so. So we are trying to actually liquidate that inventory. I think they’ve done with majority of it that led to compression of margin in fossil foam because we had to liquidate that inventory we just cannot keep it otherwise it becomes a write off.
Prashant Biyani
Sir, I meant. Sorry, you meant that these two products inventory was liquidated before Q4 or during Q4?
Gyanendra Shukla
No, no, during Q4
Prashant Biyani
But we delivered a decent margin expansion at the gross level. So
Gyanendra Shukla
You’re looking at it, right? No,
Prashant Biyani
I’m. I’m looking at Q4 specifically
Gyanendra Shukla
From the perspective of crop protection or seed.
Prashant Biyani
Both seeds I mean is a small thing only mainly on the crop care side.
Gyanendra Shukla
So look, I Think margin expansion. If you see from what I know our CSM business delivered higher margin because we had a contract though it is a smaller business. But there is a clause where we can actually get some benefit if volumes drop below certain thresholds. So that helped SPH business was slightly better overall B2B business exports were better, seed was better. So that that’s what is reflected in overall number on crop protection. Standalone basis it was marginally down because B2C business because of Benjilla and Plasto.
Prashant Biyani
Okay sir, how are you seeing the initial demand for curry?
Gyanendra Shukla
So two things are happening. I think right now everybody has gone into a wait and watch mode. First of all the rainfall impact. Nobody knows the other thing which is people are looking at how government will be able to mop up sufficient fertilizer. These two factors might have some and then third one is always a commodity prices. Right. So rainfall pattern, commodity prices and fertilizer. These three factors will determine to what extent farmer will plant what. When we plan our business, we plan on a normal basis because I believe each three factors, for example, I believe that if farmers get 10% less urea, it will not impact the yield because farmers are used to using high urea because they are highly subsidized.
More than urea, phosphorus, potassium are going to be more critical. When it comes to rain. There’s a forecast of 8% less rain over LPA. But again there have been instances where rainfall has been 8% lower or even much lower but distribution was good and it arrived timely. So as a result it didn’t have much negative impact. So I think a lot of unknowns and war led petrochemical disruption, supply chain solvents, energy costs, everybody increasing the prices of raw material, all of that when you factor in it is very, very difficult to put a finger and say look what will happen.
What we are trying to see is that historically, you know, in my agriculture lifetime experience in 40 years there have been two worst droughts. Even then area soon does not go below 85, 95, even 91, even 90% of farmers will plan something. They might make different choices. They might also down trade on the kind of seed they buy. They may not buy very premium seed. They might reduce some fertilizer consumption. And unless they expect a good income, they may opt for lower cost crop protection product versus high cost crop protection products.
So it’s too difficult to say. From our perspective, we are trying to secure as much as possible supply for Kharif and we’ll also seek opportunities to pass on at least cost increase.
Prashant Biyani
So Just lastly, Sir, our crop B2C business growth was driven by insecticides. So why would insecticide sales grow this much when you know there is a. This would be a herbicide placement season.
Gyanendra Shukla
So I mean, so let me tell you placement. I think first of all we have not gone for any significant placement more than what is required in quarter four because some of this was low cost inventory and we would like to sell in quarter one because there’s an opportunity to realize higher price. And also, but I mean I keep saying that, look, don’t look at our business on a quarterly basis. That’s not the right way. Always look at our business on H1 basis, H2 basis. So if you say H1 story I was telling, no H1 if you see our business actually the leading growth had come from fungicide and herbicide.
And in H1 because of August September rain, insecticide users had dropped. As a result, insecticide business had declined come to H2. Actually our herbicide and insecticide have done better. Right? Whereas fungicide has slightly gone down because when there’s a driver, lesser diseases. But on a yearly basis I would say we are slightly down on insecticide because of the impact which got created in H1. We are up on fungicide and we are significantly higher on herbicide. So on a yearly basis our herbicide business is up by 15%, fungicide by 5% and insecticide is down by 3%.
That means B2C business has gone by 4% overall.
Prashant Biyani
Okay, sir, thank you so much for your time and all the best.
Gyanendra Shukla
Thank you.
Operator
Thank you. Next question comes from the line of Ankur Periwal Access Capital. Please go ahead.
Unidentified Participant
Yeah. Hi sir, thanks for the opportunity. Now my first question on the, the seeds business there. So you know, if I look at, not quarterly but let’s say on an annual basis we have done reasonably well this year along with some sort of, you know, stability or improvement coming in the EBITDA margin as well. Given your commentary of focusing on those key five crops, how do you look at growth or ramp up in this business over the next two to three years? There have been issues of lower inventory earlier but despite that we are seeing some margin uptake possibly because of better pricing.
So your thoughts on one volume growth, pricing growth and margin outlook for this business?
Gyanendra Shukla
Right. So I think now in one statement I can say pricing across the board will be higher because when you have to, when the commodity prices go up, we have to compensate more to the growers and that has to be. We have to figure out a way to continuously Increase the price. Now when it comes to yearly construct of the seed business, to me four crops are more important. Cotton, rice, maize and millet. And each one of those crops actually had delivered growth last year. Cotton in fact had grown by almost 35%.
Maize had grown by 20%, millet growth was 8%. And there was a small growth in rice because rice seed availability was a challenge. Now when I look forward, I think cotton probably this year again will deliver highest growth. Followed by maize and rice and then millet. Millet because of the limited area. In fact, millet might surprise us in a less rainfall area. Sometimes millet area also goes up. So that’s how I see it. So I expect a combination of price and volume growth and expecting to deliver high double digit growth again this year.
Unidentified Participant
Sir, just one follow up. High double digit is a volumetric growth that you’re looking at. Or it includes the pricing also.
Gyanendra Shukla
It’s a combination of volume and price.
Unidentified Participant
Okay, sure. And on the margin front, should we expect to sustain these margins or maybe even improve given the realization improvements?
Gyanendra Shukla
I cannot predict that. But obviously effort is when your business grows. Costs would not grow in the same proportion. That should have positive impact on the margin. But in seed, for example, last year we suffered because we have higher prices for drying and processing. And all this year there is other phenomena. Seed crop was on time by everybody else and harvest came at the same time. As a result, there was a sudden capacity constraint for dryers which is a primarily third party activity. As a result, companies have to pay incremental cost for drying in the paddy open field.
When you dry in the open field, what we call pad drying, it also sometimes can lead to lesser recovery. So all of those factors are not known yet. I think we are in the process of preparing for and inventory and costing and everything probably will be known towards end of the quarter. And how season fares from a consumption perspective is only known when first half is over.
Unidentified Participant
Sure, sir. Second bit. On the crop care side, if you can share your thoughts and comments on the specific product. Aciphate, Vandy, methylene, etc. How is the macro behaving? Especially given the supply chain volatility globally as well, both on capacity as well as
Gyanendra Shukla
I think as far as domestic branded business is concerned. Availability is not a constraint. We are okay now when it comes to our export business. I think there are four primary molecules we deal. Pendimethaline, Hexachonazole, Sfade and Metrobagen. I continue to remain positive on Metrobagin and pendimethalin. And Hexachonazole. There is a structural challenge on SFA side because the same people, those who supply us raw material, they compete with us in the American markets. So as a result there’s always a challenge to supply those markets.
Having said that, given some supply challenges also we are trying to prioritize domestic market for a product like SF8 and trying to balance it, not lose the customer at the same time. See where we are going to be able to be making more money. There are other products like metal XLM we make, Crysoxim Methyl we make. Those are relatively smaller product.
Unidentified Participant
Sure sir, that’s helpful. I’ll get back into the queue. Thank you and all the best.
Operator
Thank you. Next question comes from the line of Viraj with simple please hu
Viraj Kacharia
Yeah, just a couple of questions. First is just to clarify, you said the standalone B2C gross margin has softened in the quarter and whatever increase we’ve seen on a console basis is a mix of B2B exports and seeds. Am I right?
Unidentified Participant
Yes.
Viraj Kacharia
Okay. And also with regards to the double yeah just Q4 and with regard to the healthy volume growth which we saw in B2C in the quarter gone by, that would also be largely a function of the prelacement we would be doing for NSX sites or maybe for the, you know, biostimulants for the upcoming quarter. Would that also be a right understanding?
Gyanendra Shukla
No, actually contrary to what we should have done, we have not done that. We have been very conservative on replacing the stock. Right. So we have only sold what is required because as the sentiments change we might have an opportunity to have higher realization. As a result, we haven’t aggressively posted stocks.
Viraj Kacharia
Okay. Any color you can give in terms of inventory in the system for the market.
Gyanendra Shukla
So look at this point of time if you go to the market while it’s seems challenging environment but every product is available, right? And we haven’t seen any early sign of price increase because consumption has not begun yet. Right. Except the cotton seed where probably in northern India. We are midway in the season. Some of the frosty sale quantity were in season so it’s too early to predict. But yes, on seed cotton prices were not increased by the government so they remain flat. So we have to rely on volume and cotton is going to be roughly 20 25% of our projected cottonseed business.
So from that perspective, no price increase, all the price increase opportunities will come in price. Maize and millet cotton is primarily a volume game. Same way crop protection I think because of rain and all. So. So yes, companies do Place some the normal inventory. We haven’t done anything beyond normal inventory.
Viraj Kacharia
I meant for the crop protection for the industry, not specific to us. Any color you have on the. You can give on the inventory in the system because, you know, even Q2 was bad and Ravi has not been that great. So you know, any color you can give in terms of the inventory in the system.
Gyanendra Shukla
So I think inventory has come to normal level. I mean, two years ago this whole industry was suffering from lot of inventory hangover. I think that has reached to a normal level now. Now obviously I don’t have company by company detail. I don’t have insight into other companies. But there are enough indicators in the system to say people have inventory what they need, they’re not carrying power. Lot of excess inventory.
Viraj Kacharia
Okay. No, because where I was coming from is as you alluded in this earlier part of the call as well is that you know, any cost increase which we are witnessing right now, we will be looking at opportunity to pass through. So in that sense, you know, especially on the Zenzig piece, you know, just understand the factors. We are, you know, looking internally which gives us confidence that
Unidentified Participant
We’ll be able to pass through.
Gyanendra Shukla
Yeah. We are one of the first ones to announce price increase because we cannot absorb all the cost because season consumption season has not yet begun. So it’s very, very difficult to say how market will be have. But every company is kind of indicating, you know, they have to pass on cost increase. Otherwise they will all become. They will. They’ll face a very challenging time.
Viraj Kacharia
Okay, and last question was on the exports of the B2BC. Any update in the pipeline into the new molecules which we have commercialized or looking to commercialize.
Gyanendra Shukla
So current year. So last year we did start making. There’s a molecule called Pensecuron. Besides that, when that happened in the last quarter, I think we will still rely on old molecule. There are two, three new molecules. So we have narrowed down the list which used to work. Now we’ve got about three molecules which should get introduced in next two to three years. We are in the advanced stages of know, establishing processes, know, working with the supplier, what you call buyers and. And obviously there’s a registration process that has to happen parallelly.
Viraj Kacharia
Okay, thank you.
Gyanendra Shukla
Thank
Operator
You. Next question comes from the line of Sor. Jane with HSBC please.
Saurabh Jain
Thank you for the opportunity. Yes, sir. First, my first question is can you please give us a. Sorry for interrupting.
Operator
You sound a little lower. Can you speak a little louder please?
Saurabh Jain
I’m saying can you give us some sense on how Is the trends you’re looking at in April across all the three businesses in terms of, you know, volume growth and maybe some sense on the pricing.
Gyanendra Shukla
So if you say April, April basically some season for tea gardens starts in the northeastern side. That is from a consumption perspective is normal. Apple season seems to be normal across Himachal and Jammu. Then you have cotton season which begins in north for seed. This is a low crop protection month and low SPH month. Right. Because all of that will start with the rains when they start coming in the month of end of May in Kerala and pre monsoon source some places it happens. So it’s too early to predict that.
But as I was saying, farmers will plant the crop even in the worst monsoon years. We haven’t seen acreages dropping. I think what farmers do start doing in down trading, right? So they might use lesser price, they might surprise seed. In some cases they might go for saved seed. All of that happens given the uncertainty around rain and commodity prices and everything else. Seed indication I think will have a fair seed indication by end of May. In terms of sentiments towards crop. Crop protection I think is very, very difficult to predict any trend before end of May or early June.
Saurabh Jain
And what about global trends? Because you earlier alluded to the fact that there is some sort of panic buying that is being set in. Are you seeing any trends that indicate that the trade channels are looking to fill up the products and volumes are moving early,
Gyanendra Shukla
Not early. So North America is the biggest season where placement happens in the March right now their purchases would have happened in the fourth quarter calendar year last year. So I think what is important for North America is their rainfall because their agriculture is highly rainfall dependent. Brazil had a decent season, not an outstanding season. But global commodity prices actually still are not reflecting in the commodity prices around the globe. Commodity prices continue to remain relatively soft, which means at least what is sitting on enough inventory of everything.
Saurabh Jain
And have you also increased, you’ve taken some price increases in the global portfolio
Gyanendra Shukla
Everywhere. I mean wherever possible we have to increase, otherwise we’ll be paying money from our pocket.
Saurabh Jain
Understood. In trying to tie this with the disruption that we are currently witnessing. And you also mentioned that the margins in the B2B business has improved. Would it be fair to assume that the worst of the margins are behind and with the price increases that we might undertake, you know, the margins can hear onwards trend on a positive side can can get better.
Gyanendra Shukla
You know, in last five, seven years this industry has learned a lot, right? So there was a Covid and there was a Ukraine war and now this Is new war and every time new learning is coming. Right. So during COVID period everybody got engaged in the farming. As a result, companies did very well and supply chain was disrupted. But still material was available. Then came Ukraine war. There was a shock of petroleum prices that subsided. That no. But that Covid thing also led to a lot of inventory buildup.
Because 1, 2 year did well 3rd, 4th year, a lot of inventory. Then war happens and all that has become normal. Now we are dealing with a new thing. So too frequent, too many things happening. And now we are also talking about El Nino. So all I know is that farmers will plant the crop southeast monsoon based on what it looks is going to be good. Punjab, Haryana, western up part of Rajasthan eastern. But the prisons are all irrigated or get what you call a short rainfall. So the risk is only few pockets in the country.
So for example, Marathwada, Vidarbha could be a challenge. There could be a challenge in Saurasta. There could be a challenge in Royal Sema. Other than that there are pockets of challenge. But I would say still agriculture Farmers will. That’s a basic thing, right? Will happen. They will plant the seed.
Saurabh Jain
Sure, that’s helpful. My last question at this point in time, are you facing any disruptions in terms of your procurement of raw material or technicals or very high pressing which you would believe that it will be difficult to pass on?
Gyanendra Shukla
So there was a period when every company left, right and center was issuing force measure letter and they said wait, right. There was a time when they will say we are giving you a price for a quantity confirms in three hours. Otherwise after three hours they cannot. I think all of that is over now. There’s a bit of normalcy. So when this war started, I mean things looked very chaotic. But there’s some order is getting established. Yes, obviously we have to pay higher for everything. And then we have to figure out a way to see how much we can increase.
Obviously it will depend on what compromises the competitive products also do.
Saurabh Jain
Yeah. Okay. So let us see if you know, this thing seems to continue more than what we earlier expected. Would you expect any disruptions in your manufacturing in the next few critical months? Month of May and June.
Gyanendra Shukla
So I think as far as Kharif is concerned, we have covered ourselves quite well. Seed is all domestic, no problem. Soil and plant health is by and large covered, largely domestic. Where we have a crop protection which is a domestic side story. Five ingredients we produce on our own. Some of the other ingredients we have suppliers where they might want higher price. But we have secured supplies. So it’s not a straight answer. I would say I’m covered by and large for the Kharif.
Saurabh Jain
Okay, sure. That is very helpful.
Gyanendra Shukla
It goes beyond June. Right? Thank you.
Operator
Thank you. Next question comes from the line of Rohit Nagaraj with 361 capital.
Viraj Kacharia
Yeah. Hi. Thanks for the opportunity. The first question is in your opening remarks you mentioned that the margins will be stable to store jobs. And in terms of the cost increase, we have already experienced that the raw material cost or sourcing cost has increased. We’ll be passing on to the farmers by increased prices. But given that the monsoon is expected to be low, how much ability do we have in terms of increased cost? Completely passing on to the farmers. And secondly, will there be any negative impact?
Because generally the sentiment will be negative. Plus as you also explained, there would be down trading which will also happen. So I mean the farmers may go for branded generics to the normal generics. So just a broader perspective would be helpful. Thank you.
Gyanendra Shukla
So. So branded generics actually helps Rallis, because this is where we operate now. We are selling generic product. We are not an inventor company. Right. As far as planting is concerned, we know that farmers, I mean as I said, farmers even in the worst condition will plant the crop. And if they go for lower cost seed, lower price of a lower price and priced product, it does help rallies both on the seed and crop protection and other category side. What we don’t know is basically a fertilizer. How much government will be able to provide fertilizer?
Will farmers be making different choices? Government has not increased any prices for the farmer. So all price increase currently if you see is being absorbed by the government. And as I said, look, even if 10% less urea is available, it actually doesn’t, it will not have any serious impact on the agriculture production. It might have a sentiment. So some people think that for growing corn you need more fertilizer. So if they don’t get enough urea, they might say okay, plant less corn. But then there’s the other side of the story where now they can easily sell that for the industrial user.
So it’s not a straight answer. I would say let’s assume agriculture will happen, there’ll be cost increase and companies will have opportunities to pass on the cost increase unless there’s a total failure of agriculture. Monsoon doesn’t come in at all in June and July. I mean that has never happened in the history of no humankind.
Viraj Kacharia
Sure, sure. Thanks. And just second question, in terms of cost increases till now, what is the kind of cost increase that we have observed, percentage on overall
Gyanendra Shukla
15 to 25% is generally the range.
Viraj Kacharia
Sure, I think that is helpful. Thanks a lot. And all the rest. Sir.
Gyanendra Shukla
Yeah. Thank you.
Operator
Thank you. Next question comes from the line of Ketan Chawla with Affirmative Capital. Please go.
Unidentified Participant
Hi, can you just have a clarification on the earlier question? So the 15 to 25% cost increase is on account of raw materials. And what proportion of this are we passing through versus what we’re absorbing?
Gyanendra Shukla
So as I said in the beginning, right now is all placement, right? We have tried to pass on all. We have announced the price increase. I think everybody is working. So there’s always a carry over inventory which comes from January, February, March that was supplied at the low price. I think that will get exhausted and then new price will start getting established in the market. That’s how market starts. So all the new supplies we have been supplying at price, our attempt to earn all the crease, whatever.
But the rate and margin rate.
Unidentified Participant
Understood. And in terms of based on where you know, how you see the market right now, how long do you expect this 15 to 25% cost increase? Are you expecting this to populate for first half of this year?
Gyanendra Shukla
Look, most of the Kharif inventory people will build by June. So for Kareem, this cost increase, you have to assume that it has happened, right? It’s already a reality. We cannot ignore that fact because we are sitting in May. Sorry, we are getting into May now very soon. And most companies would like to procure raw material. Even if something has to be sold in July, August and September because of the lead time of shipping, bringing in, processing, backing and supplying. So Generally it’s a 90 to 150 day cycle depending on the product and crop.
For herbicides anyway, every company has made all the arrangements. Because herbicides need to be supplied in May and June for consumption in June and July, right? So herbicide is all done. Insecticides also start early. That’s happening. Fungicides come later on. So I think you have to assume this cost increase even if say war settles. Tonight we have a surprise announcement that war is over. Right? Straight upon us is open life is normal. It’s going to take three to four months to unwind. To me, Kharif, this is a reality.
We’ll live with it. We’ll have to live with it. We don’t have a choice. Understood. Thanks.
Operator
Thank you. Next question comes from the line of Abhijit Akela, Kotak Securities. Please go ahead.
Viraj Kacharia
Good morning. Thank you so Much for this question. Hi sir, just first of all one clarification on the numbers revenue breakdown. Bhaskar had given us a number of 255 crores for B2C sales for the quarter compared to 222 last year. Just wondering if it might be possible to also give us a crop protection component within that specifically.
Gyanendra Shukla
Yes, he will be able to provide that. So you are looking at a breakup of. So so those are micro details but by and large I would say it is split between SPH and crop protection now. 20% and 80%. But we’ll get back to your details separately because these are my. No,
Viraj Kacharia
No problem. You can drop the mail
Gyanendra Shukla
To charge separately.
Viraj Kacharia
Sure, sure. And when you guided to high double digit growth for seeds in the next year, just to clarify that basically referring to say something like high team. Right. Is that the range you’re looking at?
Gyanendra Shukla
I am in mid teen easily.
Viraj Kacharia
Okay, okay, sure. And there was one comment. So you made in the opening remarks that the sector may see 3 to 4% growth in FY27. No,
Gyanendra Shukla
That’s the GDP growth. Oh, okay,
Viraj Kacharia
Okay, okay. All right. Understood. But on the crop protection side as well, the margins when you mentioned steam to soft we’re basically expecting. Yeah.
Gyanendra Shukla
So I mean percentage revenue growth will be higher this year because price increase. So revenue growth probably will be maybe double the digit. And I don’t know what it could be because if an input cost has gone up by 15 to 20% it is going to lead to price increase for sure. It will be 5%, 8%, 10%. I don’t know at this point of time because ultimately many factors are not clear yet. Margins depending on how competition will react, how commodity prices will be have. Generally in such situations commodity prices tend to rise.
And again it tends to be crop specific. Other than rise. I expect commodity prices to remain firm on everything else. Rice global globe is sitting on an excess supply including India. Now India for example grows a lot of basmati. Middle east remains disrupted. Then basmati demand will go down. As a result farmers may plant less basmati. So they might plant regular rice. They might plant a little bit more maize or some other crops. So I think those are the things too early to say. But again for maize they will say I need more urea.
Now if more urea is not available, will they do something else? Too early to say.
Viraj Kacharia
Just last couple of things for me. One is, you know, at some point if we assume that this war ends and the price of crude comes down, how do we sort of Protect ourselves from the risk that we may be sitting on high cost inventories at that point.
Gyanendra Shukla
Actually, your life, the question. Well, because line was breaking.
Viraj Kacharia
Yeah. Am I audible right now? Clearly?
Operator
Yes, you are audible. Please go ahead.
Viraj Kacharia
Yeah, thank you, sir. Just asking that
Gyanendra Shukla
Question.
Viraj Kacharia
Yeah, sure. So Just asking that. Yeah, sure. I hope you can hear me now. Yes, Mr. Akiva,
Operator
You sound loud and clear. Please repeat the question. Thank you.
Viraj Kacharia
Yeah. So the question is that assuming the war, you know, assuming the price of crude comes down by some extent over the next say three to six months, how do we sort of manage the risk that we might be sitting on high cost inventories at that point in time?
Gyanendra Shukla
I think two ways to look at it. One is that we don’t have to become greedy in hoarding the inventory. Right. So we will go as per the business plan based on what can be sold. So we’re not going to hold the inventory. And if, even if war unwinds in three to six months, I am saying we are not building inventory beyond Kharif. Right. Kharif is something we want to protect for Ravi Will. So I think I can tell you and I don’t know what other companies do I have every call in the morning, every day we talk.
Right. So we are almost back to a situation. During COVID now. We were doing calls since morning 8am to 8pm so we’re into that situation. We are not. We are building inventory, which we think is right. We’re not building excess inventory because that could be a good opportunity and a bad opportunity. So we are doing. We are very calibrated about what we buy. What we said we’ll only buy what we can sell.
Viraj Kacharia
Understood, sir. That’s. That’s clear. Just last quick thing. This liquidation of Plasto and Benzilla in the fourth quarter, was that one of the key contributors to this 14 volume growth that we saw in domestic formulations?
Gyanendra Shukla
So out of the that benjila we, when you can say 80% of the problem is very little problem. Left, right, class two was more dependent on the chili crop. The thrift. The chili crop did get planted. Commodities were low teams. The first chili farmers, Benjulia was no preference of the farmer. So we are launching new products in those segments at the same time we have. We are unwinding inventory completely.
Viraj Kacharia
Thank you so much, sir. All the best for the year ahead.
Gyanendra Shukla
Thank you.
Operator
Thank you. Next question comes from the line of Riju with antique stockbroking. Please go by.
Unidentified Participant
Yeah. Hi sir. Hope I’m audible. Yes. My question regarding the inventory. If I try to look at your six numbers, I think inventory days a bit higher. So this is predominantly that we are building some, some inventory at a lower cost, maybe the pre work scenario or during the year scenario to protect our margin going forward. So how it is like is it RM related or like a finished CAD we have already built?
Gyanendra Shukla
No, no. So it is not related to what we build for the season. It is related to preparing for. So I mean this war thing was almost imminent right from the month of January. Right. So we waited for a war to happen. Wait for war to happen. We did take some risk to build some inventory for the. So, so,
Unidentified Participant
So understood. So these are predominantly RM inventory and maybe a low cost kind of inventory that we are built.
Gyanendra Shukla
Absolutely
Unidentified Participant
Understood. And sir, second thing, if I look at, in terms of you know in the, in the, in the current, current pricing of the few of the commodities. So in your earlier remarks you said that are you expecting a good, good crop in terms of maize and other crops. So, so if I look at pricing of maize, uh, from the month of October, November, so the prices are very low compared to the MSC prices. How do you see the impact like our farmer going to, you know, stick to the maize crop or there will be some shape that will happen if that happens.
Like what are these scenarios in terms of city business and in terms of your city business will get.
Gyanendra Shukla
So I think look low and high has to be seen from the perspective of farmers makes per acre of money. Don’t worry about commodity prices as much. I think at the end of the day it will be matter of relative economics. So how much I can produce by growing a crop, how much it is going to cost and what price I can sell. To me what they are used they have seen for a period of time crop is still very, very competitive to grow.
Unidentified Participant
Understood. So crop prices might not impact significantly in terms of crop shifting, right?
Gyanendra Shukla
Yes, I mean, I mean it’s again I’m saying for example rice. So I think a lot depend on global inventory buildup and what country allows to import and what country restricts. For example India had a restriction on how much maize can be imported. We said we will not allow GM GM maize commodity soybean which is GM grown. So I think a lot of other factors will play I would say other than rise inventory. Global inventory is at the normal level.
Unidentified Participant
Understood, Understood. And sir, in terms of city business right now we have done 15% kind of a growth. So in the domestic CP business, if you could you know, clarify in terms of volume and the duration growth in the 15% growth that we have reported this quarter.
Gyanendra Shukla
15% growth in which segment?
Unidentified Participant
CP business that we have recorded this quarter.
Gyanendra Shukla
That is crop protection. We were. Where did we say the same? Oh, you’re saying B2C growth, right?
Unidentified Participant
Correct. Correct.
Gyanendra Shukla
Yeah. So see we have. When we say crop protection business we primarily have there’s a soil and plant health and there’s also crop protection. And so these are the two major component. Now this is B2C. Within that there’s a higher growth in soil and plant health related to crop protection. And I have been saying that look, my focus is to sell more herbicide, more soil and plant health and more seed. Right. Because disease sometimes because of moisture and all can come and go. Insects come and don’t come.
Right. So actually our focus segments have contributed more in terms of growth. If you see from that perspective.
Unidentified Participant
Understood. So sir, if we remove that, you know, 27% kind of a growth in the spa, how much will be our B2CP business growth for this quarter?
Gyanendra Shukla
It will be flat.
Unidentified Participant
Okay. It will be flattish kind of.
Gyanendra Shukla
I mean marginal growth. I mean you can say marginal growth, low single digit. It won’t be flat. It’s still marginally positive.
Unidentified Participant
Understood? Yes. Thanks for clarifying all the questions.
Operator
Thank you. Next question comes from the line of Nitin Avasti with infrared capital. Please do it.
Unidentified Participant
Hello sir. Just wanted to understand on your new venture, the aqua feed business. What is the current investments and the thought process behind this? And given that Tata and Maharashtra. The Tata group in Maharashtra does have expertise in fresh water fisheries with its hatchery business, not business. It’s a social commitment perspective. So that linkage and the basic thought process behind this business. Where we are, what we, what we see to invest, where we are going to invest. That if you could outline.
Gyanendra Shukla
So look, as part of the Tata strategy in agriculture we did the whole mapping and we identified this as an idea to work experiment. Right. I think it’s still at the experimental stage. Because we believe as economies grow per capita income grows more animal origin protein becomes a crop preferred food or the consumption of fish which can be grown in land. Even our Prime Minister keeps talking about mission so that no, we are not only dependent on ocean. We can also have more fish in land. So I mean look, this still is a relatively smaller scale.
It hasn’t gone to a stage start discussing how much we want to make investment. I would like to see one more year this year to say where I am able to take it and then start thinking up the strategy. But yes, it’s an Important segment we were trying to understand rather than trying to rush into the segment.
Unidentified Participant
Understood. So the current products in the market are completely outsourced.
Gyanendra Shukla
So products are outsourced. Soil and plant health business we incubated seven, eight, 10 years ago because when we sold Tata Chemical bulk fertilizer business we were left with some residual micronutrients, right? So we said okay, what do we do with this business? So we build or build this business. Now it has reached to a scale of no. To 50 crore plus. So now we are saying okay, how do we invest more? Because this we find it very exciting, Right. I think equa is probably there five, seven years ago our soil and plant health business was.
So we probably one or two more cycle before we can say anything about it.
Unidentified Participant
Understood. So second question.
Gyanendra Shukla
But I think see there’s so much potential in everything, right? We can’t do everything. So it’s a still understanding phase.
Unidentified Participant
Understood sir. The secondly, on the seed perspective, the whole industry has a lot of GE trials approved, including Rallis and it’s been going on for quite some time now. And given that the new policy of GE which has come up which differentiates itself from GM regulation, do you see what you call the traction in that segment increasing exponentially going ahead or do you still see hurdles in this segment picking up?
Gyanendra Shukla
See when I Look at seed RnD there are clearly two components. One is called genetics improvement where you keep accessing genetics and start applying tools to improve the genetics to develop product faster. I think there we are doing everything which needs to be get done when it comes to ge. Basically it’s not about GM crop now any longer. It’s not about bringing gene from outside. The conversation is all about genetic gene editing. And gene editing is one space I think where while government has cleared the regulation but big global multinationals continue to hold patent rights.
Right? So we would rather initially rather than trying to do everything in house,
Unidentified Participant
We
Gyanendra Shukla
Would rely on outside skills to get the job work done. And there are technologies we are accessing. For example, our cotton business is built on the foundation of BT technology. Now we are, we are actually launching what you call paran technology led rice seed business where there’ll be herbicide tolerance gene and will be sold as a bundled product along with seed and herbicide. So we would rather license those technologies rather than trying to invest 10 years on researching those technologies.
Because global multinationals, they have disproportionate R and D on those areas. I think by spending a small money and for the sake of conversation I can say I will do it. But I would rather prefer accessing those technologies, you know?
Unidentified Participant
Understood, sir. Thank you.
Operator
Thank you. Next question comes from the line of Tashi Tasha, the PSP asset manager. We have lost the line of Mr. Shah Promote the next. That is Rajkumar Vedanath Projects.
Viraj Kacharia
Yeah, My question has been answered. Thank you so much.
Gyanendra Shukla
Yes, please go ahead.
Operator
Thank you. Ladies and gentlemen, we take that as a last question and conclude the question and answer session on behalf of Valis India Ltd. That improves this conference. Thank you for joining us. You may now disconnect.
Gyanendra Shukla
Thank you.