The Immense Growth of PI Industries Limited

“Our Branded products for crops including Cotton, Rice, Chili, Horticulture and Wheat, have performed well. With a portfolio of advanced brands, we have carved out leadership in respective categories. Further, we are recording attractive responses to the spate of new brands that we have recently introduced into the domestic market; one of the highest number of launches in the industry in a year. “

– Mr. Mayank Singhal, Executive Vice Chairman and Managing Director in Q3FY23 Concall

Stock Data
Ticker	PIIND
Exchange	NSE
Industry	CHEMICALS

Price Performance
Last 5 Days	+7.11%
YTD	-1.00%
Last 12 Months	+18.58%

*As of 28.04.2023

Company Description:

PI Industries Ltd. has a diversified business portfolio that includes agrochemicals, custom synthesis, and contract manufacturing. The company operates through two main segments, namely Agri-inputs and Custom Synthesis & Manufacturing. The Agri-inputs segment produces insecticides, herbicides, fungicides, and plant growth regulators for crop protection. The Custom Synthesis & Manufacturing segment provides contract research and manufacturing services to global customers in the pharmaceuticals, agrochemicals, and specialty chemicals sectors.

Future Prospects:

PI Industries Ltd. is well positioned to benefit from the growing demand for agrochemicals globally. The company has a strong R&D team that enables it to develop new and innovative products that cater to the needs of farmers. The company is also expanding its manufacturing capacity to meet the growing demand for its products. PI Industries Ltd. is exploring new markets and partnerships to expand its reach and increase its market share.

Key Strengths:

“Dynamics within the global speciality chemicals industry are evolving to realise higher value procurement of products from India, where the country stands out both in terms of quality, processes, and technology. Global clients are prioritising diversification of sourcing to India, even as the country develops an integrated value chain in key chemistries. Our order book at the end of the quarter stood at around US$ 1.8 billion, indicative of the confidence the innovators repose in our business model and delivery.“

– Mr. Mayank Singhal, Executive Vice Chairman and Managing Director in Q3FY23 Concall

• Strong R&D capabilities: PI Industries Ltd. has a dedicated R&D team that focuses on developing new and innovative products, formulations, and processes. This enables the company to offer a wide range of customised solutions to its customers and stay ahead of its competitors.

• Diversified business portfolio: The company has a diversified business portfolio that includes agrochemicals, custom synthesis, and contract manufacturing. This enables the company to cater to a wide range of customer needs and reduces its dependency on any particular segment.

• Strong manufacturing capabilities: PI Industries Ltd. has a strong manufacturing infrastructure with numerous manufacturing plants in India and one in Saudi Arabia. The company’s manufacturing facilities are well equipped with state-of-the-art technology, which enables it to produce high-quality products at a competitive cost.

• Strong distribution network: The company has a strong distribution network in India and exports its products to over 80 countries across the globe. This enables the company to reach a wide customer base and generate a significant portion of its revenue from exports.

• Experienced management team: The company has an experienced management team that has a proven track record of successfully managing the business and driving growth.

Key Opportunities:

“Our business model remains poised to scale up markedly once the consummation of the new pharma entity takes shape. We continue to actively evaluate inorganic growth opportunities in pharma domestically and internationally in line with our pharma strategy. Initiatives to augment leadership bandwidth are ongoing to steer our foray.”

– Mr. Mayank Singhal, Executive Vice Chairman and Managing Director in Q3FY23 Concall

• Growing demand for agrochemicals: The global demand for agrochemicals is expected to continue growing in the coming years due to population growth, increasing demand for food, and decreasing arable land. PI Industries Ltd. can leverage this opportunity by expanding its product portfolio and capturing a larger share of the market.

• Increasing focus on sustainable agriculture: With growing concerns about the impact of agriculture on the environment, there is an increasing focus on sustainable agriculture practices. PI Industries Ltd. can leverage this opportunity by developing and offering sustainable and environmentally friendly products to meet the evolving needs of farmers.

• Increasing focus on contract manufacturing: The contract manufacturing segment is expected to continue growing due to increasing outsourcing of manufacturing activities by global companies. PI Industries Ltd. can leverage this opportunity by expanding its contract manufacturing services to capture a larger share of the market.

• Increasing focus on research and development: With increasing competition in the agrochemicals and custom synthesis sectors, there is a growing need for companies to focus on research and development to stay ahead of the competition. PI Industries Ltd. can leverage this opportunity by investing in research and development to develop new and innovative products that meet the evolving needs of its customers.

• Expansion into new markets: PI Industries Ltd. can expand its reach and increase its market share by exploring new markets and geographies. The company can leverage its strong distribution network and product portfolio to capture a larger share of the global market.

Financial Results:

PI Industries Ltd.’s revenue in Q3FY23 rose 19% to ₹ 16,132 million. Consolidated Profit After Tax came at ₹ 3,518 millions in Q3FY23 showcasing a 58% rise on an YoY basis. In this quarter’s results, the reports suggested that the firm has continued to deliver consistent performance in all key operational and financial indicators in Q3Y23.

Despite higher depreciation, the EBITDA growth of the company supported its rise in net profit. During the quarter that ended December 2022, the EBITDA grew by 40% YoY to stand at INR 415.6 crore.