Buzzing Stock: Sharda Cropchem soars 37% this week after posting robust Q3 results

The stock has hit its all-time high of Rs 525.80 on the BSE today.

Shares of Agrochemical manufacturer, Sharda Cropchem Limited were up 19% intraday on Tuesday today, continuing its rally this week in an otherwise weak market on the back of a strong set of Q3 numbers.

In the quarter ended December 2021, Sharda Cropchem recorded topline growth of 78.17% YoY and 36.88% QoQ to Rs 879.81 crore led by strong volume growth across geographies, better product mix and price realisation. The company reported PBIDT (Ex OI) of Rs 188.36 crore during the quarter, up 95.73% YoY and 89.74%, sequentially. Operating margins expanded 192 bps to 21.41% during the quarter driven by economies of scale, effective cost management marginally settled off by higher freight cost. On a YoY basis, the company's Q3 net profit was more-than-doubled to Rs 102.19 crore in Q3FY22 and was up significantly from a net profit of Rs 48.30 crore reported in Q2FY22.

The company’s board declared an interim dividend of Rs 3 per equity share for the financial year 2021-22. The company fixed February 2, 2022, as the record date for interim dividend.

Apart from the strong Q3 numbers, the investor sentiment for companies in the agrochemical industry like Sharda Cropchem has been positive on expected announcements to increase fund-flow in the industry in the Union Budget 2022.

Headquartered in Mumbai, Sharda Cropchem Limited is a fast-growing global agrochemicals company with a leadership position in the generic crop protection chemicals industry. The company has an asset-light business model whereby it focuses on identifying generic molecules, preparing dossiers, seeking registrations, marketing and distributing formulations through third party distributors or its own sales force. Its identification of off-patent high-demand molecules, high registration cost and a long gestation period in registering formulations and active ingredients are high entry barriers.

At 1.10 pm on Tuesday, the stock of Sharda Cropchem was trading at Rs 522, up by 19.12% or Rs 83.80 per share as against a 0.29% decline in the benchmark index. The 52-week high of the scrip is recorded at Rs 525.80 and the 52-week low at Rs 265 on the BSE.