UPL Q4 net profit jumps 29%, revenue climbs 24% as higher prices help

Agrochemicals company UPL on Monday reported a 29% jump in its consolidated net profit on a year-on-year basis for the fourth quarter ended March 2021.

The company, which is one of India’s biggest manufacturers of pesticides, said fourth-quarter profit jumped to Rs 1,379 crore as against Rs 1,063 crore during the same three-month period last year.

While the profit numbers were slightly lower than analysts’ projections, UPL said it saw “robust growth” in revenue during its fourth quarter, which was up 24% on a year-on-year basis to reach Rs 15,860 crore.

The company said this growth was on account of a 19% higher product realisation, a 3% higher volume growth and the impact of the depreciating rupee, which added 2% to its top line. In the same period last year, UPL had reported revenue of Rs 12,797 crore.

Shares of the company on Monday were trading at Rs 778.05 in the afternoon session, down 1.11% on the BSE.

Other key highlights

1) EBITDA grows 36% on a year-on-year basis to Rs 3,591 crore, as against Rs 2,839 crore.

2) Net profit for the full financial year 2021-22 was up 26% to Rs 3,626 crore from Rs 2,872 crore during 2020-21.

3) UPL’s revenue in FY22 climbed 19% to Rs 46,240 crore from Rs 38,694 crore the year before.

Management commentary

UPL said that improved realizations, backward integration linkages for key products and effective supply chain management aided in delivering higher EBITDA margins.

“We have been able to significantly outperform the guidance given at the start of the year, with nearly every region seeing double-digit growth,” said Jai Shroff, CEO, UPL.

“FY22 was a year of challenging macro-environment, input cost inflationary pressures and supply chain disruptions and we chose to prudently invest towards ensuring reliable growth going forward,” he said.

“As we look ahead into the new year, we feel very well-positioned to further power our growth trajectory as the demand outlook continues to be constructive supported by strong agri commodity prices. The positive traction in our differentiated & sustainable solutions business is expected to continue, led by new launches and a strong go-to market strategy. Further, we will continue to improve our leverage ratios and ROCE profile,” said Shroff.