Advance Agrolife Limited IPO

1 Oct 2025 , 05:38 PM

Advance Agrolife Limited is a Jaipur based company that produces a wide range of technical and formulated grades of insecticides, fungicides, herbicides and plant‑growth regulators, holding more than 400 product registrations and operating three integrated manufacturing facilities.  Over the last three fiscal years, the business has delivered steady top‑line growth and strong return metrics, positioning it as a competitive player in the Indian crop‑protection market.

Offer details of the IPO

• Total Offer Size – INR 192.9 crore. The issue comprises a fresh issue of up to 19,285,720 equity shares worth INR 192.9 crore. There is no offer for sale component.

Price Band: INR 95 to INR 100 per Equity Share

Book‑Running Lead Managers

• Choice Capital Advisors Private Limited

Agro‑Chemicals Industry – Overview

The agro-chemical sector provides crop-protection and nutrition solutions that support modern agriculture in meeting the world’s growing food demand. In India, the sector is largely dominated by chemical pesticides—including insecticides, fungicides, herbicides, and a miscellaneous “others” category (such as plant-growth regulators, fumigants, disinfectants, etc.). However, a fast-growing bio-based segment—comprising bio-pesticides and bio-fertilisers is increasingly reshaping product portfolios and driving the industry’s future growth.

Table: Key Segments

Key Segment	What it Covers
Insecticides	Chemicals that kill or repel insects (contact & systemic modes).
Fungicides	Protect crops from fungal diseases (protectants & eradicants).
Herbicides	Weed‑control agents (selective & non‑selective).
Others	Plant‑growth regulators, fumigants, nematicides, rodenticides, miscellaneous formulations.
Bio‑pesticides Bio‑fertilisers	Micro‑organism‑based or natural‑product agents that offer low‑residue, environmentally‑friendly crop protection and nutrition.

Source: RHP

The Indian market is the world’s fourth‑largest producer of crop‑protection chemicals (≈ 14 % of global share) and a net exporter of pesticides.  Demand is driven by a rising population, higher per‑capita food consumption, expanding horticulture & cash‑crop acreage, and government programmes that boost credit, MSPs and organic‑farming incentives.  At the same time, stricter residue regulations, the push for sustainable farming and the emergence of bio‑based solutions are reshaping the competitive landscape.

Table: Growth‑Rate Snapshot (Past vs Future)

Segment / Market	Past Growth Rate (CAGR)	Future Growth Rate (Projected CAGR)	Comment
Global Crop‑Protection & Nutrition Market	6.2 % (2019‑2024) – driven by steady expansion of arable land, higher yields and rising food‑price pressures.	~6 % (2023‑2029) – growth to continue as emerging economies intensify pesticide use, but will be moderated by stricter environmental rules.	The market remains robust; however, the share of herbicides is expected to decline in favour of more targeted, low‑residue products.
Indian Pesticides Market (USD)	10.9 % (2019‑2024) – from USD 814 m to USD 1,367 m, buoyed by strong domestic demand and export growth (CAGR ≈ 8.1 % for exports).	8.8 % (2024‑2029) – forecast by CareEdge, reflecting continued demand for high‑value crops and a shift toward premium formulations.	India’s growth outpaces the global average, underpinned by expanding horticulture, increased mechanisation and government support.
Domestic Chemical‑Pesticide Consumption (tonnes)	–2.7 % (recent 5‑year window) – a modest decline as dosage per acre falls and newer‑age agro‑chemicals gain market share.	2.4 % (FY 20‑FY 36) – projected rise from 61 k t (FY 20) to 89 k t (FY 36), ≈ 46 % total increase (≈ 2.4 % CAGR).	The slowdown reflects better‑targeted applications and a gradual shift to bio‑alternatives; the long‑term outlook remains positive as overall crop area expands.
Bio‑Pesticides / Bio‑Fertilisers	< 2 % of total pesticide volume (2022‑23) – early‑stage market, mainly neem‑based and microbial products.	10‑12 % of total pesticide volume by 2029 (industry consensus) – driven by EU Green Deal, US EPA fast‑track approvals and strong Indian R&D in microbial agents.	Bio‑based solutions are the fastest‑growing sub‑segment; they will capture a larger share as regulators tighten limits on conventional chemicals and farmers seek residue‑free produce.
India’s Crop‑Protection Demand (tonnes)	61 097 t (FY 20) → 55 000 t (FY 23) – a dip due to lower per‑acre dosage and pandemic‑related supply‑chain stress.	89 170 t (FY 36) – ≈ 46 % increase over 16 years (≈ 2.4 % CAGR).	The demand trajectory reflects population growth, higher MSPs, and the adoption of precision‑agriculture tools that enable more efficient pesticide use.

Source: RHP

• The Indian chemical-pesticide market has historically grown faster than the global average. However, in recent years, it has seen a modest contraction in volume due to falling dosage intensity.
• Future growth is expected to be driven by premium, low-residue formulations and bio-based products, which are likely to offset the slowdown in traditional chemical pesticide volumes.
• Government policies—such as MSP hikes, incentives for organic farming, and stricter residue limits, along with the adoption of precision agriculture, will continue to influence product mix and shape the overall growth trajectory of the sector.

Advance Agrolife Limited – Company Overview

Advance Agrolife Limited, incorporated in 2002 is headquartered in Jaipur, Rajasthan. The promoters are Om Prakash Choudhary, Kedar Choudhary, and Geeta Choudhary. The company operates in the agro-chemical sector with over 400 formulations, focusing on sulphur-based and eco-friendly products. It has three manufacturing plants in Jaipur and additional capacity in Gujarat. Its distribution network spans ~4,500 distributors across 26 countries and 20 Indian states, serving key customers like DCM Shriram and IFFCO.

Competitive Positioning

Strengths

• Broad product base – over 400 registrations, enabling diverse crop-protection solutions.
• Extensive distribution – 4,500+ dealers and 13,500 retail points, ensuring strong market reach and repeat orders.
• Eco-friendly focus – sulphur-based and “green chemistry” products aligned with sustainability trends.
• Established customer relationships – major agro-chemical players provide revenue visibility.

Weaknesses & Risks

• Regulatory & litigation exposure – over 50 pending criminal cases (Insecticides Act violations, misbranding allegations) with hearings scheduled through 2025–2026.
• Rising debt – While still moderate, total debt increased from INR251 mn (FY23) to INR792 mn (FY25); debt-to-equity ratio trending upward.
• Declining asset turnover – efficiency of asset utilisation decreased from 1.76× to 1.43× over FY24-25.

 

Financial Profile

Robust Revenue Growth: Advance Agrolife Limited recorded a revenue CAGR of ≈12 % over FY 2023–25, with net sales rising from INR3,978 mn in FY 23 to INR5,023 mn in FY 25. Growth was driven mainly by domestic sales (INR3,630 mn → INR4,920 mn), while export revenues fell (INR336 mn → INR99 mn). Product-mix optimisation, focusing on higher-margin sulphur-based and technical formulations, supported steady growth. No material acquisitions were made, indicating organic expansion. FY 2025 revenue growth (+10 % YoY) reflects continuation on a larger base.

Better Profitability: Advance Agrolife Limited’s EBITDA margin rose from 6.3% in FY 23 to 9.5% in FY 25, driven by operating leverage, cost efficiencies, and pricing power. Net profit margin improved from 3.7% to 5.4% in FY 24, slipping slightly to 5.1% in FY 25. ROE remained above 25%,. Premium sulphur-based products helped cushion raw-material volatility. Overall, the company continues to deliver strong returns on capital.

Table:  Peers Comparison 

Name of the Company	Revenue from Operations (INR in million)	P/E	EPS (Basic) (INR)	EPS (Diluted) (INR)	NAV per equity share (INR)
Advance Agrolife Limited	5,022.60	17.54*	5.70	5.70	22.42
Dharmaj Crop Guard Limited	9,510.44	34.60	10.68	10.3	116.70
Insecticides India Limited	19,999.50	16.99	48.38	48.38	372.74
Heranba Industries Limited	14,097.30	NA	0.77	0.77	210.15
PI Industries Limited	79,778.00	34.29	109.44	109.22	668.22
Sharda Cropchem Limited	43,198.53	30.33	33.74	33.74	277.21

Source: RHP; * – based on upper end of price band

Table: KPI Comparison

Company	Particulars (with units)	FY 2023	FY 2024	FY 2025	CAGR
Advance Agrolife Limited	Revenue from Operations (INR in million)	3,978.06	4,558.99	5,022.60	13%
	EBITDA (INR in million)	252.23	402.11	482.45	38%
	EBITDA Margin (%)	6.34%	8.82%	9.61%	–
	Net Profit after Tax (INR in million)	148.68	247.32	256.38	33%
	Net Profit Margin (%)	3.74%	5.42%	5.10%	–
	Return on Net Worth (%)	34.46%	39.30%	29.11%	–
	Return on Capital Employed (%)	34.38%	37.62%	27.02%	–
	Debt-Equity Ratio	0.50	0.60	0.80	–
	Days Working Capital	48	55	74	–
Dharmaj Crop Guard Limited	Revenue from Operations (INR in million)	5,242.97	6,541.03	9,510.44	29%
	EBITDA (INR in million)	456.35	663.69	769.27	27%
	EBITDA Margin (%)	8.70%	10.15%	8.09%	–
	Net Profit after Tax (INR in million)	268.60	443.76	348.25	14%
	Net Profit Margin (%)	5.12%	6.78%	3.66%	–
	Return on Net Worth (%)	13.43%	13.16%	9.24%	–
	Return on Capital Employed (%)	16.68%	14.58%	11.90%	–
	Debt-Equity Ratio	0.17	0.31	0.29	–
	Days Working Capital	69	84	73	–
Insecticides India Limited	Revenue from Operations (INR in million)	18,013.29	19,663.86	19,999.50	5%
	EBITDA (INR in million)	1,231.50	1,717.20	2,282.13	40%
	EBITDA Margin (%)	6.84%	8.73%	11.41%	–
	Net Profit after Tax (INR in million)	632.11	1,020.75	1,420.19	49%
	Net Profit Margin (%)	3.51%	5.19%	7.10%	–
	Return on Net Worth (%)	7.07%	10.58%	13.55%	–
	Return on Capital Employed (%)	9.56%	12.94%	17.29%	–
	Debt-Equity Ratio	0.18	0.09	0.10	–
	Days Working Capital	124	108	122	–
Heranba Industries Limited	Revenue from Operations (INR in million)	13,188.20	12,570.70	14,097.30	3%
	EBITDA (INR in million)	1,682.50	907.00	1,055.00	-8%
	EBITDA Margin (%)	12.76%	7.22%	7.48%	–
	Net Profit after Tax (INR in million)	1,043.70	345.00	22.60	-53%
	Net Profit Margin (%)	7.91%	2.74%	0.16%	–
	Return on Net Worth (%)	12.88%	4.14%	0.37%	–
	Return on Capital Employed (%)	17.14%	6.81%	4.48%	–
	Debt-Equity Ratio	0.11	0.19	0.41	–
	Days Working Capital	66	50	48	–
PI Industries Limited	Revenue from Operations (INR in million)	64,920.00	76,658.00	79,778.00	11%
	EBITDA (INR in million)	17,011.00	22,224.00	25,232.00	21%
	EBITDA Margin (%)	26.20%	28.99%	31.63%	–
	Net Profit after Tax (INR in million)	12,295.00	16,815.00	16,602.00	15%
	Net Profit Margin (%)	18.94%	21.94%	20.81%	–
	Return on Net Worth (%)	18.46%	21.11%	17.58%	–
	Return on Capital Employed (%)	21.39%	23.69%	22.54%	–
	Debt-Equity Ratio	0.01	0.02	0.02	–
	Days Working Capital	129	110	117	–
Sharda Cropchem Limited	Revenue from Operations (INR in million)	40,451.57	31,630.25	43,198.53	3%
	EBITDA (INR in million)	6,833.72	3,426.22	6,551.09	4%
	EBITDA Margin (%)	16.89%	10.83%	15.17%	–
	Net Profit after Tax (INR in million)	3,419.83	319.06	3,044.18	1%
	Net Profit Margin (%)	8.45%	1.01%	7.05%	–
	Return on Net Worth (%)	16.50%	1.43%	12.85%	–
	Return on Capital Employed (%)	19.54%	3.17%	15.01%	–
	Debt-Equity Ratio	0.00	0.01	0.00	–
	Days Working Capital	97	138	113	–

Source: RHP