Indogulf Cropsciences – A leading agrochemicals player

26 Jun 2025 , 10:58 AM

Indogulf Cropsciences is a leading player in India’s agrochemicals market. Structural tailwinds for the sector include a strategic shift towards China Plus One by global players.

Indogulf Cropsciences has shown consistent revenue growth over the past three years. Its IPO is aimed at strengthening its balance sheet and funding capex. The IPO also includes an offer for sale by the promoters.

Offer Details of the IPO

The Indogulf Cropsciences Limited IPO consists of

• A fresh issue of upto INR 1,600 million (14,414,414 Equity Shares).
• An offer for sale of upto INR 400 million (3,603,603 Equity Shares)

The offer for sale is being made by the Promoter Group Selling Shareholders, Om Prakash Aggarwal and Sanjay Aggarwal. They are offering up to 1,540,960 and 2,062,643 Equity Shares, respectively.

• Price Band: Rs. 105 to Rs. 111 per Equity Share
• BRLM: The issue is being managed by Systematix Corporate Services Limited, which is the Book Running Lead Managers (BRLMs) to the issue.

Objectives of the IPO:

IPO objectives are to raise funds primarily for de-leveraging and , capital expenditures. The company plans to utilize the net proceeds to repay debt, set up a new plant, and fund its working capital requirements. The IPO will also provide liquidity to existing shareholders.

De-leveraging/Repayment of Debt

• Repayment/prepayment, in full or in part, of certain outstanding borrowings availed by the company: INR 341.17 million
• The company proposes to repay 13.28% of its total borrowings as of April 30, 2025

Capital Expenditures

• Capital expenditure of the company for setting up an in-house dry flowable (DF) plant at Barwasni, Sonipat, Haryana: INR 140.00 million
• The plant will be used to produce dry flowable formulations, a type of pesticide formulation

Other General Corporate Purposes

• Funding working capital requirements of the company: INR 650.00 million
• General corporate purposes: up to 25% of the Gross Proceeds

Industry Overview – Agro Chemicals

• The Indian agrochemicals industry has been expanding significantly over the past few years due to the rising demand for food grains, change in crop mix and regulations related to environment. The Indian agrochemicals industry market is projected to reach 2.82 billion USD in 2020 and is anticipated to reach 4.17 billion USD by 2025, at a CAGR of 8.1% from 2020 to 2025.

Market Segments

The Indian agro-chemicals industry can be classified into the four major categories, namely, insecticides, fungicides, herbicides and plant growth regulator and rodenticides. Insecticides are the largest segment, followed by fungicides and herbicides.

• Insecticides – Based on type, the insecticides segment led the market with a market size of USD 1.23 billion in 2020. The segment is anticipated to grow at a CAGR of 8.5% from 2020 to 2025.
• Fungicides: The second-largest segment of the market was the fungicides segment in 2020, valued at USD 734 million. This segment is projected to grow at a CAGR of 7.8% during the forecast period of 2020-2025.
• Herbicides: With a market value of USD 434 million (2020), the herbicides segment was the smallest segment. This segment is anticipated to grow at a CAGR of 7.2% during the forecast period of 2020-2025.

Key Driving Factors

Several factors are contributing to the Indian agrochemicals market:

• Growth in the demand for food grains: Growth in demand for food grains, especially in the Asia-Pacific region, is fueling the market.
• Changing Crop Mix Pattern: Increasing focus on high value crops like fruit and vegetables has led to demand for agro chemicals.
• Environmental Legislation: The rising significance of environmental legislation is propelling the requirement for sustainable agrochemicals.
• Government Initiatives: Government efforts to boost sustainable agricultural practices are pushing the growth in the agrochemical market.
• Growing Awareness about Crop Protection: The growing awareness regarding crop protection among farmers is boosting the sales of agrochemicals.

Company Overview – Indogulf Cropsciences

Indogulf Cropsciences Limited is a prominent name in the agro chemical industry with a legacy of more than two decades. The company was founded in the year 1993 under the name Jai Shree Rasayan Udyog Limited. The company was renamed as Indogulf Cropsciences Limited in the year 2015.

The Company operates in three business verticals:

1. Crop Protection Products: Crop Protection Products are specialized in the development and marketing of a broad range of crop protection products such as insecticides, fungicides, herbicides and plant growth regulators. Proper crop protection yields, offered by products, keep the crops free from pests, disease, and weeds and help promote healthy growth along with ample productivity.
2. Plant Nutrient: Indogulf Cropsciences Limited manufactures a variety of plant nutrients such as straight fertilizers, nutrient deficiency correctors, and micronutrients. They are products to improve soil fertility, root strength, and crop productivity.
3. Biologicals: The biologicals segment of the company comprises bio-stimulants, bio-fertilizers, and bio-pesticides. The products are intended to encourage sustainable agriculture and to improve soil health and increase crop yield.

Services

To supplement its range of products, Indogulf Cropsciences Limited also offers contract manufacturing facilities, which can be tailored to specific requirements of clients. It also provides technical support and advisory services to farmers, enabling them to maximize crop yields and enhance farming practices.

Infrastructure
Indogulf Cropsciences Limited has manufacturing facilities at four locations: Samba, Jammu and Kashmir, Nathupur-I and Nathupur-II, Haryana and Barwasni, Haryana. These facilities are provided with the latest technologies and have installed capacity 19,620 KL of liquid suspension concentrate, 27,930 MT of granules, 1,980 MT of powder.

Research and Development

The company has a professional R&D team, specializing in new product development, process improvement and advanced technology performance. Indogulf Cropsciences Limited has made substantial investment in R&D amounting to INR 12.77 million in Fiscal 2024 and INR 11.77 million in Fiscal 2023.

Exports and Distribution Network

Indogulf Cropsciences Limited has a strong export presence, with its products being shipped to over 34 countries. The company has a pan-India sales and distribution network, with 192 institutional business partners, 6,916 working domestic distributors, and 17 stock depots.

Competitive Landscape

The agrochemical industry in India is highly competitive, with a number of domestic and international players operating in the market. The company faces competition from established players as well as new entrants.

Major Competitors

• Dharmaj Crop Guard Limited: Dharmaj Crop Guard Limited is a leading player in the agrochemical industry, with a strong presence in the Indian market. The company has a broad product range, including insecticides, fungicides and herbicides. Dharmaj Crop Guard Limited has a strong distribution network in India agrochemical market, which gives it significant market share.
• Heranba Industries Limited: Heranba Industries Limited is another major player in the agrochemical industry, with a strong presence in the Indian market. The company has a wide product range, including insecticides, fungicides and herbicides Heranba Industries Limited has a considerable share in India agrochemical market.
• India Pesticides Limited: India Pesticides Limited is a leading player in the agrochemical industry, with a strong presence in the Indian market. The company has a broad product range, including insecticides, fungicides and herbicides. India Pesticides Limited has a strong distribution network and substantial market share in India’s agrochemical market.

Competitive Positioning

• Diversified Product Portfolio: The company’s product portfolio is broad, with such items as insecticides and fungicides to meet various segments within the agrochemical market. The product portfolio is similar or slightly better than that of our competitors, focusing on insecticides, fungicides and herbicides.
• Distribution Network: The company has a strong distribution network with its presence across 22 states and 3 union territories of the country. It also has an export network of more than 34 countries. The wide distribution network and a focus on customer services gives it a competitive edge.
• Research and Development: The company’s R&D is focused on designing new products, optimizing processes and upgrading to the latest technology. This has allowed it to introduce new products and widen its product range.

Weaknesses

·         Dependence on Natural Resource: The production of raw materials used in the manufacturing process can be influenced by weather, government policy, and global markets. Any below-average supply of raw materials would likely affect the production of the enterprise, impacting gains and losses.

·         High Competition: The agrochemical market is very competitive, with numerous national and international competitors. Such competition may have a negative bearing on the company’s profitability.

·         Regulatory Risks: The company is regulated by several acts and rules related to the industry of agrochemicals, such as the Insecticides Act, 1968, and the Fertilizer Control Order, 1985. Adverse changes in such regulations or failure to comply with such regulations can have a material impact on the company’s business and results of operations.

 

Financial Performance

Revenue Growth:

The company has reported revenue growth over the past three years – from INR 4,872.1 million in fiscal year 2022 to INR 5,522.34 million in fiscal year 2024. Increase in turnover is mainly due to the company’s further penetration into new areas, namely West Bengal, where sales have gone up from INR 81.40 million to INR 171.10 million. Some products also witnessed substantial increases, such as Cypermethrin, which increased from INR 0.40 million to INR 20.06 million, and Glyphosate from INR 2.18 million to INR 88.50 million.

Profit Growth:

The company has also seen an improvement in EBITDA margins in FY24 – from 8.92% to 10.09%. The margins have also improved in 9m FY25 YoY. As a result, while it witnessed a decline in profits in FY23, they have improved in FY24. 

Financial Summary

INR million	FY 2022	FY 2023	FY 2024	9m FY24	9m FY25
Revenue from operations	4872.1	5496.56	5522.34	4134	4641.88
EBITDA	472.43	490.4	557.44	340.11	447.77
EBITDA Margin	9.70%	8.92%	10.09%	8.23%	9.65%
EBIT	386.42	394.26	454.37	262.81	376.42
EBIT Margin	7.93%	7.17%	8.23%	6.36%	8.11%
PAT	263.63	224.23	282.33	152.91	216.77
PAT Margin	5.41%	4.08%	5.11%	3.70%	4.67%
Net Working Capital	1151.89	1400.37	1710.45	1801.14	1958.16
Inventory turnover ratio	2.38	1.95	2.02	1.91	1.62
Fixed asset turnover ratio	7.21	7.03	7.83	6.88	4.9
Debt-equity ratio	0.56	0.93	0.67	0.67	0.78
Return on net worth	14.60%	11.03%	12.19%	6.99%	8.17%
Return on capital employed	13.81%	10.12%	11.93%	7.27%	8.07%
Product-wise Revenue – Crop Protection	4732.32	5220.89	5235.59	3833.69	4368.61
Product-wise Revenue – Plant Nutrient	152.96	183.53	194.34	163.78	190.4
Product-wise Revenue – Biologicals	189.92	278.98	289.02	243.15	286.71
Revenue from top 10 customers	1155.75	1175.32	1033.4	727.94	967.21
Number of customers served	3963	4330	5043	4237	4960

Source: RHP

 

Peer Comparison

Particulars	Indogulf	Aries Agro	Basant Agro Tech	Best Agrolife	Bhagiradha Chemicals	Heranba Industries	India Pesticides	Dharmaj Crop Guard
Revenue from operations	4641.88	6326.88	3302.21	15399.7	3178.52	10749.6	6213.7	7411.16
EBITDA	447.77	671.04	194.54	1958.8	308.72	1124	887.1	709.33
EBITDA Margin	9.65%	10.61%	5.89%	12.72%	9.71%	10.46%	14.28%	9.57%
EBIT	376.42	607.77	137.46	1645.3	206.03	713.7	754.1	572.39
EBIT Margin	8.11%	9.61%	4.16%	10.68%	6.48%	6.64%	12.14%	7.72%
PAT	216.77	374.05	30.14	917.8	147.42	439.2	620.1	372.76
PAT Margin	4.67%	5.91%	0.91%	5.96%	4.64%	4.09%	9.98%	5.03%
Net Working Capital	1958.16	NA	NA	NA	NA	NA	NA	NA
Inventory turnover ratio	1.62	NA	NA	NA	NA	NA	NA	NA
Fixed asset turnover ratio	4.9	NA	NA	NA	NA	NA	NA	NA
Debt-equity ratio	0.78	NA	NA	NA	NA	NA	NA	NA
Return on net worth	8.17%	NA	NA	NA	NA	NA	NA	NA
Return on capital employed	8.07%	NA	NA	NA	NA	NA	NA	NA

Source: RHP