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Crop protection firms may face headwinds due to extreme weather conditions

Despite the price hikes, margins continued to be under pressure in the quarter

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Though most brokerages are positive on the outlook for the sector, given the uncertainty on the demand front, investors should await clarity on volume/margin trends before considering the stocks

Ram Prasad Sahu
With the exception of Sumitomo Chemical India, the stocks of the agricultural input (crop protection) makers have been on a downtrend since the start of September. UPL and PI Industries, the largest listed players have underperformed, having shed 6-8 per cent even as the benchmark BSE Sensex has been flat over this period.

Brokerages believe that companies in the sector could face near-term headwinds due to the extreme weather conditions, spike in gas costs and its impact on demand, both in the domestic and international market. Say Abhijit Akella and Prasenjit Bhuiya of Kotak Institutional Equities, “We would expect some

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First Published: Sep 22 2022 | 8:28 PM IST

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