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Godrej Agrovet slips after muted Q2 performance

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Godrej Agrovet fell 1.64% to Rs 620.40 after the company reported 2.9% fall in consolidated net profit to Rs 112.2 crore despite a 24.7% rise in total income to Rs 2,159.7 crore in Q2 FY22 over Q2 FY21.

EBITDA improved by 8% to Rs 196.1 crore in Q2 FY22 from Rs 181.5 crore in Q2 FY21. EBITDA margin was 9.1% in Q2 FY22 as against 10.5% in Q2 FY21.

Finance costs surged to Rs 15.62 crore in the second quarter from Rs 9.60 crore in the same period last year.

Profit before tax in the second quarter stood at Rs 149.8 crore, down by 0.2% from Rs 150.1 crore in reported in the same period last year.

B. S. Yadav, managing director, Godrej Agrovet, said: For Animal Feed business, it was one of the best quarterly performances with segment results growing by 21%, supported by volume growth, introduction of new products and R&D benefits realization. Vegetable oil benefitted from higher oil prices and increased efficiencies and posted excellent segment results of Rs 78 crore for the second quarter which was a 1.9x increase year-on-year.

Profitability of standalone crop protection business declined by 24% due to erratic and inconsistent rainfall which reduced application opportunities of agrochemicals. Segment results were also impacted by inflation in raw material prices which could not be absorbed resulting in lower margins.

Astec LifeSciences' EBITDA declined by 29.9% primarily due to closure of plant on account of floods for about 15 days. Global container shortage limited the ability to ship goods timely resulting in deferment of sales.

In the food businesses, higher input & procurement costs impacted the performance in the current quarter. Our dairy subsidiary, Creamline Dairy registered a lower EBITDA profit of Rs 4.1 crore due to increase in the milk procurement costs.

The performance of our poultry and poultry products business improved in the second quarter after a challenging first quarter as end-product prices improved. As a result, Godrej Tyson Foods, registered an EBITDA of Rs 10.1 crore in Q2 FY22.

With the key economic indicators signaling recovery in Q2FY22, we expect the second half of the year to be better for our businesses.

Godrej Agrovet is a diversified, Research & Development focused agri-business company. It holds leading market positions in the different businesses in which it operates - animal feed, crop protection, oil palm, dairy and poultry and processed foods.

In August 2015, Godrej Agrovet acquired stake in Astec LifeSciences, which makes a wide range of agrochemicals and pharmaceutical intermediates.

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(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

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First Published: Wed, November 10 2021. 10:08 IST