IGI Logo

Dharmaj Crop Guard Limited : Subscribe

Company Description

Dharmaj Crop Guard are an agrochemical company engaged in the business of manufacturing, distributing, and marketing of a wide range of agro chemical formulations such as insecticides, fungicides, herbicides, plant growth regulator, micro fertilizers and antibiotic to the B2C and B2B customers. They also engage in the marketing and distribution of agrochemical products under brands in-licensed by them, owned by them and through generic brands, to Indian farmers through their distribution network. The company provides crop protection solutions to the farmer to assist them to maximize productivity and profitability. They export their products to more than 25 countries in Latin America, East African Countries, Middle East and Far East Asia. They sell their agrochemical products in granules, powder and liquid forms to their customers. Additionally, they manufacture and sell general insect and pest control chemicals for Public Health and Animal Health protection.

With an aim to offer a wide product portfolio across the agri-value chain, Dharmaj Crop continues to expand its product portfolio by introducing new products. They manufacture and sell various formulations of insecticides, fungicides and herbicides, plant growth regulators, micro fertilizers and antibiotics. The company has obtained 464 registrations for agrochemical formulations from the CIB&RC, out of which 269 agrochemical formulations are for sale in India as well as for export and 195 agrochemical formulations are exclusively for exports. Additionally, they have also applied for registrations of 18 agrochemical formulations and 17 agrochemical technical from the CIB&RC, which are pending at various stages.

Dharmaj Crop has 157 trademark registrations including our branded products. The formulations are sold as branded products to customers. As of September 30, 2022, they had over 118 branded formulations that are sold to farmers. They sell bulk products to their institutional customers domestically and in the international markets. Further, as of September 30, 2022, the company had more than 154 institutional products that they sold to more than 600 customers based in India and in the international markets. As of September 30, 2022, they exported their products to more than 66 customers across 25 countries.

Valuation

Dharmaj Crop has a diversified portfolio of products and consistent focus on quality and innovation. They have Strong R&D capabilities with focus on innovation and sustainability. The company is available at the upper end of the IPO price band, it is offered at 27.9x its FY22 earnings and 9.4x to P/BV with a market cap of Rs. 8,010 million. The valuation of the IPO appears to be reasonable when we compare with listed peers. The company has the agrochemical segment and has created a niche place with its B2C and B2B model.

The revenue from operations has grown at a CAGR of 41.02% from FY2020 to FY2022 and Profit after tax (PAT) has grown at a CAGR of 63.30% FY2020 to Fy2022. The company has established a distribution network, strong branded products, and stable relationships with their institutional customers. In addition to this, the government’s aim to reduce dependency on China and improve selfsufficiency is expected to support industry’s backward integration and thus its growth. Pursuant to the setup of this manufacturing facility, profit margins on products would resultantly increase due to backward integration. Considering the future prospect for the company we assign “Subscribe” Rating to this IPO.

To Read Complete Report & Disclaimer Click Here

Please refer disclaimer at  https://www.rathi.com/LeadGenerate/Static/disclaimer.aspx
SEBI Registration No.: INZ000170832

Above views are of the author and not of the website kindly read disclaimer