1. At a Glance
Sharda Cropchem just pulled a full-on Bhojpuri blockbuster. The stock hit upper circuit on result day, rising 20%, and here’s why:
Net profit shot up to ₹143 Cr, margins at 22%, and OPM that makes even FMCG stocks blush. This agrochemical export star just dropped the fertilizer equivalent of a mic.
2. Introduction with Hook
Imagine if your neighbourhood kirana suddenly turned into D-Mart overnight. That’s what Sharda Cropchem just did — transitioning from sleepy quarterly slogs to a Q1 earnings explosion. While competitors are still fumbling with R&D and monsoon charts, Sharda is busy turning rubber belts and pesticides into profit gold.
EPS this quarter: ₹15.83
Last year same quarter? –₹9.82
Comeback Level: Sachin Tendulkar 1999 Sharjah Desert Storm vibes.
3. Business Model (WTF Do They Even Do?)
Let’s break it down:
- Core Biz: Agrochemicals (pesticides, herbicides, fungicides) – both technical & formulations.
- Side Hustle: Conveyor belts, rubber sheets, dyes – basically, they export niche industrial stuff no one brags about at parties.
They’re a low-R&D, high-registration model:
Buy global licenses + register in target countries = global sales.
It’s like Uber, but instead of cabs, they lease molecule rights.
4. Financials Overview
Q1 FY26 Numbers:
| Metric | Value | YoY Change |
|---|---|---|
| Revenue | ₹985 Cr | +54% |
| Operating Profit | ₹215 Cr | 🔥 OPM: 22% |
| Net Profit | ₹143 Cr | From ₹–89 Cr |
| EPS | ₹15.83 | From ₹–9.82 |
Commentary:
Margins sharper than a scythe. After five quarters of ups and downs, this is the performance analysts fake excitement over on CNBC.
5. Valuation
CMP: ₹1,090
P/E: 32.9x
Book Value: ₹277
P/B: 3.92x
Fair Value Range:
- P/E Method: Assume sustainable EPS of ₹40, fair P/E of 18–22 → ₹720–₹880
- EV/EBITDA Method: TTM EBITDA = ₹723 Cr, EV/EBITDA 8x = ₹5,784 Cr
With near-zero debt and ₹9,800 Cr market cap — already priced like next-gen PI Industries.
Verdict:
The stock’s not cheap — it’s pricing in a flawless season, a good monsoon, and zero tax drama.
6. What’s Cooking – News, Triggers, Drama
- Massive tax reversal:
₹145.6 Cr demand quashed = clean balance sheet + market party - Conveyor belt biz still alive:
No one’s watching it, but margins stay supportive. - Monsoon blessings + global demand revival = potential tailwind.
- New CFO yet to be announced (previous CFO left June 2023) — corporate housekeeping still in progress.
7. Balance Sheet
| Metric | Mar 2025 (₹ Cr) |
|---|---|
| Equity Capital | 90 |
| Reserves | 2,410 |
| Borrowings | 8 |
| Total Assets | 4,713 |
- Debt-light despite global business — rare for this space.
- Net worth grown 3x in 5 years.
- Assets loaded with productive investments and CWIP.
8. Cash Flow – Sab Number Game Hai
| Year | CFO | CFI | CFF | Net CF |
|---|---|---|---|---|
| FY23 | ₹328 Cr | ₹–112 Cr | ₹–97 Cr | ₹120 Cr |
| FY24 | ₹341 Cr | ₹–393 Cr | ₹–37 Cr | ₹–89 Cr |
| FY25 | ₹604 Cr | ₹–496 Cr | ₹–68 Cr | ₹+40 Cr |
Highlights:
- Operating cash flow doubled in FY25.
- Investing aggressively (₹500 Cr+) in growth assets.
- No borrowing spree — just pure free cash kicking in.
9. Ratios – Sexy or Stressy?
| Metric | Value |
|---|---|
| ROCE | 16.5% |
| ROE | 12.6% |
| OPM | 16% |
| D/E | 0.003 |
| P/E | 32.9x |
Verdict:
Not insane, not boring. Efficient capital usage with zero leverage drama. ROCE and ROE improving again post tax reversal and margin restoration.
10. P&L Breakdown – Show Me the Money
| Year | Revenue (Cr) | EBITDA (Cr) | PAT (Cr) |
|---|---|---|---|
| FY23 | 4,045 | 659 | 342 |
| FY24 | 3,163 | 303 | 32 |
| FY25 | 4,320 | 615 | 304 |
Commentary:
FY24 was a blip (hello, ₹78 Cr tax demand & margin erosion). But FY25 brought redemption. FY26 Q1 confirms the phoenix is flying again.
11. Peer Comparison
| Company | Rev (Cr) | PAT (Cr) | P/E | ROE (%) |
|---|---|---|---|---|
| PI Industries | 7,977 | 1,663 | 37 | 17.6 |
| Sumitomo Chem | 3,090 | 502 | 58 | 18.8 |
| Sharda Cropchem | 4,520 | 420 | 33 | 12.6 |
| Rallis India | 2,837 | 171 | 41 | 6.7 |
Sharda is cheaper than Sumitomo, faster growing than Rallis, and leaner than UPL. Mid-cap underdog? Quite possibly.
12. Miscellaneous – Shareholding, Promoters
| Category | Jun 2025 |
|---|---|
| Promoters | 74.82% |
| FIIs | 5.48% |
| DIIs | 9.38% |
| Public | 10.33% |
| Shareholders | 62,030 |
Takeaways:
- Promoters holding steady for years — rare loyalty.
- FII stake up 3x in last year — 🧠 money is here.
- DII holding down slightly — probably switched to FMCG after a bad monsoon guess.
13. EduInvesting Verdict™
Sharda Cropchem is the agro-exporter that doesn’t invent molecules — it just hacks global markets with licenses, logistics, and legal wrangling.
- The Q1 FY26 results are fire
- Margins are up, tax demons are down
- And momentum? Blazing
Is it perfect? Nope. Is it profitable, growing, and debt-free? Absolutely.
A spicy midcap with global moves. Just don’t expect it to pay dividends like HUL.
Metadata:
Written by EduInvesting Team | 25 July 2025
Tags: Sharda Cropchem, Agrochemicals, Q1 FY26, Export Stocks, EduInvesting Premium, Tax Reversal
