UPL Q1 Results: Profit Nearly Doubles On Low Base, Improved India Business

UPL Ltd.’s profit surged in the quarter ended June, a period marred by the coronavirus pandemic, on account of a low base and improved performance in India—one of its largest markets.

Net profit rose 93% year-on-year to Rs 551 crore in the April-June period, according to the agrochemical maker's exchange filing on Friday. That compares with the Rs 525-crore consensus estimate of analysts tracked by Bloomberg. The bottom line in the base quarter was hurt on account of higher costs and an exceptional loss related to acquisition of Arysta Lifesciences Ltd.

• UPL’s revenue, however, declined 1% over the year ago to Rs 7,833 crore. Analysts had pegged the top line at Rs 8,528 crore.
• Its operating profit rose 29% to Rs 1,704 crore, in line with estimates.
• Margin widened to 21.8% from 16.7% in the year-ago period, against the estimated 20%.

Key Performance Highlights

• Strong growth in India, Southeast Asia, driven by good rains.
• Gross margin aided by cost and portfolio mix improvements .
• Covid-19-related supply chain disruptions in most regions delayed sales from first to second quarter for Latin America and Europe.
• North America impacted by Covid-19-related pre-buying in fourth quarter.

Also Read: Here's A Sunrise Sector Amid India's Covid-19 Gloom

Shares of UPL closed 2.8% higher ahead of the quarterly results, compared with a 0.3% drop in the benchmark Nifty 50 Index.