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UPL Q1 Review - Higher Fixed Overheads Negate Impact Of Gross Margin Expansion: Prabhudas Lilladher

UPL Q1 Review - Higher Fixed Overheads Negate Impact Of Gross Margin Expansion: Prabhudas Lilladher

<div class="paragraphs"><p>A man holds a basket of fertilizer pellets. (Photographer: Taylor Weidman/Bloomberg)</p></div>
A man holds a basket of fertilizer pellets. (Photographer: Taylor Weidman/Bloomberg)

BQ Blue’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer BloombergQuint’s subscribers an opportunity to expand their understanding of companies, sectors and the economy.

Prabhudas Lilladher Report

UPL Ltd. reported lower than expected results with topline growth of 9% to Rs 85 billion (our estimate - Rs 87 billion) led by 6%/2%/1% volumes/realisations/exchange impact.

India/ Latin America/Canada, Mexico and U.S. business grew by 27%/24%/19% while Europe/rest of world business declined 11%/14% YoY due to weather related issues.

Net debt was higher by Rs 25.5 billion QoQ at Rs 214.7 billion due to higher working capital, which was up by seven days to 91.

UPL's management guidance of 7-10% topline growth, 12-15% Ebitda growth and less than two times net debt:Ebitda for FY22 remains intact and will be driven by its sustainable solutions (carved out into a new entity) and strong agrochemicals demand worldwide, given remunerative crop prices and supply chain issues.

Click on the attachment to read the full report:

Prabhudas Lilladher UPL Q1FY22 Result Update.pdf

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