Coromandel International Ltd Q2 2025 Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Prashant Biyani - Elara Securities - Analyst : Yes. Thank you for the opportunity. Ma'am, what drove the profitability improvement in crop protection and especially the nonsubsidy non CP business?

Question: Prashant Biyani - Elara Securities - Analyst : And ma'am on the nonsubsidy non CP part,

Question: Prashant Biyani - Elara Securities - Analyst : Okay. Ma'am. Secondly, if Shankar sir can answer this rock prices have increased of it. I guess from the lows and how are we stocked up on the inventory of rock phosphate till which month? And do you also expect phosphoric acid prices to increase from here? If yes, then what could be the immediate levels that we can look at?

Question: Prashant Biyani - Elara Securities - Analyst : All right, sir. So then going forward if you see the ammonia prices subsidy on and has reduced, but prices have increased. So how would it change the complex portfolio mix for you going into H2? Will it be more towards NPK only? And if then in the grade, it will be?

Question: Prashant Biyani - Elara Securities - Analyst : Sure. And ma'am lastly, before I jump back into the queue, how much was the revenue from nano, nano fertilizer as well as Daksha in Q2?

Question: Prashant Biyani - Elara Securities - Analyst : Thank you. That's it from my side.

Question: Parth Mehta - Venom Capitals - Analyst : Yeah, hi. Just wanted to ask. So you mentioned that the new MPP in the crop protection side will help meet the growing demand for the identified products in domestic and export geography. If you could just help me, you know, which are the products that you've identified and in the, in the domestically export that, that we have.

Question: Parth Mehta - Venom Capitals - Analyst : Okay. Okay.

Question: Parth Mehta - Venom Capitals - Analyst : Yes, yes, that was helpful and just wanted to understand, are we coming up with any other new molecules that are being developed in our R&D or are they more of from the tie ups that we have done group?

Question: Parth Mehta - Venom Capitals - Analyst : Hello ?

Question: Parth Mehta - Venom Capitals - Analyst : Okay. Okay, sir. Just last one, if you can help me, how is Chinese molecules are selling out right now in the export market? And how is the situation globally? In terms of volume or pricing?

Question: Parth Mehta - Venom Capitals - Analyst : Okay, great, thanks. Thanks. Thanks a lot.

Question: Vishnu Kumar - Awenda Park - Analyst : Good afternoon. Thanks for your time. In terms of the fertilizer business, the operational profitability is better than expected for most of us. So, is there any thing that we have done differently or is the wall because we understand the pricing was relatively not that great for us, given the RM and the end market prices? So what has led to kind of slightly better? At least what we from what we were considering? Is it any operational costs or mix any help would be Great?

Question: Vishnu Kumar - Awenda Park - Analyst : Got it. How much would probably be a structural cost savings for us? Like as you mentioned on the power and the ro and water others, I understand can move up and down. So how much could be a structural cost savings that we are going forward we should see.

Question: Vishnu Kumar - Awenda Park - Analyst : Understood, sir. So also on the, you mentioned that this this year, this quarter or rather we have seen on the curve that the DAP consumption has been much lower and NPK probably come up. Well, is it this, this is because of the profitability for traders was very low or since from import replacement angle government would probably want us to probably import less of DAP. So we should we see structurally, this is going to be a theme for so DAP will go down. Is this a more of a short term issue or like we will bounce back in the AP come back?

Question: Vishnu Kumar - Awenda Park - Analyst : This 0.75 million ton of capacity. When are we likely to have it? I mean, in terms of commercial sales, when should we begin and in the interim to capture the market before we launch the product, are we going to do additional marketing? And how should we see the approach from now to the, when the plant comes in.

Question: Vishnu Kumar - Awenda Park - Analyst : So, so this area that we target will still be within the zone where our price subsidies there or we'll stretch it outside also?

Question: Vishnu Kumar - Awenda Park - Analyst : Got it, sir. Thank you and all the best.

Question: Resham Jain - DC asset managers - Analyst : Yeah, hi. Good afternoon, sir. So just 2-3 questions. The first one is you mentioned in your opening remarks that you opened 45 new store in this quarter. Is that correct?

Question: Resham Jain - DC asset managers - Analyst : This will be probably the highest number of stores you have opened. It seems. So what is the strategy on the retail front? Let's say over next 2-3 years. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. OCTOBER 25, 2024 / 9:00AM, CORF.NS - Q2 2025 Coromandel International Ltd Earnings Call

Question: Resham Jain - DC asset managers - Analyst : This is from number perspective, the 750-800 stores can go to what number, let's say next three years

Question: Resham Jain - DC asset managers - Analyst : Okay. Understood. So the second question is the incremental or higher subsidy for that versus NPK. So does that mean that our overall production will be higher of DAP versus NPK? At least in the near term

Question: Resham Jain - DC asset managers - Analyst : Okay. Despite the higher subsidy for DAP, that doesn't change anything from your overall production mix perspective.

Question: Resham Jain - DC asset managers - Analyst : Understood. And so just your guidance on the overall non subsidy piece, which has been doing quite well both from revenue as well as profitability perspective over the next 2-3 years. Given there are multiple projects which are going on. How should one look at the overall loan subsidies? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. OCTOBER 25, 2024 / 9:00AM, CORF.NS - Q2 2025 Coromandel International Ltd Earnings Call

Question: Resham Jain - DC asset managers - Analyst : Okay, sir. Thanks for the detailed answer. All the best.

Question: Bharat Sheth - Quest Investment - Analyst : Hi, good afternoon, Sankar and Jayashree. And thanks for the opportunity. The question, my question is of say three years perspective, what would be our capacity for this nutrient business including SSP and how do we see what kind of a backward integration is that point of time we'll have in terms of whether it's a sulfuric seed or rock or rock process seed and how that will play out. And second thing when you are talking of this replacement of DAP with the NPK. So how much scope is also there for replacing REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. OCTOBER 25, 2024 / 9:00AM, CORF.NS - Q2 2025 Coromandel International Ltd Earnings Call DAP with the phosphate SSP. If you can give some more color and how that thing will really play out. And last question is on the nano DAP. So how much that will also over a three year period if you can give some color?

Question: Bharat Sheth - Quest Investment - Analyst : What kind of the core integration that we have? I mean, once we reach this NPK capacity or this DAP capacity obviously, with this expansion, how much of the core integration will have?

Question: Bharat Sheth - Quest Investment - Analyst : And basically, would you like to give some more color on this? That's how that are played out. How much older or do we have in and how do we expect for a couple of years?

Question: Bharat Sheth - Quest Investment - Analyst : And last question on this, since we are sitting 4,000 plus kind of net case. So what will be our capital allocation including for the additional investment then other facility? So if you can give more color?

Question: Bharat Sheth - Quest Investment - Analyst : So how much can revise capex for this year, next year? And for '27 do we have in plan?

Question: Bharat Sheth - Quest Investment - Analyst : Thank you. Thank you and all the best with everyone.

Question: Prashant Biyani - Elara Securities - Analyst : Yeah. The point that you outlined regarding capacity of say 4.5 million ton, an import of five lakh ton. So where would we be seeing or selling these volumes? Would it be in our core and periphery markets? And how Much volume do we do right now? Saying north and region around north and where could that volumes be in the next five years?

Question: Prashant Biyani - Elara Securities - Analyst : And sir do we have fertilizer business presence right now in the UP or Rajasthan site to make the market ready for our large volumes in 2-3 years.

Question: Prashant Biyani - Elara Securities - Analyst : Right. And where do we stand in terms of latest business developments in the spec chem or CDM. If anyone can answer that.

Question: Prashant Biyani - Elara Securities - Analyst : All right. Thank you. That's it from my side.

Question: Ranjeet - IIFL Securities - Analyst : Yeah. Thank you for taking my question. The first question is on the MPP capex. So I believe this since you commented recently operated products, I believe to be STI. the question is how far would we be backward integrated into this or we are only going to target the manufacturing of technicals and would be importing the intermediates.

Question: Vishnu Kumar - Awenda Park - Analyst : Right sir. Thank you. Second question is to Shankar sir. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. OCTOBER 25, 2024 / 9:00AM, CORF.NS - Q2 2025 Coromandel International Ltd Earnings Call In the last call you had kind of mentioned a couple of plans. One is what we have seen the board of putting on the capex front. You also had mentioned branching out of fertilizers and pouring into related chemistry. So, so is there any progress on that front? And by when can we expect an announcement on that front? Thank you.

Question: Vishnu Kumar - Awenda Park - Analyst : Sure, sir. Thank you. That's all from my side.

Question: Rohan Gupta - AMA Wealth - Analyst : Yeah, hi sir. Good afternoon. Thanks for the opportunity and conversations on good set of number. Shankar, are you, you mentioned that almost in next two years, you plan to definitely overall comp fertilizer to 4.5 million and 10 another trading and even further in SSP and mop trading and all that. I think that we have always been mentioning that the fertilizer margins we have always been targeting with a close to 5,000 to 6000 per ton that gives a clear picture about the fertilizer business over the next two years. For non fertilizer business, you have stopped giving and sharing. That is slightly more detail that how you think that the next 2 to 3 years, whether the fertilizer business contribution to EBITA will be 50% or less than that. And also where you see that the other business, I mean, non fertilizer business piece will be contributing to the profitability EBITA in next three years,

Question: Rohan Gupta - AMA Wealth - Analyst : Also sir that the government focus on some non supportive policy on policy on fertilizer. Do you see that there is a need in future that you had to dier this business because of the working capital related challenges and the interest cost portion where the government wanted to cap the profitability. So you see that to benefit from that, I mean you need to do the balance sheet while the company started generating. So cash flows. So do you see that, that we have to do the fertilizer business to to be the part of the, I mean to benefit from the government policies in future.

Question: Ranjeet - IIFL Securities - Analyst : This is for my sir. Thank you so much.

Question: Sumant Kumar - Motilal Oswal - Analyst : Yeah, hi. Last year we talked about that the 1,000 code capex cost protection. So can you talk about the timeline of the, the capitalization of the asset and the commencement?

Question: Sumant Kumar - Motilal Oswal - Analyst : So the single Plant also will take time?

Question: Sumant Kumar - Motilal Oswal - Analyst : Okay. Okay. Thank you

Question: Himanshu Binani - Anand Rathi - Analyst : Thank you sir for taking my question. Good day and happy festivites to the management. So sir, I have two questions. One is on the share of the uni rates to the overall volume. So what has been the share basically for the second quarter? And the second question was largely around that since we have been like backward, integrating for quite some time and that has been like able to reap benefits and going forward also with the kind of like cost services which we have outlined particularly from the sulfuric as well as from the phosphorus first plant and the energy savings also. So I do understand that yes, the RM prices globally has been the volatile as well as the subsidies from the bomb. So the question was like, how do we see that the person moving? So our guidance has been somewhere around the 4,500 to 5000 per ton. So do we see that it should like increase going forward? So how should one actually look into this? Thank you.

Question: Himanshu Binani - Anand Rathi - Analyst : Yeah, for this quarter? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. OCTOBER 25, 2024 / 9:00AM, CORF.NS - Q2 2025 Coromandel International Ltd Earnings Call

Question: Himanshu Binani - Anand Rathi - Analyst : Okay. Okay. Got it. Got it.