Godrej Agrovet's profit in June quarter up by 13%

Mumbai, August 6, 2025: Godrej Agrovet’s consolidated net profit for the first quarter saw a 13% rise, reaching ₹148.83 crore, a boost primarily driven by improved performance in its crop protection and vegetable oil businesses, the company said.

The stock of the company closed the day, up by 1.83%, at Rs 825.45.

Financial Highlights

For the first quarter of FY26, Godrej Agrovet’s revenue from operations was ₹2,614.29 crore. This represents an 11.2% increase compared to the same period last year and a 22.6% increase from the previous quarter. The company’s Profit Before Tax saw a significant jump of 20.7% year-on-year, reaching ₹200.49 crore. The Net Profit (PAT) was ₹148.83 crore, up 13.1% from a year ago and a massive 125.1% increase from the previous quarter. The Earnings Per Share (EPS) also grew significantly by 18.8% year-on-year to ₹8.35.

Segment-Wise Performance (Q1FY26)

The company’s performance was mixed across its different segments. The Vegetable Oil business was a key driver of growth, with revenue soaring by 91.6% to ₹499.13 crore and a significant increase in its earnings before interest and tax (EBIT) of 260.5% to ₹86.81 crore. The Crop Protection segment also performed strongly, with revenue up 10.4% to ₹402.57 crore and EBIT growing by 34.2% to ₹116.46 crore.

In contrast, the Dairy segment saw a 2.7% decline in revenue to ₹416.81 crore, and its EBIT fell sharply by 76.7% to ₹4.31 crore. The Poultry & Processed Food segment also faced challenges, with revenue dropping by 20.2% to ₹186.88 crore and EBIT plummeting by 76.8% to ₹4.46 crore. The Animal Feed business saw a marginal revenue increase of 0.1% to ₹1,156.24 crore, but its EBIT declined by 17.4% to ₹64.52 crore. The Others segment recorded a strong revenue growth of 87.3% and turned a profit of ₹2.07 crore.

Key Corporate Developments

Godrej Agrovet has been actively consolidating its business by increasing its stakes in key subsidiaries. The company raised its stake in Creamline Dairy to 99.67% after acquiring an additional stake during and after the quarter. It also participated in a rights issue of its subsidiary, Astec LifeSciences, increasing its stake to 67.03%. In a move that was made effective last year, Godrej Foods became a fully-owned subsidiary. In addition, three of the company’s subsidiaries declared interim dividends: Godrej Foods paid ₹207.50 per share, Creamline Dairy paid ₹5.75 per share, and Godvet Agrochem paid ₹1.80 per share.

Management Commentary

The management highlighted that the strong profit margins were a result of “strategic price realignments, higher seasonal volumes, and efficiencies in raw material costs.” They also emphasised that the company’s focus on consolidating its subsidiaries, like Creamline and Godrej Foods, is helping it to better integrate its operations and improve control.

Strong Overall Performance with Margin Expansion

• Net profit rose 13.1% YoY to ₹148.83 crore, showing solid execution across core segments.
• Margin gains came from strategic pricing, raw material efficiencies, and seasonal volume uptick, especially in Crop Protection and Vegetable Oil.

Vegetable Oil and Crop Protection Lead Growth

• Vegetable Oil revenue soared 91.6%, with EBIT rising over 260% (the top performer this quarter).
• Crop Protection posted 10.4% revenue growth and a 34.2% jump in EBIT, supported by strong seasonal demand.

Challenges in Dairy and Poultry Segments

• Dairy EBIT dropped 76.7%, despite a small dip in revenue. Input cost pressures likely hurt profitability.
• Poultry & Processed Foods revenue dropped 20.2%, with EBIT also down 76.8% — an area of concern going forward.

Animal Feed Flat; Margins Under Pressure

• Revenue remained flat (+0.1%), but EBIT fell 17.4%. This suggests competitive pricing and cost pressures in this key volume segment.

Significant Profit Improvement

• Compared to Q4FY25, net profit more than doubled (+125.1%), indicating strong seasonal recovery and cost control.

EPS and Shareholder Returns Improving

• EPS grew 18.8% YoY to ₹8.35, supporting long-term valuation strength.
• Subsidiary dividends (e.g., Godrej Foods ₹207.50/share) show strong cash flows and a commitment to shareholder return.

Strategic Subsidiary Consolidation

• Increased stake in Creamline Dairy (now 99.67%) improves control in the dairy business.
• Raised stake in Astec LifeSciences to 67.03% via rights issue, showing continued focus on core agri-chemicals.
• Full ownership of Godrej Foods completed, aligning with long-term strategic vision.

Stock Market Reaction Positive

• Shares closed 2.52% higher at ₹831.05, showing investor confidence post-results.
• Strong intraday movement (high of ₹851) reflects bullish sentiment.

What to Watch Going Forward

• Margin trends in Dairy and Animal Feed.
• Sustained demand in Crop Protection and seasonal resilience in Vegetable Oil.
• Performance of newly consolidated subsidiaries, especially Creamline and Astec.
• Progress on integration efforts and cost efficiencies across verticals.

REF: https://nsearchives.nseindia.com/corporate/GODREJAGRO_06082025150422_BSENSEBMOUTCOME06082025.pdf

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