UPL posts quarterly loss on weak demand, destocking woes

UPL, an agrochemicals firm, reported a quarterly loss on Friday as it continued to grapple with inventory destocking and weak demand for its crop protection products. The herbicides and insecticides maker reported a net loss of 12.17 billion rupees ($146.84 million) in the quarter ended on December 31, compared to a profit of 10.87 billion rupees a year ago. This is the company's second consecutive quarterly loss.

Revenue from operations fell 27.7 per cent to 98.87 billion rupees, with its biggest business - crop protection - plunging nearly 31 per cent. Its Latin American business, which accounts for more than 40 per cent of total sales, declined by 28 per cent. Other major regions, including Europe, North America and India also saw a double-digit decline in sales. "Destocking - the process of emptying out excess inventory levels following low demand - continued to weigh down the global agrochemical market," CEO Mike Frank said in a statement.

UPL's crop protection business suffered from destocking and pricing pressures in the North American and European markets, it said. In India, a below-average harvest season, especially in the states of Telangana and Karnataka, also hampered sales. The company expects to see improved performance in the next two quarters and anticipates normalized business performance from the second quarter of fiscal 2025, Frank said.

Rival Bayer CropScience, opens new tab reported a 31 per cent fall in quarterly profit on Thursday, hurt by sluggish demand for its crop protection products. UPL's shares ended 0.7 per cent higher ahead of its results.

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