Earnings Outlook
Rise in maize acreage to boost Bayer CropScience sales, PAT
This story was originally published at 21:25 IST on 5 August 2025
Register to read our real-time news.Informist, Tuesday, Aug. 5, 2025
By Muskan Lodhi
MUMBAI – Bayer CropScience Ltd. is expected to report solid sequential growth in both its top line and bottom line for the June quarter due to a low base effect, according to brokerages tracking the company. The growth is also expected to be boosted by the early monsoon-led crop shift with the area under maize cultivation rising for the second year, a better product mix, and stable domestic and global prices.
The company's net profit for the June quarter is estimated at INR 3.16 billion, up 24% on year and up 121% on quarter, according to the average of estimates from four brokerages. The highest estimate for the company's bottom line is INR 3.42 billion from Antique Stock Broking Ltd. and the lowest estimate is INR 2.82 billion from Kotak Institutional Equities.
The company is expected to report net sales of INR 18.21 billion for the reporting quarter, up 12% on year and up 74% sequentially. The highest estimate for the company's net sales is INR 18.90 billion from Elara Securities (India) Pvt. Ltd. and the lowest estimate is INR 17.29 billion from Kotak.
Bayer CropScience's net sales are expected to benefit from potential crop-shift patterns which will likely result in 20% on-year growth in sales volumes of hybrid maize seeds, according to Anand Rathi Share and Stock Brokers Ltd. The company develops and sells hybrid variety seeds as well as agrochemcials. The brokerage also attributed the growth in net sales to a superior product mix, an 8% on-year rise in volumes of domestic agrochemicals, and stable domestic and global prices.
Kotak, however, expects the company's agrochemical sales to be subdued in the reporting quarter. This is probably because the company has enough inventory of agrochemical products but the distributors had already stocked up in the March quarter, which will likely result in low demand in the reporting quarter. Also, demand may be muted because the early monsoon damaged vegetable crops in Maharashtra, one of the company's key markets.
"The Kharif season has started on a strong note led by early arrival of monsoon. However, a slow pace/dry spell towards the latter part of June has led to moderation in (revenue) offtake," Antique Stock said.
The wholly-owned subsidiary of Bayer AG is expected to post earnings before interest, tax, depreciation, and amortisation of INR 3.96 billion, up 26% from the year-ago quarter and up 132% sequentially. The highest EBITDA for the company is estimated at INR 4.32 billion by Antique Stock while the lowest is estimated at INR 3.42 billion by Kotak.
The company is expected to report flat gross margins from the low margin in the year-ago quarter, Kotak said. "However, we expect employee costs and other expenses to normalize as one-off charges toward employee severance and doubtful receivables should be largely done." The brokerage expects the company's EBITDA margin to grow to 19.7%, up 50 basis points on year. On the other hand, Anand Rathi expects the EBITDA margin to jump 298 bps on year to 22.2%.
The key metrics to monitor when the company announces its results Wednesday are the guidance on inventory levels, pipeline for maize seed, and the impact of monsoon distribution over the June quarter.
Tuesday, the company's shares closed at INR 6,281 on the National Stock Exchange, up 0.5%. The shares are up almost 11% since the company announced its March quarter earnings. All the three research reports on the company available with Informist have a 'buy' recommendation on the stock with an average target price of INR 6,413.
Following are the Apr-Jun standalone earnings estimates for Bayer CropScience based on reports from four brokerages in the descending order by the estimate of net profit:
Brokerages | Net Sales (in INR million) | Net Profit (in INR million) | EBIDTA (in INR million) |
Antique Stock Broking Ltd. | 18,663.00 | 3,423.00 | 4,319.00 |
Elara Securities (India) Pvt. Ltd. | 18,894.00 | 3,283.00 | 4,100.00 |
Anand Rathi Share and Stock Brokers Ltd. | 17,986.00 | 3,124.00 | 3,998.00 |
Kotak Institutional Equities | 17,291.00 | 2,824.00 | 3,415.00 |
Average | 18,208.50 | 3,163.50 | 3,958.00 |
End
Edited by Ashish Shirke
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