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Informist, Sunday, Jul. 26, 2026

 

By Durgesh Nandan

 

MUMBAI – Sumitomo Chemical India Ltd. is expected to report an on-year decline but a sharp sequential rise in both net profit and revenues, according to brokerages tracking the company. Weak sales in domestic agrochemicals, which contribute 80% of the company's business, will be the key drag on revenues on a year-on-year basis.

 

The company is expected to report a net profit between INR 1.37 billion and INR 1.60 billion for the reporting quarter, according to estimates from three brokerages. The highest estimate for the net profit is from ICICI Securities Ltd. and the lowest is from Nuvama Wealth Management Ltd. The company's bottom line for the March quarter was INR 1.11 billion. For the year-ago quarter, it was INR 1.78 billion.

 

Sumitomo Chemical's consolidated revenues for the quarter are estimated at INR 9.70 billion-INR 10.04 billion, according to brokerages. The highest estimate for the revenues is from Nuvama and the lowest is from ICICI Securities. The company's top line for the March quarter was INR 6.84 billion. For the year-ago quarter, it was INR 10.48 billion.

 

The company's profitability is likely to have been affected by the El Nino weather phenomenon, which has resulted in a delayed and deficient southwest monsoon in India, delaying the sowing of crops, in turn pushing the demand for agrochemicals to the September quarter. Globally, too, demand for agrochemicals has declined owing to El Nino, which affected Sumitomo Chemical's exports business, Nuvama said. The brokerage expects an on-year fall of nearly 4% in the company's domestic business and of over 12% in exports.

 

"We understand that price hikes taken in the domestic agrochemical industry have not been fully absorbed, thus we expect a partial price gain to have marginally offset the extent of a high single digit volume decline," Nuvama said. Supply disruptions caused by the war in West Asia also led to a sharp rise in crude oil price as well as the cost of imported materials and shipping products. The increase in prices of essential chemical ingredients also added to the company's costs.

 

Sumitomo Chemical's earnings before interest, tax, depreciation, and amortisation for the June quarter are expected to be in the range of INR 1.90 billion, from ICICI Securities, and INR 1.71 billion, from Nuvama. The EBITDA margin is likely to fall year-on-year by 270-370 basis points, according to two brokerages. Analysts expect agrochemical companies to report subdued revenue growth and a decline in EBITDA for the June quarter, primarily due to the late arrival of the monsoon.

 

Sumitomo Chemical manufactures, imports, and markets products for crop protection, grain fumigation, rodent control, bio-pesticides, environmental health, professional pest control, and feed additives in India. It sources chemicals from its Japanese parent Sumitomo Chemical Co. and biological products from its US-based subsidiary, Valent Biosciences LLC.

 

Sumitomo Chemical will detail its June quarter results Monday. Friday, its shares closed at INR 520.45 apiece on the National Stock Exchange, down 2% from Thursday. The shares are up over 6% since the company announced its March quarter earnings on May 26.

 

All six research reports on the company available with Informist have a "buy" recommendation on the stock with an average target price of INR 603, implying an upside of over 16% from the current market price. 

 

The following are the Apr-Jun earnings estimates for Sumitomo from three brokerages in INR billion, in descending order of the estimate of net profit:

 

Brokerage	Revenue	Net Profit	EBITDA
ICICI Securities Ltd.	9.70	1.60	1.90
Anand Rathi Share and Stock Brokers Ltd.	9.97	1.56
Nuvama Wealth Management Ltd.	10.04	1.37	1.71

 

End

 

Edited by Shubhayan Bhattacharya

 

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