India Pesticides Ltd IPO

Company Strengths

Strong R&D and Product Development CapabilitiesCompetitive Strengths:

India Pesticides Limited has substantial experience in undertaking R&D activities as part of their manufacturing operations. Their R&D places significant emphasis on identification of appropriate complex Technicals that are suitable for commercialization, improving their production processes and the quality of their present products, and manufacturing new off-patent products. Their R&D plays a big role in identifying products that give higher margin and require specialized manufacturing and handling capabilities.

Long-term relationship with key customers

India Pesticides Limited has developed strong and long-term relationships with various multinational corporations that has helped it expand its product offerings and geographic reach for its Technicals business. Several of the company’s customers have been associated with the Company for over 10 years. Company’s major customers include multinational corporations, and hence, 56.71% of its revenue was generated from exports.

Diversified portfolio of niche and quality specialized products

The company has diversified its product portfolio over the years and has grown into a multi-product manufacturer of Formulations, herbicide and fungicide Technicals as well as APIs. The company is the sole Indian manufacturer and among top five globally for several Technicals including, Thiocarbamate herbicide and Folpet. They have obtained registrations from the CIBRC for 22 agro-chemical Technicals and 125 Formulations for sale in India and 27 agro-chemical Technicals and 34 Formulations for export. They also have a license to manufacture from the Department of Agriculture, Uttar Pradesh for 49 agro-chemical Technicals and 158 Formulations.

Key Risk Factor:

• The top 10 customers constitute a significant portion of the company’s revenue and represent 56.83% of the revenue generated. The loss of one or more such customers could adversely affect business.
• Increasing use of alternative pest management and crop protection measures such as bio technology products, pest resistant seeds or genetically modified crops may reduce demand for the company’s products and adversely affect business.
• The availability of counterfeit products passed off by others as their products, could adversely affect the company’s reputation, goodwill and results of operations.