ET Now In a chat with ET Now, Salil Singhal, Chairman, PI Industries, shares his business outlook. Excerpts:
ET Now: How has demand for agri inputs business been in the first three quarters of FY15 between agrochemicals, fertilisers and hybrid seeds? Which division has seen the strongest growth?
Salil Singhal: We are basically in the agrochemicals, pesticides division business. It has been a little choppy in the kharif season, but with the kind of weather that we see here, I see a lot of scope for good growth in the fungicide business. By and large, while the acreages have reduced, we would have a kind of growth which was witnessed last year on an overall industry basis. So we should be able to manage 12% to 15% growth for the business.
ET Now: But if you have to map the demand environment for us, Q2 versus Q3 has anything changed dramatically?
Salil Singhal: It has been a little better in Q3 than Q2, and the season is now on. So we still have several weeks to go and I definitely see it as a fairly positive environment.
ET Now: Last when we checked up with the management of PI Industries, they did indicate that they are looking at commercial launches of about two to three molecules. What is the update on that and how big is that opportunity?
Salil Singhal: Well, one molecule has just got registered. So we are in the process of launching it and the other molecule is waiting for the final confirmation at the registration level. In fact, it has been overdue and pending with the registration authorities and the time taken there is far too long than it is warranted to take. It is a problem of people at the registration cell where they seem to be overloaded with a variety of challenges that they have to handle, but I expect that should happen in the next month or two and we will be ready with the second product and certainly the products will add to our basket. It will add to our ability to handle a bigger segment of the agrochemical business and being new molecule, we see there is a lot of opportunity and a lot of hope in both the products that we intent to launch.
ET Now: While you are looking at launching these molecules, what is the value that these molecules really bring to the table at this point in time? Also, in terms of the margins that the sale of these molecules would generate for you?
Salil Singhal: We do not actually put an estimate of volumes. A lot of activity has to be done at the ground level to make the user familiar with the molecule and the cost and the value advantage it offers to the customers. So there is a time lag of a season to get the molecule to be acceptable to the farmers. It has to meet with the competitive environment, it has to meet with the value expectations of the farming community. But, as I said, knowing the markets, we are very confident that there will be reasonably good profitable molecules going in the future.
ET Now: But you still have got to give me some numbers. This is a good opportunity for you, but translate that into some real numbers.
Salil Singhal: I do not see any advantage in talking of numbers. It has so many factors in it. Let us wait and watch. There will be time to talk of numbers in due course, but it is not the right time.
ET Now: How has demand for agri inputs business been in the first three quarters of FY15 between agrochemicals, fertilisers and hybrid seeds? Which division has seen the strongest growth?
Salil Singhal: We are basically in the agrochemicals, pesticides division business. It has been a little choppy in the kharif season, but with the kind of weather that we see here, I see a lot of scope for good growth in the fungicide business. By and large, while the acreages have reduced, we would have a kind of growth which was witnessed last year on an overall industry basis. So we should be able to manage 12% to 15% growth for the business.
ET Now: But if you have to map the demand environment for us, Q2 versus Q3 has anything changed dramatically?
Salil Singhal: It has been a little better in Q3 than Q2, and the season is now on. So we still have several weeks to go and I definitely see it as a fairly positive environment.
ET Now: Last when we checked up with the management of PI Industries, they did indicate that they are looking at commercial launches of about two to three molecules. What is the update on that and how big is that opportunity?
Salil Singhal: Well, one molecule has just got registered. So we are in the process of launching it and the other molecule is waiting for the final confirmation at the registration level. In fact, it has been overdue and pending with the registration authorities and the time taken there is far too long than it is warranted to take. It is a problem of people at the registration cell where they seem to be overloaded with a variety of challenges that they have to handle, but I expect that should happen in the next month or two and we will be ready with the second product and certainly the products will add to our basket. It will add to our ability to handle a bigger segment of the agrochemical business and being new molecule, we see there is a lot of opportunity and a lot of hope in both the products that we intent to launch.
ET Now: While you are looking at launching these molecules, what is the value that these molecules really bring to the table at this point in time? Also, in terms of the margins that the sale of these molecules would generate for you?
Salil Singhal: We do not actually put an estimate of volumes. A lot of activity has to be done at the ground level to make the user familiar with the molecule and the cost and the value advantage it offers to the customers. So there is a time lag of a season to get the molecule to be acceptable to the farmers. It has to meet with the competitive environment, it has to meet with the value expectations of the farming community. But, as I said, knowing the markets, we are very confident that there will be reasonably good profitable molecules going in the future.
ET Now: But you still have got to give me some numbers. This is a good opportunity for you, but translate that into some real numbers.
Salil Singhal: I do not see any advantage in talking of numbers. It has so many factors in it. Let us wait and watch. There will be time to talk of numbers in due course, but it is not the right time.
Get Unlimited Access to The Economic Times
