Best Agrolife Limited — Q3 FY26 earnings call

Call held 9 Feb 2026

Management summary

Best Agrolife reported a challenging Q3 FY26 with significant revenue decline due to unseasonal rainfall and market conditions. Despite this, the company showed operational improvements with a positive EBITDA and reduced OPEX. The patented product portfolio demonstrated resilience, and new product launches received strong farmer acceptance. Management expressed confidence in returning to growth in the coming quarters, driven by their patented products and cost optimization efforts.

Highlights

  • Q3 FY26 EBITDA improved to ₹3.8 crores from a loss of ₹5.8 crores in Q3 FY25

  • Q3 FY26 EBITDA margin improved to 1.9% from negative 2.1% in Q3 FY25

  • OPEX (excluding financial depreciation) reduced by 36% in Q3 and 20% over 9M FY26

  • Patented product portfolio showed resilience with only a 5% reduction in 9M FY26

  • New patent products BestMan and Fetagen have treated over 4 lakh acres each and received strong farmer acceptance

Concerns

  • Q3 FY26 Revenue from operations declined by 25.9% YoY to ₹202.9 crores from ₹274.1 crores

  • 9M FY26 Revenue from operations declined by 28.5% YoY to ₹1,101 crores from ₹1,540 crores

  • 9M FY26 sales declined by 28%, with 23% due to volume decline and 5% due to price variation

  • Company reported a loss of ₹12.7 crores in Q3 FY26

  • Unseasonal high rainfall in October 2025 significantly impacted Q3 sales and cropping cycle

Key financials

2 periods

Q3 FY26

  • Revenue
    ₹202.9 Cr
    YoY -25.9%
  • EBITDA
    ₹3.8 Cr
  • EBITDA Margin
    1.9%
  • PAT
    ₹-12.7 Cr

9M FY26

  • Revenue
    ₹1,101 Cr
    YoY -28.5%
  • EBITDA
    ₹127 Cr
  • EBITDA Margin
    11.5%
  • PAT
    ₹46.1 Cr

What they filed

Q1 FY27: revenue up 3.9%, net profit up 105.0% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue747 274 274 381 517 −31%203 −26%156 −43%396 +4%
EBITDA147 -6 4 46 78 −47%4 +167%-27 −775%78 +70%
Net profit95 -24 -22 20 39 −59%-13 +46%-37 −68%41 +105%
How to read this

₹ crore, as filed. The percentage beside a figure is the change against the same quarter a year earlier — never the quarter before, which would make every seasonal business look like it collapses and booms each year.

Capital allocation

medium confidence
  • Capex Capex disclosed
    Yes, it is still on hold. We will think about it four, five months down the line, not now.
  • Debt Debt disclosed
    Sir, because we are already paying Rs. 50 crore to Rs. 55 crore interest to the bank and our profitability is below since last few years, so how do you think that this business is sustainable because our interest cost is more than our net profit?

Guidance & targets

Revenue

  • FY26 Revenue Revenue · FY26 · High confidence ₹1,300 crores to ₹1,400 crores
    So, FY 2027, still pretty early to say for this year, for FY 2026 already for nine months our sales are around Rs. 1,100 crores, so we expect to close the year between Rs. 1,300 crores to Rs. 1,400 crores.

    — Vikas Jain

  • FY27 Revenue Revenue · FY27 · High confidence ₹1,600 crores, ₹1,700 crores, ₹1,800 crores
    And next year, we will come around Rs. 1,600 crores, Rs. 1,700 crores, Rs. 1,800 crores also, because just I told in the Mr. Gunit question also, that we are already in the same path where we are developing our new product.

    — Vimal Kumar

  • Next year (FY27) Revenue Revenue · FY27 · High confidence higher than ₹1,500 crore, ₹1,600 crore and then going up to ₹1,700 crore, ₹1,800 crore
    So, Rs. 1,700 crore, Rs. 1,800 crore for next two years, in the sense, so next year our plan would be to achieve at least at around higher than Rs. 1,500 crore, Rs. 1,600 crore and then going up to Rs. 1,700 crore, Rs. 1,800 crore.

    — Vikas Jain

EBITDA Margin

  • FY26 EBITDA Margin EBITDA Margin · FY26 · High confidence around 12%
    Analyzed basis, we will be at around 12% or so. So that would be our EBITDA targets.

    — Vikas Jain

  • FY27 EBITDA Margin EBITDA Margin · FY27 · High confidence 16% to 17% minimum
    Not 20%, but definitely our target is there, but I cannot say 20%. But definitely, it will be 16% to 17% will be minimum.

    — Vimal Kumar

Profitability

  • Q4 FY26 Profitability Profitability · Q4 FY26 · High confidence not to have losses
    Our expectation is not to have losses, so in Q4 last year we had very high losses, so based on already we have worked on the OPEX part which we are reducing drastically. So, sales, obviously, as I said, the demand is a little softer, so we do not expect very high sales, but we expect not to go into losses and have even a small profit, but our plan is not to have losses.

    — Vikas Jain

Capacity Utilization

  • Revenue potential from existing capacity Capacity Utilization · Ongoing · High confidence ₹2,000-plus crore
    So, earlier at Rs. 1,800 crores also we had sufficient capacity. So, based on our existing capacity, we can do Rs. 2,000-plus crore.

    — Vikas Jain

What to watch in Q4 FY26

Q4 FY26 Profitability

next quarter
Current Loss of ₹12.7 crores in Q3 FY26
Target No losses, small profit

Why it matters

To confirm management's commitment to avoid losses in Q4 and demonstrate improved financial discipline.

Our expectation is not to have losses, so in Q4 last year we had very high losses, so based on already we have worked on the OPEX part which we are reducing drastically. So, sales, obviously, as I said, the demand is a little softer, so we do not expect very high sales, but we expect not to go into losses and have even a small profit, but our plan is not to have losses.

Risks & concerns

  • Unseasonal rainfall and adverse weather conditions

    high

    October 2025 witnessed exceptionally high rainfall (49% higher than long-period average), disrupting sowing, produce, and overall cropping cycle, leading to lower sales.

    Management acknowledged

  • High inventory at trade level and price competition

    medium

    Industry faced challenges related to high generic inventory at the trade level, leading to higher price competition and affecting demand.

    Management acknowledged

  • Potential El Nino effect in next financial year

    medium

    Management acknowledged reports of El Nino effects, stating they will work with caution on the supply chain and inventory, but existing policies will help manage impact.

    Analyst acknowledged

  • Warrant issue payment uncertainty

    medium

    The exercise price of warrants is significantly higher than the current market price, creating uncertainty about the payment of the remaining 75% of the issue.

    Analyst acknowledged

  • Delayed receivables

    medium

    Receivables over six months have increased due to delayed payments from government/farmers, though management states they are under control and expects improvement by March.

    Analyst acknowledged

Q&A highlights

1 direct
Missed H2 FY26 sales target and profitability Partial
So, Hemant, mostly in the sales, if you are aware, most part of September, August and September and including October, there was continuous rainfall. Especially in the north, most of the flooding has also happened. So, this impacted a little bit of sales. So we were pretty confident that we will be positive.

Analyst challenged management's prior confident guidance for H2 FY26, leading to an explanation of weather impacts and focus on cost control to limit losses.

Asked by Hemant Gupta

Warrant issue payment before May Partial
So, it's still based on the market prices we have to wait for a few more months before we can take any call as to what will happen.

Analyst inquired about the status of warrant payments, which are significantly out of money, and management indicated a wait-and-see approach based on market prices.

Asked by Hemant Gupta

Loss of market share and volume decline Partial
Yes, Mr. Gunit. In fact, I cannot say we are losing our market share, it depends on the products. Like, last some years we were doing mix of some generics and our patent portfolio. And now we are mainly focusing our patent product.

Analyst questioned the significant volume decline compared to competitors, and management explained their strategic shift towards higher-margin patented products, which entails higher initial marketing expenses.

Asked by Gunit Singh

Increasing receivables over six months Partial
So, as I said, in our business the collection period is defined based on how they introduce sales and the money flows from the government to the farmers, dealers and to us. So, this year mostly it has been delayed by a month or so, but we do not see any major surprises as I said.

Analyst highlighted a concerning increase in receivables over six months, and management attributed it to delayed payments from farmers/government due to weather, expecting improvement by March.

Asked by Kailash Chander

Utilization of preferential issue proceeds and CAPEX funding Direct
Yes, yes, so the 25% amount what we got, those as part of our utilization, this thing we already utilized it for the working capital purpose.

Analyst sought clarity on the use of funds from a preferential issue, and management confirmed 25% was used for working capital, with the remaining 75% (intended for CAPEX) currently on hold.

Asked by Vijay Jhawar

Plan B if remaining warrant amount is not received Partial
So we do not want to commit as of now that, okay, we are not going to get that 75% and we will do something else. So the CAPEX plan can hold because we have enough capacities to go for our target for next two years.

Analyst probed for contingency plans given the low share price relative to warrant exercise price, and management stated CAPEX plans could be deferred as existing capacity is sufficient.

Asked by Vijay Jhawar

Sustainability of business given high interest costs vs. net profit Partial
So interest cost, obviously, would be based on the loan what we would have utilized. So if there was a delay by a month or so, meaning if dealers have paid late, generally, we charge dealers with little bit of interest for delay payments. So that we do based on after they do the payment.

Analyst questioned the business sustainability given high interest expenses relative to net profit, and management explained interest costs are partly due to delayed dealer payments, which they aim to recover.

Asked by Vijay Jhawar

2 min read 6 chapters

Detailed narrative

Q3 FY26 Performance Overview and Challenges

Best Agrolife reported a challenging Q3 FY26 with revenue from operations declining by 25.9% YoY to ₹202.9 crores. The company posted a loss of ₹12.7 crores for the quarter. For the nine months ended December 31, 2025, revenue stood at ₹1,101 crores, a 28.5% decrease YoY. This decline was primarily attributed to unseasonal rainfall and market-related factors, including high inventory at the trade level and increased price competition.

Operational Efficiency and Cost Optimization

Despite the revenue decline, Best Agrolife demonstrated improved operational efficiency. The company achieved a positive EBITDA of ₹3.8 crores in Q3 FY26, a significant improvement from a loss of ₹5.8 crores in Q3 FY25, with the EBITDA margin rising to 1.9%. OPEX, excluding financial depreciation, was reduced by 36% in Q3 and 20% over the nine-month period, contributing to better financial discipline.

Patented Product Portfolio and Innovation

The company's patented product portfolio showed resilience, with only a 5% reduction in sales for the nine-month period, compared to a 48% decline in the non-patent portfolio. Newly launched patent combinations, BestMan and Fetagen, have been well-received by farmers, treating over 4 lakh acres each. Best Agrolife secured three patents for novel combination formulations and a process patent for an intermediate, and filed four international patent applications, strengthening its global IP position.

International Business and Export Focus

Best Agrolife is actively expanding its international footprint, with registration for patented products progressing in Sri Lanka and dossier preparation underway for Vietnam and Morocco. The company finalized its third export shipment to Sudan on a cash basis. They are also exploring opportunities in nano-urea and identifying intermediates for sale abroad, aiming for higher-margin export revenues.

Financial Outlook and Future Growth Targets

Management expects to close FY26 with revenue between ₹1,300-1,400 crores and an EBITDA margin of around 12%. For FY27, they project revenue to grow to ₹1,600-1,800 crores with an EBITDA margin of 16-17% minimum. The company believes the worst is behind them and anticipates growth to return from next year, driven by new products and a stabilized operational structure. Existing capacity can support over ₹2,000 crores in revenue.

Capital Allocation and Warrant Issue Status

The company has put CAPEX on hold, stating they are not doing anything as of now, and existing capacity is sufficient for the next two years. Proceeds from the preferential issue (25%) were utilized for working capital. The remaining 75% of the warrant issue is pending, and management is awaiting market conditions to decide on its payment, acknowledging the significant difference between the exercise price and current market price.

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