Heranba ind - new addition in PF ( added below 650 ) waiting for another dip . 
Acquisition of industrial shed in Vapi for expansion
Expansion in Saykha -dsij.in/DSIJArticleDet…
The global pyrethroids market reached a value of USD 3.3 billion in 2020. The market is further expected to grow at a CAGR of 4.2% in the forecast period of 2021-2026 to reach a value of approximately USD 4.3 billion by 2026.
Heranba industries - some interesting points from credir report.
1Further fully integrated facility for pyrethroids and limited dependence on China for raw material procurement, should ensure operating profitability stabilizing at 15-18 percent.
1Further fully integrated facility for pyrethroids and limited dependence on China for raw material procurement, should ensure operating profitability stabilizing at 15-18 percent.
2-expected to incur capex of Rs 150 crore over next 2-3 years
3-HIL is present in the entire product value chain of the agrochemicals industry . Technicals (15-16 products), Formulations (more than 80 products) and Intermediates (2 products).
3-HIL is present in the entire product value chain of the agrochemicals industry . Technicals (15-16 products), Formulations (more than 80 products) and Intermediates (2 products).
4-HIL dominates the Indian pyrethroids market, accounting for a share of ~20%.
5-Large working capital requirement:
6-In May 2020, the Ministry of Agriculture issued a draft order prohibiting 27 pesticides, out of which 16 were being manufactured by HIL contributing around 10%
5-Large working capital requirement:
6-In May 2020, the Ministry of Agriculture issued a draft order prohibiting 27 pesticides, out of which 16 were being manufactured by HIL contributing around 10%
of overall revenue. However, continuous addition of new products mitigates the risk to a large extent.
6-Liquidity will remain strong over the medium term, backed by sizeable cash accrual and absence of any term debt obligations.
6-Liquidity will remain strong over the medium term, backed by sizeable cash accrual and absence of any term debt obligations.
The bank limit of Rs 74.75 crore was utilised moderately, at an average of 25% during the 9 months through January 2021. Estimated cash accrual of Rs 120-150 crore per fiscal over the medium term will be utilised to meet incremental working capital and (capex) requirements
Heranba- fy21 profit 154 Cr vs 98 Cr , qoq almost flat , new CFO , increased fixed assets , CFO 60 Cr
Heranba concall some interesting points-
1- capacity will be three times in next 2-3 yrs
2- major capex is of technicals
3- revenue will grow by 18-20 CAGR
4- ready for contract manufacturing also if there is any opportunity
5-over 3 yrs they will spend 200-250 cr on capex
1- capacity will be three times in next 2-3 yrs
2- major capex is of technicals
3- revenue will grow by 18-20 CAGR
4- ready for contract manufacturing also if there is any opportunity
5-over 3 yrs they will spend 200-250 cr on capex
6- capex will be from internal accrual only
7- Asset turnover for capex will be 3-3.5
8- no long term contract ( only short term )
9- they are selling pyrethroids to china also
7- Asset turnover for capex will be 3-3.5
8- no long term contract ( only short term )
9- they are selling pyrethroids to china also
Some important points after my recent communication with officials from Heranba
1- Company is now focusing in regulated market where margins are better
2- Recently They got registration for three products at two to three places in Europe.
1- Company is now focusing in regulated market where margins are better
2- Recently They got registration for three products at two to three places in Europe.
3- one Registration got in US market
4- capacity expansion is on track
5- Debtor days long due to formulation business
6-technicals capacity utilisation is around 88-90% and it is major area for expansion
7-they are planning to introduce import substitutes in future
4- capacity expansion is on track
5- Debtor days long due to formulation business
6-technicals capacity utilisation is around 88-90% and it is major area for expansion
7-they are planning to introduce import substitutes in future
8- optimistic on 18-20% growth on revenue
9- trying to reduce debtors day
10- very less dependence on China for raw material
9- trying to reduce debtors day
10- very less dependence on China for raw material
Heranba environmental clearance for expansion-bseindia.com/xml-data/corpf…
Heranba- excellent results , growth in top line and bottom line , margins are down qoq , rest looks superb
Good growth,only margins are down but good EBITDA growth, ab Kya bacche 👶 ki jaan loge .
Heranba concall-
-Export growth was marginal due to scarcity or containers and backlog exports.
-In terms of business mix, our technical grew our revenue this quarter contributing 72.75% of revenue from
operations. There has been a growth of 44.56% in technical ( QOQ)
-Export growth was marginal due to scarcity or containers and backlog exports.
-In terms of business mix, our technical grew our revenue this quarter contributing 72.75% of revenue from
operations. There has been a growth of 44.56% in technical ( QOQ)
-while formulations grew by 10.4% this quarter compared to QI FY21 last year.
-Public health has doubled in absolute terms this quarter as compared to Ql FY21 as we see the reason of
government contracts. ( I dont like their goverment business growth -cash flow problems)
-Public health has doubled in absolute terms this quarter as compared to Ql FY21 as we see the reason of
government contracts. ( I dont like their goverment business growth -cash flow problems)
- On the research and development front, five new compounds are being evaluated two of which are
fungicides, two of which are herbicides and one of which is an insecticide for exclusive sale in
Europe and United States of America.
fungicides, two of which are herbicides and one of which is an insecticide for exclusive sale in
Europe and United States of America.
-Ratio of Technicals and formulation will be in the range of around 65% to 70% technicals to formulations even going forward.
-Agrochemicals as a segment is definitely seasonal so there is seasonality, but we are spread
across the globe.
-Agrochemicals as a segment is definitely seasonal so there is seasonality, but we are spread
across the globe.
So, if you say Q2 and Q3 would be good in India where Q2 would be the strongest, but when it becomes softer in India we export in foreign countries.
Capacity utilization-Majorly in our technical facilities it is around 90%. So, with every debottlenecking it again goes back to 90% and the formulation capacities we have around 55 percentage which with the new
registrations that we get this also capacity utilization would go up.
registrations that we get this also capacity utilization would go up.
-Pyrethroid non pyrethroid revenue share 60 /40
-expansion in to new products/expansion in to existing products 70/30
-next 3-5 yrs CAGR expected 18-20%
-250 crore CAPEX for the next two to three years with asset turnover 3.5 ( Planned)so 2000 Cr+ revenue in next 3 yrs
-expansion in to new products/expansion in to existing products 70/30
-next 3-5 yrs CAGR expected 18-20%
-250 crore CAPEX for the next two to three years with asset turnover 3.5 ( Planned)so 2000 Cr+ revenue in next 3 yrs
-In US received one registration this year. Europe have received four registrations
and this year we feel we will receive one more.
-Right now working capital days is around 90 days to 95 days and it will be in the same range going forward .
and this year we feel we will receive one more.
-Right now working capital days is around 90 days to 95 days and it will be in the same range going forward .
Read management Comments on chlorpyrifos and pyrethroids
Heranba- promoters bought 1 lac shares from open market
Heranba - almost flat results qoq
Heranba concall ( Only important Points)
1-we have sent our first consignment of our newly registered insecticide molecule to USA,
which marks our entry into the highly regulated market
2-I am happy to announce that our unit 4 plant in
Vapi will commence in November end 2021.
1-we have sent our first consignment of our newly registered insecticide molecule to USA,
which marks our entry into the highly regulated market
2-I am happy to announce that our unit 4 plant in
Vapi will commence in November end 2021.
This unit will greatly complement our existing
technical units in Vapi reducing our external dependence as well as increasing capacity and
improving bottomline to some extent.
3- Logistic problem - To some extent it is getting resolved because now the customers have also become
technical units in Vapi reducing our external dependence as well as increasing capacity and
improving bottomline to some extent.
3- Logistic problem - To some extent it is getting resolved because now the customers have also become
smarter they have realized that they have to book in advance if they want their material on time in
their market so customers have started buying early so that is one case that we are facing
and also there are some improvement in the logistical part;
their market so customers have started buying early so that is one case that we are facing
and also there are some improvement in the logistical part;
4-We have always said that our growth is in the range of 18% to 20% and we will be able to
maintain that kind of growth also and EBITDA margins also will be in the range of 18% to
20%.
5- capex - Sarigram 180 Cr, Dahej -70cr
maintain that kind of growth also and EBITDA margins also will be in the range of 18% to
20%.
5- capex - Sarigram 180 Cr, Dahej -70cr
6-Contribution from recently launched molecule- one product which we have launched, last to last year we have launched that product we used to make around 50 tonnes now we have scaled it up to around 120
metric tonnes.
metric tonnes.
Our intermediate also which we used to make around 200 we have increased
it to 350 so that way definitely we have been able to increase our volume by increasing our
capacity for debottlenecking our existing facility to some extent and once we shift to our
new facility in Sarigam
it to 350 so that way definitely we have been able to increase our volume by increasing our
capacity for debottlenecking our existing facility to some extent and once we shift to our
new facility in Sarigam
there would be a better scope to increase the volumes of our new
molecules that we have launched this year or maybe last year in the second half.
molecules that we have launched this year or maybe last year in the second half.
7- US Sales Goal-In the longer term may be three-year to five year down the line we should be able to touch
around 25 million tonne that is the goal.
8-Pyrethroid sales -Now it is around 65% of Total sales may come down to around 57% around three to five years down the line
around 25 million tonne that is the goal.
8-Pyrethroid sales -Now it is around 65% of Total sales may come down to around 57% around three to five years down the line
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