Top Indian Companies: UPL Limited

UPL Limited, formerly United Phosphorus Limited, is an Indian multinational company that manufactures and markets agrochemicals, industrial chemicals, chemical intermediates, and specialty chemicals, and also offers crop protection solutions.

Headquartered in Mumbai, Maharashtra, the company engages in both agro and non-agro activities. The agro business is the company's primary source of revenue and includes the manufacture and marketing of conventional agrochemical products, seeds and other agricultural related products.

The non-agro segment includes the manufacture and marketing of industrial chemical and other non agricultural related products such as fungicides, herbicides, insecticides, plant growth and regulators, rodenticides, industrial and specialty chemicals, and nutrifeeds. UPL products are sold in 150+ countries.

United Phosphorus Limited was established on 29 May 1969. The company changed its name to UPL Limited in October 2013.

UPL is a Nifty 50 company with a weightage of 0.51%.

Shareholding Pattern

The Shareholding Pattern page of UPL Ltd. presents the Promoter's holding, FII's holding, DII's Holding, and Share holding by general public etc.

Holder's Name No of Shares % Share Holding

No of Shares 764045456 100%

Promoters 198372963 25.96%

Foreign Institutions 261791273 34.26%

Banks Mutual Funds 48446620 6.34%

Others 85162842 11.15%

General Public 58757976 7.69%

Financial Institutions 94108482 12.32%

Foreign Promoter 17379800 2.27%

GDR 25500 0%

UPL on Monday reported 42.56 per cent decline in consolidated net profit at Rs 792 crore for March quarter 2022-23.

The company's net profit stood at Rs 1,379 crore in the year-ago period, UPL said in a regulatory filing.

Revenue grew 4.46 per cent to Rs 16,569 crore as compared with Rs 15,861 crore in the year-ago period.

"We delivered a resilient set of results for FY23 despite facing significant headwinds in the final quarter...We reduced our gross debt by over USD 600 million and net debt by USD 440 million driven by improved cash flow from operations and a leaner working capital cycle," UPL Chairman and Group CEO Jai Shroff said.

He said, in line with the company's priority of creating shareholder value, UPL created distinct pure play platforms during the year to bring in enhanced focus and operational freedom to pursue independent growth strategies thereby unleashing the growth potential of each of UPL's distinct platforms.

"...as we look ahead to FY24, we are well-positioned to deal with the market headwinds and deliver better profitability growth. In the longer-term, we remain confident of achieving our growth ambitions and transforming the food value chain with emphasis on sustainability," Shroff added.

UPL Global Crop Protection CEO Mike Frank said FY23 was a tale of two distinct periods, the company's performance in the first nine months delivered 20 per cent growth in revenue and EBITDA.

The fourth quarter was an unusual one with pricing pressure and delayed purchases by channel in the post-patent space due to oversupply of certain molecules, Frank said.

Shares of the company were trading 0.04 per cent up at Rs 715 apiece on the BSE.

TP raised to INR 914 UPL’s continued investment in manufacturing has ensured minimal supply chain shock amidst robust demand environment, thus propping its business. Its collaborative approach (+70 projects under evaluation), product pipeline, both for traditional chemical pesticide and biologicals, and digital platform investment will make UPL agile.

At the current market price, the stock is trading at 10.1x FY24E EPS of INR 76.5, making it one of the most inexpensive global-scale agrochemical stocks.

Brokerage, Elara Capital raise their FY23E/24E topline/EBITDA 2%/2%. Elara Capital roll forward to FY24E earnings and raise TP to INR 914 (from INR 806), based on 7x FY24E EV/EBITDA (implied P/E 11.9x). Maintain Accumulate.

ESG

UPL Ltd., a sustainable provider of agricultural products and solutions with a focus on crop protection, has been ranked as the highest performing global crop protection company.

UPL is constantly working to reduce environmental footprint as environmental care has been a part of our core philosophy since inception and is practiced in our daily business across the value chain.

CO2 reduction

• Utilisation of biomass as a source of energy: Working on installing a biomass boiler with 30 MT per day steam generation

• Recycling 100% plastics used in packaging

• Use of renewable energy through Green power purchase agreements

• Process and technology innovation to reduce CO 2 emission

Water consumption reduction

• Scale-Ban technology to reduce cooling tower water demand

• Rainwater harvesting to reduce abstracted water demand

• Recycling and reuse of green effluent stream

• Forward Osmosis technology for effluent recycling

Waste disposal reduction

• Reduce moisture in ETP sludge from 70% to <25%

• Biological treatment of incinerable waste, U4 & U5

• Zero liquid discharge at one of our units in India

• Wastewater stream identification and segregation.