Coromandel International Reports Strong Q2 FY26 Growth, Analysts Recommend Stock Accumulation

Coromandel International announced strong financial performance for the second quarter of fiscal year 2026 (Q2 FY26), with consolidated revenue increasing by approximately 30% year-on-year (YoY) to Rs 9,654 crore. The company's core nutrients business, representing about 90% of its revenue, saw a significant 28% YoY growth in sales, bolstered by favorable monsoon conditions. The crop protection chemicals segment, contributing around 10% of revenue, achieved 42% YoY growth, largely attributed to the recent acquisition of NACL Industries.

Profitability faced some pressure due to increased input costs, particularly for imported Di-ammonium Phosphate (DAP) and raw materials like sulphur and ammonia. Earnings Before Interest, Tax, Depreciation, and Amortisation (EBITDA) grew by about 18% YoY, with a slight margin contraction of 124 basis points (bps). The nutrients segment profit rose 15% YoY but also experienced a 126 bps margin decline.

The company plans to integrate NACL Industries, consolidating R&D and leveraging its expertise to drive future growth, aiming to significantly improve NACL's profit margins. Management is optimistic about sustained growth, new product launches, and expansion into bio-products and agri-retail, with a focus on innovation including agri-drones.

Impact This news positively impacts Coromandel International's stock performance by highlighting strong operational execution and promising future growth drivers. It also reflects positively on the broader Indian agrochemical and fertilizer sector, given the healthy monsoon outlook. (Rating: 7/10)

Difficult Terms * YoY (Year-on-Year): A comparison of financial metrics over the same period in consecutive years. * EBITDA (Earnings Before Interest, Tax, Depreciation, and Amortisation): A measure of a company's operating performance before accounting for financing costs, taxes, and non-cash expenses. * Margin contraction: A decrease in the profit margin, meaning the company is earning less profit for every rupee of sales. * Bps (Basis Points): Unit of measure equal to 1/100th of a percent. A margin contraction of 124 bps means the profit margin decreased by 1.24%. * DAP (Di-ammonium Phosphate): A widely used phosphatic fertilizer. * Rabi season: The winter cropping season in India, typically from October to March. * NACL Industries: A company acquired by Coromandel International, specializing in crop protection chemicals. * Synergies: The benefit achieved when two companies merge or cooperate, where the combined entity is more valuable than the sum of the individual parts. * FY27e: Estimated figures for the fiscal year ending March 2027. * P/E (Price-to-Earnings Ratio): A stock valuation metric comparing share price to earnings per share.