PAT grew 6% YoY to INR15,510m. Growth was robust across key geographies (+36.6% YoY in Europe, +26.5% YoY in LATAM, +21.5% YoY in North America and +12.7% YoY in RoW), barring India (-20.8% YoY), where poor Kharif yield and erratic rainfall resulted in stressed cash flow for farmers. UPLL also faced restriction on the sale of organophosphorus products in a few states in India, which impacted the top line (to the tune of INR300-400m on an annualized basis). UPLLs performance in Europe has been a highlight, with the geography growing at 15.4% YoY in 9MFY19 against an estimated industry decline of 10% in CY18. We maintain our estimates (revenue/PAT CAGR of 32%/18% over FY18-21), factoring in the financials of Arysta in FY20E and FY21E. We roll over the target price to FY21E EPS, valuing UPLL at 13x (~15% discount to its three-year average trading multiple, primarily due to the expectedly high leverage in the balance sheet post Arysta acquisition).

The EU has passed a regulation (effective from Jan'19) to minimize the use of copper in crop protection products. The new regulation states that the permissible use of phy to sanitary products (pesticides, nematicides and rodenticides) containing copper compounds should be curbed. In this report, we analyze details of the regulation and its impact from UPLL's point of view.

LATAM drives revenue growth; steady volume growth Revenue rose by 13% YoY in Q2FY19 led by strong performance in India and LATAM businesses (contributing around 66% of total sales). LATAM business registered a strong revenue growth of 26% YoY in Q2FY19 led by decent growth across geographies in the region especially Brazil barring Argentina which was impacted by currency depreciation and overall economic situation. LATAM's revenue contribution has increased to 41% during the quarter from 37% in Q2FY18. Management expects strong performance to continue in LATAM in H2FY19 as well led by advance orders received in Brazil. Going ahead, we expect LATAM revenue to grow at a CAGR of 13% over FY18-20E on the back of strong...

Scales higher in the top five league globally: With Arysta's acquisition, UPL moves ahead in the global agri-chemical ranking and is now among the top five players. The acquisition is expected to provide significant benefits to UPL, as it complements UPL in many areas. Arysta is an asset-light company and a global provider of innovative crop-protection solutions, including...

Scales higher in the top five league globally: With Arysta's acquisition, UPL moves ahead in the global agri-chemical ranking and is now among the top five players. The acquisition is expected to provide significant benefits to UPL, as it complements UPL in many areas. Arysta is an asset-light company and a global provider of innovative crop-protection solutions, including...

In Brazil, UPLL primarily engages in soybean and maize (together account for 63% of the countrys total plantation area) and Arysta in sugarcane and cotton (19% of the countrys total plantation area). Moreover, UPLL has a strong presence in fungicides, while Arysta has a robust platform of bio solutions (#2 globally in bio stimulants) and seed treatment in Brazil. Brazilian farmers are enjoying strong demand for soybean, primarily due to the tense ties between the US and China. According to industry sources, China accounts for more than 60% of the soybean traded worldwide. This apart, Brazils producers are selling soybean at a premium soybean that were to be loaded in August fetched USD2.21/bushel more than Chicago futures as on July first week the widest gap since 2014. Where Unizeb Gold (brand of mancozeb) is sold at ~USD4 per unit in Brazil, Tridium fetches a realization of USD8-10 per unit.

We maintain Buy with a TP of Rs 719 (9x Sept'20 EV/EBITDA). UPL reported Sales/EBITDA/APAT growth of 12.9/16.2/18.4% to Rs 42.57bn/Rs 7.87bn/Rs 2.85bn respectively. PAT was weighed down by a higher tax rate (26.6% against 17.5% in 2QFY18) due to derivation of higher profits from India (attracting a higher tax rate).

EBITDA increased 17% YoY expanding 60bp YoY to 19.7% (in-line). PAT increased grew 12% YoY, EBITDA increased 15% YoY (margin up 50bp to 20.1%) and adj. We expect the momentum to continue in 2HFY19, with revenue growth of 12% YoY and margin expansion of 80bp YoY. LATAM is an important geography for UPPL accounting for 41% of overall revenue (v/s 37% in 2QFY18). Management has maintained its growth (10-12%) and margins guidance on account of the holistic growth prospects across geographies. We maintain our revenue/PAT CAGR (FY18-20) estimate of 44%/8%, and continue valuing UPLL at 13x Jun20 EPS (~15% discount to its three-year average trading multiple) on account of (a) highly leveraged balance sheet (due to Arysta acquisition) leading to increased D/E, (b) pressure on return ratios and (c) higher exposure to forex risk. However, with key drivers of growth in place, we maintain our price of INR749 (20% upside).

UPL's consolidated revenue for Q1FY19 came in at Rs 4134cr, an increase by 7.3% yoy. This was primarily driven by rise in revenue from Agro activities and Non-Agro activities by 7.6 per cent and 7.3 per cent yoy, respectively. The operating profit for the quarter stood at Rs 797 cr, a rise...

UPL reported revenue growth of 11% YoY to INR 41.34bn against our estimates of INR 41.06bn. The growth was led by steady growth from agro activities (+7.6% YoY) supported by higher growth from LATAM (+17% YoY) along with decent growth from India market (+12% YoY) due to low base. OPM expanded by 34bps YoY to 20.5%, which led EBITDA to up by 12.9% YoY to INR 8.5bn against our estimates of INR 8.15bn....

We now value UPL at 9.0x Jun'20 EV/EBITDA and maintain Buy with a revised target price of Rs 700 (implied P/E of 12.6x Jun'20 EPS). UPL reported Sales/EBITDA/APAT growth of 11.0/15.3/7.8% to Rs 41.3bn/Rs 7.97bn/Rs 5.15bn respectively. India business reported a growth of 11.0% YoY to Rs 12.4bn on a lower base, while Latam business showed a recovery with a growth of 17.2% YoY to Rs 8.6bn.

31 July 2018 increased 11% YoY to INR41.3b (est. of INR41.9b) in 1QFY19, driven by volume growth of 8% YoY and price increase of 1% YoY. EBITDA grew 12.9% YoY to INR8,470m (est. of INR8,638m), with the margin expanding 40bp YoY to 20.5% (est. Higher interest cost of INR1,750m (est. of INR790m) was partly offset by a lower tax rate of 9.2% (est.

UPL Corporation Ltd, international arm of the UPL (United Phosphorus Ltd), has entered into an agreement to acquire Arystra Lifesciences for US$4.2bn, making it to Top 5 in the world. UPL will now have sales of US$5bn & 20%+EBDITA margins (presynergies).Transaction provides UPL a perfect match with powerful synergies across geographie..

20 July 2018 UPLL boasts of an agrochemical product portfolio that is spread out across geographies and crops (including fruits & vegetables, rice, soybean and cotton). The acquisition will not only boost UPPLs product portfolio for crops where it already has a strong presence, but also in those where it has limited presence (e.g. wheat, barley, nuts and a wide variety of specialty crops). This apart, the acquisition will strengthen the companys product portfolio in the European cereal market, where its presence is currently limited to sugar beet, fruits (grape) and vegetables. As Arysta is multiple times larger than UPLL in both the aforementioned categories, we believe the acquisition help UPPL to transform into a true integrated crop solutions provider. Arysta relies on contract manufacturers for raw material sourcing from low-cost manufacturing countries like India, China and Eastern Europe. Post-acquisition, the sourcing cost of Arysta will reduce given UPLLs strong manufacturing base.

UPL's long-term prospects remain positive, led by focus on branding and launching new innovative products, maintaining geographical presence , product and crop diversity, increasing share in the global agrochemical market, improving Innovation Turnover Index and consistently investing in backward as well as forward integration, resulting in better cost management. Acquisition of Arysta Life Sciences, a part of the US-based Platform Specialty Products, will make UPL the world's fifth largest crop protection company and the largest generic player with combined revenues of slightly lower than $4.6 billion . The company is currently the ninth largest with annual revenues of $2.7 billion. Further, given the strong manufacturing base of UPL, sourcing costs will be reduced as Arysta gets most of its raw materials from India and China. A strong supply chain can...

UPL reported a revenue growth of 6.5% YoY to INR 56.9bn against our estimates of INR 58.8bn. The growth was led by mixed of geographies such as Europe (+7.3% YoY) & LATAM (+7.2% YoY). OPM inched up by 32bps YoY to 21.4% resulting into EBITDA growth of 8.2% YoY to INR 12.18bn against our estimates of INR 12.86bn....

Net sales grew by 7% to ` 56.9bn lower than our estimate by 6%. Volume growth during the quarter was 8% and exchange impact of -1%. Adjusted EBITDA grew by 9% to ` 12.2bn higher than our estimate by 3%. PAT degrew by a percent to ` 7.4bn. North America, Latin America and Europe grew by 7% while India and RoW grew by 6% and 5% respectively. In FY18, industry witnessed a de-growth of 0.2% while UPL outperformed the industry with a 7% growth and constant currency growth of 9%. UPL...

We maintain BUY with a TP of Rs 851/sh (16x FY20E EPS) For 4QFY18, UPL reported muted revenues at Rs 56.91bn (+6.5% YoY). Volume growth of +8% was negated net cross currency movement of -1%. EBITDA stood at Rs 14.21bn (+36.4% YoY), as margins expanded to 25.0% (+554 bps YoY). EBITDAM expansion was driven by higher gross margins (+90bps YoY), lower employee costs (-49bps YoY) and drop in other expenditures & exchange difference (-415bps YoY). Reported APAT at Rs.7.36bn (-0.7% YoY) was muted as a result of higher interest costs (+92.5% YoY) and higher tax rate (17.6% +1042bps YoY).

A consistent outperformer in a challenging industry UPL reported 4Q18 Revenue/EBITDA/PAT of INR 57bn / INR 12.2bn / INR 7.7bn (+7%/+8%/+6% YoY respectively), in-line with JMFe of INR 59.1bn/11.3bn / 7.87bn. Geographically, (i) India business grew 6% YoY with growth in new fungicides and successful farmer reception of 3 new launches, (ii) LATAM business grew 7% YoY driven by product launches throughout the value chain , (iii) Europe grew at 7%YoY(against the industry negative growth rate of 2%) driven by sugar beet herbicide portfolio (iv) ROW grew at 5% YoY driven by double digit growth in Africa and key South East Asian countries, and (v) North...