The company reported a revenue of Rs 11,090 crore for the September quarter, compared to Rs 10,170 crore during the year-ago period. Revenue growth during the quarter was driven by a 16% year-on-year growth in volumes, and a 7% drop in prices and near-flat forex rates.

Brokerage Phillip Capital noted that UPL reported strong volume expansion with an expected price decline in the second quarter, however, there are signs of revival in key markets which provide hope of normalcy in business from the second half of FY25 onwards.

UPL has been facing issues such as high inventory, subpar demand, pricing decline, and China dumping, said Harmish Desai, Research Analyst at Phillip Capital in a note, adding that “Going ahead, we expect a steady recovery in demand in key regions from FY25 onwards.”

The company said in its earnings filing that it remains optimistic about the second half of the fiscal year, with an expectation of accretive margins and improved cash generation through optimised inventory management.

Phillip Capital continues to maintain a “Neutral” rating on UPL Ltd and remains hopeful about the net debt reduction target the company has taken up for FY25. The brokerage raised the target price of the company by 10% to Rs 566.Analysts at Kotak Institutional Equities note that the company’s Q2 earnings missed estimates as a revenue beat was more than offset by pressure on margins. Achievement of the FY25 outlook would require sharply improved margins in the second half of FY25, the brokerage said.Kotak Institutional Equities raised the target price for UPL to Rs 430 from Rs 400 earlier and maintained a “Sell” rating on the company.

Any recovery in the global agrochemical market will only be gradual, not sharp, Kotak Institutional Equities noted, adding that in this backdrop, “the consensus estimates are too optimistic, and the stock needs to correct significantly to factor in the extent of erosion in earnings power and increase in balance sheet stress.”

Nuvama Institutional Equities slashed UPL’s FY25 and FY26 PAT guidance by 27% and 5% respectively, even as the company maintained FY25 revenue growth guidance of 4–8% and EBITDA growth of 50%-plus as high-cost inventory liquidation is over.

Nuvama Institutional Equities raised target price on UPL to Rs 590 from Rs 486 previously and upgraded rating on the company to “Buy” from “‘Reduce”.

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