Annual Report FY 2011-12 - PI Industries

2. OPERATIONS
Your company’s Domestic Agri Input Business once again outperformed the industry by growing at 22% YoY. The strong
performance was mainly driven by sales growth of newly launched in-licensed products, expansion of the distribution channel
network and inclusion of products in the portfolio to give complete crop solutions in the Company’s targeted crop areas.
Meticulous planning, proactive sales promotion on select crops, regular monitoring of crop acreages and pest infestation and
the hard work of the marketing team were the key to success.
The growth in the domestic agri input business was achieved despite several challenges during the year for the Agri input
industry in general and plant protection industry in particular. These challenges included increasing costs of production due
to higher input costs (fertilizers, manpower, fuel etc) and the inability of the farmers to realize Minimum Support Prices (MSP)
in many parts of the country affected the crop economics for farmers. Factors such as change in subsidy system on fertilizers,
export restrictions on leading crops, crop holidays in certain areas, unfavorable rains for crops such as pulses and soybean had
an impact on the farmers’ investment in plant protection chemicals and hence the agro-chem industry.
The quantum and distribution of rainfall, particularly in the 2nd crop season, was also not very helpful to the farmers and
to the agri input industry. Though the South West monsoon was normal for most parts of the country (102 % of its LPA), the
North East monsoon was significantly lower than the normal rainfall (52 % of LPA) and the distribution was also scanty which
affected the crop acreages and yields in some parts of the country.
This financial year also saw the steep rise in energy and transportation costs, sudden fluctuations in foreign currency rates
and raw material price increases.
The International Custom Synthesis & Manufacturing business registered a robust ~62% growth in sales YoY. The growth was
mainly driven by the scale-up of already commercialized products and commercialization of some new products. Since most
of these products are at early stage of their life cycle, they auger a good future growth of the Company. During the year, some
more high growth potential products were added to the R&D and process research pipeline of your Company.
The efforts of your team have started bearing results, and we hope to continue with the momentum of growth during the
current year as well. Your team is continuing to work in the diverse areas of applications leading to balanced portfolio of
products. The business continues to have several long-term orders and a robust and high potential order book position for the
coming years.
Introduction of New Products
For the third consecutive year, NOMINEE GOLD continued to be the growth driver and a sought after solution for weeds by
the rice growers. Your Company could successfully enlarge the use of NOMINEE GOLD, the rice herbicide, which is expected
to be a key enabler for rice productivity enhancement. The Company is also working to promote the concept of direct seeded
rice against the present practice of transplanted rice. This is expected to save a huge amount of water and labour costs to the
farmer.
As a part of its strategy to provide complete crop solutions, your Company successfully introduced two broad spectrum modern
fungicides: CLUTCH and SANIPEB, one wheat herbicide: WICKET and a broad spectrum Insecticide: OVAL.
During the period under review, your Company also reached the penultimate stages of registration approval for two new broad
spectrum insecticides. Both these molecules are expected to be launched in the domestic market in the year 2012-13. Your
Company continues its quest for new molecules and has signed 6 new agreements with their patent holders in insecticide /
herbicide / fungicide segments to evaluate their potential in the domestic market. These products further add to the Company’s
product pipeline and strengthen our product portfolio for the coming years.
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