Fresh worries for agrochemical majors as govt mulls ban on 27 chemicals
Net impact would depend on final list of chemicals to be banned and companies' move to diversify portfolio
agriculture economy | lockdown should be expected in order to prevent a second
Last Updated at May 20, 2020 14:03 IST
The Street sentiment on agrochemicals' manufacturers was impacted on Tuesday, following news that the government is considering banning 27 agrochemicals. Analysts say, these are in addition to the 8 formulations that are to be banned from December 2020. Stock prices of UPL, Coromandel International, Rallis India and Sumitomo Chemical, thus, fell between two and 9.6 per cent on Tuesday, with UPL emerging as the biggest loser.
Analysts say, chemicals being considered for ban form a significant part of the portfolio, both exports and domestic sales, of many players. For instance, agrochemicals like 2, 4-Dinitrophenol, Chloropyrifos Mancozeb, Acephate, and Pendimethilin form a significant portfolio of UPL, Sumitomo, Coromandel, Atul Ltd and Rallis. Since the move can impact 60-70 per cent portfolio of some companies, the Street concerns are bound to get aggravated. An analyst at a domestic brokerage says that though management replies and inputs are awaited, elementary assessment of the situation in his view is a negative for the entire agrochemicals pack.
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First Published: Wed, May 20 2020. 12:49 IST