Shares of Sharda Cropchem traded firm after the company reported a strong Q2 and H1 FY26 performance, reinforcing signs of a demand and margin recovery in the global agrochemical cycle.

On the BSE, the stock opened at Rs.811.95, hit an intraday high of Rs.854.65 and hovered around the VWAP of Rs.836.86, compared with a previous close of Rs.814.20. At current levels, the stock remains well below its 52-week high of Rs.1,180.30 but has rebounded sharply from the 52-week low of Rs.440.05, reflecting improved investor sentiment as earnings visibility strengthens.

For Q2 FY26, revenue rose 20% YoY to Rs.929 crore, driven by about 36% overall volume growth and recovery in demand, particularly in agrochemicals, where revenue grew 27% to Rs.803 crore. Gross margin expanded 690 bps to 34.5% as input costs stabilised and pricing improved from historically low levels, pushing EBITDA up 71% YoY to Rs.139 crore with a 15% margin, while PAT rose 75% to Rs.74 crore.

Management attributed the gap between volume and revenue growth to product and regional mix rather than outright price cuts, and reiterated a full-year EBITDA margin guidance of 15–18%, implying a stronger, seasonally better H2.

On a first-half basis, revenue grew 23% YoY to Rs.1,914 crore, with agrochemicals up 26% and non-agro up 7%. H1 gross margin stood at 35% versus 28.4% a year ago, and EBITDA grew 69% to Rs.281 crore (14.7% margin), while PAT surged to Rs.217 crore from Rs.70 crore. Working capital improved meaningfully, with days reducing to 84 (a 34-day improvement versus March 2025), and the company remains debt-free with cash, bank and liquid investments of Rs.794 crore. Capex of about Rs.250 crore in H1 and planned Rs.450–500 crore for FY26 is largely directed towards registrations and dossier-building, which management sees as its key competitive moat.

On outlook, the company guided for EBITDA margins in the 15–18% range for FY26, implying a stronger second half given the seasonal skew of the agrochemical business and historically better H2 demand. Management also downplayed the impact of recent US tariff actions, stating that in both agro and non-agro (conveyor belts), higher duties are largely passed through to customers owing to registration barriers and made-to-order business models.

Key monitorables for investors will be the sustainability of current gross margins as pricing normalises, the pace of deployment of its strong cash balance into value-accretive registrations, and whether H2 volumes and profitability can validate the medium-term growth narrative that the current re-rating appears to be pricing in.