An above-normal monsoon forecast for 2016 has raised hopes for extensive crop sowing and higher agricultural growth. Agro-based industries are set to reap the benefits of higher demand for fertilisers and pesticides. Dhanuka Agritech plans to launch new products for sugarcane, horticulture and other crops. Speaking to Bloomberg TV India , Dhanuka Agritech Managing Director MK Dhanuka says after two years of deficit monsoon, the forecast for a good monsoon in 2016 has brought cheers on the faces of Indian farmers, agri-input companies and the entire Indian agriculture sector. The company hopes to grow its revenues by 20 per cent in FY17, he said.

There are hopes of a strong monsoon this time around. What are your expectations? What kind of a boost can it provide to a company like Dhanuka?

After two years of deficit monsoon, the forecast of a good monsoon has brought cheers on the faces of Indian farmers, agri-input companies and the entire Indian agriculture sector. We hope that farmers sow every inch of their land. Dhanuka will be able to notch up around-20 per cent growth in the current fiscal.

Your margins have been pretty steady, around 17 per cent. If you are expecting a growth of almost 20 per cent during FY17, what will be the margin this fiscal?

The first objective of the company is to sustain the margins the company already has. But there is every possibility of increasing the margins by a few basis points in the current fiscal because of the 20-per cent growth in revenues.

Currently, your publicity expenses are close to 1 per cent of your revenue. What kind of ad spend are you looking at during FY17?

Recently, Dhanuka has been endorsed by Amitabh Bachchan for its new molecules such as Sempra, Cover and Maxsoy. We will launch Maxsoy in June in soya bean-growing areas. The ads will be played on national and regional channels from June 15. So our budget for publicity during the current fiscal will be around 2 per cent of the total revenue.

What is the outlook on Sempra and Cover? What kind of response have you received and what kind of growth are you targeting for these products?

The responses from the farmers have been fantastic for both the molecules. Sempra is the only molecule to control Cyperus Rotundu s (weed) in sugarcane fields. But we have to educate farmers and show them that even after using Sempra they can gain ₹15,000 per hectare because there is approximately 15-per cent increase in the yield. As far as Cover is concerned, DuPont launched it five years ago. Farmers and dealers know about this molecule. So we got a very high success rate for Cover last year itself. And we hope to double it in the current year. But Sempra will take another year to measure up to the sales volume.

What new products are you planning to launch?

We will be launching two 9(3) molecules in the current fiscal. One is Maxsoy, which is a soya bean herbicide. It will be in the market next week onwards. The other one will be Conika, a fungicide from Hokko Chemicals of Japan, used in a number of horticulture crops, vegetables, fruits and pulses.

Regarding capex plans, your Keshwana plant started commercial production in March. You also doubled your capacity at your Udhampur unit. When will revenues start flowing in from these plants?

At Udhampur plant, the excise concession is to end this year. So we applied for substantial extension. And now the company would be able to get refund benefits at Udhampur unit up to FY27. That way, it will help mitigate some part of the taxation. Secondly, in Keshwana, we hope that this capacity will be able to meet the market demand for the next four years.

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