UPL Limited (UPL.NS) Earnings Call Transcript & Summary

Good evening, everyone, and welcome to UPL's Capital Markets Day 2022. It's a pleasure to meet you in person after a 3-year challenging but rewarding period. A lot has happened in these 3 years with the completion of the integration of Arysta, followed by the aftermath and overcoming of the COVID years, launching of NPP, a separate biosolutions business segment, and raising the industry bar by the launch of nurture.farm and also signing the Gigaton challenge. Needless to say that all of this was alongside a strong delivery of business performance year-over-year. We've tried and created an experience center of many of these achievements in the experience center you just saw outside the presentation hall. A lot of effort has gone into this, and I would like to thank the entire team for putting this together. During the event, we will be referring to a presentation, and those of you joining us on the webcast would be able to view the event live. The presentation is also available for download on the website, and we take as having read the safe harbor statement. From UPL, we have with us today the entire global leadership team, and we're also joined by our esteemed Board of Directors. The session will start with a presentation and would be presented by the Global CEO, Mr. Jai Shroff; CEO and President, Mike Frank; Anand Vora, our Global CFO; Raj Tiwari, Global Chief Supply Chain Officer; Dhruv Sawhney, COO nurture.farm; and our CEO of the Advanta Seeds business, Bhupen Dubey. Post the presentation, we'll have a Q&A session, followed by a high tea, and then an open interaction session time to you with the leadership team. With that, let me now hand it over to Jai.

Thank you, Radhika. Welcome, everyone. Before I begin, I just want to thank all the people, who are involved in the emergency response team in Ankleshwar, where we had a fire incident on Friday. It was unfortunate, but the team did an excellent job of bringing the whole fire under control within 2 hours. So it's been another fantastic year at UPL among all the challenges which we can only imagine we could cope with. With COVID being past us, we were estimating that this will be a much more easier year to navigate, but it's been very challenging. And I just want to congratulate the whole UPL team to cross INR 10,000 crores of EBITDA, which is a record and only a dream few years ago when we embarked on the journey of integrating the Arysta business within the UPL framework. It has been an extremely exciting experience, but combining 2 companies in a period of 3 to 4 years at the speed we did with operations in 100 countries or more and putting together and continuing to grow the business was no easy task. But it looked effortless with the whole team completely focused on not only integrating the businesses, but also continue to gain market share in almost every market which we operate in. So I just touched on the revenue numbers. I'm sure that you have seen the extremely fantastic performance across all markets in a year where we had so many uncertainties even after all the supply chain disruptions, the war in Ukraine, the currency fluctuations, the oil price fluctuations. We started with -- in a year where we were expecting almost a flat or a price reduction market, and we've then seen hyperinflation in the same year. Dollar strengthening now, and the Brazilian currency and all the other currencies being completely volatile, which was almost impossible to predict. But in our business, we have to manage that every day. And the team has done an incredible job of dealing with that. As we see the revenue growth of 19%, EBITDA growth of 19%. We've been able to reduce our debt to below 2, which was a number which we had always -- we were always targeting. We continue to reduce debt going forward, and we are also increasing the payout to our shareholders with a buyback and probably a good dividend payout. Our ROCE also has been growing. So the 3 key pillars for sustainable growth. And the whole environment around sustainability is growing, and UPL is actually the thought leader and the business leader in all the business sectors. So we have been growing from 2017 till '22. With the integration of Arysta and all the challenges, we've continued to grow our business and are continuing to create a portfolio of differentiated products, which are really helping us to continue to gain the trust not only of farmers and the farming community, but also of the whole food industry. We are continuing to gain market share, and we are today at about 8% market share. We believe that by 2027, we will be above 10% or around about 10% to 12% of market share worldwide. In the bigger advantage of UPL's investment over the last so many years, in terms of integrated manufacturing and the overinvestment we have done, is beginning to pay off and is paying off today, where we can be so much more self-reliant on our own supply chain. And this gives us the comfort and our customers a comfort around the fact that we are less dependent on the other factors of supply chain disruptions around the world. So the whole world is transforming from just food production to sustainable food production. The farmers will be beginning to get rewarded for better and better behavior and better practices. And we are seeing a huge growth in our new business line, NPP, and the opportunities and the pipeline of products coming out of there is really helping us to continue to build a trustful relationship with the whole food system. The whole -- the puzzle, as we call it, in UPL, the OpenAg and the transformation of UPL from being just a supplier of ag chem products to be a solution provider with the UPL Crop Protection business, the Decco business, which is the post-harvest, the NPP business, which is the biosolutions platform, nurture.farm, which is a technology platform, which enables farmers to really digitize and give complete traceability, to our amazing platform in Advanta, which is bringing in transformational technology, not only today, but it was one of the first companies to create hybrid canola. Today, we are the first non-GM sorghum trades, herbicide-tolerant trades, and all these businesses are getting huge traction around the world. And we're seeing almost double-digit growth in the Advanta platform and getting great traction, not only in the Asia region, which was the traditional stronghold of Advanta, but in Central America, South America. Our oilseeds platform there around sunflowers giving us tremendous confidence to that the Advanta business will continue to grow. So UPL is focused on -- our businesses are focused individually, and that's why we have divisionalized them on -- each of the platform has sustainability goals and has a sustainable strategy to really make a huge impact. And being a company which is committed to make every food value chain more sustainable and better for the world, we believe that anything we do today, it has to be around making everything more sustainable. And we're very excited with the beginning of this journey, and you will see in the next 5 years, this will be the mainstay of our whole industry. This also expands the universe of our market. And when you look at some of the fertilizer replacement and reduction technologies, that's a $250 billion segment. If you look at all the quality and value, which we create through our NPP finishing product, that's a huge extra segment and Decco, which there is so much awareness around the world about food wastage. And Decco is by far the industry leader on green protection, on fresh food waste reduction. And we are very excited about all these industries because there is such a lot of global awareness today about what we are doing, and it's much easier to talk to our customers, to supermarkets, to food companies, and to, obviously, the farmers, who see a much better value using these technologies. The nurture platform has done an incredible job in a very, very short period of time of really understanding, not only the pain points and the challenges of farmers and addressing some of those things like weather-related insurance products, et cetera, but also convincing them that burning 6 million acres of rice stubble in the north of India is not the right solution. And we are beginning to get data that when you do not burn your field and create such a lot of pollution, which not only impacts his own family, but all the cities and villages around, and we've been able to convince 400 -- 25,000 farmers. And this year, we are committed to do minimum 2 million acres of area. But what we are able to see that the farmers who do not burn the crop have a huge soil improvement. And we're able to increase the soil carbon in the soil. And if you are aware, which I think you'll hear more and more going forward, is soil carbon is the key metrics to understand the productivity of soil. And these areas have been farmed for a long time, and the farms have not been replenished with enough carbon. And with this project, where we intend in the next 3 to 4 years to complete all these rice farmers to actually not burn their crops and incorporate all the compost, which we generate through our program into the soil. We will see a huge yield increase in this area and also reduction of fertilizer use, which is such a big thing because, if you just look at the fertilizer subsidy in India, the numbers are astronomical. And anything we can do to help farmers reduce the use of fertilizer, can be a huge impact to their income level. We've also been able to be the first company in the world to sell field crop agriculture credits. We sold 20,000 credits from the rice farmers where they were able to reduce the methane generation. This is also very exciting, and we believe that this will go to millions and millions of acres in the future, and this benefit will really help farmers follow more sustainable practices. We are collaborating with -- globally. As you are aware, UPL is present across almost every agriculture area in the world. And we have committed to a Gigaton Challenge, where we will reduce 1 billion tons of carbon through better farming practices. This is a great challenge, and we are driving this thought leadership around the fact that we can use agriculture, not as a pollutant of the environment and air but as a way to remove carbon from soil. And this is something which will drive the whole industry to move toward that. We're already seeing that other companies are willing to join us in this journey, and all of the food industry will soon join us, and we believe that labeling of sustainably grown food is the future for every food value chain. I'll hand over to Mike.

All right. Thank you, Jai. I'm Mike Frank. I recently joined UPL, and it's really good to be here for my first Capital Day meeting. So we're going to split up the next 60 minutes or so into 3 segments. Firstly, we're going to take a look at FY '22, our year that we just finished, look at Q4 results and then do a full year summary and talk about the highlights. We're then going to look at FY '23 guidance, and we're going to finish the presentation with quite a deep dive on our 5-year business plan. And you're going to hear from our Head of Supply Chain. You're going to hear from Dhruv, who leads our nurture platform. and Bhupen, who leads our Advanta Seeds business. And so I think it's going to be a very exciting afternoon. So we have a long list of highlights from this past year. As Jai mentioned, we grew both the top line 19% across the entire UPL business as well as the EBITDA line by 19% in spite of a very challenging year from a supply chain standpoint. We'll talk about that a bit more. We also launched a new dedicated business unit that we call NPP, Natural Plant Protection. This is a business unit that we have had in our company for several years. And when we looked at how do we really exponentially grow this business, we came to the conclusion that we need to set up some dedicated resources to help our field sales organization globally really have the competence and the skills to effectively sell NPP products. We also made significant investments and advancements in our nurture platform, and you'll see that when Dhruv gets a chance to highlight that later today. Our Advanta Seed business had a fantastic year, growing 24% on the top line and 26% at the EBITDA line. We also received a second tranche of USD 700 million in a sustainability-linked loan. And I really believe that, that really validates what we're doing from a global sustainability standpoint in addition to lowering our cost of borrowing. We were also recognized a number of times with various global institutes on our great sustainability work. And so it's always great to get those third-party recognitions of what our teams are working really hard side by side with growers and other stakeholders to really impact global agriculture and make it more sustainable. We joined the climate pledge. And as Jai mentioned, we also launched the Gigaton carbon challenge. And finally, we'll talk about collaborations later, but we entered a new long-term collaboration with a company called Christian Hansen, which is one of the leaders in microbial discovery. And so we've got an exclusive opportunity to work with them on a number of products, the first one that we're going to launch in Brazil this year, and we have a pipeline of other products that we're going to be working with them on for the next several years. So when I look back on 2022, you can see that we had very strong operational performance in spite of many operational challenges. Our teams leaned into them. The agility and the speed at which we adjusted was really incredible. We had a strong year financially, both on the income statement and the balance sheet, and we advanced several strategic initiatives throughout the year. So here's a quick look at our Q4 results. You can see that we had a very strong Q4, growing revenues, this is across the entire UPL company, at 24%. We grew contribution margins on a comparative basis Q4 over Q4 by 231 basis points. And so you saw over the course of the year with each quarter we were able to really price into the environment that we had with increasing raw material costs. And by the fourth quarter, we were really humming, and you can see that how it played out here on the income statement. Ultimately, we grew EBITDA by 26%. And when you look at the fourth quarter in particular, you can see that price drove 19% of the 24% growth. Volume was 3%, and we also gained about 2% on foreign exchange. And then last look at Q4, just from a regional perspective, we had strong growth, I would say, in every one of our regions with the exception of Europe. The Latin American region grew by 21% really across the board, again, thanks to solid pricing and some new product launches and strength of our herbicide portfolio in particular. We had a great year in North America, and it ended with a really strong quarter as well with 38% growth in North America, again, largely on herbicides and insecticides but also strong pricing. And we also believe that the channel, in anticipation of a very strong year that's going to unfold here in the next several months, was probably pulling through a little bit of inventory in the first 3 months of this year into the channel. Europe grew by 2%. Europe had some real headwinds throughout the year, especially in the back half of the year with the euro devaluation, the conflict, of course, at the end of the year in Ukraine as well as we had about a $40 million impact last year from products that we sold the year before that we're no longer able to sell in Europe because the regulators are taking products off the marketplace. So in spite of that, our teams continue to really work closely with growers and even in the Q4 with the conflict in part of that region, we still grew by 2%. In the Rest of the World region, which is a number of countries, we grew by 25% in the fourth quarter, again, largely on pricing, and it really was across our entire portfolio. And then finally, the highlight of the quarter was here in India, where we grew quarter-on-quarter by 63%. Some of that was benefited from a relatively weak Q4 the previous year, but mostly, it was because of new product launches, stronger pricing, and I think our team really did a good job out there, and we believe we grew quite a bit of share in -- as the year wrapped up as well. So great job by our team here in India. So if you look at this across the year, as Jai mentioned, 19% revenue growth, 19% EBITDA growth. There was a really nice balance where the growth came from. Of that 19%, 10% of it was from price, 8% of it was from volume, and about 1% from foreign exchange. So we anticipated the volume growth. When we think about the opportunity that unfolded this past year, we were really excited about our differentiated and sustainable products, and we did see significant growth in that category. What we didn't anticipate, as Jai mentioned, was the escalation in cost of our post-patent products, but we recognized the challenge, and our teams priced into that marketplace and, ultimately, was a big part of our revenue growth last year. And then from a regional perspective, North -- sorry, Latin America grew 21%. If you kind of divide Latin America up between Brazil and the rest of Latin America, we grew about 25% in Brazil. So we had really strong growth in Brazil, about 14% across the rest of Latin America. There was some weather challenges, specifically in Mexico and Argentina last year that probably took off some of the opportunity for us in some of those countries. In North America, we had a very strong year. And it was across a number of herbicides, but also our insecticide portfolio grew by over 60% in North America last year. So just really strong performance across the board there. As I mentioned, in Europe, we grew 7% last year, pretty balanced across the portfolio, but the highlight would have been our NPP products or our sustainable portfolio, which grew at a more accelerated rate. The rest of the world region grew by 11%, a very balanced growth across our portfolio. And finally, in India, we grew 22%. Obviously, we had a very successful Q4. We had a challenging Q3 with some product returns coming off of a very dry [ para ] season. And so we recovered that and then some in Q4. So that's a look at the income statement and the operating performance for Q4 and for the entire year 2022. I'll next ask Anand, our Group CFO, to come up and review some of the balance sheet metrics from our balance sheet. Anand?

Good afternoon, everyone, and thanks, Mike. Let me start off by saying that, considering all the global nature of our business and the challenges we had during the year, I'm really pleased to say that we came up with a robust set of performance which has helped us to deliver good growth both in terms of revenue, where we grew by 19% for the financial year, in net profit, where we grew by 26%, along with an improvement in return on capital employed. It's important to highlight that some of these challenges, which we faced during the year, especially we started off the year with COVID-19 still continuing in some way or some geographies and associated logistics and supply chain challenges. We also saw a sharp increase in raw material prices in a very short span of time, which took the markets by surprise and did not permit us to increase the prices for our products. We, therefore, had pressure on margins in particularly Q3 and Q4 of the financial year. We also saw a huge volatility in currency, especially in Latin America. And towards the end of the financial year, where the conflict in Russia, between Russia and Ukraine added to the global challenges, resulting in sharp jump in commodity prices and also putting in inflationary pressure across various economies. Considering all this, I think the performance, we still ended up with some very good performance. And I think it's thanks to all our team members, who relentlessly worked to deliver these results. Stepping back a bit, when we announced the acquisition of Arysta and also the launch of a new purpose, the OpenAg platform in 2019, we kept focusing on improving our return on capital employed. And I'm happy to say that we have been able to successfully improve the return on capital employed by 170 basis points to 15.6% by end of financial year '22. And since 2019, when we announced the acquisition and the OpenAg platform, we have improved our return on capital employed by 800 basis point. This improvement in return on capital employed, over the last 3 years, has been driven by strong EBITDA growth of almost a 30% CAGR over the last 3 years. While we improved the EBITDA growth, we continue to make strategic investments in manufacturing capacities, product innovation and new initiatives, such as the Natural Plant Product, which is our Biosolution platform, and the nurture farm, our digital platform. Such strong all-around performance through the cycle highlights the robustness of our business model. I'll take you through some of the highlights of Q4 as you see in the slide. Talking about the financial results, benefiting from healthy demand on the back of strong agri commodities, commodity prices, we posted solid growth in operating profits. More important, the robust growth in contribution and EBITDA, which we saw in Q4 is a good reflection of the team's ability to drive price increases and higher sales of differentiated and sustainable products. The agility of our team, along with the resilience of our business, resulting in normalization of margins in Q4, provides us a strong platform to continue our healthy growth momentum heading into financial year '23. The robust EBITDA growth also translated into strong bottom line performance as net profit for the fourth quarter rose by 29% year-on-year to INR 1,379 crores. This significant increase in net profit was in spite of higher finance costs and exceptional costs. And let me give you some color to this higher financial cost as well as the exceptional costs. While overall interest on borrowings did come down quarter-on-quarter, we did see an increase in cost of nonrecourse factoring due to increase in securitization amount in line with our growth of sales, particularly in the Americas, both the North and South America. Additionally, we did have a mark-to-market loss of about INR 172 crores on hedges taken in on advanced sales orders, again, in Latin America countries, as compared to a gain which we had in the previous quarter -- in the previous year of the same quarter. We should see the benefits of this reversal of mark-to-market as we start invoicing our products in the following quarters in the coming financial year. On the exceptional items, it is mainly we had a charge of INR 123 crores arising because of the fire that we had in our warehouse in South Africa. Further, the fourth quarter being seasonally the strongest quarter for us, this robust performance in Q4 translated into a superior full year performance -- superior performance for the entire financial year. Moving on to the -- moving on to the full year of -- I think did I move 2 slides? Going the other way now. Are you controlling? Sorry about that. Yes, okay. Moving on to the EBITDA bridge for Q4. As you would see that we did have higher realization largely on account of efficient supply chain, which helped us to drive our EBIT contribution margin by almost 230 basis points over that of the previous quarter. Our contribution margins were at 39.2% as compared to that of the previous year, which was around 35%. SG&A as a percentage of sales did go up, as you would see as you would see here, and that was largely because of our investments in nurture.farm as well as the nurture.farm platform, which I spoke about as well as in the biosolution platform, which we have launched, besides, of course, the normalization of business as we came out of the COVID resulted in higher travel costs as well as SG&A expense as well as advertising and selling and promotion expenses. This is the bridge for the full financial year. And as you would see, we did have a flat -- despite the Q2 and Q3, as I mentioned earlier, where we had pressures on our margins, we did end up with EBITDA margins at flat, and that's at about 22%. But as I said, this ensured us -- the Q4 robust profit ensured us to deliver good results for the full financial year. Moving on to working capital. We did see an increase in inventory by 14 days, as is reflected, which is a reflection of our higher raw material costs and a strong order book that we have for financial year '23. As the receivables, we did manage to -- manage our risk well by increasing our nonrecourse factoring, which is in line with the robust growth which we had in sales in the Americas. The increase in payables is largely in line with the increase in inventory. And therefore, we did see a reduction of about 2 days in our overall net working capital. So overall, again, on working capital, we continue to deliver good numbers as we move forward. This is the cash flow bridge, which I know has been a point of great interest. People have been focusing on the debt-reduction initiative. But keeping in mind that we had guided for about 7% to 10% growth in sales and that we ended up delivering 19% growth in sales. We did see higher working capital, but I'll take you still through the numbers. In absolute dollar terms, we did end up reducing our debt by $90 million. However, in rupee terms due to depreciation of rupee from INR 73 at the end of last year to INR 75, we did see almost a flat net debt reduction in INR terms. Going through details of each of the items in the cash flow. The business generated operating cash flow before working capital of INR 9,267 crores, which was higher by 14% as compared to that of the previous year. The incremental working capital of INR 1,124 crores was largely to support the higher growth in revenues over and above the guidance that we had given of 7% to 10%. The incremental working capital and tax payments, the company generated healthy cash flows. After deducting the working capital and tax, the company derivative healthy cash flows of about INR 4,426 crores. Given the highly dynamic supply chain environment and the strong demand tailwinds, the growing needs to secure food supply chain to enhance pharma connect, we continued with our strategy of making prudent capital investments and investments through increased incremental spend in NPP and the nurture platform for ensuring healthy and sustainable growth moving forward. The company also distributed higher dividends considering the good performance for the financial year. The resulting cash flow resulted, as I mentioned earlier, in a net debt reduction of $91 million. The robust growth in absolute EBITDA resulted in the net debt-to-EBITDA ratio of 1.86x, far exceeding the guidance which we had given at the beginning of the year of 2x. The gross debt and the net debt numbers in INR and U.S. dollars are provided in the slide for your ready reference. I would like to hand over to Mike again to take us through the guidance for FY '23. Thank you for the attention.

All right. Thank you, Anand. So we're going to talk a little bit about FY '23 guidance. And as I talk to farmers really anywhere, the common theme of the conversation goes a little bit like this. This year, coming into this crop year, rents are higher, seed costs are higher, fertilizer price is higher, fuel is more expensive, and so the cost of establishing and investing in the crop this year is going to be significantly higher than last year. Now the benefit farmers have, of course, is the commodity prices for their grains are also up over double digits where they were just a year ago. So when they think about crop protection products and biosolutions, they tell me they're going to maximize their investments this year in these types of products to protect their crops and maximize yield. So I really believe coming into this new year, we've got some real tailwinds behind us. Like every year, there's going to be some challenges. We don't know what they are. Obviously, today's supply chain continues to be somewhat of a challenge and a bottleneck, including out of China today with the COVID situation. Currencies, the U.S. dollar has appreciated against some of the currencies in key regions, like in Europe and Japan. But generally, we're expecting a very strong operating and financial performance again as we look at FY '23. So as Jay mentioned, we're guiding for a revenue increase of 10% or more with EBITDA growth in the 12% to 15% range, and very importantly, continue to improve on ROCE with another 125 to 200 basis points improvement on return on capital. So as Jai mentioned our 3 areas of strength in our pillars. And this is going to play out again in our business in FY '23. Firstly, we're expecting strong growth from our differentiated and sustainable products. Last year, the mix between post-patent and sustainable and differentiated remained about flat, about 71% post-patent, about 29% differentiated and sustainable. Again, on the post-patent business, that's where we saw a significant price increase. And in fact, 90% of the growth in that business came from price. In the differentiated and sustainable business, 70% of our growth last year came from volume, and we expect that to play out again this year. We've got some very exciting new launches. Between last year and this year, we'll launch over 80 new products globally. And on the next slide, I'll show you 3 of those products that we're very excited about. We're also making unique investments. When we look at countries where we think we can increase our presence, really drive our sustainable and differentiated solutions, we're making unique investments in 22 countries that represent about 80% of the global crop protection product marketplace today, and we believe we're going to grow exponentially quicker and gain more share in those 22 countries, and we'll talk a bit more about that during the 5-year plan. And then finally, really the part that anchors our success here at UPL is the strength of our supply chain. And that showed itself last year, and we know that it's going to be a key strength for us again going into this new fiscal year. So just to highlight 3 products that -- of 80. So I didn't want to go through 80 products with you today, but here's 3 that we're incredibly excited about. So firstly, there's a new soybean herbicide for growers in the U.S. One of the challenges that growers in the U.S. have is resistant weeds, specifically glyphosate resistance, so we have a new 2-way herbicide for soybean growers that can be put on in the fall or preplant in the spring. It has nice residual value, and the crop safety is second to none. This will be our launch year. Our team in North America has already run out of product. And so we have sold everything that we've got, and we're anticipating even more growth in this business coming into the following year, but it's a really nice product launch and introduction to this product called Preview in the U.S. In Brazil, we're launching a product called Evolution. This is a new 3-way fungicide that really is going to be the leading product for Asian rust in Brazil. Efficacy is incredible. I was in Brazil a couple weeks ago with our Country Manager, Rogerio, and we were looking at some plots. And you could see the difference between Evolution and the standard in the market today. And not only was efficacy higher. In the field results that we harvested, yields are also higher with Evolution. So we really believe this is going to be an incredible product. We've increased the supply, so we've asked our supply chain to produce even more, and we think we're going to have a really big year with Evolution in Brazil this year. Finally, a product that we launched in Q4 here in India, which is Triskele. It's the first 3-way herbicide ever launched in India, and it really demonstrates the incredible work between our R&D formulations team, our regulatory team, and our marketing and commercial teams all coming together, creating a product for sugarcane growers that is the best product from a weed control standpoint and also from a yield standpoint. And so this is really a new break-through for our business and for growers here in India. So next, I'm going to call Dhruv to come to the stage and talk about our very exciting nurture platform. Dhruv?

Hi. Good afternoon, everyone. So just talking about the nurture platform and the leading up sustainability initiatives. There's a lot of focus on R&D capabilities, open innovation model. I think I came too soon.

No, I called you too soon. Thank you, Dhruv. I saw Dhruv's name on the last slide. So I thought, well, this is time to call Dhruv up, but premature, sorry, Dhruv. So we're going to switch to talk about our 5-year plan. And I think you'll conclude when you look at our 5-year plan that we have incredible opportunities across our business, in the crop protection space, in the biosolutions NPP space, in our seed business with Nurture, and again, the exciting work that we're doing in our supply chain. So I'm going to start by talking about some of our innovations, what we call open innovations, and I'll talk about our R&D capabilities, our open innovation model, our innovation pipeline, and we'll show for the first time our really strong IP landscape. So firstly, it all starts with business smart R&D. And this is how we invest our R&D resources to become super efficient and effective at delivering new technologies to farmers around the world. We have over 1,000 R&D professionals across 30 facilities. And we've increased our investment from about 2.5% previously to about now 3% of sales in our R&D investments. This here is a short -- a snapshot of our OpenAg farm in Brazil. So last year, we opened up a 25,000 hectare at-scale farm in Brazil. And what we wanted to do at this farm is we wanted to do -- we wanted to put down UPL products wherever we could to grow corn, soybeans and cotton. And we also wanted to use it as a demonstration field where we could do both some demo and some science but also bring farmers across Mato Grosso and beyond to come to the farm and look at the technologies that we're applying. And in our first year, we were able to put UPL products in corn and soybeans down on 70% of all the applications. So if you think about our market share in Brazil today, it's not 70%. But on this farm, 70% of the products that we used were UPL products. And not only did they work, they delivered about 6% more yield than the average yield across Mato Grosso, which is about 3.5 bags per hectare. We also tested and trialed scientifically a lot of our NPP biosolutions. And again, versus the standard farmer practice, we saw about an 8% yield increase. The benefit of this farm is most companies do their trials on small plots. And often when you talk to farmers, they say, well, maybe what happened on a small plot doesn't apply on a big field. But we're proving in Brazil, where, as you all know, there's some really big farmers, that at scale, our products and technologies can really benefit growers. And so I really think this is an exciting advancement in our OpenAg farm. We also look at R&D through what we call farmer pain points. So recognizing where are farmers challenged today agronomically and where can we bring new solutions, whether they be new mixtures of conventional crop protection products or ProNutiva products, which is a combination of our biological platform along with conventional crop protection products, or straight up NPP products. So that's how we focus our R&D investments. And when we look at our pipeline and our exciting products coming through the pipeline, on a risk-adjusted basis, we have over $5 billion of revenue that we believe is going to be generated through our R&D pipeline. Over half of that is going to come between now and the end of fiscal year '27. So it really demonstrates that this pipeline is coming at us each and every year, which is why we had, for example, 80 new product launches in the last 2 years. When we look at the makeup of the portfolio, about 1/4 of all of our pipeline is post-patent products and about 3/4 of our pipeline is differentiated and sustainable products. So it really demonstrates for us that we're investing in the right area. When we look out to 2027, we expect about half of our product mix to be differentiated and sustainable products. And again, about half of our mix to be post-patent products. So both segments will grow. When we look out over the next 5 years, there's about $6 billion of global market of crop protection products that are going to come off patent. So a lot of our post-patent investment here is in the AIs that are going to be coming off patent over the next handful of years. We want to be first in the marketplace when those products come post-patent. But more importantly, we want to take those products, combine them with either our NPP products or other active ingredients in our portfolio, and that's how we bring differentiated and higher-value products to our customers. I think this is the first time that we've showed this slide. We have an incredible team within UPL that's focused on IP, securing patents, defending patents, and really understanding that entire landscape globally, which is complicated. We have over 1,500 granted patents. We have over 3,000 in the queue waiting to be approved that are pending today. Over 600 innovations across these patents, and we've achieved patents in over 133 countries. When you look at what we've patented, it's very balanced between herbicides, insecticides, fungicides and also biosolutions. And we also have a multitude of types of patents from composition patents, the method of use, formulations, process patents. All of these really create a lot of value for us, help us make these investments in these differentiated products, which ultimately benefit growers. When we look at our current sales, from last year, over 1/3 of all of our sales of crop protection products and NPP products were covered by 1 or more of these patents. So it's a very important part of our business and creating unique value for our customers. So again, in summary, as we think about our open innovation, we have a pipeline that has risk-adjusted value of over $5 billion. Again, over half of that is going to be realized, we believe, in the next 5 years. About 3/4 of our pipeline is differentiated and sustainable solutions. We're making more investments in R&D and in field testing, and we have a very rich IP patent estate. The next area of growth for us is in what we call open collaborations. We've talked about some of these previously, but we want to give you an update on some of our key global collaborations plus talk about at least 1 or 2 new ones that we did this past year. So firstly, with FMC, we announced this about a year ago. It's for a very large and important active ingredient called CTPR. We actually launched our first solo CTPR product this year called Shenzi. We launched it in 5 countries, and we had very, very good sales of this product. We're also -- we've also built a manufacturing facility to produce CTPR, and we expect to be operating that in the second quarter of this year. As we look out towards 2027, we expect to have a portfolio of over 40 CTPR solo or combination products that are differentiated. This is going to be a very big part of our future growth platform. We also have a partnership with Mitsui on a very -- a new and novel active ingredient that's an insecticide for rice. We're expecting the first registration of this product here in India in FY '23 and over the next 2 or 3 years, we expect many more registrations of this product across Asia as well as a seed treatment for this unique product in the U.S. And then another new product collaboration that we entered this year is with Christian Hansen. They're one of the leading companies today discovering new microbial technologies. And so we've got access to a broad part of their portfolio. As I mentioned earlier, we're launching our new -- our first new product in Brazil this year. And we have about 6 other products that are right now in the pipeline, and we expect more to come here over the next couple years. And then finally, I'll highlight a new go-to-market collaboration that we have in Brazil with Bunge. Bunge is one of the leading grain traders around the world and oilseed processors. They have a very strong presence in Brazil. And one of the things that they do with growers in Brazil is they help manage risk. And so by providing credit on future grain, they're a natural partner for us where we can go to a grower, help them manage risk and help them get access to seeds, fertilizer and crop protection products. And so we've invited them into an investment that we have in a retail network called Sinagro. They came in and took a 33% share of that business. And so now we're operating it together with them, and we're just in the process. We got approval for this investment just in March of this past year. So we're now just coming to our growers. And we're targeting primarily, I'd say, small and medium-sized growers with this initiative through the center and northern parts of Brazil. So it's -- we think it's going to really help us accelerate the growth of Sinagro, but more importantly, the growth of UPL products through that platform. When we look at our collaborations that we have today and we're working on a number of new collaborations, we believe that by 2027, over 10% of our business will come through collaborations, whether they're with these type of large companies that we profile today or partnerships that we're doing today in our OpenAg center in North America with a lot of the start-up community. And so we just have a lot of exciting collaborations that we're working on, some big, some small, but we believe that they're going to have a significant impact on our ability to bring technology and value to growers and to help us grow our business. As I said earlier, in addition to our innovation, we're also looking to see where can we make unique investments at the country level specifically to get closer to growers. When you think about selling differentiated and sustainable products, it takes more of a partnership with growers. You need to help them understand the benefits and the features of the technology. And often, they're priced to value, so unlike post-patent products, they're not priced on cost. They're priced on the value that you can establish with your customers. So as we continue to grow our differentiated and sustainable product portfolio, we want to continue to get closer and closer to the farmers that we serve with our technologies. So what I'll do in this section is highlight some of our unique NPP biosolutions and give you some examples of some new products that we're launching this year. I will invite Dhruv up to talk about our nurture platform. I'll highlight some of the investments we're making in our key countries, really enhancing the proximity to our customers. And then I'll highlight what we're doing with what we call the ProNutiva platform, which is where we combine sustainable solutions, natural solutions with more traditional solutions to create new value. So when we look at all the markets where we participate in, we believe that this segment of biologicals, biostimulants, biocontrols, bionutritionals, this will be the fastest-growing market probably over the next decade in agriculture. We believe over the next 5 years, this market alone is going to grow at a CAGR of about 14%. We are the #1 player in this market today, but it's still very fragmented. So our strategy in this market is to continue to develop new technologies ourselves, including some of the technologies that we're developing here in [ Tawnay ] right here in India for global distribution, some technologies that we're developing in France and in Mexico. We're globalizing our really rich portfolio that we have today, and that's one area of growth. But we're also looking for new opportunities, whether that be collaborations or acquisitions, we plan to grow at an accelerated rate from the market. Our plan within this segment is to grow at about a 20% CAGR over the next 5 years. So we lead today but we believe that over the next 5 years, we can even further establish our leadership position. Here's just a couple of examples of what NPP products are about. So the first one is a product called Vacciplant. This is really like a vaccination for the plant. It creates a healthier, more robust plant, especially when it deals with abiotic stress. So whether that's heat or drought conditions. By using this technology, it creates a more durable plant. It helps boost the plant's natural immunities. And so this is a product that we sell today, and we're in the process of creating a number of combinations with this product with other biosolutions to really create a unique portfolio of bioproducts that can help create stronger plants and stronger roots and ultimately, higher yields for growers. The second product is K-Tionic. K-Tionic is a bionutritional product. We sell it today in 15 countries. And as you all know, with the price of fertilizer that's gone up significantly over the last 18 months, farmers are looking for tools and technologies to help them optimize and reduce the investment in fertilizer. And K-Tionic is one of those products. And so we're doing a lot of work with growers in these 15 countries and beyond to commercialize this technology. We believe it's a technology that not only creates value in high fertilizer price markets. But even when fertilizer eventually comes back to more normal prices, whatever that's going to be. But more importantly, it creates a very important sustainability benefit by having less nitrogen, more natural organic products in the soil, it creates for a healthier soil. And ultimately, growers are really trying to look for those types of solutions. Then lastly, a technology that we call GAXY. GAXY is a concentrated biostimulant. It again creates stronger plants. It's a very exciting technology that we are just about to launch this year. And again, this is a product and a natural plant protection that's going to be sold individually as a standalone, but also, we believe, can be part of many mixtures with other biologicals but also with some of our conventional products as well. All right. With that, [ Drew ], I think we're ready.

Good afternoon, everyone. I think we've seen across the world, multiple industries benefit when technology-led innovation starts disrupting how traditional business has been run. And we've seen that happen in pockets for agriculture with great products, innovations having been developed. But the challenge has been that there hasn't been a strong platform to take those innovations in a very cost-effective, efficient and convenient way to farmers. Nuture.farm is now well positioned to be the leading platform in doing so. We are primarily focused on 2 goals. Our first goal is to solve for farmer resilience. 85% of Indian farmers are small holding farmers. As you can imagine, with inflationary pressures, access to labor, cost of labor going up, cost of inputs going up and crop prices typically being kind of held at a certain ceiling. They're definitely feeling the pressure in the middle. So how do we make farmers more economically resilient in a world where their landholdings are shrinking and costs are going up? The only way that can happen is if we help them improve their operation and help them run their operation more efficiently at a lower cost with better advisory, better guidance and the right curated set of products and inputs such as ProNutiva packages and other solutions that would actually drive better yields. The second goal that we're focused on is a shift to sustainable outcomes and sustainable practices. The world is going to add another 2 billion more people by 2050. How do we feed 2 billion more people without cutting more trees and accessing already precious resources. Again, the only way that will happen is if we can grow more from less using sustainable practices. Our focus on these 2 pillars are solving from a farmer resilience and a shift to sustainable practices is being dealt through the following approach. We believe farm mechanization is a key lever for us, where in a shared economy model, we are giving access to the right tools to a small holding farmer at a price point that is far more efficient and profitable for them. We're also giving them access to the right advisory at the right time so that they don't have to discover the knowledge systems on their own in a world that is fast evolving. A farmer should not have to discover that knowledge. The information and the outcome should be at their fingertips. And that's what the platform does through our digital offerings of presenting services, products, access to information, and a lot of solutions that we are curating for farmers with the knowledge and confidence that we'll be able to give the outcome that will give the profitability improvement that the farmer is seeking. Last but not the least, this ecosystem has been well supported and run with retailers and distributors and the channels supporting the farmers in the form of ag inputs and credits. We are now here to support that channel as well. And through our retail e-commerce platform, we are bringing authentic products to the doorstep of every retailer and distributor in the most efficient, predictable supply chain. Technology can play a great role in innovating in how we predict impact of weather and pest and disease onsets. And there's no reason why retailers and distributors and farmers can't benefit from these technologies as well. We already have close to actually about 3,000 machines for spraying services, multiple harvesting machines. We're going to be launching our drone machine soon. which the farmers are benefiting from about 5.5 million farmers -- sorry, 5.5 million acres have already been serviced in this last year, and about 1.5 million farmers have been onboarded on to our digital platform. So this is a great progress that we've made over the last couple of years. We have over 80,000 retailers now accessing our retail platform. with over 15 brands that are already participating in this e-commerce venture. So just looking ahead, we believe that the pace of innovation and the access and reach that a digital platform gives can lead to exponential growth when we combine that with the right products and services and the knowledge systems available to us. Today, we are already at 1.5 million farmers, over 5 million acres service with 80,000-plus retailers. We're just beginning. We believe in 3 years, we can easily have over 6 million farmers transacting on our platform. We'll have over 40 million acres serviced through various initiatives and over 300,000 retailers transacting on the platform as well. This is going to be a platform, which is available to the complete ecosystem. We have a new means of livelihood being generated with new knowledge systems coming in. So we look forward to brighter futures for our farmers and the ecosystem and the retailers. Thank you. I'm going to hand back to Mike.

Super exciting, [ Drew ]. Very impressive what we're doing with that platform and the impact it's having for growers across India. As I mentioned, we're making unique investments with over 96 separate initiatives in 22 countries. This is a new program that we really just started in the last year, as Anand mentioned, we did see some growth in our SG&A. Some of that was to get closer to growers and it was also partly to invest in these unique opportunities that we're tracking very carefully from a spend and benefit standpoint, we believe that the growth that will come through these 96 unique initiatives over 22 countries will be in the range of 1.5% to 3% CAGR over what would have been our base business just over and above the R&D portfolio and new products that we're developing. Again, we have many, many examples today here at the Capital Markets Day. We have each one of our regional leaders. And so during question and answer, if you want to ask any questions about what's going on in any specific country, we have people that can talk about that. But it's really exciting. In every country, we're getting closer to the growers helping pull our products and technologies through to the farm and really making our relationship and our business durable and creating a better defense in the long run with our business. And finally, the ProNutiva concept. So this is again where we take a biosolutions product, one of our NPP products and combine it with the conventional crop protection products. Often, people talk about the need or the want or the desire to go to organic farming. The reality is today, most farmers can't move directly to organic farming because the biocontrol products and the biostimulants aren't as good today across the board as some of the more traditional fertilizers and crop protection products. So we believe that this is a journey. We believe over the next decade, we're going to move from a world today that's primarily conventional crop protection eventually to a world that's primarily natural plant protection and we're going to lead in that journey. But as we go from today to that future world, we think it's a combination of bringing products and technologies together, making agriculture more sustainable, making plants more durable and ultimately helping growers drive yields and economic viability on their farms. One really neat example of ProNutiva in action is here in India with groundnut. If you go back just to 2020, we had about 100,000 acres here in India under the ProNutiva concept. Today, we have over 1.7 million acres. We have over 4,000 villages that have adopted this technology and 220,000 farmers using the ProNutiva package. On average, we've increased farmer income by 15%, and it's increased groundnut yields by 35% to 40%. So just it brings it all together, higher yields, more profits for growers and a more sustainable production. So that's how we see the evolution of the marketplace. So to summarize, we have a number of exciting initiatives that are going to drive our growth and accelerate our growth over the next 5 years, NPP products, obviously, our Nurture platform, our unique investments across 22 countries, getting closer to growers and then bringing more and more ProNutiva packages to farmers around the world. Next up, I want to invite one of my new best friends, Raj, who leads our supply chain. And one of the first things I did when I joined the company is I had a chance to travel extensively with Raj to a number of our plants. And I was blown away at the -- at the scale, but more importantly, the world class, which we run our manufacturing operations. And so Raj, it's a pleasure to welcome you to come up and talk about what we're doing in supply chain.

Thank you very much, Mike. I mean this year was really a tough year. We thought COVID behind us should be relatively an easier year but it was the toughest year of which I have experienced in my last 10 to 15 years in supply chain. I mean, right from the time the energy crisis in China started to sudden rise of costs. And we were not very sure, I mean, how do we pass it on. I mean, whether to source or to scale it down. And then the whole issue in terms of logistics, that was our biggest nightmare. So as Jai mentioned earlier, reliability of supply chain and cost competitiveness are the overreaching to an objective of our supply chain team. Further to the -- to that point in this section, as we move forward, we will discuss how supply chain acts as a competitive advantage for us. And what are the key initiatives which we are taking in time to come. So first, on safety. As Jai initially mentioned, on Friday, we had a fire incident at one of our factory in Ankleshwar and one of the portions of one of the plants got fire. And the rest of the plants in the same factory are operating normally. There were 5 people who got injured. One has got to leave and 4 are recuperating in the hospital. We are taking good care of them. Last year, our TFR in terms of our KPI, the 2 key KPIs, the TFR was 0.21 and on process safety incidents. We have 2 process safety incidents. But taking a cue from our South African warehouse fire, we have got external experts for the -- all new warehouses, which we are hiring or we are going to hire, we have got external experts in terms of doing the due diligence in the hiring process and redefining our checklist for hiring a new warehouse, but also the existing warehouse in terms of identification of the gaps, and the mitigation of those gaps we are working on, and we should be -- we should be completely able to come out of those gaps, if any, which are identified. On Jhagadia's chemical handling and incident management, we have implemented what we call it as Jhagadia's chemical transportation management. This is completely implemented in India, especially coming from [indiscernible] to our factories, which is the incoming raw materials. And we are also leveraging -- we have -- on digital initiatives in terms of AIs and manufacturing 4.0, in terms of -- for the safety for PPO zero compliance in the factory, what we are doing is that we are using video analytics to a great extent in terms of understanding where real-time PPO violations are there to be able to bring more rigor and discipline on the shop floor. Also, the crisis management plan just in case if there's a crisis, we have a crisis management plan, which is rolled out where [indiscernible] has helped us in terms of designing the whole crisis management plan, a lot with the leadership team and the people in the factories, which is rolled out for India, and we're in the process of rolling it out for our global regions. As you can see in the pie chart, this is -- in terms of our sourcing footprint, you can see in the pie chart, you'll be able to see that our raw material sourcing is quite diversified. If I talk about FY '22 per se, about 31% was the share of China, 38% was India and 31% was rest of the world. So this is really very, very balanced. And if I talk about last journey of last 3 years, we have moved China shares from 38% to 31% now. And if you see on the left hand side, wherein if you see 72% of our active manufacturing we do in-house. And the interesting piece is that 6% of our active will now get it done by our, what we call it as a strategic partners. This itself in 3 years' time, have moved from 2% to 6%, so almost 300% jump and largely in India. And only about 22% of our actives, we source we source directly. Therefore, you can see that reliance of import of AI is fairly low. And additionally, we have also worked on enhancing our manufacturing efficiency by closing down our Rotterdam plant and which was basically making Mancozeb and that capacity we moved to India and Colombia, thereby bringing efficiency. And more importantly, the top 10 AI for UPL, we do in-house and that is mostly backward integrated through and through -- and if you see on the left-hand side of the chart where the road map is there, that largely shows our formulation footprint, of course, it is active as well. But lastly, the formulation footprint is such that we are closer to our customer. For 2 reasons. One is that we can be more agile and we can service our customer orders better. I mean we don't differentiate between 0.5 kilo order or 0.5 a ton order. And therefore, if our commission plants are close to a customer that helps us in terms of serving them better. And lastly, that we also can keep AI as a safety stock so that our reaction time is much, much faster. In fact, in 2020, we also expanded our formulation footprint in China by -- with the acquisition of [indiscernible]. And therefore, overall, if you see, we have well diversified raw material supply base. We have highly reliable, active and specialty chemical manufacturing setup and we have a backward integration linkage. And actually, just -- this has held us good stead in FY '22 and going forward in FY '23 also. This is going to be a big advantage to us in terms of maintaining our competitive advantage, agility and our margin expansions. So over the last 3 years, one of our major focus has been to drive growth -- organic growth with our growth with optimum investments. And to achieve this objective, we actually established a robust ecosystem for our strategic manufacturing partners. And as I said earlier, if you see from 2% to 6% or almost 3x, we have grown the share of our strategic partners in our active intermediate space and that is largely India. And we have kept on expanding our -- I mean, investing in our new capacities for new products. But also, we have continuously worked on debottlenecking our existing plants to [ stretch ] our assets. And overall, these initiatives helped us to drive organic volume growth by about 40% average in last -- I mean, 40% over the last 3 years. In a very capital-efficient manner, with our fixed asset turnover actually improving by about 30%, which was 1.8x in FY '19 to 2.4x in FY '22. And what's more important is that while we achieved this feat, we also continuously worked on derisking our supply chain. We not only diversified our sourcing in terms of raw materials, but also in terms of geography and supplier -- supplier source in terms of mix. We also -- last year was a nightmarish year for ocean freight and the whole supply chain. And actually, we -- what helped us was long-term contracts, which we had done last year with -- with some of our partners for ocean lines. Further to that, we're also leveraging our scale and our footprint to be able to get favorable sourcing terms from our strategic partners. And therefore, overall, these derisking initiatives combined with our agility and to -- our ability to adjust to a volatile supply chain situation. help us not only deliver robust volumes, but help us maintain our -- maintain our EBITDA or slightly improve our EBITDA margins. So further to, as Jai mentioned earlier, our purpose is to reimagine sustainability to drive the real-world impact -- and to further this purpose, we have really done some hard work over the last 4, 5 years in terms of optimizing our -- are dramatically improving our manufacturing footprint -- our [indiscernible] footprint. Just to give you numbers I mean, key KPIs for our [indiscernible] footprint reduction. We actually reduced our CO2 emission -- sorry, our water consumption per ton by about 11%. We reduced our CO2 emission by about 7% and our waste disposal by about 17%. Now this is all possible. We have a fair share of -- of course, we had substantially increased our green power usage. But we have also reduced -- we have also continuously worked on bringing specific energy consumptions down and therefore, the new technology adoption in the factories has been commendable. We have 50,000 meter cube of water we have conserved and used -- and rain waters we have used. Also, we have continuously put the technology to reuse the waste water, which is coming back in our process, and that has been -- that has been a big initiative because of which we have been able to save the use of freshwater. So looking ahead over the next 5 years, we are focused on implementing a robust 3-pronged strategy to enhance efficiency and to drive ROC accretive, sustainable growth. The first one is, of course, we'll keep on optimizing our sourcing mix. It will not change dramatically, but -- but I mean, by and large, it will remain balanced, but India will gain some share in that mix optimization. And we will keep on working with our strategic partners so that we can raise the share of our strategic partner in our overall AI intermediate sourcing, which is long term. Extensively, we are going to leverage digital and analytics. We are already under a transformation project wherein we are end-to-end our supply chain as soon as these processes getting digitized, and we are using -- we are going to use the AML tool for demand forecasting and so that our forecasting areas are less, which is going to also optimize our inventory. And we expect that with this digitization, we should be able to optimize our inventory level by about 10-odd percent. And sustainability being the core, we consider that as extremely important for us to remain competitive. And we will -- we are going to leverage our sustainable initiative, and we are going to keep working on improving our footprint year-on-year. We have already given commitments in terms of -- from FY '20 baselines to reduce our CO2 emissions by 25% and our waste water consumption by 20%. I'm sure we -- and my team and the entire UPL team is going to surpass these targets. Thank you very much. Mike -- yeah, I'll invite my colleague, Bhupen Dubey, to give you some color on our seed business.

Good afternoon. Thank you very much, Raj, and Mike. Of agrochemical, I would like to take opportunities to update on the Advanta progress for the year gone by and in the next few years. Okay. These are some numbers. We have taken the number in rupee crores. So Advanta is now nearly INR 3,000 crore revenue company. We have a CAGR of about 14% the last 2 years. Against the backdrop of industry, seed industry's CAGR is about 5% to 6%. Against that background, consistently, the growth is going up 14%. EBITDA similarly, our focus has been on the EBITDA relatively while we have a size where we have opportunity to grow, but our focus has been on the profitability. So if you see we have EBITDA of about INR 774 crores and a CAGR of about 23% over the period of 2019 to '22. In the seed industry is very, very important that we manage our inventory very well. Sometimes we try to choose top line aggressively and end up having the return of the inventory from the marketplace and then hit very badly. And to recover from that takes years together. So our team, team Advanta has been able to manage this in a good year and bad year, continuously this kind of focus on the profitability. We have 900 hybrid varieties across 40 crops. We operate in both the domains, field crop as well as vegetable crop. Field crop really out of, let's say, 40 crops, nearly field crops are 10 and 30 crops are vegetable part of it. As you know, in the previous presentation also we [indiscernible] -- breeding based company, a number of years matters in terms of 2 aspects, which are important ingredient for the continuous success, number one, germplasm. [indiscernible] seed industry -- seed company in the business have a very good germplasm collection. That is where UPL -- the Advanta has a privilege of having it. And also, we have a [ breeder ] who know this material very well and they know how to play around with this different genetic material and come out of the innovative product. So that is extremely important asset which we have. Country-wise, we have now expanded to 84 countries, our presences. Similarly, we are also going to do production sites. We are now 24. With the uncertainty happening in the global arena because of the pandemic as well as the conflict in the Europe, every country we interact with the decision makers, one thing we are very clear that they want to produce seed locally, extremely important. So which is the downside of it is that we will not be able to take advantage of the scale. But at the same time, positive part is that if you are committed to the one country, I think this is a great opportunity for investment. And as a result of that, we are now production site in 24 countries, and this is likely to continue to expand going forward. In terms of regional mix, we have South Asia is the #1 region for us, 31%; followed by Lat Am at 24% (sic) [26%]; ASEAN, the Australia and rest of the world in North America. So very well balanced, almost all the key components we are present. Here, you will find that we are not debt -- presence is not as strong in Europe as of now. There, we are focusing primarily on the oilseeds and which is coming from Eastern Europe. Comes to the crop, #1 crop for Advanta is field corn, primarily tropical corn and subtropical corn. We are not very much into the temporary corn. That is the area we are not really paid that much attention at this point in time, but the opportunity remains in future. Our second most important crop where we have a very strong presence is a grain and a forest sorghum. This is a very important crop in our portfolio. We are one of the top 2 or 3 companies in the world where we have a very good position in the sorghum. As you may not -- may know, there's a climate smart crop in that definition, sorghum fits in well. More biomass using less fertilizer, less soil, less water is something really -- this crop qualifies a lot. The time has come for this crop to expand faster. Another important product category we have is vegetables and sunflower and canola are the crops. So very well they're distributed in terms of geography as well as the crop portfolios. Another important aspect, I think the seed industry is by definition, a company which survives for 60 years successfully other companies having a very strong innovation portfolio. Without innovation, is we cannot survive. And here, Advanta team globally has done a wonderful job. We are a very good team of professionals across the country is highly dedicated, very knowledgeable and then very, very creative in terms of the way they approach the market. So we have 3 platforms where we give us a very differentiated position in the marketplace. One is the global brands. Advanta seed is a global brand from us. But there are regional brands under which these products are being marketed like Pacific Seeds, Australia Pacific seeds are Thailand. Alta seeds North America, et cetera. Now these are the brands which we have association of the farmers for many years. So while we've contemplated that globally, we will standardize it, that everywhere, we just eliminate these names and we make it Advanta. But we realize that farmers associate the brand name of the seed very strongly. Any change, there is always a fear of losing the farmers. And as a [ real objective ], we continue to play with this brand names in various countries. Umbrella Brand remains Advanta though. Crop-specific brands. It's important that whatever new features our breeders are able to bring in the marketplace are identified in the different brand platforms. So we have our Empyr, the Hyola, Vereda as well as Pacific Seeds Wheat, other brands which are crop-related brands, which are associated to the unique attributes. And the most important next category we have created is a technology brand. I want to primarily conventional breeding, and we bring out other unique features, for example, igrowth. igrowth is a first of its kind technology in the world in sorghum. Many of you may be aware, that crops like corn and [indiscernible] been a high [indiscernible] . They've got a lot of [indiscernible] , which are primarily incorporated by using GMO -- now GMO has reached to play too in many countries where it's openly accepted, but many regions like Europe and some of the [ ACM ] regions, they are reluctant for the GMO. So how do we go about it? So our breeding team started a project in 2007 to develop herbicide tolerance in sorghum. -- via non-GM route is a very big challenge. 2007, they started investing in. And finally, they succeeded in launching a product in 2016, so nearly 9 years. And the product has created a big impact to begin with in Argentina. Let's say, today, Algeria has about 1.5 million hectare sorghum. And this area is limited because it does not have any herbicide tolerance. Now these countries does not have labor force to eliminate the weeds manually. And therefore, they're unable to -- there's no selectivity and therefore, they cannot use the herbicide like glyphosate, the way they use on the corn, et cetera. But our breeding team incorporated with gene biomutagenesis technology, and they launched this one product called igrowth. Farmer can apply the [indiscernible] herbicide, and it will kill all the weeds, but the crop will be protected. In 3 years' time, '16, '17, '18, '19, '20, now 4 years' time, we have nearly 62% market share in igrowth in Argentina. Now that is a tempered of success. Similarly, next year, we launched in Australia. Last year, we launched in U.S.A. In the current year, we launched in Brazil. So nearly 4 countries we launched this technology. And if it -- if you take template of Argentina, success template and we are able to successfully transfer this know-how and replicate the success then our value creation in this segment is going to be humongous. This may not only convert the conventional sorghum into igrowth, but also the area under sorghum will expand exponentially in the area where there is the multiple times here going to the corn. Similarly, we have Vertix, Aphix and Nutrisun. Each one associated with like the [indiscernible] which is great for a given crop. Coming to the numbers. Once again, revenue is INR 3,000 crores. We have 24% growth. And EBITDA is about 32% growth for the year we've gone by. -- and EBITDA margin is 150 bps up. If you look at the revenue by region, growth is South Asia is 19%. It could have been more actually 24%, 25%, but I think extended rain monsoon in India, especially spoiled some of the areas and the business was impacted. Therefore, we are at 19%. LatAm is the highest growth we have 32%. The reason was primarily I explained igrowth. Growth was very, very high. ASEAN region, led by Thailand and surrounding countries 14%. Australia is a wonderful year we had, I think, one of best year in the last few years, 22%; NAFTA, not America, in the U.S.A. and Mexico and Canada is we call it NAFTA, we have a 32% growth, and rest of the world is about 24%b (sic) [25%] growth. So each region has contributed very well in our growth journey so far. Our focus on innovation remains R&D. I think that is a core for us. We just cannot compromise on that. And we are very proud of our R&D community of 189 scientists. They're all [ EHB ] in biotechnology or plant breeding, et cetera. They collaborate very well and the committed working of over 2 years of time because a single product launch in seed takes about 9 to 10, 10 years. And there is a powerhouse for us, which will propel continuous growth for Advanta going forward. Advanta has delivered a robust EBITDA growth over [ 1922 ]. While it's not a one-off story. And I'm very proud of Team Advanta our professional. We had a tough time because some time in 2014 and '15, '16, I think industry operating environment also very challenging. Within that internal challenge is also very, very high. So we decided to make sure that we focus on 2, 3 areas. Number one, profitability because in a good year or bad year, you are focused on profitability, then sustainment and growth is guaranteed. So that is something our team has been able to do that. So if you look at FY '19, we had a 21% EBITDA. It's about 21% EBITDA going up to 24% EBITDA and now it's 26% EBITDA. So last 4 years, even if you go back 2 years further, the EBITDA number was about 16%, 14%. So last 5, 6 years continuous the EBITDA percentages are going up. Now if you compare it with the industry peer where the top line is going up because of the organic growth, inorganic growth, -- but there is a direct correlationship. They go up in the top line, EBITDA start declining by biotech company, GM [indiscernible] companies. They used to have a 24%, 25% EBITDA. Currently, these companies all the big name in the industry, their EBITDA is 14%, 15%, 16%, right? So in this background, when you look at Advanta, we are very, very proud of the delivery of these numbers by our team here. And we believe that we have now the processes -- in the business processes, the systems and the mindset in place to make sure that this journey will continue even if you go on the top line going forward. Long-term growth ambitions, which we have, we believe that we are at a level which is a platform is just to take off. Operating environment in industry as we have seen Mike also asserting in many slides. It's very bullish going forward. I think every country wants to make sure that their population gets in a food on time. When the systems are disrupted, people talk about deglobalization in this scenario, every country, priority is to make sure that there is stability, political stability. And for political stability, it's important that food supply is there on time. Inflation going up and the temperature will go up in the power structure. They will be taken up. We have seen that yellow revolutions and orange evolutions and all those things happening. No country want to go through that. And therefore, we believe that the food security is a top priority for all the countries. In that, we are being a part of -- important part of the chain -- seed industry part. And therefore, long-term outlook is very, very bullish for us. That would continue -- and we will be continuing to benefit out of this trend. The priority is product innovation. And second is the increased penetration across the geography and crops. Product innovation will continue. There are fascinating projects nearly I think, 85 to 86 projects we have lined up. We are just prioritizing so that we fund those projects because once we commit R&D projects, you cannot go back because you have to stay the course for 6 to 7 years' time or 8 years' time. And therefore, we are very careful in prioritizing the project. But now with the kind of results which we are seeing 4 or 5 years, giving us a good confidence probably to consider many more projects than what we have so that our innovation rate continues to grow than where we are today. You have seen my earlier slide. We are right now in 85 countries. Still, we have an opportunity to grow within those countries at the level which we have, that is one growth area. Also, we intend to expand another 10 to 15 countries there's a possibility we can expand with the investment. I think Mike, over to you. I think Mike will be walking up and down for 10 kilometers, 11 kilometers today.

Thank you. Very good, Bhupen. Yes, amazing results. Outstanding performance and a very exciting future for the Advanta seed business. So just to wrap it up with 2 more slides, and then we'll do a short video and then move to Q&A. So you saw over the last several slides, I think a very exciting story for UPL over the next 5 years. We have opportunities in many, many areas. And when you add up the opportunities, we believe that we can have growth over this term of 7% to 10% compounded. By 2027, we believe that 50% of our revenue will be from differentiated and sustainable solutions, not only helping growers be more successful, but from a UPL standpoint, also greatly benefiting our business. We have a pipeline that we believe can deliver $5 billion of value. Over half of that will be commercialized in the next 5 years. accelerating the growth of our NPP Biosolutions business, expanding nurture.farm and making unique investments in 22 countries to continue to drive incremental growth. As Bhupen just mentioned, growing our Advanta seed business at a rate of 12% to 15% per year and then maintaining and growing our manufacturing competitive edge that we have in this business. We'll continue to focus on increasing ROCE and improving our leverage ratios. We expect this year that we'll be able to reduce our total debt by about $400 million. Finally, we are reimagining sustainability and bringing real-world impacts with how we reimagine sustainability, creating a better environmental footprint for agriculture really driving food security with our seed business, with our biosolutions with our traditional crop protection business with our Decco post-harvest business and creating real economic and social benefits for farmers and farm communities around the world. I think this next video will really bring it to life. [Presentation]

So anybody who wishes to ask a question, you can just raise your hand and one of us will come closer to you to hand over the mic to you.

[ Prashant ] from Elara Capital. Jai, when do we plan to take nurture.farm global and when do we plan to monetize it? What size do we want it to reach before we do so in terms of asset or revenue, whatever it may be?

Thanks for that. There's a lot of global initiatives in different markets, different farmer groups require different -- have different challenges. So while we are today focused mainly on all the challenges and improving farmer resilience for the small holder farmers in India. That's by no means all the projects -- we have the Gigaton challenge is something which is going to monetize for farmers around the world their -- the value of sustainability. It will also give traceability as a tool for farmers to be able to monetize more sustainably grown crops. I believe the world is going to start labeling sustainably produced food. And so nurture will cater to -- the digital platforms will cater to that. We are already doing a lot of stuff there. Today, nurture is focused on really building farmer resilience and we are launching similar projects around the world, and I was surprised that even large farmers are looking for technologies to reduce -- reduce their impact, the biosolutions even fertilizer use using the NPP and a lot of these things will have much more additional value than just -- just the reducing -- reduction of cost. As far as monetization, there's a lot of excitement around the nurture platform from various sovereign funds, other funds, and we are constantly discussing what is the right time and what is the right partner for us because it's not about the just about the money, nurture is a profitable company and is probably the largest and the most profitable active platform in the world, if it were to be separated. So there is a lot of interest there and we are constantly discussing and evaluating options to unlock value and also to be able to get that talent retention, the bigger challenge in the start-up space is the talent wants to be tangibly involved in their own journey. And as you can imagine, we have a lot of brilliant young talent at nurture in Bangalore who are in the ecosystem and are looking for exciting things. So that's a discussion, the management team, myself and various other stakeholders are discussing, and we will keep considering options and let you know at the appropriate time.

Rohan from Edelweiss. I have many questions. I will keep it short and interest for other participants to ask the question. Sir, first is on your guidance, you mentioned roughly 10% kind of growth for the current year. We see and we are -- it's all visible now that the price increase itself will be likely to be more than 10% for at least FY '23, given the current prices. So the 10%, you are mainly focusing only on the volume growth. That's one bit first clarification point.

I don't -- I can't -- I mean, with the challenges and the vulnerabilities and the impact of all these price increases, it may be a price reduction. We have to really look at it in a sensible way. Obviously, if you look at it from today's point of view, we expect better than that growth. But 3 months later, 6 months later, things can change. So we are being conservative there, and we believe that if situation remains the same, it can be better than that growth.

I just wanted to make sure that -- I mean, we are not expecting any volume degrowth because of that price increase itself is roughly 10% to 20% this year, then are we building a 10% volume growth in the numbers. So just wanted to make sure on that.

Yes. No, absolutely not. In fact, we expect to see some volume growth in this next year. If you think about pricing, so the prices of our products came up through the year, especially starting in Q2. And then by Q3, we really, for the most part, reached the new pricing level that we are still at -- so we got a lot of that price lift throughout much of the year last year. If we look out over the next, say, 2 quarters, we'll expect prices to roughly remain about flat, unless again, there's a dramatic change in cost of goods. But as we look out for the next 2 quarters, we don't expect to see significant cost of change -- cost of goods change. So then depending on what happens on the back half of the year, we could see some growth due to price. But we won't see a lot of growth due to price in the first couple of quarters of the year. So the growth will primarily come from volume in the first at least in the first half of the year.

Sir, second, despite the inflationary scenario, we have seen 19% EBITDA growth in FY '22, quite remarkable, much ahead also from what you guided earlier. I believe that though the volume growth has been 8% to -- 8% only in the current year, but EBITDA growth has not only changed the volume growth but it seems that you have also improved the margin significantly to get this 19% kind of EBITDA growth. Just wanted to understand that the price increase still remains there. Cost-led inflation is still there. So are we going to -- or will we be able to protect this kind of EBITDA margins, which has already been visible in the current year? Or you'll see that the margin pressure may come and we may see some drop in EBITDA margins?

Yes. So as we guided today, we expect to see revenue growth of about 10% or more and EBITDA growth of 12% to 15% in this next fiscal year. So we do expect to see some increase in our gross margins. We also expect to see some economies of scale and some efficiencies from an SG&A standpoint. So we will get more efficient in the middle part of the income statement. And so we do expect to see EBITDA margin expansion this next year.

Despite this cost increase, you still expect some margin expansion?

Yes. Of course, not only cost of goods, but we're also seeing wage inflation right now. And so we have a number of initiatives to make sure we're managing our SG&A. In some countries where the currencies devalued to the U.S. dollars, that will give us a little bit of relief on that. But it's something that we'll be managing throughout the year.

Sir, another question is on our outsourcing partners. You mentioned that roughly the share of outsourcing partners of the sourcing has gone up from 2% to 6% over the last 3 years. If you can share that, what are our expectations over the next 3 years? Do we have any numbers in mind that our outsourcing partners will be contributing, any particular number in terms of outsourcing?

So I think by and large, if you see, I gave the number about 31% is China and about 37% -- 38% is India and 31% is rest of the world. This is not going to change dramatically. And as we said, out of that 38%, there is -- that is a percentage of our strategic partners' share, which is largely India but also outside India. So this will inch up, but not that this whole balance is going to be lopsided to India or to rest of the world or to China. That is not going to happen. So that will remain balanced.

Okay. Just last, and I will take the latter opportunity to ask on question. On this fixed asset turnover, definitely, that looks like it has increased from 1.8x to 2.4x. But I think that the credit goes to the rising in food prices and the end product prices, which has gone up by almost close to 18% to 20% for the year that is showing a higher asset turn. Do you see that there is any opportunity for us to improve this asset turn and driving ROCE going forward if we adjust it for the inflation?

Yes. I mean partly, it's the price. But if you see 8% volume turnover in last year, such a difficult scenario, I don't know how many -- it can be compared with any other company. But 8% volume growth has been largely because of our own manufacturing. So we have been able to sweat the asset more.

Yes. Definitely, we look at revenue growth of almost INR 4,000 crores to INR 5,000 crores a year. And as we continue to debottleneck and add more capacities and we have ongoing investment cycle, which is continuous, we are planning for 2, 3 years ahead. So you will see that impact as the company keeps growing and be able to really -- a lot of our backward integration projects where certain critical raw materials we overinvest even to make ourselves less vulnerable to supply chain disruptions.

Sir, just one more from my side. Sorry, for being greedy in the scenario. Sir, though you maintained a very strong margins in the current quarter, kudos to the management for that, but as far as the volume growth is concerned, I think -- I mean, 3% volume growth for the quarter versus 8% for the full year is definitely quite disappointing. I just wanted to understand that, is it because of the low demand scenario or poor demand because of the rising end product prices and that is affecting the demand? Or it is just only some spillover is being there and the markets are -- or the dealers are keeping it more closer to the consumption and we can see some spillover in Q1? That's the -- I mean, why there is such a low volume growth? And also, why very poor growth in Europe market? Though you gave the reason for that, but I just wanted to understand that, will it catch up? Or the current scenario looks like that it is unlikely to be improved significantly.

Yes. So a couple of things. So firstly, in Q4, a lot of our business in Q4 is sales into the retail channel. If you think about globally, obviously, there is some product that goes on ground in that quarter, but a lot of our sales goes into retail warehouses in anticipation of the upcoming season. So a 3% volume growth, I think, is probably going to be consistent with what we saw across the industry for that quarter. And the fact that we had 18% price increase, I think, is really a testament to the good work from our teams. In Europe, yes, we had 7% growth on the year. Again, we lost about $40 million to products that were banned on a year-over-year basis. And so we overcame that. If you think about that on a percent, that's about a 3% or 4% of the European business. And so in a market like that, if you look at our peers around the world, 7% growth in that time frame would likely be one of the leading -- we'd be one of the leading companies in the world in terms of our growth in Europe.

And just to also add that when there is such a lot of volatility and prices are going up, you do face a little bit of slowdown. And if you flood the market with all your products, you're not going to be able to increase the price. So there is a little bit of balance we have to maintain with our sales channels, where if we want a price increase, you can't offer the same amount of volumes. You have to tighten up.

Just to add one more point. I think we sold a lot of new products during Q4. You saw the growth in India, 63% in Q4. That was the launches of new products. And also, we are seeing some shift more towards differentiated products than the off-patent products. So that's also that you would see higher sales of these differentiated products will not be that much high volume but will be much higher in the pricing.

This is Surya from PhillipCapital. So last 2 years, back to back, strong growth, value growth, what we have witnessed. Firstly, the successful integration of Arysta in FY '21. And in the current year, it is a price-led growth, what has contributed to the overall value creation. So going ahead, given the scenario that there could be a kind of price erosion scenario that is there going ahead, what value growth -- or what factors can really create value growth for UPL for FY '23 and -- or going ahead over the next 5 years?

Yes. Thank you for the question. As I said in my comments, our value growth is really going to come from our Differentiated and Sustainable products. Those are products that are not based on a cost-plus pricing. It's really based on the value that they deliver to our farmer customers. And so when we think about going from approximately 29% share of our mix today up to 50%, there's going to be a lot of value growth as we transition our mix towards that part of the portfolio.

Is it the product mix or it is a market mix, which is going to really contribute incrementally over the next 5 years?

Yes. For us, it really is around product mix.

Product mix and wallet share also with all the initiatives which we are doing.

Sure, sir. Just last question. On the non-agri initiative side that you had mentioned or since a few quarters that you have been emphasizing more on and to -- in the current scenario of the supply disruption and all that, so I think that initiative is going to have incremental kind of -- incremental contribution to the overall business and the value creation. So anything on this that you can share and guide us.

I think there is a lot of growth possibilities there. That business is growing. Actually, it's very small today for us in the whole scheme of things. Still, we are one of the large players. That business has a lot of interest and is growing quite nicely. I think the impact will come in the next 2 years, 3 years where it will become one of the larger specialty chemical platforms where we are supplying to all the ancillary industries based on core competencies we had built for our crop protection business. And those portfolios will be used for pharma intermediates, other specialty needs for the country, primarily for domestic use. But it's very small right now.

This is Vishnu from Spark Capital. I have a few questions. Firstly, the cost increases that you are looking for, is it completely done or costs are continuing to gallop and we will be taking further price hikes as we go forward in the next couple of months?

Well, my take is that in the next 2 quarters, the cost is going to be the same level what it is today. So we don't see a very, very large, as you used the word, gallop. I don't think the cost is going to gallop that way. What current level the costs are there, more or less, it is going to be there at a similar level because the Ukraine conflict is already factored and also the global macroeconomic situation is already factored. So that's what visibility we can say with some amount of certainty that we can say that for next 2 quarters, but can't say for third and the fourth quarter.

Have we passed on everything that probably between Feb, March, any cost increases, all those have been completely passed on? Or should we see some more next...

I mean quarter 4 numbers, you can see. I mean when you are seeing February, March, I mean, the quarter 4 numbers itself says that we have successfully been able to pass on the cost increases to the market.

I would just add, when you look at the Post Patent segment in particular, it's both a cost of goods equation, but it's also a supply-demand equation. And so if we think back over the last 8 to 12 months, there's been products that have also been short in supply, and so sometimes there's a disconnect between cost of goods even in the Post Patent segment and the price you can achieve in the marketplace. And so there was some of that, that played out as well that benefited us, I think, in Q4 as well.

You did speak about cost inflation across the board, fertilizer, seeds and ag inputs. Is the farm margins still way better than last year? Or is it still coming down? What is the experience when you increase the prices to the farmers?

Yes. It largely depends on the region and the crop. If you look at global crops, wheat, corn, soybeans, crops like that, that are traded globally that have a very established price, those prices are extremely high. And in most countries that we operate, farmers will earn a very strong margin on the production this year. Some of the specialty crops and some of the domestic crops haven't seen the same inflation, and yet those farmers have the headwinds of cost inflation. So it really depends on the region but more so on the crop and what's happened in terms of how the prices have evolved.

And also the farmers, which are selling the produce harvested now, have not had the cost inflation, which they're going to have in the next season. So economics is a very dynamic economics going on there. And we have to -- the farmers are very, very conscious. And we know some farmers taking fertilizer holidays, reducing it, et cetera, trying to anticipate what can happen to commodity prices. So there is a little bit of tension every farmer has also because he has to plant, harvest, sell 8, 10 months from now. But he has to buy the produce, his raw materials today at today's prices. He's seen the benefit of that. He may -- it hits. So they're very conscious of that, at least the very professional farmers.

Got it. When you say we are going to take at least 200 to 300 basis points market share gains in the next 3 to 4 years, would this come from the innovators or the smaller players? I mean we are -- we did see a lot of different things that we are approaching, but the larger companies would also be doing something similar. Or where exactly are we, one, going to take the market share from? And what are the competitors today we are looking at it? And how are they going to counteract in terms of this market share gain?

UPL has been constant. Every year since inception, we've been gaining market share. And we have a very strong cost base. We are a very efficient and agile company. And I think a lot of companies would like to be in our shoes. We have a very loyal customer base. And we probably invest more money or more effort per dollar of revenue in terms of making supply chain security and backward integration and CapEx as we do. So we have the trust of our customers, whether it's large distributors, dealers or farmers. And now with the innovation, the rate of innovation which we have, the value of innovation, our innovation is not for the sake of innovation. It is because it generates some value for the farmers. And so when we are gaining market share, it is just not selling more cars. It is -- or whatever else they're selling. We are selling differentiated solutions, which are adding incremental value. So we naturally gain market share. It's not necessarily just bulldozing and driving somebody out of the market. We increase wallet share because we give more value to the farmer, whether it's the nurture platform where we help farmers improve soil health, and he sees -- we are seeing today in the wheat farmers who did not burn their crop, we're seeing here gains. They are seeing much better quality greens, better quality. The groundnut farmers are seeing oil content in their groundnut growing by 3%, 4%. And that gives them a better quality seed. If you have A grade quality groundnut produced in your farm, then you actually get a 30% to 40% higher price for your crop. And if you have higher oil content, you get another little bit premium. So they're not doing it. We're not just bulldozing our way with price. We're giving value to the farmer. And that's why we believe that our market share gains are sustainable, and really, we are not really focused on necessarily bulldozing anybody out of the market. We just gain it because of the natural strength of our portfolio and our technologies and our approach to the farmer.

So Brazil has been a real workhorse for us, I mean, being pretty strong in the last couple of years. I mean where are we today, let's say, firstly, in the market in LatAm? What would be our market share in terms of the top 3, 4, 5? Where would we be -- specifically in Brazil, where would we be? And where can we grow from here in Brazil? And is it a 15%, 20% growth market even from here on? Or is that more or less done?

So Rogerio is here somewhere. I can't see him. You should catch him in the coffee break afterwards. Now I think with the product launch like Evolution, we have a few other products, which are actually #1 in their category for the solution. And we -- those are just launched. That's a huge segment creation. So I think the segment is huge. And we think that farmers will naturally move towards that. Even if you look at some of the Bunge partnership, it makes -- it's very easy for farmers to do more business with UPL. It is the biosolutions bit and the whole impact on fertilizer substitution with K-Tionic and [ Humiflex ], some of those technologies which we are launching. Every avocado farmer in Mexico, which is one of the largest producers, is going to be a UPL customer. It wasn't the case 2 years ago. But now it will be. So we are gaining market share by crop, by market, by region. And so -- and it's a solid market share with something which is creating an innovation and carrying value to that farmer. So we feel that, that is -- we can take that market share and keep it. And some of it is not really taking market share from the existing player at all. Some of our biosolution product on heat tolerance, better quality crops, our soybean products is actually better quality. And those are not really taking. This is creating a new market. So we believe that, that is another area where we are growing. We are not taking market share from anybody else.

Where would we be in top 5 rankings, let's say, in Brazil, I mean, will be top 3, 4?

Yes, we are -- it depends on how you look at it, but we are in the top 3 companies for sure. Just if you add glyphosate, if you remove glyphosate, it becomes very different. So we don't play in that market much. So that's more a commodity business.

So in the differentiated, which we are talking about growing this business a lot in the next couple of years, would physical assets, fixed assets, CapEx, go in this business over the next couple of years? And any guidance in terms of how much it will be...

We're not going to increase our CapEx any more than our guidance. In fact, in proportion of revenue, I think it keeps going down. But we will need to. We don't have too much spare capacity. So we've added a lot of investment, a lot of capacity for the NPP portfolio in our Bangalore facility. We are adding more facilities. We're expanding in France. We're expanding in Mexico. Everywhere, we're adding capacity, but it's within that limit, nothing something -- within that budget of INR 2,000 cores, INR 3,000 crores, INR 2,000 crores or so. Right, Anand?

Yes.

So sourcing, this 38%, would it continue to inch up closer to 50%? Or more or less, we'll be here on 38% to 40%?