Shares of PI Industries dropped by 1.90% to trade at ₹3,968 on Friday following weak guidance from its key customer, Kumiai Chemical Industry Co., Ltd., for FY2025.
Kumiai Chemicals forecasted a decline in net sales and profitability for the upcoming fiscal year, citing challenging market conditions and strategic inventory adjustments.
Highlights of Kumiai Chemicals’ Guidance
- Net Sales: Expected to decline by 1% to ¥159.3 billion, compared to ¥161 billion in 2024.
- Agricultural Chemicals Sales: Anticipated to drop by 4%, reflecting subdued demand.
- Operating Income: Forecasted to decline by 8% to ¥10.4 billion.
- Net Profit: Projected to fall by 20% to ¥10.9 billion, attributed to lower operating performance and increased cost pressures.
The company attributed the weak outlook to lower agricultural chemical sales and plans to optimize AXEEV inventory levels in collaboration with its overseas marketing team. Efforts will also focus on negotiating with suppliers to reduce raw material costs.
PI Industries, a key partner of Kumiai Chemicals, saw selling pressure as investors reacted to the weak outlook. The stock has declined 3.51% over the last five trading sessions and 12.55% over the past month, reflecting broader concerns about the agricultural chemicals market.