- 28 Oct 2022
- ICICIdirect Research
SUMITOMO GETS RESTRICTIONS ON USE OF GLYPHOSATE
SUMICHEM - 548 Change: -16.45 (-2.91 %)News:
The central government by its order published in Official Gazette on October 25, 2022 has decided that the use of Glyphosate is hereby restricted and no person shall use Glyphosate except pest control operators. Use of Glyphosate involves health hazards and risk to human beings and animals
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Glyphosate was banned in states like Kerala and Andhra Pradesh. Glyphosate is an important product for the company and is under the category of Herbicide. Revenue generated from glyphosate product (Sumi Nara) is ~10-15% on an annual basis. Hence, this will affect topline by 10-15%. Sumitomo Japan have potentially found a substitute for glyphosate but it is at a very initial stage and will take four to six years to get commercialised. The management believes the order will have no impact on export business for the product but will impact domestic sale and consumption of Glyphosate in the near term
Impact:
Negative