Atukuri Soujanya, a promoter group member of Nova Agritech Limited, has acquired additional equity shares of the company through open market transactions. The acquisition was disclosed to the company's compliance officer and stock exchanges in accordance with SEBI regulations.

Transaction Details

The share acquisition transaction involved the purchase of 5,000 equity shares valued at ₹1.50 lakh. The transaction was executed on the National Stock Exchange on February 23, 2026, with formal disclosure made to the company on February 25, 2026.

Shareholding Changes

The acquisition resulted in a change in Soujanya's shareholding pattern in Nova Agritech Limited. Prior to this transaction, the promoter group member held 5,709 equity shares representing 0.006% of the company's total shareholding.

Regulatory Compliance

The disclosure was made under multiple SEBI regulations to ensure transparency and compliance. Soujanya filed the necessary forms under SEBI (Prohibition of Insider Trading) Regulations, 2015, and SEBI (Substantial Acquisition of Shares and Takeover) Regulations, 2011.

The promoter group member provided an undertaking confirming no access to unpublished price sensitive information and full compliance with the prevailing Code of Conduct for Prevention of Insider Trading. The disclosure was copied to both BSE Limited and National Stock Exchange of India Limited.

Company Information

Nova Agritech Limited's equity share capital consists of 9,25,19,813 equity shares of ₹2 each. The company's shares are listed on both BSE Limited and National Stock Exchange of India Limited. The transaction did not result in any change to the company's total equity share capital, which remained at 9,25,19,813 equity shares before and after the acquisition.

Nova Agritech Limited has received a credit rating outlook revision from CARE Ratings Limited, with the agency changing its outlook from 'Stable' to 'Negative' while reaffirming the CARE BBB rating on the company's long-term credit facilities. The revision, announced on February 23, 2026, affects facilities worth ₹30.99 crore and reflects challenges stemming from regulatory disruptions and operational pressures.

Rating Action Details

CARE Ratings has taken the following action on Nova Agritech's credit facilities:

Primary Reasons for Outlook Revision

The outlook revision stems from multiple operational and regulatory challenges that impacted the company's Q3FY26 performance. The government-imposed stay on bio-stimulants in July 2025 significantly affected Nova Agritech's revenue stream, as this segment contributed approximately 30% of the company's revenue share.

The Government of India cancelled over 8,000 provisional registrations for bio-stimulants, leaving only 146 approved products permitted for sale under the Fertilizer Control Order (FCO). From June 17, 2025, companies were prohibited from manufacturing or selling unapproved bio-stimulants, creating immediate supply shortages across the industry.

Financial Performance Impact

The regulatory disruptions have materially affected Nova Agritech's financial metrics:

Q3FY26 results showed a 25% decline in income compared to Q2FY26 and a 28% decline compared to Q3FY25. The sharp revenue drop was primarily driven by disruption in the bio-stimulant segment, compounded by extended rainfall in South and West India that reduced crop activity and demand for agri-inputs.

Liquidity and Working Capital Challenges

The company's liquidity position has become stretched due to deteriorating working capital metrics. Key concerns include:

• Receivables: Remained high at ₹214 crore as of December 31, 2025, with 55% outstanding for more than six months
• Inventory levels: Continued elevation at ₹95 crore
• Cash credit utilization: Approximately 96% over the 12 months ended January 2026
• Operating cycle: Extended to 217 days in FY25 from 203 days in FY24

The company offers credit periods of 4-5 months to dealers, contributing to the elongated collection period. The agricultural sector's seasonal nature, with cash flows peaking during harvest periods, further compounds working capital challenges.

Positive Developments and Recovery Prospects

Despite current challenges, Nova Agritech has secured regulatory approvals that may support future recovery. The company received 43 product approvals on January 21, 2026, valid until September 29, 2029, which is expected to help restore bio-stimulant sales.

The rating continues to derive strength from several factors:

• Strong parentage and established track record with efficient management
• Diversified product portfolio across soil health, crop nutrition, and crop protection
• Extensive distribution network spanning 6000+ active dealers across 18 Indian states
• Comfortable capital structure with overall gearing ratio of 0.25x as of March 31, 2025

Rating Sensitivities

CARE Ratings has outlined specific factors that could influence future rating actions:

Positive factors:

• Total operating income improving above ₹300 crore with sustainable profitability margin over 18%
• Operating cycle improving below 150 days

Negative factors:

• Decline in total operating income and PBLDT levels by over 20% for the projected period
• Further deterioration in operating cycle and liquidity position

The agency will monitor management efforts to ease the stretched liquidity situation and may revise the outlook to stable upon significant improvement in liquidity position.

Source: None/Company/INE02H701025/c11c947d-7aeb-4d8a-86e9-cccf0305e4c7.pdf