Best Agriculture Stocks in India 2024

Stock market investing is an essential strategy for achieving financial stability and growth. Agricultural stocks have garnered attention from investors in the recent past due to the potential they offer. In this article, we will take a look at the best agriculture stocks in India. Keep reading to find out more!

Agriculture Industry Overview

More than 58% of people in India make their living primarily from the agricultural sector. From 2024 to 2032, the market is expected to grow at a 10.5% CAGR due to changing eating habits, population growth, and technological advancements such as precision farming and automation. Despite contributing less than 20% of GDP, India’s agricultural production has improved, ensuring food security and making the country a net exporter.

India ranks second in the world’s output of rice, wheat, and cereals and is the leading producer of ginger, okra, bananas, papayas, mangoes, and wheat. The government is investing significantly in agriculture to boost output and promote sustainable farming. Programs like the Paramparagat Krishi Vikas Yojana (PKVY) encourage organic farming. The agricultural department was allocated INR 1.24 lakh crore (USD 15.9 billion) in the Union Budget 2022-23. Furthermore, 729 Krishi Vigyan Kendras offer farmers new technology and better farming practices.

List of 10 Best Agriculture Stocks in India

Company Overview of Agriculture Stocks in India 2024

In India, the biggest players in the agriculture sector come from companies whose operations are involved in producing agrochemicals. These include companies that make fertilizers and pesticides. Here is a list of the best agriculture stocks to buy in India:

1. PI Industries Limited

PI Industries Ltd is one of India’s best agriculture stocks, excelling in domestic and export markets. Based in Gujarat, its cutting-edge facilities host integrated process development teams and in-house engineering. 

The company’s product portfolio includes insecticides, fungicides, herbicides, and specialty products. PI Industries is also India’s biggest producer of generic molecules like ethion, profenofos, and phorate.

PI Industries, a leading global provider of agrochemicals, has four global offices and operates in over thirty countries. With 77% of its income coming from exports, the company is highly focused on this market. 

The company has been dedicating 3-4% of its revenue towards R&D activities which demonstrates its focus on research and development. 

2. UPL Limited

UPL, an Indian corporation, produces and sells agrochemicals, industrial chemicals, chemical intermediates, specialty chemicals, as well as field crops and vegetable seeds. The company has a presence in over 130 countries and its top products include crop protection chemicals like insecticides, fungicides, herbicides, etc. 

UPL Ltd. is known for its sophisticated crop protection technology and currently holds a 13% market share in India. The company earns up to 88% of its revenues from around the world whereas India only forms 12% of its total revenues

3. Coromandel International Limited

Coromandel International Ltd. is a well-known player in India’s agricultural solutions sector, providing farmers with a wide range of products and services. The company’s primary focus on fertilizers, crop protection, and related items boosts agricultural production dramatically. 

The majority of the company’s revenue comes from two principal segments: crop protection (15%) and fertilizers and related items (approximately 85% of total revenue). Coromandel International Ltd. is a major player in the fertilizer industry, accounting for a large portion of India’s phosphatic fertilizer market. 

With a 15% market share, it is the largest supplier of single superphosphate (SSP). Furthermore, the company is a major global player in mancozeb and sells a variety of crop protection products under several trademarks. 

4. Bayer CropScience Limited

Bayer CropScience provides Agri Care to farmers through products such as insecticides, fungicides, herbicides, and corn seeds. They have introduced new solutions, such as the Vayego insecticide in Crop Protection. In Seeds & Traits, they produce tough hybrid seeds such as Dekalb 7204 and 9208. They also work in Environmental Science to ensure that public spaces are pest-free.

2022 saw major adjustments made by Bayer. They and Cinven came to a deal on March 10th, whereby Bayer’s Environmental Science Professional division will be sold for a sum of $2.6 billion. Additionally, they sold their seed distribution company for an astounding 58 crores, which included seeds for sorghum, millet, cotton, and mustard.

5. Sumitomo Chemical India Limited

Sumitomo Chemical India Ltd. (SCIL) is known for its wide range of technical and formulation products. The company brings innovative solutions from its Japanese parent company to the Indian market, especially in agrochemicals, animal nutrition, and environmental health. After merging with Excel Crop Care Limited, SCIL now offers a broader selection of generic and specialty products.

SCIL exports to over 60 countries, making up 22% of its revenue in FY22. With 5 manufacturing facilities, 200+ brands, and a wide network of distributors and dealers, SCIL is dedicated to delivering quality and innovation in the agrochemical sector.

Factors to Consider Before Investing in Best Agriculture Stocks

Like any other industry, the agriculture industry is influenced by several factors that can impact the performance of agricultural stocks in both the short and long run. Let's discuss some crucial factors to consider when investing in some of the best agriculture stocks in India:

Financials

The financial health of a company significantly impacts its stock performance. Before making any investment decision, conduct in-depth research on the company's revenue, profit, debt levels, cash flow, and other important financial ratios.

Government Policies

Favorable government policies can positively impact a company's performance. Research government policies related to subsidies, import-export regulations, pricing, and long-term plans. These can have a substantial effect on agricultural stocks.

Technological Advancements

Technological advancements, such as the use of machines, satellites, drones, and pesticides, significantly increase production output and reduce the cost of production. Consider these technological integrations for the company before investing in agriculture stocks.

Market Trends

Market trends also impact the performance of agricultural stocks. Consider factors like demand, supply, global dynamics, and more.

Weather Patterns

Long-term changes in climate patterns, such as rising temperatures and increased frequency of extreme weather events, can impact crop yields, water availability, and overall agricultural productivity. Companies that are better prepared to adapt to these changes or invest in sustainable practices may perform better.

Labor Availability and Costs

The availability and cost of labor can substantially impact agricultural operations. Regions facing labor shortages or increasing labor costs may see higher operational expenses, affecting the operational efficiency and profitability of the company.

How to Invest in Agriculture Stocks?

Now that we know the factors to consider before investing in agriculture stocks, let's explore the steps to follow for investing in some of the top agriculture stocks in India:

1. Conduct detailed research on the agriculture industry's growth and market dynamics.

2. Evaluate the level of risk you can bear and analyze your goal for the return on your investments.

3. Research agriculture company stocks by reviewing the company’s financial statements, annual reports, and press releases.

4. Consider Consulting Finance experts and discuss your investing avenue

5. Choose the best stocks listed in NSE after doing comprehensive research, and build a diversified portfolio investment plan.

6. Open Demat Account with a certified Stockbroker

7. Monitor your investment and stay updated on the agriculture sector news

Conclusion

The agricultural sector offers good potential for investments. The returns provided by the agricultural product manufacturing industry have increased due to significant revenue growth in several leading enterprises. Due to this trend, agricultural equities are now seen as desirable investment opportunities. Investors should thoroughly investigate these businesses to take advantage of these opportunities, taking into account aspects like growth potential, market position, and financial stability. 

By thoroughly understanding these factors, investors may make well-informed decisions that support their financial objectives and could result in significant returns. You can find and trade or invest in all of the above stocks on the Rupeezy app created to provide you with the best tools and information in the industry. Happy Investing!