A favourable monsoon and increased sowing activity are set to drive strong performance for Indian agrochemical companies in the first half of FY2026. With rainfall now above seasonal norms, the agriculture sector is witnessing renewed momentum. Experts suggest this trend will benefit seed and pesticide demand, strengthening the fundamentals of key agrochemical players across the country.
India’s southwest monsoon, which arrived early on May 24, initially began with a 31% rainfall deficit. However, steady progress and a broad revival have since reversed the shortfall. As of June 23, cumulative rainfall across the country stood 2% above normal. This recovery is proving vital for sowing operations and enhancing the prospects of a healthy cropping cycle, especially in rain-dependent regions.
Experts tracking the agrochemical sector report that favourable rainfall and faster sowing activity are encouraging higher usage of farm inputs. Pesticides and seeds are expected to see a surge in demand in the coming weeks. Agrochemical manufacturers are already witnessing increased interest from distributors and farm-level buyers, signalling a robust quarter ahead driven by seasonality and rural momentum.
Backed by these agricultural tailwinds, agrochemical stocks have shown positive market movement. Year-to-date, major players have seen significant gains. UPL shares have risen nearly 29%, while Dhanuka Agritech has appreciated around 13%. Bayer CropScience and Rallis India have recorded modest gains of 1.9% and 3.1%, respectively. Investors appear to be betting on strong rural fundamentals and improved earnings visibility.
While certain firms are expected to benefit more than others, the outlook varies by company. Analysts maintain a ‘Buy’ rating on firms showing resilience and pricing power, while remaining cautious about others facing structural challenges. Experts suggest that timely rainfall, input subsidy policies, and farmer sentiment will continue to shape the sector’s performance in the second half of the year.
With monsoon conditions improving and sowing activity on the rise, India’s agrochemical sector is poised for a strong first half. Increased demand for seeds and pesticides is expected to support earnings growth for key players. As rainfall patterns stabilise, rural optimism and input consumption could remain high. Experts believe sustained policy support and market responsiveness will be key to long-term momentum in the sector.
