Indian chemical industry delivered strong total shareholder return at 28% during 2020-24: BCG

While the global chemicals sector underperformed overall, India emerged as the standout market, driven by strong domestic demand, policy support and healthier valuation dynamics

Boston Consulting Group’s 13th Value Creation in Chemicals report, based on an analysis of 322 publicly listed chemical companies worldwide, finds that the global chemicals sector delivered average annual total shareholder return (TSR) of 7% from 2020–2024.

India’s chemicals outperformance was driven by resilient domestic demand, targeted policy support, and improved investor sentiment that lifted valuation multiples. The sector’s performance reflected a combination of strong home-market demand and a strong share of exports in agrochemicals and in focused specialties such as pharma ingredients, personal care, and engineered/high-performance Materials, while fertilizers remained largely a domestic play.

This trajectory is consistent with BCG’s recommendations, which highlight that companies focusing on commercial excellence, disciplined capital allocation, and portfolio quality are best positioned to sustain value creation in a challenging environment.

Amit Gandhi, Managing Director & Senior Partner, BCG India said, "Between 2020 and 2024, India’s chemicals industry led the world in value creation, delivering a five-year TSR of ~28%, compared with ~7% globally. This performance is driven by revenue and profit growth as well as higher P/E multiples, supported by strong domestic demand. While the potential for continued growth is evident, the next phase of advancement will be defined by how Indian companies choose to scale over the next five years, whether by strengthening existing value chains or by venturing into new ones."

Key findings from the report:

* Average annual TSR for chemicals globally was 7% (2020–2024), constrained by soft demand, overcapacity, and cost pressures. In contrast, India outperformed with a 28% five-year TSR, supported by resilient domestic demand, policy reforms, and a record increase in valuation multiples.

* Indian companies in Focused Specialties (33% TSR) and Fertilizers (32% TSR) significantly outperformed.

* India’s export engine was particularly strong in Agrochemicals and Focused Specialties (such as pharma ingredients, personal care, and engineered materials), while fertilizers were driven almost entirely by domestic consumption.

* BCG recommends, firms that focus on commercial excellence, disciplined capital allocation, and selective investments in specialty chemistries are best positioned to deliver superior shareholder outcomes.