July 02, 2024

Numaligarh Refinery Limited (NRL) registered the highest-ever PAT since its inception at Rs. 3,703 Crore in FY 2022-23. How has the company performed in FY 2023-24?  

FY 2023-24 ended on a positive note for NRL in terms of physical and financial performance. This is despite a setback in the form of a fire during the first quarter of the FY 2023-24 while the refinery was getting back to operations after a planned turnaround of about a month. Refinery turnaround involves inspection and maintenance of all units of the refinery in a holistic manner to ensure its smooth and efficient functioning and is carried out at regular intervals of four years. 

Despite this unforeseen adversity and a valuable quarter lost during the beginning of the FY 20233-24,  the company  bounced  back with resilience and the refinery was able to record a crude throughput of 2,510 thousand metric tonne, equivalent to 100% capacity utilization for 10 months. 

Annual Accounts closing is under progress and we are hopeful that the financial performance will reflect the physical performance. 

Current production capacity of NRL and how has it changed over the years?  

The present refining capacity of NRL is 3 million tonnes per annum (MMTPA) which is the design capacity since inception and commencement of commercial production in the year 2000. However, the company has embarked on a major expansion drive to treble its refining capacity from 3 MMTPA to 9 MMTPA. We are encouraged by the performance of the refinery so far and are aiming at crossing the design capacity of 3 MMTPA and achieve 110% capacity utilisation this year. 

Latest development on NRL's expansion? Total capacity post expansion and how is this going to impact NRL’s overall performance?  

The ongoing Numaligarh Refinery Expansion Project (NREP) to treble the capacity from 3 MMTPA to 9 MMTPA has achieved around 60 per cent progress on ground. Further, as part of the integrated refinery expansion plan, a 1,640 Km crude oil pipeline is being laid from Paradip to Numaligarh, the progress for which is around 70 per cent on ground. The scheduled completion of NREP is December 2025 and we are mobilising all our resources and moving ahead aggressively to achieve the target as per set timelines. 

Enhancement in refining capacity is expected to have a multi-pronged impact not only for NRL but the entire industrial ecosystem. With increased refining capacity, NRL will be able to contribute in enhancing regional energy availability apart from venturing for exports to neighbouring countries. It is expected to boost economic growth in the region by creating direct and indirect employment opportunities as well as growth in ancillary industries.  

NRL has announced Capex of Rs. 35,000 crore in the next 5 years. Can you please elaborate on this?  

Refinery project is almost 60% through on ground while the Paradip Numaligarh Crude Oil pipeline has achieved a progress of 70%. Corresponding amount of capital expenditure in terms of financial commitment has been made. These form a major part of the Rs. 35,000 crore investment which will continue till the end of 2025. NRL is also putting up a Polypropylene unit of capacity 360 KPTA for which environmental clearance is awaited. Once on board, another Rs. 7,000 crore would be apportioned from the above Rs. 35,000 crore capex proposed. 

What is the development of setting up a 2G bio-refinery?

The 2G bio-refinery plant at Numaligarh which is designed to produce 49,000 metric tonnes of bioethanol has already been mechanically completed during the end of March 2024; with some residual jobs remaining. It is a pretty complex project and therefore would typically require 3 to 4 months for commissioning. All out efforts are being undertaken to commission the plant quickly and safely tentatively by mid July 2024. 

The 2G bio-refinery is unique in the sense that bamboo biomass is being used as a feedstock, which no one else in the world has ever tried. The North East of India has abundance of bamboo availability which is being tapped for the purpose. The bio refinery would require around 300,000 metric tonnes of dry bamboo annually. In order to maintain unhindered supply, we have also carried out major tweaking in the whole supply chain of bamboo. Our aggregation model is about offsite chipping of the bamboo and a great deal of value addition will happen at the village level. 

Other than bioethanol, a chemical called furfural and acetic acid would be produced in the process, which would ensure the economics of the project. The Government of India has granted a Viability Gap Funding (VGF) of around Rs. 150 crore for the project.  

NRL has signed a pact with NTPC for a green chemicals project. Please share details? 

Banking on the experience gained by NRL so far, NTPC has signed a MoU with our company for collaboration and knowledge sharing in setting up a biorefinery like the one we are putting up in Numaligarh. The biorefinery will be put up in   Salakati, West Assam and a separate catchment area for growing bamboo has been identified. 

Biofuels have a great future ahead as is manifest by the focus it has gained in recent years not only in the milieu of the Government of India, but globally. NTPC can also explore the opportunity to utilise the lignin from bamboo and feed it into their plant along with coal, to make their electricity greener. 

NRL and Inland Waterways Authority of India (IWAI) has inked a pact for petroleum products transportation. How is the progress on this front? 

Most of the over dimensional and overweight consignments for NREP have been transported to Numaligarh utilising waterways. Most of these equipment are being produced in Dahej in Gujarat along the West Coast of India; then being transported through big vessels up to Haldia to be trans-shipped onto river going barges that take NW2 via Bangladesh to reach Assam.  

The consignments are finally offloaded at a location very close (about 10 Km) from our refinery wherein a jetty has been constructed on the river Dhansiri, a tributary of the mighty Brahmaputra. However, in order to navigate this route, we need waterways and adequate drafts around the year.  

I take the opportunity to thank IWAI for their support in facilitating the above due to which we have been able to transport consignment of weight upto 1,500 tonnes along this route. Moreover, the current infrastructure will pave the way for future transportation of materials as well as products through the river route that would happen mostly downstream. NRL will produce Polypropylene in the future while solid sulphur is already being produced. Eventually, the river route is expected to be utilised to transport a variety of refinery products, other than transporting petrol and diesel. 

The company also opened its first overseas office in Bangladesh. Is there any plan to expand more overseas offices? 

NRL has a pipeline named India Bangladesh Friendship pipeline running up to Parbatipur in Northern Bangladesh from its terminal at Siliguri, West Bengal for transportation of Diesel. We are also exporting Paraffin Wax to Bangladesh and have plans to export Polypropylene which has a good demand in Bangladesh, mainly to meet its packaging needs for cement and readymade garment industries.  

To expand our footprints and export more products to Bangladesh, we thought it prudent to open an office in Dhaka. We are also exploring markets in Nepal and Myanmar and tap its potential for NRL products. 

How does NRL contribute to the socio-economic development of the region?

There are three to four key contributions of NRL towards socio-economic development of the region. 

 Firstly, direct and indirect employment to hundreds of youths from the region. Secondly, we are the highest tax payers in the North East region and the Income Tax Department has repeatedly recognized the company on this account. Thirdly, NRL has been able to transform the socio-economic status of the region through its social initiatives that are undertaken under corporate social responsibility. 

Fourthly, we operate a 100 bedded multi-speciality hospital called VK NRL Hospital within our township premises; that has been able to deliver quality health care in the region since the year 1998. The hospital also conducts mobile medical camps, delivering healthcare to the doorsteps of the community in 70 villages covering a population of 80,000 rural residents within a radius of 10 Km of the refinery. We have also set up a VK School of Nursing that provides quality Nursing Education to girls from the region to make them self-sufficient and capable of earning their own livelihood.  

What are some of the major challenges faced by NRL in its operations?

Operating expenses per barrel of crude oil for a 3 MMTPA refinery is very high since manpower and associated expenses are almost at par for a refinery with higher capacity. We are hopeful to overcome the challenge when our 9 million tonnes refinery is commissioned by the end of the year 2025. 

Also, in order to ensure long term growth and sustainability, we are planning to put up a petrochemical complex for producing Polypropylene, which is the road ahead for all existing refineries. This is expected to attract more and more ancillary industries in the domain of chemicals, especially niche chemicals. Also, considering Government of India’s mandate of 1% blending of sustainable aviation fuels (SAF) to Aviation Turbine Fuel ( ATF) by 2025 in line with global sustainability standards, NRL is exploring the means to produce SAF. 

We are tucked in one corner of the country and have a major challenge of high transportation (freight) costs for our products. But fortunately over a period of time, with phenomenal economic development, North East is witnessing double digit growth in both diesel and petrol demand, easing our logistic issues. For example, when we first started marketing our products in the year 2000, the geographical range was 1,500 - 2,000 km for which we had to bear substantial freight under recovery. Now, the product envelope has shrunk to almost around 700 - 800 km and therefore our freight economics have improved significantly. As we diversify into more products, we are hopeful that we are able to meet the growing demand for our products in the region. Also, we are focussing on export to our neighbouring countries like Bangladesh, Bhutan, Nepal and Myanmar which are geographically closer. 

NRL plans to achieve net zero by 2038. Can you discuss the steps taken by NRL to ensure the safety and environmental sustainability of its operations?

Our first and major initiative is the carbon neutral Bio Refinery in Numaligarh, which is under commissioning. The only carbon dioxide emissions that take place are during the fermentation process; when glucose gets converted to ethanol. We are planning to capture this carbon dioxide in liquid form. 

Another green initiative is putting up a 2.4 KTPA green hydrogen plant; which is expected to be commissioned by June 2025.

Several other technologies are being adopted to make the refinery fuel efficient and green. By reducing fuel consumption for running the refinery, we aim to reduce greenhouse emissions.  

We are also creating a huge carbon sink by afforestation of hectares and hectares of land in different districts of Assam. We have already acquired around 70 hectares of deforested land and developed three major nurseries for generating bamboo saplings in collaboration with the Government of Assam. Another MoU with the Assam government for afforestation of 28 hectares is on the cards.  

Going forward, we are planning to capture carbon dioxide which gets generated in the process; to reduce Scope 1 emissions.

To create pathways to meet our net zero targets, we are in serious discussions with major players in the field.  

What role does NRL play in the global energy transition and shift towards cleaner and renewable energy sources?

As stated earlier, we have embarked on a 2.4 KTPA green hydrogen plant project. For that purpose, we need around 18 MW of electricity from round the clock green electricity sources. We are exploring opportunities for power purchase agreements for green electricity. 

June 27, 2024

Our core group strength and synergy are in manufacturing complex Fluorine & chemical derivatives such as Fluoropolymers and Fluoroelastomers

How has the performance been of Gujarat Fluorochemicals Limited (GFL) in 2023-24? What is the expectation from 2024-25?  What are the key achievements in 2023-24? 

The year 2023-24 has been challenging overall for both the chemical industry as a whole and for GFL. One of our most important verticals – our Fluoropolymers segment – was impacted by destocking in Europe. As a result, our results for FY 2023-24 were muted as compared to the previous year. 

However, moving forward, the destocking phenomenon seems to be phasing out and we expect to see continuous growth quarter on quarter from hereon. FY25 is also expected to reflect some of the positive impact from the exit of legacy players in the Fluoropolymers segment. 

Our EV business, GFCL EV, saw the commissioning of the initial phase of its integrated battery materials manufacturing facility. With battery agnostic offerings covering both Lithium Iron Phosphate (LFP) and Nickel Manganese Cobalt (NMC) batteries, the GFCL EV product portfolio caters to around 40% value of LFP battery cost. With a CAPEX of Rs. 6,000 crore already announced for the next 3 years, we aim to tap significant global opportunities presented by the Electric Vehicle (EV) and Energy Storage System (ESS) ecosystems. 

What are the emerging challenges and opportunities for the EV market in India? 

Customer perception of range anxiety remains a significant hurdle in India's EV adoption journey. The limited charging infrastructure adds to this worry and poses a challenge to widespread EV adoption. 

Additionally, the price disparity between internal combustion engine (ICE) vehicles and EVs remains a barrier for many consumers. However, fostering domestic manufacturing and incentivizing local production of EV components can drive down production costs, making EVs more affordable and competitive in the Indian market.

The opportunities mainly involve government initiatives aimed at curbing vehicular emissions, such as the implementation of policies like the Production Linked Incentive (PLI) scheme for Advanced Cell Chemistry batteries, coupled with state-level subsidies to facilitate the establishment of electric vehicle manufacturing, underscore a strategic focus on sustainability and innovation. These measures, alongside the burgeoning domestic market spanning various segments including passenger vehicles, two and three-wheelers, present a landscape ripe with opportunities for growth and development within the EV sector.

What is the current market demand for battery chemicals, and how does GFCL EV Products plan to capitalize on this demand?

In the past few years, a number of factors have impacted the global EV markets and hence the battery chemicals market by extension. Some of the key markets are now beginning to mature and what they need are reliable, uninterrupted supply chains together with availability of affordable battery metals. Global disruptions like the Russia-Ukraine conflict have impacted both these areas. Add to that the investments companies have already made in capacity and technology development, and the impact on prices and availability cannot be missed.

On the other hand, the global focus on environment protection and promotion of EVs has resulted in significant expansion in the global EV market. Nearly 14 million new electric cars were sold worldwide in 2023. 

In the face of these global scenarios, India’s EV market has been remarkably resilient. EV adoption in India is still in its nascent stages, but growing leaps and bounds. Driven by adoption of two-wheeler (2W) and three-wheeler (3W) segments, EVs are projected to account for around 40% of total vehicle sales in India by 2030. For the battery and battery chemicals market, this means that the demand will remain robust, which is good news for companies like GFCL EV. 

With our product offerings in the areas of Cathode Active Materials, Electrolytes, Battery Binders and Additives, and the dependability of GFL’s Fluoropolymer expertise and supply chain reliability, we are strategically positioned to capitalize on this enhanced demand both in India as well as globally.

GFCL EV Products Ltd’s vision is to evolve as a respected EV and Energy Storage components company. What is your strategy to achieve this vision? 

We aspire to establish ourselves globally as a reputable company specializing in EV and ESS components. Our strategic approach to realizing this vision involves becoming a leading material solutions provider to the burgeoning battery manufacturing sector in India, thus facilitating the widespread adoption of EVs and actively contributing to the reduction of carbon footprints.

To achieve this, we are committed to aligning our growth trajectory with market demands, while judiciously allocating resources, including capital investment, to support our expansion and innovation efforts.

The company recently announced an investment of Rs 6,000 crore over the next 4-5 years in EV and ESS battery solutions. Major chunk of the investment is earmarked to set up a battery chemicals factory in Gujarat. Could you please share details with us? 

In the preceding two financial years, our company has made considerable investments to increase our production capabilities across both intermediary and finished product categories in the lithium-ion battery materials sector. Notably, in the last quarter of the fiscal year 2024, we successfully commissioned two new plants dedicated to battery materials production.

Moving forward, our strategic direction entails aligning our growth trajectory with market demands. We intend to judiciously allocate capital expenditure (CAPEX) towards augmenting our manufacturing capacities to meet the evolving needs of the market. 

Can you also outline the company's manufacturing capabilities and capacity for battery chemicals?

Our core group strength and synergy are in manufacturing complex Fluorine & chemical derivatives such as Fluoropolymers and Fluoroelastomers. Within this niche, we proudly stand as one of the select global players, distinguishing ourselves as the sole Indian manufacturer with exports reaching mature markets.

Regarding our battery chemicals capacity, our existing infrastructure is poised to support approximately 5~6 GWh of battery production. This capability underscores our commitment to diversifying our portfolio while leveraging our core competencies to contribute meaningfully to the EV industry.

How are you going to differentiate your battery technology from other industry players?

We have implemented rigorous quality systems at every stage of production, ensuring that our solutions consistently meet the highest standards of battery grade purity, quality and reliability.

This expertise uniquely positions us to provide material solutions that prioritize both quality and cost-effectiveness. Whether catering to domestic or overseas markets, our commitment to excellence allows us to stand out among competitors, offering innovative solutions that address the evolving needs of our customers with precision and efficiency.

Can you provide an overview of the types of battery chemicals that GFCL EV Products aims to specialize in and their applications?

GFCL EV Products specializes in various segments of battery materials, each catering to specific applications within the electric vehicle and energy storage sectors.

In the cathode segment, we offer Lithium ferro phosphate (LFP). In the electrolyte segment, we are present in both the salt (LiPF6) and finished electrolytes. We intend to produce two key additives in the electrolyte segment and we offer PVDF/PTFE in the binder category.

By strategically focusing on these key segments, we ensure a comprehensive offering that meets the diverse needs of battery manufacturers, supporting the advancement and adoption of electric vehicles and energy storage solutions.

You have also announced setting up a cell performance testing lab to drive innovation in EV/ESS applications this year. Please share details with us? 

We are happy to announce the establishment of our Performance Testing Lab (PTL), scheduled for commissioning in the third quarter of this fiscal year. Equipped with state-of-the-art equipment, our PTL will facilitate comprehensive cell-level testing, encompassing both coin and pouch cells. Through this, we also aim to foster collaboration with our customers, enabling us to tailor material solutions to meet their specific cell requirements effectively.

How does the company ensure the sustainability and environmental friendliness of its EV and battery products?

Ensuring the sustainability and environmental friendliness of our EV and battery products is a paramount commitment for us. We were among the first companies in India to receive carbon credits issued by the United Nations Framework Convention on Climate Change (UNFCCC) in 2006, demonstrating our early dedication to environmental stewardship.

We adhere to various regulatory requirements, including Environmental, Social, and Governance (ESG) standards. Our compliance measures include:

• ISO 14001:2015 certification for Environment Management Systems, ensuring that our environmental impact is rigorously managed.

• ISO 9001:2015 certification for Quality Management Systems, guaranteeing the quality and reliability of our products.

• Responsible Care certification, underscoring our commitment to the safe and sustainable handling of chemicals.

• ISO 45001:2018 certification for Occupational Health & Safety Management Systems, prioritizing the well-being of our employees.

• SA-8000 certification for Social Accountability, emphasizing our commitment to ethical labor practices.

• ISO 26000 certification for Social Responsibility, ensuring that we operate ethically and contribute positively to society.

• ISO 20400 certification for Sustainable Procurement, affirming our dedication to environmentally and socially responsible sourcing practices.

By diligently adhering to these standards and certifications, we uphold our responsibility to the environment, society, and future generations.

With the increasing focus on sustainability, how do you see the future of electric mobility evolving, and where do GFCL EV Products fit into this future landscape?

We strongly believe that the future of electric mobility, both in India and globally, is very bright and promising. The transition from Internal Combustion Engine (ICE) vehicles to Electric Vehicles (EVs) is experiencing exponential growth, spanning both personal and mass transportation sectors within India.

Lithium-ion batteries (LiB) have emerged as the leading energy storage solution globally, powering the EV revolution, while alternative technologies like sodium-ion batteries are also advancing. In this landscape, GFCL EV Products is positioned to play a pivotal role by providing innovative material solutions that contribute to a cleaner and greener planet.

In your opinion, how crucial is EV battery recycling in mitigating the environmental impact of electric vehicles?  

Definitely, EV battery recycling plays a crucial role in mitigating the environmental impact of electric vehicles. In fact, this practice has gained significant traction worldwide, particularly in markets such as China, Japan, and Europe, where initiatives for EV battery recycling are already underway.

By recycling EV batteries and extracting precious metals such as Lithium, Cobalt, and Nickel, we can effectively reduce the environmental footprint associated with battery production and disposal.

What partnerships or collaborations has the company established to support its EV and battery initiatives?

The company has cultivated in-house capabilities in Fluorine chemistry over the past three decades.  With a combination of in-house R&D and partnership with external consultants, we enhance our expertise and bring innovative products and processes to fruition.

Moreover, we continuously seek partnership and collaboration opportunities that promise to strengthen our technology, quality standards, output, and overall solutions for our customers.

June 25, 2024

What are key trends impacting the Green Chemicals Space? How do you see Sustainability shape the Chemicals, Performance Chemicals and Pharmaceuticals Sector? 

The term ‘Green’ has a varied interpretation as used in various contexts by different stakeholders and companies over the years. The evolving parameters and clearer definition will continue to drive awareness, consumer choices, innovation, regulation, and policy as well as business strategy. 

There are various aspects of a product being green and the understanding as well as expectations from various stakeholders are also evolving. One important aspect which has been conventionally considered “green” is something that is manufactured from bio-based or renewable. Another aspect is how much toxic load is generated by the product and the resulting environmental impact that it creates. Given the increased focus and awareness on greenhouse gas emissions and the resultant climate change impact, carbon footprint has become another important aspect. It encompasses the complete emissions from cradle-to-grave including Scope 1, 2 and 3. Then, there are other aspects of sustainability such as land use and impact on land, food, and water.  

Whilst it would be ideal to meet all possible criteria, in reality, various products and processes will score differently on different criteria and the evaluation itself is complex. Therefore, for example, on one hand something may have a lower carbon footprint it may not have such a good score when some of the other dimensions are considered and vice versa. We will see the evolution of systems and standards for a rigorous evaluation of ‘Green’. I believe with the world being increasingly interconnected, huge data generation and processing and rapid evolution of digital technologies including AI and Quantum computing, we would be able to better assess, quantify and define. 

Today sustainability is no longer merely something good-to-do that only responsible companies focus much on. It is increasingly becoming a key strategic consideration for all. The sustainability challenge is indeed extremely serious and requires immediate attention at all levels. It is accordingly reflected in growing awareness and expectations from various stakeholders. The pressure of public opinion and stricter regulations are happening faster than expected in India. In some cases, the new standards are even tighter than other parts of the world.  

You may observe that an Industry that has a perception having an adverse environmental impact does not receive as much focus and policy support. It is, therefore, important the chemical industry works towards correcting that perception. I believe the chemical industry has a crucial role to play in helping the world address sustainability issues. This is not only in terms of addressing its own challenges but also by providing new products, processes and solutions to the world. That presents a huge opportunity for innovation and building great businesses which create knowledge based and offer sustainable models for India as well as the world. 

India has some great advantages that include diverse feedstock, huge market, affordable talent, lower project cost etc. Changing geo-political dynamics, thrust on Make in India, India’s push for green energy, green hydrogen, carbon capture technologies and a thriving startup ecosystem bode well.  

We will witness disruptive changes due the sustainability requirements as well as due to new technologies including digital. Ones who respond well will have great opportunities. Others will have an extremely high pressure to either transform or get acquired or else be out of business. 

Challenges for Bio-Based Chemicals 

The green chemical space has its own challenges. From our perspective, Ethanol is an important feedstock for chemicals but there is growing demand for blending. Since it got coupled with crude, it is no longer a cheaper feedstock. We have to compete with chemicals which are based on crude, but the cost of sourcing green material has increased due to a variety of reasons. That has posed a significant challenge. 

Meanwhile, sourcing of Ethanol is important. India’s Ethanol Blending Programme has some potential repercussions too. Currently sugarcane, molasses and rice are the major feedstocks. These crops are water thirsty and there is an overlap with the food chain. We are talking about corn and biomass as alternatives. Biomass will be an important feedstock but again it will compete with the energy sector and excessive use of biomass will pose another challenge because we will be taking out organic matter and nutrients from the soil. Moreover, some of the technologies / supply chains e.g. cellulosic and captured carbon are either new or yet to be established in terms of commercial viability. 

What is the big opportunity in Bio-based Specialties? Where does India Glycols fit into this ecosystem?   

I would like to speak more broadly on green chemicals of which bio-based specialties are a part of. One of the opportunities has been the fuel blending programme. This created an opportunity to produce Ethanol through various routes. In addition to molasses, the government also made available damaged grain as raw material. Ethanol, CNG and methanol would be interesting green feedstock in future to produce a whole range of hydrocarbons through alternate processes and technologies.  

India Glycols is unique in the world to produce ethylene, ethylene oxide and several derivatives like glycols, green solvents, and specialty chemicals that have a better environmental impact profile. This will drive the opportunities for bio-based chemicals. However, carbon capture materials, cellulosic materials will become potential feedstocks for green chemicals in future. 

Green materials can be classified into conventional and novel materials. The first one comprises conventional materials but made from greener feedstocks such as making PTA for polyesters using bio-based feedstocks like bio-based MEG. These materials have a lower carbon footprint but still have some of the issues like biodegradability and environmental impact like micro-plastic issues etc. 

The next big step will be novel materials which are not only made from greener feedstocks but have other greener attributes like biodegradability and lesser adverse impact on land, water, food chain etc. For example, some work is being done on polylactic based and other novel polymers. However, while polylactic acid-based materials offer better biodegradability, it does not have the same level of heat tolerance and tensile strength. Therefore, continued innovation for improving functional performance as well affordability will be an important driver.

In the times to come, apart from regulations, wider introduction of some forms of carbon tax and/or penalties on one hand as well as wider adoption of carbon trading will be an important driver for adoption of greener materials and processes. 

How has India Glycols performed during FY 2023-24 and what are the plans for FY 2024-25?  

 Due to Covid and other factors, the last 2 to 3 years were quite disruptive for several industries including India Glycols. Sharp increases in feedstock costs, energy costs and freight costs posed a challenge. Imported ethanol prices went up. Imported ethanol price went up from approximately Rs. 35 to Rs. 70 per litre landed at its peak. The price has seen a correction but are nowhere close to the earlier levels which had been stable by and large for many years prior to the period of sharp escalation. Secondly, many countries are looking at their own energy security due to the volatile situation in the Middle East and Russia – Ukraine issue. Thirdly, there are energy transition hiccups in many parts of the world as the energy prices went through the roof particularly in Europe thus affecting the entire energy ecosystem which also impacts the global ethanol prices. 

These factors posed a significant challenge in managing our prices and position our products against crude based products which even became cheaper on the other hand. Now, we have taken several actions. We invested in grain-based ethanol capacities. We now have a wider range of options to manage our cost base apart from importing ethanol. In addition, Biofuels presented an additional opportunity for sales as well. The situation however is dynamic, and we are able to choose various options based on best viability. 

We have three broad end use areas for our ethanol i.e. Chemicals, Biofuels and Potable Spirits. This has made the business more resilient in terms of back-end feedstocks as well as frontend usage areas.  

Our diversification into potable spirits has also helped to derisk the business and improve business performance. Last year i.e. FY 2023 the top line witnessed a slight decline, but it had seen a good improvement in the EBITDA of around 15%. The performance for 9M for FY 2024 has been much better with a revenue growth of ~ 17% and EBITDA growth of ~ 45%.  Overall, we expect a good year. 

We have been focusing on leveraging our strengths including our sustainability credentials, strong manufacturing footprint, strengths in product, process and application development and a strong relationship with good, reputed partners. 

With all these, we are also looking at new value-added chemicals. We have set up a new R&D Centre and expanded our manufacturing for a range of value-added chemicals like Oil Field Chemicals, Carbon Smart Materials, Green Solvents, Speciality Esters, Biopolymers and Amines etc. This is with the aim of improving the quality of the business as well as creating new areas for growth. 

What strategy should India adopt to become a global manufacturing hub for bio-based Specialties, Performance Chemicals, and Pharmaceuticals? What role does India Glycols see for itself in making India a global manufacturing hub? 

We need to transform our organizations towards having a culture of learning and innovation, high standards and excellence. We have come from a past where we would get a loan, licence, put up a factory, have some people and start production by getting technology from MNCs. Today licenses and capital are not the real constraint and it all about investing in great talent, excellence, and innovation. This is crucial to create a knowledge-based organization for driving innovation to meet unique and arising needs for the India as well as the world and deliver sustainable products. This will continue to be an important area for the Indian Speciality Chemicals Industry. 

We also need to strategize in a way that can address India's challenges, encash opportunities and leverage India’s advantages in terms of talent, raw material, feedstocks, and capital cost. Another area that needs attention is the availability of feedstock for base materials which are either not produced or not competitively produced. For the pharmaceutical and agrochemical industry, the majority of API (key starting materials) are still being imported from China. This is a concern as well as an opportunity. 

There is also a need to build a good manufacturing ecosystem. I have wondered why India has not created parks like Jurong Island, Singapore. If you look at it, India is in a much better position in almost every respect to create several manufacturing set ups like or better than Jurong and make them much more successful. India is better placed in many respects be it access to feedstocks, access to markets, quality of talent, cost of talent, cost of doing projects, availability of land, water and other resources. Yet many consider Jurong as a preferred manufacturing destination due to several factors. These include work culture, standards (EHS and Quality), and better facilitation by the government and better collaborative working by the industry. 

Another very important aspect is proactive risk management and the perception around managing the EHS risks. In my view, this is one of the reasons why the Chemical Industry does not get as much policy support as it should probably get.  

We must have a sharp focus on process safety and environmental risk management as well as compliances and governance. It is becoming increasingly critical from the view of stakeholders. These include society, regulators, consumers, NGOs, governments, and policy makers as well as investors. Without that we will not attract talent, get necessary policy support, or attract investments which are key for the industry to realize its true potential. It must not be seen as a cost but a very important investment for building great businesses. 

In the end, it is not about individual companies as much as it is about creating winning ecosystems. The electronics ecosystem of Japan or the automobile ecosystem of Germany or several others are good examples. Lastly, particularly, in today’s world it is about outstanding collaboration and creating reliable, trustworthy, and lasting partnerships. 

Initiatives taken by India Glycols for enhancing process safety across all facilities/processes to make operation intrinsically safe?   

Conventionally, safety was thought about as taking some extra care, following some procedures, and providing personal protective equipment etc. That is a very limited way of looking at safety. Process Safety is a very advanced science. It is about adopting leading edge practices, leading edge science, technology, design and most importantly a strong culture throughout the organisation.  

Process safety for example is about examining the impact of all layers together and quantifying the risk. It is a very rigorous approach which helps improve in a multiple dimensional way. With emerging technologies like digital and AI, this will advance even faster. Good companies will progress to convert their ability to manage Process Safety and Environmental risks into a distinct competitive advantage. It is also crucial to attract good talent which is at the heart of creating successful chemical companies. 

Similarly, we can expect the world to be far less tolerant of companies that continue to not address these risks. The expectations of stakeholders and regulations will continue to become more stringent. Even a few major incidents can have a detrimental impact not only on specific companies but the industry as a whole. I therefore consider investment in safety and environmental risk management not a cost but a long-term strategic imperative. 

How are Indian companies driving innovation? 

Driving innovation foremost is about creating a strong culture of learning and innovation. That needs time, investment, a strong belief, motivation and commitment. The fruits of this often-longer term but much larger and much longer lasting. You can beat one technology which another company may have acquired but you can’t beat a strong culture of innovation. It is not about doing it all along but building a strong culture of collaboration within and outside the organisation, a culture where people are given space to think, space to try and to learn from mistakes. It is about creating a fertile ground for sprouting of ideas, evaluation of ideas, weeding out and shortlisting of ideas and then executing them and scaling them up with perseverance. 

It is also about focusing on identifying problems or needs and creating value for customers, consumers and society. In the times to come sustainability will remain at the heart of innovation and it will drive the most innovation in the industry. We, as a country, are making progress, but we need to keep pushing as there is a lot more that needs to be done and eventually not only about catching up but getting ahead in an ever increasing competition in the world. 

June 25, 2024

Emerging trends/challenges in the agrochemicals industry in 2024?

In 2024, the agrochemicals industry, especially in India, is on the move as the fourth-largest producer globally and has an unrealized potential to grow further. We've already seen some significant shift in the Indian market, and it's gearing up for more changes ahead that'll shape the trends and throw challenges our way. 

In terms of challenges, regulatory changes continue to drive the industry, with increased scrutiny on pesticide residues, environmental impact, and product safety necessitating adaptation and innovation. 

Even the global supply chain disruptions, increased by factors such as trade tensions, geopolitical uncertainties, continue to impact the availability and pricing of raw materials and finished products.  

Now, with the emergence of pesticide-resistant weeds, pests, and diseases, it poses a significant challenge for both farmers and agrochemical companies. To address this issue, there is a growing attention on integrated pest management (IPM) strategies, and the development of novel chemistries with different modes of action, including the development of bio-based pesticides and precision application technologies.

Moreover, through the integration of AI, IoT, and data analytics, is reshaping the agri sector with precision agriculture initiatives. Addressing these trends and challenges requires agility, innovation, and collaboration to ensure sustainable and productive agriculture while meeting the needs of farmers, consumers, and the environment. 

What strategies should India adopt to become a global manufacturing hub for agrochemicals? What role does Corteva India see for itself in making India a global manufacturing hub? 

According to the World Trade Organisation (WTO) data, India’s agrochemical exports, valued at $5.5 billion, have surpassed the USA, which stands at $5.4 billion. The growth in India’s agrochemical industry has resulted in a worthwhile trade surplus of Rs 28,908 crore in FY 2022-23.

India's potential as a global manufacturing hub looks promising due to growth factors supported by government policies, demand, and innovation, focusing on research and development and capacity building under initiatives like Make in India or Atmanirbhar Abhiyan.

The industry has developed advanced manufacturing facilities to meet both domestic and global demands, reducing the need for agrochemical imports in the long run. However, to sustain exponential growth, supportive policies and regulatory reforms are crucial. These include streamlining approval processes, offering investment incentives, and ensuring compliance with international quality and safety standards.

At Corteva, we believe India plays a vital role in a robust global supply chain, leveraging its strong growth, scientific knowledge base, and skilled workforce. We're ramping up our R&D investment to maintain leadership in plant breeding and crop protection, focusing on proprietary and unique products for future growth. Corteva operates three production facilities and eight R&D centers, with the Multi-Crop Research Centre (MCRC) in Telangana as our flagship plant breeding facility and technology hub for Asia-Pacific. We're expanding our R&D presence, developing global supply chains, digital capabilities, manufacturing, and skill partnerships to support India's growth aspirations, contributing to the country's socio-economic progress.

Strategies adopted by the company for developing and characterizing hybrid seeds for farmers in India? How does it help them to select the right product to maximize productivity and profitability?

At Corteva, we employ extensive R&D efforts to identify and develop high-yielding and resilient crop varieties suited to the diverse agro-climatic conditions across different regions of India. This involves leveraging advanced breeding techniques, such as marker-assisted selection and genomic analysis, to accelerate the development of desirable traits like disease resistance, drought tolerance, and enhanced yield potential. 

Secondly, we conduct rigorous field trials and performance evaluations to assess the agronomic performance and adaptability of hybrid seeds under real-world farming conditions which helps us validate the performance of new hybrids across various soil types, climates, and cropping systems, ensuring that they meet the needs and preferences of local farmers. Furthermore, we actively engage with farmers and agricultural extension services to gather feedback on the performance in different farming contexts

This feedback loop enables our teams to continuously refine its breeding programs and seed development processes, incorporating farmer preferences and addressing specific agronomic challenges.

We at Corteva currently work closely with more than 5 million farmers, 19,000 retailers and 2,500 distributors across 15 million acres of cultivable land, train 75,000 Farmers Spokesperson and conduct field trials at over 1,000 location – to get the right product on the right acre to maximize their productivity and profitability. 

How is the company's Pioneer brand helping the Indian farmers to grow corn, rice, millet, and mustard sustainably? What are the key product offerings?

For the last 50 years, Corteva Pioneer seeds have been benefiting millions of farmers to maximize their productivity and profitability and are supporting Indian farmers across various crops like corn, rice, millet, and mustard.

For corn cultivation, Pioneer offers a range of hybrid seeds characterized by traits such as drought tolerance, pest resistance, and high yield potential. For millet cultivation, we provide seeds specifically developed to enhance yield, nutritional quality, and resilience to biotic and abiotic stresses. 

Last year, Corteva with ICRISAT and ICAR collaborated on research and have achieved a significant milestone by resequencing pearl millet genomes leading to the development of new molecular markers, opening the door to creating millet cultivars with exceptional yield performance and improved nutritional quality. In the mustard segment, the seeds are characterized by traits such as high oil content, uniformity, and disease resistance. These hybrid mustard varieties enable farmers to maximize their oilseed production, enhance oil quality, and improve their profitability while reducing dependency on imports and promoting self-sufficiency in edible oil production.

In the case of rice, seeds give superior yield potential, disease resistance, and adaptability to different soil and water conditions. These hybrid rice varieties help farmers increase their productivity while reducing input costs and minimizing the environmental footprint of rice cultivation, such as water usage and pesticide application.

For easier adoption of such sustainable innovations like Direct Seeded Rice (DSR), Corteva is at the forefront by providing technical grooming of agriculture entrepreneurship and leadership training to build confidence, financial literacy, and negotiation tactics for agri entrepreneurs through shared value projects.

Company has recently launched Salibro Nematicide in India. What are its unique features and expected outcomes? 

Salibro focuses specifically on controlling harmful root-knot nematodes while preserving beneficial insects and soil health, minimizing its environmental impact. Its targeted and environmentally friendly nature sets it apart from broad-spectrum alternatives. Also, the product boasts a novel mode of action, making it effective against nematodes that may have developed resistance to older products

Moreover, Salibro plays a crucial role in protecting plant root systems, promoting the development of healthy roots that enhance water and nutrient uptake. This results in improved crop yields and quality, directly benefiting farmers.

For Indian farmers, Salibro promises reduced crop losses by effectively controlling nematodes, thereby safeguarding crop health and minimizing yield losses caused by these pests. Additionally, Salibro aligns well with sustainable farming practices, emphasizing targeted control and minimal environmental impact. 

Company's approach with respect to R&D for new technologies and products. How will it shape the future roadmap of the company keeping sustainability and net carbon zero in picture?

Corteva is strategically advancing its R&D efforts to drive innovation and sustainability within the agricultural sector while keeping sustainability and net carbon zero goals at the forefront. With an increasing R&D investment, we maintain leadership in core areas of plant breeding and crop protection, leveraging proprietary and differentiated products while investing for future growth.

With our 2 manufacturing production facilities, and 8 R&D centers in India, we are expanding R&D footprint to build world-class research bases, supply chains, digital capabilities, and manufacturing and supply chain capabilities. 

As part of its 3D Reform Agenda, Corteva supports crop protection registration regulatory reforms, advocating for a predictable, science-based regime to expedite the introduction of new age molecules to farmers. Corteva's leadership in CRISPR gene editing for agricultural products, particularly in row crops like corn, soybeans, sorghum, and canola, underscores its commitment to sustainable innovation with 100% of Corteva's current seeds pipeline meets sustainability criteria, with a commitment that all newly developed solutions will meet sustainability criteria tied to UN Sustainable Development Goals by 2025.

With sustainability at the core of our business, we recognize making it central to every aspect of its operations, from Discovery to Launch. Through climate-positive solutions like Direct Seeded Rice practices, Corteva is not only enhancing farmer profitability but also contributing to water conservation, soil health improvement, and reduced greenhouse gas emissions.  

How has the company adapted to changing market conditions and evolving consumer preferences?

As market dynamics shift and consumer preferences evolve, Corteva has consistently innovated its product portfolio to meet emerging needs. Corteva has invested in digital agriculture tools, precision farming technologies, and biological solutions that align with consumer demands. By incorporating these innovations into our product offerings, we ensure that farmers have access to cutting-edge solutions that enhance productivity while minimizing environmental impact.  

Looking ahead, Corteva's future product roadmap is likely to focus on continued emphasis on sustainability and environmental stewardship, with an increased focus on developing products that support regenerative agriculture practices, enhance soil health, and reduce greenhouse gas emissions. Additionally, we are looking at investing further in digital agriculture solutions, leveraging data analytics, AI, and IoT technologies to optimize farm management practices. Furthermore, we may expand our portfolio of biological solutions, biopesticides, and bio-based inputs. Advancements in gene editing technologies, such as CRISPR, will enable us to develop crops with improved traits and characteristics, further enhancing productivity and resilience in the face of changing climatic conditions.

How are you planning to leverage digital technologies to optimize your processes and better your overall operational capacities?     

Over the years, the Corteva Global Services Center (CGSC) has evolved into a vital support hub, playing a pivotal role in our organization's transformation journey. CGSC serves as an extension of our line organization, supporting critical processes with a significant business impact. Many employees within the GCC hold significant roles such as Country Controller and Global Process Owners, responsible not only for service delivery but also for defining processes and policies within their respective areas. Technology plays a pivotal role in maximizing efficiency and driving value for our finance and tax functions. 

CGSC is deeply involved in Corteva's digital adoption and transformation journey. We have already automated transactional and repetitive processes, as well as certain client interaction processes, using technologies like workflows and chatbots. Looking ahead, we aim to further digitize and automate standardized processes to deliver greater business value. Our success is measured not just in terms of cost and speed, but also in terms of the business impact we make, end-to-end ownership of our work, and the level of partnership we have with global functional and business teams.

Overview of the company's sustainability initiatives and how do you plan to reduce your environmental impact while still delivering value to customers and shareholders?

Corteva’s sustainability efforts are guided by four key goals: Sustainable Innovation, Biodiversity, Greenhouse Gas Emissions, and Inclusion, Diversity & Equity (ID&E). By 2025, every new product we develop will meet or surpass sustainability criteria tied to UN Sustainable Development Goals. We aim to ensure that each product not only meets baseline sustainability requirements but also delivers notable sustainability advantages across its lifecycle, compared to existing products. 

We recognize that sustainability is not just a moral imperative but also a business imperative. By proactively addressing environmental challenges, we mitigate risks, enhance operational efficiency, and unlock new growth opportunities. Ultimately, our sustainability initiatives are not only about reducing our environmental impact but also about creating shared value for all stakeholders, including customers, shareholders, and society at large.

New areas which are opening up for seed & crop protection companies and what's the role that you foresee for your company?  

Seed and crop protection companies are venturing into new areas to address evolving challenges. These include sustainable agriculture, where there's a growing emphasis on environmentally responsible practices and products. Additionally, digital agriculture is transforming industry, biologicals and biotechnology are also gaining traction, offering safer and more sustainable alternatives to traditional pesticides and fertilizers. Companies are focusing on developing crops and solutions that can withstand changing environmental conditions. 

With this in mind, Corteva is leveraging its extensive R&D capabilities, global presence, and strong partnerships. By delivering solutions that address these emerging areas, Corteva will continue to provide value to farmers, consumers, and the environment while fostering sustainable growth and innovation in the agricultural industry.

Major CSR initiatives planned by the company in 2024? 

Corteva’s multi stakeholder partnership with Water Resource Group is implemented in Uttar Pradesh to convert 40,000-acres of rice farmland towards DSR in 3 years. This will result in a 30% reduction in water utilization, GHG emissions and labor requirement making rice farming sustainable and higher ROI for rice farmers. 

Our flagship initiative – AcreNext makes rice farming sustainable without exerting pressure on climate & resources. We work with primarily smallholder farmers growing rice in Punjab, Haryana, MP, Bihar & Jharkhand with focus on reducing water, fuel suage, GHG emissions, manual drudgery while improving soil health, resulting in ~10% increase in income.

 Corteva Agriscience Scholarship Program is an initiative of Corteva Agriscience India Pvt. Ltd. that aims to provide financial assistance to meritorious students to pursue post-graduation or doctoral courses in the area of Agriculture. Under this scholarship program, female students pursuing studies in any year of post-graduation or PhD programs in streams such as Home Science, Biotechnology, Entomology, Breeding, etc. will be awarded with a scholarship amount of Rs. 50,000 to cover their academic expenses.160 meritorious female students awarded scholarship. Out of the 80% were from farming families and 78% had family income less than Rs. 1 lakh per annum.

June 24, 2024

Ion Exchange (India) Ltd. has completed 60 years of operations. How has the journey been so far? 

Ion Exchange completed 60 years of incorporation on March 6, 2024. We are pioneers of water treatment in India and over the years, have developed innovative solutions to address water-related challenges, contributing significantly to the industry's growth and development. 

Through our 60 years’ journey, we have also expanded our reach and product offerings to newer markets while serving every sector. We entered new markets with concepts like desalination, recycling, zero liquid discharge and affordable solutions for rural water treatment. Thus, we have created impressive global water references for total water and environment management solutions for industries, homes and communities.

Throughout our 60-year journey, Ion Exchange has continually invested in research and development to stay at the forefront of technological advancements in water treatment. This includes development of new products, processes and solutions to meet evolving customer needs and regulatory requirements. 

In 1976, Ion Exchange set up the first international plant in Malaysia. Since then, we have continued to successfully execute large number of projects globally meeting the exacting needs of our international customers. Last year, Ion Exchange acquired Portugal based company MAPRIL for penetrating the European market as part of our sustainable growth strategy.

Exports now account to 30% of our sales.  For nearly three decades, we have built a favourable position as a reliable exporter of quality Ion Exchange resins, water treatment plants, chemicals and services. 

Over the past decade, we have added many milestones to our legacy. Notably, our consolidated revenue crossed the milestone of Rs. 2,000 crore in FY 2022-23. We continued to invest in EESG practices as fundamental building blocks for our sustainable growth. We have committed ourselves to 14 of the 17 Sustainable development Goals and are on track to achieve new zero target by 2023.

We have also strengthened our CSR program aimed at addressing water scarcity, promoting water conservation and supporting community development initiatives.

As a six-decade old company operating in volatile, uncertain environments, we have faced challenges while we maintained our leadership position. Successfully navigating these challenges has been the key attribute to our long-term success.

How has the overall performance been for Ion Exchange (India) Ltd. in 2023 -24 and what is the expectation from 2024-25?

For 9 months of FY 2023-24, on a consolidated basis, our operating income increased 8% YoY. Profit after tax increased 8% on a YoY basis. We expect this trend to continue in subsequent years while treading with caution against global geo political, economic headwinds. However, considering good backlog of orders and increasing awareness on water security, we predict our growth in 2024-25 and the foreseeable future to be good. 

What are the key factors that have contributed to Ion Exchange India's success and growth in the industry?

As trailblazers in the water and environment management sector, we continuously seek innovative solutions, whether originating from our internal research or global strategic partnerships with experts. 

Amidst escalating competition, our strategy remains resolute: embracing innovation to enhance our performance. This ensures our ability to expertly address evolving customer needs. By consistently integrating new technologies, we not only maintain relevance but also lead as a premier global provider of water treatment solutions. We have honed expertise in delivering tailored water solutions for homes, communities, industries and institutions alike.

In addition, Ion Exchange has continued to diversify its offerings beyond traditional water treatment solutions. This includes the development of engineered products and process solutions for separation, purification, concentration and recovery using advance ion exchange resins, adsorbents and membrane technologies. 

What are the key revenue growth drivers for the company and how are you planning to grow your business in the coming years?

Some of our key growth drivers are:

* Expansion into New Markets: Expanding into new geographic markets and industries increases the company's customer base and revenue streams.

* Strategic, sustained investments in manufacturing - capacity building to meet growing market demands for our products, solutions and services.

* Focus on Sustainability: Offering sustainable and eco-friendly solutions aligns with increasing customer demand for environmentally responsible products and services, driving revenue growth

*  Digital Transformation: Our IonSite digital solutions leverage digital technologies and data analytics to monitor real time performance of water assets, enhance operational efficiencies and ensure continuity of operations without unplanned breakdowns. 

How do you optimize capacity utilization of your plants? What steps do you take to minimize downtime and ensure that the facilities are operating efficiently?

Ion Exchange optimizes capacity utilization of not only plants within our fence but also at our customer’s site through our digital 24X7 services to ensure that facilities operate efficiently with minimal downtime.  

*  Predictive Maintenance: Implementing predictive maintenance techniques allows us to detect potential equipment failures before they occur. This minimizes unplanned downtime and maximizes equipment uptime.

*   Scheduled Maintenance: Developing comprehensive maintenance schedules helps ensure regular maintenance tasks are performed at optimal intervals, reducing the risk of unexpected breakdowns.

*  AI-based Continuous Monitoring: IonSite Digital Twin is a cloud based solution that leverages Artificial Intelligence (AI) and wastewater modeling technology to predict and avoid water quality issues, identify cost savings and provide real-time performance advice. This allows for early detection of abnormalities and proactive intervention to prevent issues from escalating.

* Training and Skill Development: Providing ongoing training and skill development programs for plant operators and maintenance personnel ensures they have the necessary knowledge and skills to operate equipment efficiently and troubleshoot issues effectively.

* Process Optimization: Continuously monitoring and analyzing process performance data allows for identification of opportunities for process optimization and efficiency improvements, leading to increased throughput and capacity utilization. 

With increasing concerns about water scarcity and pollution, how does Ion Exchange (India) address these challenges and provide sustainable solutions?

Ion Exchange’s strongest asset is its unique capability to provide 360° sustainable solutions for water & waste water treatment across industries, institutions, homes and communities - both urban & rural, to customers globally for six decades.

Ion Exchange has contributed in shaping the water industry’s response by providing the most innovative, cost-effective and sustainable solutions for water and waste water management. And we shall continue to channel all our strengths and efforts into doing this. I see Ion Exchange playing a dominant role particularly in bringing cost-effective, user-friendly solutions for waste water treatment and reuse, introducing technologies that require less energy & less use of chemicals.

The impressive countrywide and global infrastructure Ion Exchange has built - seven manufacturing facilities across the country, an assembly centre in Hamriyah Free Trade zone, Sharjah, UAE and a chemical blending unit in Bahrain, warehouse & assembly centre in Indonesia , the new acquisition in Portugal and sales and branch offices both in India and overseas backed a strong network of dealers and stockists have enabled our customers and prospects to benefit by our innovative, quality offerings to meet their ever increasing demand for water and meeting their sustainability goals. 

Supported by an extensive 24X7 Digital Service infrastructure, we are well placed to meet challenges faced due to scarce water availability, stringent discharge norms, increasing costs and demands for this limited and scarce resource - viz water. 

How does Ion Exchange (India) Ltd. differentiate itself from its competitors in terms of product offerings, customer service, and overall value proposition?

Ion Exchange (India) Ltd. distinguishes itself from competitors through several key factors in its product offerings, customer service and overall value proposition:

* Innovative Solutions: Ion Exchange is known for its continuous innovation in developing cutting-edge water treatment solutions. We invest significantly in research and development to introduce new products and technologies that address evolving customer needs and regulatory requirements.

* Customization: Ion Exchange offers customized solutions tailored to the specific requirements of each customer. By understanding the unique challenges faced by different industries and applications, we deliver solutions that optimize performance and efficiency.

* Comprehensive Product Portfolio: Ion Exchange provides a comprehensive portfolio of water treatment products and services, including ion exchange resins, membranes, specialty chemicals and engineering solutions. This breadth of offerings allows customers to source all their water treatment needs from a single, trusted provider.

*  Quality and Reliability:. We adhere to stringent quality control measures throughout the manufacturing process to ensure consistent performance and customer satisfaction.

* Technical Expertise: We boast a team of highly skilled engineers, scientists and technical experts who provide comprehensive support to customers. From system design and installation to troubleshooting and maintenance, we offer unparalleled technical expertise and assistance.

* Digital 24X7 Service: We are committed to providing exceptional after-sales service and support. We offer maintenance contracts, spare parts availability and prompt response to customer inquiries and service requests, ensuring minimal downtime and maximum uptime for customers' systems.

Could you elaborate on some of the major projects or partnerships that Ion Exchange (India) has undertaken, highlighting the impact created?

Our acquisition of Portugal based company MAPRIL last year has strengthened penetration into the European market in line with our sustainable growth strategy. 

We have witnessed a steady order flow, both in the domestic and international market for engineering, chemicals & services. This includes a 40 MLD Seawater Desalination project for a leading EPC company in North Africa followed by repeat orders for even larger capacities following the timely and quality completion of contract within stringent time lines for the 40 MLD Sea Water Desalination Project. We also received EPC contracts for Desalination and Complex Waste treatment from one of India’s largest offshore oil exploration unit.

Other significant orders include a complete Zero Liquid Discharge plant and a turnkey contract for capacity expansion at Indian Oil Corporation, Panipat Refinery. 

We have also received several EPC contracts for Water Treatment Recycle and Complete Zero Liquid Discharge plants from leading companies in paint, food & beverages, steel, textiles, to name a few.

As a leader in the industry, how important is environmental sustainability for Ion Exchange (India) Ltd., and how do you ensure it is incorporated into all aspects of your operations?

The key aspects of Ion Exchange’s sustainability strategy are based on the purpose of our business i.e. to conserve the planet’s most precious resources through total water and environment management solutions. 

Our factories make all efforts to reduce the water footprint by efficient water usage in non-product applications such as cleaning activities, gardening, and for domestic purposes Certification under ISO 14001 ensures system adherence to environment protection guidelines and periodic reporting of compliance to senior management. Emissions generated are within the permissible limits given by CPCB. 

An example is the green manufacturing practice followed at our resins manufacturing plant at Ankleshwar.  This is the largest resins manufacturing unit in India.  Ankleshwar being an industrial area having a cluster of chemical units with inadequate treatment of chemical waste generated by them; the water table and natural water source is heavily polluted. Our facility has an effluent treatment system treating waste streams to acceptable levels for discharge. Our commitment to recover water from the effluent and reduce the load on the environment led us to initiate a first-of–its–kind project to extend the treatment of effluents by a series of state-of-the-art and sophisticated membrane systems.  

Ion Exchange has an extensive protocol/ mechanism to test our products for their impact on the customers and the environment. Measuring, monitoring and improving impact across the lifecycle of products and operations will continue to be another key factor of the strategy to achieve our goal to create a positive impact on nature and people’s lives and transform Ion Exchange into a water positive operation.

Besides this, an important part of our sustainability strategy is to ensure the well-being of our employees as well as the communities whom we serve.  

What are the future growth strategies and areas of focus for Ion Exchange (India) in the coming years?

Ion Exchange (India) will continue investment in research and development to drive innovation and develop new products and solutions that address emerging market needs and technological advancements. Expanding into new geographic markets and industries through market diversification and international expansion will continue to be important for us. Leveraging digital technologies and data analytics, will result in improving decision-making, enhance operational efficiency and deliver value-added services to customers. 

We will continue to increase focus on sustainability initiatives, including offering eco-friendly products and solutions, promoting water conservation and supporting environmental stewardship through corporate social responsibility programs. 

Finally, investing in talent development and skill enhancement programs are key for us to ensure the company has the necessary expertise and capabilities to drive innovation, deliver exceptional service, and execute growth strategies effectively.

June 21, 2024

2024 Industry trends/challenges in Advance Intermediates, Phenol and Acetone? 

2024 is a year where 90% of the democratic world goes into elections, which generally result in a vote focused and short-term bias. It is also fraught with geo-political volatility and for agrochemicals, an El Nino year adds additional uncertainties. Despite these uncertainties, we see several signs of recovery, and India continues to stand out in its business optimism. We, though, must be vigilant of possibilities of increased chemical dumping from our large neighbour to maintain the sector’s agility and resilience for powering India’s trillion-dollar dream. 

How has Deepak Nitrite performed during FY 2023-24 and what's your forecast for FY 2024-25? 

Deepak is working toward a well-articulated goal for the next four years. Its current business and new investments will result in compounded growth opportunities for the entire chemical manufacturing landscape of related and downstream products in the chemical and material science applications landscape. 

Capex invested in FY 2023-24 and projects where it was invested? Capex investment for FY 2024-25 and projects where you are planning to invest? 

Deepak's considerable investment plans are in line with its 'Right to Win' framework which includes upstream, downstream and sunrise segments. It has also invested into sustainability initiatives which will result in value accretion from FY25 onwards. In FY 2023-24, Deepak Chem Tech Limited (DCTL) has inked MoU worth Rs. 14,000 crores with the Government of Gujarat for manufacturing Polycarbonate, Methyl Methacrylate (MMA)/Poly Methyl Methacrylate (PMMA) Resins & Compounds.  

When are you planning to manufacture these products and Capex investment that you are planning to make and for what time duration? 

The capital investment plan announced assumes stagewise commissioning for multiple projects over the next 3-4 years. The company has already taken steps to become not just a manufacturer of the chemical intermediates, but an approved partner that supplies 'Fit for Effect' compounds and formulations to marque end customers. 

Deepak Nitrite has signed a term sheet with Petronet LNG to offtake 250 KTPA of Propylene and 11 KTPA of Hydrogen for 15 years. How will this help Deepak Nitrite in the long run?  

The term sheet with suppliers allows Deepak Nitrite to derisk its investments and reduce its dependency on multi-modal transport of hazardous raw materials. It is pertinent to note that the mission for Petronet LNG is well aligned with Deepak's in building a resilient chemical ecosystem for India's growth story. 

What strategy should India adopt to become a global manufacturing hub for Advance Intermediates, Phenol and Acetone products? What role does Deepak Nitrite see for itself in making India a global manufacturing hub? 

The world sees India as a ‘China +1’ destination for manufacturing. Deepak Nitrite acknowledges the strong possibilities and demand for chemicals in India itself, to make it a dynamic and sought after destination in itself. So, we should strive to Make India as ‘The One’, the right destination for manufacturing. To realise this, policies need to formulate and invest in key infrastructure development be it road connectivity, ports, SEZ and integrated chemical hubs.  

Proactive policy support and procedural clearance will help in cutting the red-tape and pave the way for development and give confidence to MNCs to set bases in India. ‘Skill-Developed India’ will be a backbone to sector development. Government and company supported R&D, training and learning centres will up-skill youth to be industry-ready and be ready for jobs of tomorrow.  

Construction work of Photo Halogenation and Fluorination has made significant progress. When do we see commissioning of this plant? 

We have announced commissioning. Presently, ramp up ongoing in a safe and phase-wise manner. 

Other expansion projects including MIBK, MIBC, and hydrogenation among others are taking shape and will be commissioned as per plan. What's the update on this front? 

Projects will be commissioned in various quarters of the current financial year. 

Initiatives taken by Deepak Group for enhancing process safety across all facilities/processes to make operation intrinsically safe?

Deepak cares for people and the planet. Our processes are guided by steadfast adherence and compliance to safety. Our operations at plants have received ISO certifications. Deepak Nitrite is one of only 40 companies certified to use ‘Responsible Care’. Safety and quality go hand in hand and at our units, we have adopted 5s and six sigma practices to ensure productivity backed with safety. This year, Deepak Nitrite Limited received “Score ‘B’ which is in the management band, signifying our transparency and innovativeness in creating safety culture in the company. 

What is the update on Deepak Research & Development Centre? When are you planning to make it operational and how will it help Deepak Nitrite in the long run? 

Our R&D facility is crucial to our success with its ability to develop advanced intermediates which requires complex chemistry and engineering. Its state-of-the-art pilot facility acts as a bridge between R&D trials and commercial production, allowing us to deliver quality products seamlessly. We are targeting this financial year or very early in the next financial year. 

What is the sustainability roadmap of Deepak Nitrite? What's the sustainability plan for Deepak Nitrite in FY 2024-25? 

Deepak Nitrite will publish its first Sustainable Report in 2024. Guided by the philosophy of Responsible Chemistry, we use new technology to capture new products from downstream, as well as frugal and judicious use of water and steam to reduce dependence on natural water sources. In 2023, we recycled over 420,000 KL water and planted 55,000 trees. We operate the lowest thermal footprint phenol plant in the world. 

Key CSR initiatives of Deepak Nitrite in FY 2023-24? Plans for FY 2024-25?

Deepak Medical Foundation has conducted over 115,500 diagnostic tests and 20,200 patients in rural communities along with health and medical camps and mobile-health units to serve 129,750 OPD cases. 

Project Vivek Vidya offers story books, learning material to over 8,000 across three states covering underprivileged children.  

Project Neem Satva offers silk development and economic empowerment to women in rural communities, helping the Self Help Groups to create livelihood opportunities by making and selling soap, sanitizer and hand wash. Education and skill development for over 150 Divyang children at the Gujarat State run Samaj Suraksha Sankul in Vadodara.  

Project Sangath community-based intervention aimed at increasing convergence of eligible households under government schemes and social safety net programmes, benefitting over 85,000 families.  

June 20, 2024

Epsilon Carbon and Epsilon Advanced Materials are on an aggressive expansion spree. What is the project wise total Capex planned for both entities till date? 

Currently Epsilon carbon is under capital expenditure cycle, focusing on both greenfield expansion in Orissa and brownfield carbon black expansion. We are targeting a capex of Rs. 2,000 crore over the next two years to build out these capacities. Moreover, Epsilon's strategic vision extends beyond domestic expansions. We're venturing into advanced materials, with plans to establish multiple graphite anode facilities, commencing with operations in India and the US. In the next three years, our investment commitment stands at close to Rs. 8,000 crore in developing facilities in both regions India and the US.

Last year Epsilon announced a US $650 million battery component and anode plant in the USA. What factors promoted you to set up the plant there considering you are a strong advocate of local manufacturing? What is the latest development on this facility? 

We prioritize local manufacturing and customization for diverse/various clientele. Hence, we selected North Carolina’s Brunswick County site for setting up a manufacturing facility in the US. Brunswick county is one of the fastest growing counties in the NC with developed infrastructure, skilled workforce and welcoming environment for business.

Presently, there is a promising opportunity with prominent/larger US-based customers seeking to establish large-scale giga factories. Consequently, our focus is on establishing a facility in India initially, tailored to their needs, followed by the establishment of a plant in the US, particularly in North Carolina, to cater directly to US customers while ensuring compliance with IRA regulations. Currently, our US facility is in the permitting phase, with advanced engineering stages underway. We aim to commence construction early next year and complete the facility within the next 18 months. 

Epsilon Carbon plans to establish Rs. 9,000 crore graphite anode facility in Karnataka. Please elaborate? 

Epsilon Carbon announced this investment of Rs. 9,000 crore in Karnataka last year. The aim is to build a 100,000 ton per year graphite anode facility to cater to both Indian and global customers. This facility will produce synthetic graphite at some of the lowest carbon footprint in the world at about 80% lower than what is produced in China today. Our first phase will be to start off with a 30,000 ton facility and we'll have about a Rs. 3,500 crore investment to build that plant.

Epsilon Carbon also plans to set up a Rs. 10,000 crore Integrated Carbon Complex in Odisha. What will be its salient features, manufacturing capacity, and completion date of this project? 

Epsilon Carbon plans to replicate the integrated carbon complex that has been built in Karnataka over the last 10 years, where we have different businesses of specialty carbon, carbon black, and our advanced materials as well. We are working on the investment to set up a 300,000 ton state-of-the-art coal tar Distillation Plant with downstream units to produce specialty chemicals that are today not manufactured in India. We hope to replace imports with our production capacity there. This plant will cater to local aluminium smelter demand and also export to the Middle East. Our goal is then to continue the journey of setting up a carbon-black plant and advanced materials plant to create this, to become one of the World's largest integrated carbon complexes.

The company has announced an investment of Rs. 1,200 crore in polymetallic nodule plant. What is the current status? 

We've recently signed a Memorandum of Understanding (MOU) with the metals, the metals company to develop this onshore nodular processing facility. Currently, the metals company is waiting for the offshore permit in the US from the EPA. So, we continue to study this project but not much development is happening over here.

What is the big opportunity in the battery industry? Where does Epsilon fit into the battery ecosystem?

Today India relies heavily on imported battery materials.  In 2018, we imported around US$ 1.23 billion worth of lithium-ion batteries, which accounted for more than half of the country's demand. To address this, the Indian government launched the Production Linked Incentive (PLI) scheme for the Advanced Chemistry Cell (ACC) battery to boost domestic manufacturing. This scheme reduced dependencies on imported battery materials and accelerated the rate of innovation within the country. This had a significant impact on the country's battery material industry, which was valued at US$ 1.66 billion in 2020 and is projected to reach US$ 4.85 billion by 2027, registering an impressive CAGR of 17.23 per cent during the forecast period of 2022-2027.

This unprecedented growth was amplified due to India’s strong manufacturing ecosystem, in innovation and a large pool of technical and engineering talent. The industry has gained significant momentum in recent years and has put us in a position of strategic importance in the global battery materials market. 

The magnitude of demand for batteries is high, with the number of GWh (Gigawatt Hours) required increasing from about 700 GWh in 2022 to around 4.7 TWh (Terrawatt Hours) by 2030. Additionally, there are looming concerns about supplies of key battery materials like cobalt and lithium that are pushing the search for alternatives to the standard lithium-ion chemistry. 

This is where India has a major advantage as a leader in the chemical industry to address this challenge. The chemical industry is a crucial contributor to the battery material supply chain, providing essential raw materials to produce batteries.

In 2019, the Indian chemicals industry stood at US$ 178 billion and is anticipated to reach US$304 billion by 2025, registering a CAGR of 9.3%. It is one of the fastest growing sectors in India and is currently the 10th largest chemical trade partner for the US which is estimated to scale up to 7th by 2030. Herein, lies an opportunity for India’s booming chemical industry to take lead and convert minerals into battery materials and reduce the dependence on China.

China has really focused and dominated on developing this material processing industry while minerals continue to be mined in Canada, Australia, and Africa. But the processing industry of both anode and cathode is located in China and this is what we as Epsilon think we can build in India and globally also with our mature technology that we have developed over the last five years. So, we see ourselves being a battery materials company to support energy transition and contribute both to Indian companies and global companies. 

What strategy should India adopt to become a global manufacturing hub for Battery Chemicals and products? And, what role does Epsilon Group see for itself in making India a global manufacturing hub? 

The challenge in battery chemicals today lies in the necessity of achieving a certain scale when constructing these facilities. Currently, India is an emerging market in terms of self-production. Many companies, such as Reliance, Amaraja, and JSW, are investing in manufacturing facilities, but they require time to reach optimal scale. Our industry also needs to match this scale. So, we see an advantage of building these facilities in India to cater to larger facilities that are being built in the U.S. 

As India expands its scale, we are prepared with a cost-efficient, well-established company capable of meeting both global and domestic demand. Our aim is to localize our operations entirely in India and to support PLI winners and other companies in establishing a robust supply chain to meet India's energy transition requirements.

What are the challenges faced by the battery industry in terms of sustainability and recycling? Role of Epsilon in this direction?  

It is very important to understand the process of battery material production, particularly when transitioning from battery minerals to active materials like anodes or cathodes. At Epsilon, we prioritize sustainability by utilizing 90% renewable power and implementing zero discharge facilities. Moreover, we focus on maximizing value through the utilization of byproducts generated during the battery material manufacturing process. This approach not only enhances our cost competitiveness on a global scale but also facilitates the production of more sustainable materials. 

Epsilon firmly believes in the future of a circular industry. We also are into lithium-ion battery recycling, and we anticipate significant growth in this sector within the next three to four years, once our virgin anode and cathode businesses have expanded. By integrating recycling processes into our operations, we aim to create a truly circular business model. This involves reclaiming materials from end-of-life batteries and production scrap, reprocessing anode and cathode materials, and reincorporating them alongside our virgin materials. Today globally this is a necessity, and Epsilon is proud to be at the forefront of advancing this technology and promoting circularity.

Some of the major challenges we face in India for recycling in battery industry are as follows:-

• Lack of organised collection of battery waste

• Lack of education and awareness amongst the population in comprehending the criticality of the minerals found in lithium-ion batteries

• Absence of defined processes or guidelines for lithium- ion battery recycling, 

• Unscrupulous recyclers misusing the system for monetary gain with no accountability

• Dearth of lithium- ion batteries found in the country 

• Exhausting process to import batteries from abroad

Epsilon's performance in FY 2023-24 and what's your expectation from FY 2024-25? 

The company continues its growth. We clocked in at about a Rs. 3,000 crore top line last year. As I mentioned earlier, we are in a large CAPEX cycle this year and anticipate surpassing Rs. 6,000 crore in revenue after the completion of our CAPEX cycle at Epsilon Carbon. At Epsilon Advanced Materials, we have set a short-term goal of reaching a turnover of approximately US$ 700 to 800 million within the next three years as we expand these large facilities.

Epsilon became the first Indian company to export liquid coal tar pitch. How do you see the growth opportunity in the global coal tar pitch market and what is your strategy to tap this?

We believe that India has a huge opportunity to cater to global demands when it comes to these various products, especially coal tar pitch. Coal tar itself is a diminishing commodity in Europe, Japan, and the US. As coal tar production increases in India, we see the opportunity to cater to the Middle East. Currently, the Middle East imports approximately 500,000 tons of coal tar pitch annually and is actively seeking supply chain changes. India is viewed as a potential great supplier in this regard. This is where Epsilon has made investments in its own liquid pitch tanks in Mangalore, becoming the first company in India to export liquid coal tar pitch and support Middle Eastern companies.

Epsilon Carbon aims to become a global leader in carbon products. What strategies would you employ to achieve this goal?

We entered into the carbon black business approximately three years ago. We have been running at 100% capacity and due to the demand from customers, we decided to expand our capacity by adding another 100,000 tons.

In the next six months, we should become a 215,000 ton a year carbon black plant, positioning us as the third-largest capacity provider in India. With our expanded capacity and diverse product range, we are well-equipped to meet the demands of the local Indian tyre market and fulfil a substantial portion of the export market's need for high-quality carbon black. 

Currently, we estimate that our carbon footprint is approximately 20% lower than that of carbon black produced by other Indian manufacturers.

How would you approach the pricing and marketing strategies for Epsilon Carbon's products in order to remain competitive in the market?

As we navigate the competitive landscape for Epsilon Carbon's products, it's imperative to devise robust pricing and marketing strategies to maintain our edge in the market. Here are some additional thoughts and considerations:

Integration of Sustainability: Given the increasing emphasis on sustainability in the market, we ensure our pricing and marketing strategies reflect Epsilon Carbon's commitment to environmental responsibility. 

Data-Driven Decision Making: We analyze our sales data, customer feedback, and market trends to identify opportunities for optimization and refine our strategies for maximum impact.

Brand Building: Investing in building the Epsilon Carbon brand as a symbol of quality, innovation, and reliability. Consistent branding across all touchpoints, including packaging, advertising, and online presence, is reinforcing our positioning in the market and enhancing brand recall among customers.

Epsilon has recently secured Rs. 100 crore sustainability-linked funding. How do you incorporate sustainability and green elements in your project? 

In addition to our circular approach to managing utilities and by-products and sharing them among our specialty carbon, carbon black, and advanced materials businesses, we have outlined a roadmap for the next two to five years to enhance our ESG ratings. Internally, we benchmark all utilities, seeking ways to reduce power and water consumption, improve product yields, and secure sustainability-linked funding. This funding supports our additional capital expenditure and the deployment of necessary technologies to achieve these improvements. We aim to become a leading sustainable company globally, particularly in the production of various carbon products.

June 18, 2024

What are the key trends/challenges facing the Chlor-Alkali industry in 2024 in India?   

It is the usual commodity cycle affecting the larger Chlor-Alkali industry today. The good thing is that it was an anticipated downturn and if I may add, most players were getting prepared to face it. Of course, globally, the downturn was caused by macroeconomic factors due to geopolitical instability such as that inflicted by the Russia Ukraine war. In fact, the industry was recovering post Covid and capacities /consumptions were coming back to normal before the unfortunate and unanticipated war broke off. And to make matters worse and as if one war wasn’t enough of a suffering for the world to endure, the Israel-Hamas conflict started.  

Given that caustic is a globally traded commodity, the Indian Chlor-Alkali market has also witnessed pricing pressures in the recent quarters. Also, with the downstream chlorine industries such as agro-chemicals going through a downwards spiral, the pricing pressures on chlorine have been severe. This has been aggravated by new capacities that many players have commissioned or are commissioning. Also, the issue of chlorine being in an oversupply situation in India is expected to get worse with the additional capacities coming on-line. Balancing the additional capacities with new destination industries within a reasonably short span of time is the challenge that the Indian Chlor-Alkali industry is trying to address now. 

Having said so, on the pricing front, we expect 2024 to be marginally better than 2023 and this marginal improvement is likely to be caused by modest recoveries in the downstream industries.  

How was DCM Shriram Chemicals’ performance during FY 2023-24 and plans for FY 2024-25? 

Like the rest of the industry, DCM Shriram Chemicals has been impacted on volume and prices and we have also suffered from an inability to find adequate homes for our products in 2023-24. Having said so, we have tried to use the downturn as an opportunity and in some manner, have expedited implementation of cost-side interventions, say on fuel mix or salt sourcing, with the objective of improving the overall health of the value chain.  

As I said, the fiscal year 2024-25 is likely to witness a marginal recovery in prices but overall the gradient of recovery is likely to be flat. We have recently commissioned our 850 TPD caustic capacity expansion and this takes our total installed capacity to a million metric tonnes per annum. Plus, we will very soon be commissioning our Hydrogen peroxide (H2O2) and the Epichlorohydrin (ECH) plants and these will mark our continued diversification beyond core-caustic.  

Thus for us, FY 2024-25 will be the year where much of the “new rubber” hits the road and we will be focusing our energies on making sure we stabilize these new plants and run them in a safe and efficient way while working with our customers to offer us the opportunities to maximise their utilizations.  

What is the total cumulative production capacity of all plants and what will be the capacity at the end of FY 2024-25? 

For DCM Shriram Chemicals, as I said, with the commissioning of 850 TPD of additional caustic soda, we now are a million tonnes per annum caustic player. We have 2 plants manufacturing caustic soda: Bharuch is the larger one at 2225 TPD and Kota has a caustic capacity of 550 TPD. In fact, at 2225 TPD, our plant at Bharuch is the country’s largest single location caustic plant. 

The soon-to-be commissioned H2O2 and ECH plants will have capacities in excess of 50 KTPA each. We have also recently commissioned an Aluminium Chloride plant with a total capacity also of over 50 KTPA. We are now in the final stages of commissioning a new 120 MW state-of-the-art captive power plant to meet the expanded power requirements of our operations. All these plants are located at Bharuch. Just a few months back, we also commissioned close to 44MW of solar-wind combo of renewable power through the group captive mode. 

The company has recently signed a MoU with the Gujarat Government for investing Rs. 12,000 crore in the state by 2028. Please specify your plans?   

Over the last 24-30 months, DCM Shriram Chemicals has invested over Rs. 3,000 crore in Bharuch for the various expansion and new products that I mentioned earlier. Also as I said, the Bharuch plant of DCM Shriram Chemicals is already the country’s largest single location caustic plant.  

In Bharuch, we are a part of the GIDC cluster (Gujarat Industrial Development Corporation). The advantage of being in a cluster is that there are downstream consumers of the products that we make. These mutual dependencies with our co-located customer industries have over time evolved into a symbiotic relationship between the players and it is almost a scenario where member industries are cooperating with each other for maximizing their own performance potentials.  

Given this context and in light of the emergence of the belt as a chemicals hub of the country, we continue to remain bullish about the prospects of the state of Gujarat going forward. The signing of the MoU with the Gujarat government of Rs. 12,000 crore is a manifestation of our continued bullishness towards the state and our own conviction about the long term opportunities on offer in the chemicals space for us. We have very recently announced Rs. 1,000 crore investment in setting up a world class Epoxy and Advanced Materials plant, which will be at a greenfield site in close proximity to our existing plant in Bharuch.   

DCM Shriram had approved 2 new projects – Epichlorohydrin (ECH) and Hydrogen Peroxide. Can you share capacities? When will these plants be commissioned? 

Both ECH and Hydrogen peroxide plants are coming up inside our existing operations in Bharuch and each will have an installed capacity of over 50,000 tonnes per annum. We are close to commissioning these plants within the next few months. 

Can you share the plans for Capex investment for FY 2024-25 and the projects where you are planning to invest? 

As I mentioned, we have just commissioned or are in the final stages of commissioning investments worth over Rs. 3,000 crore across 6 projects – Caustic expansion, Aluminium chloride, H2O2, ECH, a new captive power plant and 44MW of renewable power through group-captive mode. For FY 24-25, our focus is simple: “to make the assumptions behind these investments come true”. 

Having said that, we are also working in parallel towards crafting the next wave of investments – As mentioned earlier, we have announced an investment of Rs. 1,000 crore towards Epoxy and Advanced Materials. Significant amount of ground work will start during this fiscal towards setting up of a new Epoxy plant. We are also exploring an opportunistic play in some chlorine downstream areas – some of which are low capex and with short gestation periods. If all goes well, some investments in such areas will also fructify during the current fiscal. 

What strategy should India adopt to become a global manufacturing hub for Chlor-Alkali? What role will DCM Shriram play in making India a global manufacturing hub in this value chain?  

The India story is everywhere to be read, felt and seen. Across sectors and verticals, the India growth story is being viewed with immense positive anticipation and bullishness. Specific to the Chlor-Alkali space, India’s production has been largely a domestic consumption driven affair with modest exports. Going forward, in order to achieve the stature of being a global manufacturing hub for Chlor-Alkali, the industry needs to focus on global scale at competitive costs. Greening requirements in downstream industries will demand Indian players to green their upstream sources, especially around power, a key raw material for the caustic industry. Emissions and effluent handling will play a key and those with optimal realizations across all products and by-products will be the most competitive in the global context. Also one will have to be prudent about future plant locations and convenient access to ports will be construed as a competitive advantage. Ease of doing business will become even more important with increasing constraints on land availability.  

At DCM Shriram, we have a strong balance sheet coupled with the legacy of a 135 year old organization and a deep understanding of the Chlor-Alkali value chain. We have a very strong pipeline of future investments and we are making sure that those investments happen in the right areas and give us that boost in terms of both top-line and bottom-line going forward.  

The company is in the process of establishing a Multipurpose Product Research & Development Centre. How will this centre help to achieve the objectives of the company? Will it also serve in areas like waste to wealth?  

DCM Shriram Chemicals has recently set-up an Innovation Centre (IC) at a state-of-the art facility in Vadodara, Gujarat. This facility is a reflection of our commitment to innovation /R&D as a vehicle of future growth for the business. While the caustic value chain has been at the core of the business thus far, going forward, as our investments in H2O2 and ECH are testimony to, we are keen to move into value-added specialized chemistries. The Innovation Centre has already been certified by DSIR, Govt. of India and it will be working on 4 key verticals, viz. “Green & Sustainable Chemistries”, “Advanced Materials including Epoxy”, “Water Treatment & Allied chemicals” and “Other Emerging Technologies”. The IC will focus on “applied research” and try to remain close to the customer, understand their requirements and work internally with the manufacturing team to come out with newer products in the new age chemistries that we are looking at.  

Can you elaborate initiatives taken by DCM Shriram for enhancing process safety across all facilities/processes to make operation intrinsically safe? 

As DCM Shriram Chemicals, we consider safety as a cardinal and indispensable condition for our existence. As part of a 135 year old group with a rich legacy, we, the current crop of managers, can only contribute to the group’s heritage if we are able to conduct our affairs in a safe and sustainable manner. It is the abiding principle of “zero harm” that guides us as we conduct our day-to-day affairs. It encompasses “zero harm” to the people in our plants, being it on rolls or contractual, “zero harm” to our equipment /assets and “zero harm” to the environment where we operate. There are specific actions around each of these principles that are underway in our plants. 

We have also been working with external safety consultants of global repute and benchmarking our safety systems with those of global Chlor-Alkali players in order to reaffirm our position in the safety journey, especially around the processes and policies we adopt vis-à-vis what the global majors do.  

Recently, the chemicals business has undergone a rebranding exercise. What is the objective behind this exercise and how will it help the business in the long run?  

I would not classify it as a “rebranding” exercise – it is more an exercise aimed at “refreshing” our brand identity and reiterating the brand promise. We have always been “DCM Shriram Chemicals”, but now we have a refreshed logo of the business with a reiterated brand promise of “delivering sustainable solutions”. The objective is to ensure continuity while at the same time, taking up a platform where we are promising ourselves and our stakeholders that "sustainability” is now core to our operations and that the business is getting closer to its customers and moving from being a product manufacturer to being a “solutions provider”. The colour tone’s metamorphosis from blue to green is a subtle play to further emphasize the greening of our businesses, now and going forward. Lastly the word “delivering” implies a combination of action orientation, agility and result focus – all of which are attributes that the business now stands for. 

DCM Shriram’s CSR Policy is aligned with preventive healthcare, sanitation, education, skilling & livelihood, environment sustainability, Agri-skilling & livelihood, and water in agriculture. Can you share details of projects executed in FY 2023-24 and plans for FY 2024-25? 

You are right. As a group, DCM Shriram has always believed in growing with the communities where one operates. Long before rules around CSR were formulated, the group has worked towards improvements of the lives of the people and communities around us.  

At DCM Shriram Chemicals, we're deeply committed to our CSR initiatives, echoing our group's longstanding dedication to community impact. We've tailored our CSR endeavours in alignment with DCM Shriram's overarching objectives, working closely with the DCM Shriram Foundation to craft programs with the core pillars of convergence, collaboration and creating impact. 

For instance, through 'Kishori Utkarsh Pahel' (KUP), supported by the DCM Shriram Foundation, we're actively promoting health awareness with a focus on empowering adolescent girls. The program is in collaboration with the Bharuch District Administration, Health and Education Department and UNICEF as Knowledge partners. We are dedicated to creating measurable impact. 

Going forward we have set targets for the next two years where we are striving to enhance our environmental footprint by aiming to plant 1 million trees and creating surface storage space of 1 billion litres of water. These initiatives aren't just short-term projects. They're part of our ongoing mission, requiring sustained efforts to ensure tangible, lasting results. 

What are the key strategic priorities and growth plans for DCM Shriram Chemicals?  

Going forward, it is a combination of long and short term priorities that will determine the shape of our strategy. While for the long term, it is the opportunities around sustainability and white spaces in the market that will determine our strategic choices, in the short run, finding newer homes for the excess chlorine will be important. Without adequate and appropriately chosen chlorine tie-ups, the caustic capacity utilization has the risk of remaining sub-optimal. The good part is that we don’t need to do everything ourselves and intelligent alliances /partnerships can help meet the chlorine objectives in a much shorter time horizon with much lesser investments.  

Overall, DCM Shriram Chemicals is an exciting place – happening, intense and fast paced. We are in a hurry and believe we have lots to do in a short span of time. We are today a million tonne caustic player and have chosen for ourselves adjacent platforms to play, whether it is around Epoxy /Advanced Materials or chemistries such as those of H2O2 and Aluminium chloride. We are also closely evaluating options around sustainable energy choices and fuel mix options. Fortunately for us, the spaces that we are in, are growing and thus we need to grow even if we were to maintain our relative position vis-à-vis our peers. 

June 18, 2024

2023-24 industry trends/challenges in Chlor-Alkali, Derivatives and Specialty Chemicals?

2024 was a challenging year for the chemical segment. Post-covid the demand surged which led to big capacities coming to market. At the same time, demand was subdued globally thereby impacting India as well. High interest rates forced western world to keep less stock, triggering destocking and low consumption in China. This led to production from China dumped in the global market leading to drop in realizations for all the products. However, we see recovery shaping up quarter on quarter. Although this is not back to normal, it is improving and we expect it to improve further. 

During FY2024, Chlor-alkali was the most impacted because of subdued demand, over supply and realizations touching all-time low. However, we witnessed things improving just below normal level by the end of the year and we expect it to improve. Derivatives & Specialty business was also low in demand and realizations were at an all-time low but we see situations improving quarter on quarter, especially if end user industries are diversified.  

How has Epigral performed during FY 2023-24 and forecast for FY 2024-25?

FY24 was a challenging year for Epigral as well, however, we performed better compared to the industry on account of our strategy to diversify business model. In FY24, Chlor-Alkali was impacted both in terms of realization and demand but our Derivatives & Specialty segment which caters to various industries performing better for us. Also the past Capex we did and the projects that we commissioned in FY23 helped to have volume growth of 15% in FY24. Even in this tough environment, our EBITDA margin improved quarter on quarter from Q1 FY24 and we ended the full year with a margin of 25%. Considering Capex we did in the last 3 years, will drive the volume growth in FY25 and FY26. We believe FY25 would be definitely better than FY24 with a volume growth of around 15%.

Epigral is aspiring to reach revenue of Rs. 5,000 crore by 2027. New plants that you are planning to commission to make it a reality?   

Yes, we are a growth oriented company and very much focused to bring consistent growth. Projects that we commissioned in FY23 and we will commission in FY25 will drive volume growth both in FY25 and FY26. We have a few projects under our evaluation which we will announce soon. This will further drive growth beyond FY26. These chemicals will be import substitutes, having good growth prospects and will also strengthen our integrated complex. 

Total cumulative production capacity of all plants? What would be the capacity at the end of FY 2024-25? 

As on 31st March, 2024, our Chlor-Alkali capacity stood at 421,000 TPA and Derivatives & Specialty capacity stood at 190,000 TPA, which included CPVC Resin, Epichlorohydrin, Chloromethanes and Hydrogen Peroxide. We recently commissioned an additional CPVC Resin capacity of 45,000 TPA in FY24 which makes our total capacity standing at 75,000 TPA (world’s largest single location plant). In FY25, we will also commission CPVC compound capacity of 35,000 TPA and commission Chlorotoluenes value chain capacity.  

Capex invested in FY 2023-24 and projects where it was invested? Capex investment for FY 2024-25 and projects where you are planning to invest?

In FY2024, we invested around Rs. 405 crore in Capex which was towards additional capacity of CPVC Resin of 45,000 TPA, CPVC Compound capacity of 35,000 TPA and Chlorotoluenes value chain capacity. For FY25, we plan to spend around Rs. 300 crore on Capex on a few of the above projects and on ones we will announce soon. 

Strategy India should adopt to become a global manufacturing hub for Chlor-Alkali, Derivatives, and Speciality Chemicals? What role does Epigral sees for itself in making India a global manufacturing hub? 

For India to become a global manufacturing hub, we need to spend more on creating new facilities, invest in R&D to strengthen our position in the specialty chemical segment and to get orders from the global market for niche products. India also needs to focus on strengthening its position in various feedstocks as that will create a whole ecosystem to have a full value chain within India, rather than importing major raw materials. Government needs to focus on various initiatives to motivate the manufacturing segment in India. The government also needs to focus on creating robust infrastructure like the PCPIR region of Dahej, and we need more such parks in India for it to become a global hub for chemicals.  

How rebranding from Meghmani Finechem to Epigral will help the company to transform as a global multi-product chemical conglomerate? 

As per our strategy, we are moving from bulk chemicals to Derivatives & Specialty business. Our Derivatives & Specialty business contributed 45% of total revenue in FY24 vs 0% in FY2019. We have also started exporting our products in the global market. Considering future growth, we are open to various partnerships where we can enter into new chemistries, on the basis of our project execution capabilities. With all these, we are here to enhance the value for our stakeholders. The name change is in line with this spirit and that is where we decided to reposition the company and changed the name of the company from Meghmani Finechem Limited to Epigral Limited. 

Epigral is planning to commission a Chlorotoluene value chain plant. What's the capacity and when are you planning to commission it?   

Yes, we will be the first in India to set up Chlorotoluene and its value chain plant. The basic capacity for the plant will be of around 15,000 TPA. There are 3 blocks, including one multi-purpose plant. We are going to do various reactions in this segment and will cater to the agrochemical and pharmaceutical industry. In the first phase, we will be launching around 10 to 15 products. We are almost there in setting up the plant and phase wise will commission all 3 blocks. We expect the full plant to get commissioned in Q2 FY25.   

Your are also venturing into CPVC compound production with a projected capacity of 35,000 TPA. When are you planning to commission the plant?

We are expecting to commission this plant in Q1 FY25. 

You have inaugurated its R&D Centre in Ahmedabad in November 2023? New products that you are working on and how will it be beneficial in the long run? 

Epigral’s new R&D center is a strong pillar for its growth in the Specialty business. We have a good team and we will further increase the team size. The R&D center is working on various molecules and products but immediate focus is on new downstream molecules of the Chlorotoluene value chain. Research is going on and we are positive to announce further growth prospects in these lines, maybe in the coming years. 

The company has also commissioned 18.34 MW of green hybrid power plants in the last fiscal? How is this beneficial for the company? 

Yes, we commissioned it in FY24 and it has helped us to reduce our carbon footprint and contribute to the environment. It has also helped us to reduce the cost of electricity. 

Initiatives taken by Epigral India for enhancing process safety across all facilities/processes to make operation intrinsically safe?

Epigral is very much focused on Environment, Health and Safety and we continuously improve processes and instruments to have a safe environment for our employees to work. During the year, we have taken various initiatives, few of them are validating firefighting measures, new techniques to recycle various by products and effluents, lifeline protection kit, training on various safety topics, strengthening emergency response team, etc. 

Sustainability roadmap of Epigral and what's the sustainability plan in FY 2024-25? 

The company is focused to drive business in sustainable way by adapting various practices like, improving efficiency to consume less energy per ton of production, adopting latest and best technology to reduce wastage, strong sewage treatment plant to facilitate the reuse of treated water to conserve environment, engaging with local communities through philanthropic initiatives, setting up 18.34 MW wind solar hybrid power plant, creating green belt at the manufacturing facility, etc. 

CSR initiatives of Epigral in FY 2023-24 and plans for FY 2024-25?

We are committed to make a positive societal impact through CSR initiatives. The company believes in giving back to the community and participates in education, health, women empowerment, skill development and environmental protection programmes. We have contributed to various charitable trusts and supported diverse social, educational and economic development initiatives. Epigral focuses on empowering women through education and self-employment and upskilling opportunities. The company has established and supported educational and medical facilities, enhancing access to essential services for underserved communities. 

June 17, 2024

Industry trends in global and Indian petrochemical market in 2024?   

The Indian economy presents an optimistic picture for the growth of the petrochemical industry in the country. With a wide range of applications, we have witnessed a surging adoption of petrochemical products across sectors like Textile, Pharmaceutical, construction, automotive, etc. In the future, petrochemical demand is expected to grow significantly, and the government’s push to make in India has boosted petrochemical capacities. The increasing focus on sustainability and decarbonization are key trends that demand proactive strategies for innovation across the value chain. The need for adapting carbon-neutral practices and showcasing supply chain resilience are critical factors that will define the success for the Indian petrochemical sector in the coming decades. 

Where does India stand in the global petrochemical market and how do you see petrochemical growth in India? 

India is a key player in the global petrochemical market and is showcasing rapid growth and increasing demand. Indian chemical and petrochemical sector continues to grow at a rate of 1.2-1.5 times the GDP. India has emerged as one of the fastest-growing petrochemical markets, accounting for more than 10% of the world's growth in petrochemicals. 

According to leading industry reports, the market size of the Chemicals & Petrochemicals sector in India is around US$ 215 billion; expected to grow to US$ 300 billion by 2025. The Indian petrochemical industry could see around US$ 144 billion (more than~ Rs. 10 lakh crore) worth of new projects as the country moves to bridge the gap between the shortage of domestic supply and increasing consumer demand. The country's strong economic development, coupled with significant infrastructure spending, serves as a catalyst for petrochemical growth. Megatrends of urbanization, rising income, and organized retail is propelling petrochemical demand in India. 

The company announced phase wise development of the petrochemicals division. Can you please share details with us? 

Nayara Energy has strategically planned the development of its petrochemical division in phases. We are in the process of setting up a 450 KTPA Polypropylene plant at our Vadinar Refinery in Gujarat, which includes a Propylene recovery unit and upgrades to the existing FCC Unit. This Polypropylene unit will leverage advanced technology for clean polypropylene production. 

Being tactically located in Western India, near the largest petrochemical consumption region, we at Nayara Energy ensure logistical competence for petrochemical exports and imports, paving the way for further growth and expansion in the sector. 

What is the current status of development of a new polypropylene plant? When is it scheduled for commissioning? How is this going to impact Nayara Energy’s position in the Indian petrochemical market? 

There has been significant progress made on the planned phase-1 execution of the Petrochemical project and we are on track to commence our maiden petrochemical journey in Q3 2024. The strategic positioning of our 20 MMTPA refinery in Western India, will further strengthen our position in the high-growth Indian petrochemical market. This project showcases our commitment to diversifying our product portfolio and driving sustainable growth within the petrochemical industry. 

What is the Capex for petrochemicals of Nayara Energy? What is the future expansion plan? 

We are on track to commission our maiden petrochemical plant consisting of a 450 KTPA Polypropylene Unit in FY 2025 at an investment of Rs. 6,000 crores. Already, as part of the project, two of the units have been revamped and deployed a new unit. The final unit is constructed and is ready to be commissioned. 

What market share Nayara Energy is looking at in the Indian petrochemical sector by 2030? 

With 450 KTPA Polypropylene capacity, Nayara Energy aims to achieve a formidable market share in the Indian PP market by supporting Government’s ‘Make-in-India’ initiative. 

What sort of sustainability and green measures are being incorporated while developing petrochemical complexes? 

The petrochemical industry is proactively addressing its environmental impact by integrating sustainable practices into the development of petrochemical complexes. Key measures include reducing carbon footprint through technologies like carbon capture and storage (CCS) during syngas production and utilizing renewable carbon sources like biomass to produce chemicals. Shifting to lower-carbon feedstocks such as hydrogen and scaling up bio-production with renewable energy further contributes to sustainability efforts. 

Additionally, maximizing material and energy efficiency, creating value from waste, and adopting a stewardship role to consider long-term environmental and social impacts are essential strategies. Embracing large-scale sustainable solutions and transparent reporting signifies the industry's commitment to balancing economic growth with environmental responsibility.  

With the rising importance of the circular economy, what steps is Nayara Energy taking to promote recycling and reduce the environmental impact of its petrochemical products?

Due to our sustainability commitment, Nayara Energy chose high-quality FFS packaging for Polypropylene packaging which is 100% recyclable as compared to prevailing Raffia packaging which is difficult to recycle.  

Several polyolefin players are looking to invest in plastic recycling, via pyrolysis however, the consistent and quality sources of plastic waste are a big challenge. Once reliable feed and technology solutions are available, Nayara will evaluate investment options in plastic recycling. 

What is the current refining capacity of Nayara Energy and what is the future plan? 

Currently, Nayara Energy contributes approximately 8% of India's refining output, showcasing its significant presence in the country's energy landscape. For the last five to six years, the company has achieved reasonably good growth both in the retail business, and the expansion to petrochemicals. 

The company is investing Rs, 4,000 crores in modernising the refinery to improve its lifespan and reliability by 2026.  Our Vadinar refinery is India's second-largest, single-site refinery with an annual capacity of 20 million metric tonnes (MMT) or 405,000 barrels per day (BPD). 

It is capable of processing some of the toughest crudes and yet produces high-quality Euro IV and Euro VI grade products. We can now produce high-quality Bharat Stage (BS-VI) compliant fuels that meet international standards. This brings us closer to the global emission standards. 

What are the key CSR initiatives planned by Nayara Energy for 2024-25? 

Nayara Energy is committed to corporate social responsibility (CSR) and has outlined several impactful initiatives to positively influence the communities it serves in the coming years. Driving inclusive growth and delivering value for all stakeholders is at the core of our beliefs. Through various sustainable development projects in areas of Health & Nutrition, Education & Skill Development, and Sustainable Livelihoods, Nayara Energy continues to play a pivotal role in improving the quality of life of the communities it operates in. 

Additionally, Nayara Energy's CSR efforts are focused on improving the quality of life for communities residing near its operations. By implementing various initiatives, the company strives to be among the most respected organizations in India, prioritizing the well-being of communities and the nation at large.