Current business and new investments to result in compounded growth opportunities for chemical manufacturing landscape: Maulik Mehta, ED & CEO, Deepak Nitrite Limited

Deepak Chem Tech Limited (DCTL) has inked MoU worth Rs. 14,000 crores with the Government of Gujarat for manufacturing MMA/PMMA resins & compounds in FY 2023-24

  • 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.  

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