We have been in ‘Investment Mode’ in the last five years: Shekhar Khanolkar, Executive Director & CEO, Chemicals, DCM Shriram Ltd

  • July 02, 2022

DCM Shriram is executing 150 TPD plant each for both Epichlorohydrin and Hydrogen Peroxide. Along with these, the company is also commissioning a 90 TPD AlCl3 plant. Part of it will come by May 2022 while balance by Mid FY23.

How has DCM Shriram performed in FY 2021-22 with special emphasis on chemicals and ethanol segment?

DCM Shriram Limited has had a satisfactory performance in FY 22. Post COVID, the push in the demand side has improved the financial performance and therefore the overall results. Chloro-Vinyl business witnessed almost unidirectional increase in input costs especially energy prices. This was led by global factors such as increase in energy demand, supply constraints due to geopolitical factors, and adverse weather conditions. Freight costs are also adding to the cost push. While realisations have been good, long term focus remains on cost optimisation.

What is the Capex plan for DCM Shriram in FY 2022-23? Projects where you are investing? How will these Capex investments help the company both in terms of revenue and profitability?

The company has taken up aggressive growth plans in both its chemicals and sugar business over the last few years. In FY 22, an investment of Rs. 2,400 crore has been approved by the board for its various expansions in chemicals business while Rs. 540 crore has been approved for expansion in sugar business.

 In the chemicals business, we are on the verge of completing our 120 MW power to support the current and future expansion at Bharuch.

We are also executing 150 TPD plant each for both Epichlorohydrin and Hydrogen Peroxide. Along with these, we are also commissioning a 90 TPD AlCl3 plant. Part of it will come by May 2022 while balance by Mid FY23.

Overall DCM Shriram has been in “Investment Mode” in the last five years and going forward, we will continue to evaluate the opportunities based on long term value creation to the group and all stakeholders.

What's the automation and digitalization plan of DCM Shriram across chemical operational plants in FY 2022-23?

We are working on formulating a detailed strategy for digitization, not only chemicals but across the group. In the chemicals business, we are working on a detailed plan to execute a function wise digitization strategy driven by global benchmarking as we work on SAP S4 HANA. Our core strategy in digitization will be long term value creation.

The company is planning a multi-purpose product R&D centre. What's the key R&D initiatives that the company is planning to undertake in this centre?

We are looking at various formulations to support our current portfolio. The centre will be used to develop various grades of current product portfolio as per customer specifications and will also work as an incubation centre to develop new products/formulations within new and allied areas.

How is DCM Shriram balancing growth and sustainability? When is DCM Shriram planning to be net zero?

At DCM Shriram Limited, we have been actively working to conserve water through our various sustainability initiatives and continue to sustain being a water positive company by undertaking various initiatives. We have built multiple water-harvesting structures in different locations, promoted water conservation, and embedded water conservation with an agri-skilling projects. This has recharged groundwater reserves, boosted the irrigated/cultivable areas, and crop production while ensuring year round availability of water.

The company has been continuously striving towards reducing GHG emissions, remaining water positive, maximising waste recycling and utilisation, maintaining safety and health at workplaces and enriching communities.

 We firmly believe that carbon capturing technologies and a circular economy will be the business sustainability drivers for growth. The company is steadily increasing use of non-fossil fuels and renewable power along with measures towards waste recycling and enhancing water security. Biomass cogeneration capacity, hydrogen production, and usage of ethanol blending has been increasing year on year.

CSR projects planned for FY 2022-23 with respect to rural development, environmental sustainability, vocational skills, and preventive healthcare?

At DCM Shriram Limited, we are committed to creating a social impact in the lives of communities around our manufacturing locations. We work with an integrated rural development approach working towards both infrastructure and softer aspects like behavioural change/IEC etc. We have long term ongoing programs across the thematic areas of sanitation, preventive healthcare, environment sustainability, education and livelihood. In FY 2022-23, also our focus will be on these CSR pillars with regular need assessments and baseline studies to help plan our CSR strategy accordingly.

Note: This interview has also been published on Chemical Industry Outlook 2022 and here's the link to view full version of the annual compendium.

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An investment of Rs. 2,400 crore has been approved by the board in FY 22for various expansions in chemicals business