Meghmani Finechem Q4 2022 Concall Highlights

  • Expected to grow 20-22% in volume for FY 23 and 50% in value terms. Expected revenues for FY 23 would be around 2250 cr.
  • Targeting to deliver 5000 cr revenues till FY 27. (Current revenues of 1551 in FY 22). 
  • Entering in new Speciality Products : Epichlorohydrin and chlorinated pvc. ECH capacity will come in May June of 2022 and CPVC will be online in Q2 2023. Both of these plants needs 3 months to stabilize operations. 
  • Expanding into chlorotoluenes and it’s value chain. Total capex amount around 180 cr. Asset turnover expected around 2.5 to 3x. It will add 500 cr of revenues.
  • Setting up R&D center in ahmedabad for Specialty chemicals.
  • Production of hydrogen peroxide has ramped up and capacity utilization is 78% in FY 22 Vs 57% in FY 21.
  • Caustic soda and caustic potash realization increased by 74% and 27% respectively.
  • Caustic soda realization stood at 34062 in FY 22 vs 21300 FY 21.
  • Epichlorohydrin (ECH) project is under commissioning and will get commissioned in next 2 months. Demand for ECH is from construction sector.
  • Demand for epoxy resins is around 70000 to 75000 MT and next year it can go upto 85-90 KT
  • Meghmani finecehm setting up the plant for caustic soda with capacity of 100kt, jinal is also setting up the plant.
  • Caustic is not imported in India, it is exported from India. Exports will continue from India for at least next 2 qtrs.
  • Capex projects :

                    1.Epichlorohydrin (ECH)

                   2.Caustic Soda

                  3.Chlorinated PVC (CPVC)

  • ECH and CPVC are high value products which are derivatives of caustic soda. 
  • Once in year sizable capacity of caustic soda is needed which can cater to demand from pharma, agrochem, infra, renewable sectors.
  • Last year due to lockdown paper and textile industry was not doing well but this year they are performing well. Caustic soda is used in these industries as well.
  • Capacity for epichlorohydrin is around 50000 MT. Generally plant needs 2 to 2.5 years to commission.Meghmani finechem commissioning ECH plant this quarter. Epoxy resin is forward integrated derivative of ECH. There are some capacities coming up for epoxy resins also. It is expected that the growth for ECH will grow in double digits. DCM also coming up with ECH capacity.
  • Most of the power requirements fulfilled from captive power plant.
  • Looking for import substitute products. New projects not announced yet.

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