Bodal Chemical Ltd


(Mridul) #83

Interesting read about the dynamics of dyestuffs industry as input to textile industry -
http://www.digitaljournal.com/pr/3368591

India specific snippet from the article -

Petroleum and its derivatives are the primary feedstock used in the manufacture of dyestuff. Fluctuation of raw materials prices and stringent government regulations in various countries in the use of petroleum derivatives is expected to hinder the market growth during the forecast period. As per the current situation India is expected to be the most favorable region for dyestuff for cotton market due to favorable government policy coupled with rising economy and growing textile industry, the country is expected to witness a significant growth for the global dyestuff market during 2017-2025. For instance, according to India Brand Equity Foundation (IBEF)—a Trust established by the Department of Commerce, Ministry of Commerce and Industry, Government of India—the Indian textiles industry, in 2016, was estimated at around US$ 108 billion, is expected to reach US$ 223 billion by 2021.


Another article i found interesting in the context of dyestuff industry - http://www.doingbusinessinmaharashtra.org/Dyestuff_Sector.aspx

Snippet from the article

Exports of Dyestuffs
Exports of dyes is progressively showing an upward trend since the last two years. Major exports of dyes are to developed countries like Germany, U.K., U.S.A., Switzerland, Spain, Turkey, Singapore and Japan. Exports of Dyes to Latin American and African Countries have also started picking up. These are new emerging markets for theIndian exporters. The industry has prepared a future strategic action plan for dyes and dye intermediate and expects to achieve a target of export of dyes and dye intermediate from present Rs. 7000 crores to Rs. 12000 crores by the end of this decade. The industry also feels that an export growth of this magnitude can be achieved only if there is close coordination between the Govt., Industry, Financial and technical institutions so that a conducive atmosphere providing a level playing field is created. The industry needs to create a set up to monitor very regularly the growth in exports and take necessary corrective action along the route – to achieve the targets. In India, the per capita consumption of dyes is 50 gms., which is very low as compared to a world consumption of 425 gms., which indicates that there is a tremendous potential for growth of this sector in India.


And here is another one

The impact of Global Meltdown on Indian Dyestuff Industry - http://www.fibre2fashion.com/industry-article/3769/impact-of-global-meltdown-on-indian-dyestuff-industry

In India, Dyestuff Industry supplies its majority of production to the textile industries. Enormous amount of dyestuff products from India are exported to textile industries in Europe, South East Asia and Taiwan. India presently manufactures all kinds of synthetic dyestuffs and intermediates and has its strong hold in the natural dyestuff market. India is a one of the major global producers of dyestuffs and dye intermediates, principally for reactive, acid, vat and direct dyes. India has approximately 6 percent share in the world production of dyestuff products.

Indian dyes and textile chemicals industry is no more insulated from the global meltdown. Industry sources say that the exports of Indian dyestuff is expected to go down in the second half as compared to the first half of this year due to global melt down and tough competition from China. Indian dyestuff industry faced less competition during the time of Olympics because some of the Chinese companies were shutdown temporarily due to the environmental laws introduced by China’s Government. However the Chinese companies are back in business now, which is believed to probably affect the Indian exports.


(rvetri) #84

Yes Mridul…Bodal is promptly expanding its capacity by acquisition and by
brown field expansions over the next 2 yrs. It is all done through internal
accruals till now…Bodal is a company to watch out for in the sector…

Disc: Invested


(Profulla Sarma) #85

Thanks Mridul. The articles you posted is very much informative to know the reasons of price movement. Increase in capacity during fair weather may not be fruitful if Chinese plants close-down come to re-opening in a short period.


(vinay ambekar) #86

Here’s why SP Tulsian recommends a buy on Aksharchem
In an interview to CNBC-TV18, SP Tulsian of sptulsian.com shared his readings and outlook on the market outlook and specific stocks and sectors.
http://t.in.com/38ub

He speaks of impending pollution issues in 3 companies in Padra district, Vadodara. Bodal has 3 units out 10 in this location and Kiri Industries is also there.

Anyone with any info on pollution issues in these? Esp Bodal?


(nil_71) #87

Please listen to Bodal Commentaries in Q4. They have address this issue and specifically said that they are spending a lot. In fact, they mentioned Unorganized sector or Others are going to face issues.


(Mridul) #88

What exactly is the issus and how are they addressing it?


(Mridul) #89

Vinkash, was there anything​ discussed in concall regarding pollutjon issues at unit 7 and 8 at padra, vadodara?


(nil_71) #90

They mentioned that they spent 35crs in installing the new pollution control stuff. That will be difficult for SMEs to install. Also all of their plants are in a place (forgot the name) in Gujrat which allows the Chemical facilities. In fact their message is that Bodal will going forward do well since they already spent significant money in being compliant.


(Mridul) #91

Was checking last few concalls…here is what i found in q1 2017 concall…

Question: Basically we are seeing good demand coming up from the Far East?
Mayur Padhya: Yes, shifting of capacities from other countries to India. Demand is growing continuously with the population growth and with the growth in the standard of living. At the same time even in India there are some small players operating, but going forward because of the strict pollution norms, etc., it will be difficult for them to expand or to maintain at the current level. For Bodal, we have installed our effluent treatment plant at the cost of Rs.30 crores and for a small player it is not possible. Therefore either they are shifting, closing down or shifting to the players like Bodal.

In march 17 presentation, they have mentioned …
“For dye intermdiates, only player with effluent disposal permission (10 lac Lts/day)”…are the recent happenings realted to this effluent permissions?


#92

Nothing was mentioned regarding pollution issues in the call.


(Chandragupta) #93

Bodal Chemicals is not facing any pollution problems.

Company has replied to my query yesterday stating “There is no issue relating to pollution with the company. Matter is that there is renovation is going on at the canal nearby the company hence there might be confusion. Otherwise there is no problem”.


(naravi2011) #94

Reply from the company to my query regarding pollution issue. Company has stated “There is no notice from GPCB to the Company. Also note that our main Padra plant was not closed for a single day in last 5 years for Environment related issue”.


(Mridul) #95

Don’t know why they aren’t accepting. My scuttlebutt from the chemical industry - “there is definitely something going on at padra”…


(sathish kumar jalantran) #96

Please find below article:
http://www.moneycontrol.com/news/business/economy/after-gst-supply-pause-organised-dyes-and-pigments-players-to-emerge-stronger-2312733.html
It describes the short term effect of gst on dye and pigment companies. And discussing the long term positivity for dye industry due to un organized to organized sector shift

Regards,
Sathish


(Sameer_srj) #97

Good report. Mentions almost everything discussed in the forum. Bodal sure looks attractive.

Disc: Invested.


(Saji John) #98

Reduced D/E from 0.84 to 0.59 last year. Planning to keep it that way. Promoters have reduced stake from 69.21 to 64.17 while institutions have increased stake from 0.26 to 4.52% last one year. The latest investor presentation. http://www.bseindia.com/xml-data/corpfiling/AttachLive/551f41ab-8e17-4e6b-829b-4e81375b5c09.pdf
Discl: invested


(tankerooooo) #99

I think you meant Debt/Ebitda and not Debt/Equity. Debt/Equity is 0.38 and Debt/EBITDA is 0.59

The Bodal story is even better that what is shown at first glimpses. The Debt went up in Q4 because they refinanced the high cost debt of SPS Processors which they partly acquired in Q4. This 40 cr odd loan is shown under “Long Term Loans and Advances” line item on their balance sheet. Most of their borrowings are low-cost working capital loans. Long term debt is negligible.

The promoter selling was done by one of the founders who has retired. He is not related to the controlling family.


(Saji John) #100

Thanks for the clarification


(Dhiraj Dave) #101

Latest Presentation by Bodal to investor
http://www.bseindia.com/xml-data/corpfiling/AttachLive/551f41ab-8e17-4e6b-829b-4e81375b5c09.pdf


(008shailesh008) #102

Today, one of the company’s promoter Mr. Rakeshbhai Patel sells around 87% of his holdings. The good part of the news: Mr. Ashish Kacholia buys 50% of it :wink: