Detailed presentation - https://www.bseindia.com/xml-data/corpfiling/AttachLive/afe607b0-b0b4-429f-af5b-9ab6d33a95a8.pdf
Summary of recent GNFC Analyst Meet 2018 (fwd)
· There are total 41 plants around the globe producing TDI with a total capacity of 300,000 MT out of which GNFC has about 67,000 MTPA Capacity
· GNFC manufactures 50,000MT of pure TDI and 15,000 MT of TM blend (TDI blend)
· GNFC has 65% of domestic market share for TDI while rest is imports
· GNFC holds 60% of domestic market share for Aniline while rest is imported
· The prices of Aniline have gone up by 24% in 1 year
· GNFC is the only manufacturer of Formic acid, Aniline and Methanol in India
· The demand of Acetic Acid is 1.5 mn MT per year in India and GNFC has a capacity of 159,000 MT while the rest is imported
· GNFC is the only manufacturer of Formic acid in India and has a domestic market share of 65%.
· The demand of formic acid in India is about 36,000 MT out of which 22,000 is supplied by GNFC
· Formic acid is used in rubber extraction; the demand is expected to go up in future on the back of increase in rubber plantation in North East India
· GNFC uses imported Ethanol which is cheaper than domestic ethanol used by other manufacturers
· The company has a strict policy of not supplying acetic acid to other domestic manufacturers of ethyl acetate since the manufacturing process of ethyl acetate is more cost efficient via acetic acid route
· According to GNFC and Covestro the supply from SADARA TDI plant has been absorbed in the market and would not cause any disruption in the prices
· The TDI prices are expected to correct but there won’t be any drastic downfall in the prices
· The demand for TDI goes down in monsoon and rises back up after September
· The export price for TDI is about USD 3500 to 3800/MT
· The TDI 2 plant has been running at 105% capacity utilization for last 2 weeks without any issues.
· The company would be spending roughly around Rs 20 bn on expansions for various chemicals such as Formic Acid (~7500 MTPA), CNA (50,000 MTPA), Ammonia(150 TPD), Acetic Acid (planning in process)
· The company expects about 12 – 13% ROI on the CAPEX.
· GNFC is a strict follower of Make in India campaign and all the product it manufactures are import substitute
· GNFC exports to 67 countries out of which 31 are in Africa
· The company has zero long term debt and zero working capital
· Exports grew by 49% in 5 years
· The prices for neem fruits went up to Rs 16/ kg from Rs 1 – 2/ kg in past few years
· The take-off in fertilizer segment was low in June due to delay in monsoon. However there has been a pick up in fertilizer sale in July.
· GNFC produces more than 1 mn MT of fertilizer and this segment contributes about 30% to the revenue.
· About 24% of total urea production was used for industrial manufacturing purpose and to limit this use of urea, the GoI has mandated need coating for urea fertilizer. 30 mn MT of urea requires ~25,000 MT of Neem coating.