Global economic overview1
In CY23, global economic optimism surged despite the ongoing geopolitical challenges. Inflation dropped notably to 6.8% in CY23 and GDP rose by 3.2%, exceeding forecasts. Strict monetary policies led to reduced energy prices, while increased government and private spending fuelled consumption. Economic growth surpassed expectations, especially in the US and major emerging markets. In the East Asia and Pacific region, excluding China, growth was subdued in 2023, primarily due to a decline in goods exports due to muted global demand. China is also facing a prolonged downturn in economic activities, primarily owing to the flight of foreign capital from China to other safe havens such as India, Mexico and Vietnam. Despite geopolitical tensions causing volatility in commodity prices, supply chains have normalised due to reduced shipping costs.
Going forward, governments in advanced economies are expected to ease fiscal policies. The United States, whose GDP had already surpassed its pre-pandemic level, relaxed fiscal policies more than the Euro area and other economies where the recovery was ongoing. In the EMDEs, where productivity has declined below pre-pandemiclevels,thefiscalstancehasremainedneutral.
Outlook
The global growth estimate for 2023, at 3.2%, is anticipated to remain same across 2024 and 2025. Despite the resilient performance of the global economy, the projected growth remains below historical averages. However, the US economy is expected to perform better than expected, although downside risks to growth persist. Contributing factors to this trend include the implementation of stringent monetary policies, the withdrawal of fiscal support and subdued productivity growth. Advanced economies are expected to witness a modest decline in economic growth before rebounding in 2025, whereas emerging markets and developing economies (EMDEs) are anticipated to maintain stable growth. Additionally, global headline inflation is forecast to decrease from 6.8% in 2023 to 5.9% in 2024 and further decline to 4.5% by 2025, indicating positive supply-side trends.
WORLD ECONOMIC OUTLOOK, IMF April 2024
GROWTH PROJECTIONS (in %)
*United States, Euro Area, Japan, UK, Canada
**Emerging and Developing Asia, Emerging and Developing Europe, Latin America and the Caribbean, Middle East and Central Asia, Sub-Saharan Africa
Indian economic overview
During FY24, the Indian economy managed to sustain its position as one of the worlds fastest-growing economies. It has surpassed its global counterparts and has recorded a GDP growth rate of 7.6% during the period under review. This growth is propelled by increase in public investments, a burgeoning service sector, stable reform-focused governance and sustained domestic demand for consumer services, coupled with robust export demand for business services.2 Leveraging its G20 presidency, India has facilitated meaningful multilateral initiatives. The financial sector has also remained resilient amid global challenges. Despite tightened fiscal policies, consumer price inflation has remained below the targeted range of 6%.3 In the coming years businesses are expected to perform better with stable interest rates and deleveraged balance sheets.
Growing credit demand in India further indicates the intrinsic potential of the Indian economy. The uptick in the industrial manufacturing sector has garnered the interest of major international technology giants such as Apple, who are interested in extending their supply within India. The implementation of state-level policies that align with industry-specific incentive schemes has contributed to this upsurge. In addition, substantial investments in transport and infrastructure, such as building new highways, railways and roads, are a testament to the governments steadfast commitment to developing this vital sector.
Outlook3
India is poised for continued growth in the upcoming fiscal year, buoyed by robust financial and macroeconomic conditions. GDP is forecasted to remain strong at 7.0%, while inflation is expected to fall, although current volatility persists due to higher food prices. The governments emphasis on public infrastructure development is also offering a favourable environment for growth.
Estimates indicate that India will experience sustained growth, driven by contributions from labour and human capital. The country is anticipated to maintain its growth momentum, supported by a robust foundation laid by digital public infrastructure and substantial governmental investments in infrastructure sectors. However, global headwinds may pose challenges, potentially leading to a slowdown in global economic activity, which could impact Indias financial and trade channels. Weather-related inconsistencies may also impact food prices, worsening inflationary pressures.
Despite these potential headwinds, forecasts suggest a significant surge in demand for consumption and private investments, which are expected to drive growth in the upcoming fiscal year.
Growth is expected to remain strong, supported by macroeconomic and financial stability.
IMF Executive Board, December 2023
Company overview
Himadri Speciality Chemical Ltd (Himadri or the Company) was founded as a private company in 1987 and commenced operations in 1990. Through its journey it has established a robust domestic and international presence. The Company operates seven manufacturing facilities across India and has set up a state-of-the-art manufacturing unit in China. Himadri has fortified its stance as a key player accross product segments, including battery materials, coal tar pitch, carbon black, naphthalene, refined naphthalene, SNF, speciality oils and more. Its vast clientele is spread across diverse sectors such as lithium-ion batteries (LiB), paints, plastics, tyres, aluminium, graphite electrodes, agrochemicals, defence, construction chemicals and more.
Battery materials for EV and ESS
India is on the cusp of a major reformation in the EV and ESS ecosystem.
In keeping with the national policy on Climate Change and Net Zero emission by 2070, the pledge to reduce Carbon Intensity by more than 45% by 2030, there is a major thrust on the electrification of Vehicles and the generation of renewable energy. This is expected to give a steady rise in the demand for Battery energy in the coming years which will inflect to a surge by the turn of this decade and will continue to grow in the years ahead. The raw materials and components will also see a huge opportunity.
As a stimulant to these ambitious goals, the government has taken the lead and has announced opportunities and subsidies for the end users and the producers dovetailing it with its Self-reliant India accent, an economic development plan. Further various fiscal incentives and consumer awareness-building initiatives are being adopted as important drivers.
For example, implementation of the FAME II scheme, allocating INR 10,000 Crores to bolster the electric vehicle (EV) ecosystem and the Production-Linked Incentive (PLI) Scheme for Advanced Chemistry Cell (ACC) battery storage, providing an incentive of INR 18,100 Crores, have been pivotal in encouraging domestic manufacturing. These policies also align with Indias ambitious goal of raising the adoption of EVs to 30% by 2030; consequently boosting the demand for lithium-ion batteries as reliable energy storage solutions.4
Global Li-ion industry
The comprehensive lithium-ion (Li-ion) battery industry, encompassing activities ranging from mining to recycling, is forecast to witness an annual growth rate exceeding 30% from 2022 to 2030. By 2030, it is anticipated to achieve a market value surpassing USD 400 billion, with a capacity of 4.7 TWh with mobility application alone accounting for 4.3 Twh . The 3 key drivers are (a) decision by 13 out of the top 15 OEMs to ban ICEs , (b) customer adoption rates and (c) regulatory shift and governmental support . The Recycling business will pick up momentum with a lag but will throw up its distinct potential by the next decade. The International Energy Agency (IEA) reports a 65% increase in demand for automotive lithium-ion batteries, reaching 550 GWh in 2022. This surge could be primarily attributed to the increasing sales of electric passenger cars, with new registrations soaring by 55% in 2022 compared to the preceding year.5
The Asia-Pacific region, particularly China, emerged as a prominent leader in the global Li-ion battery market.
4
https://www.astuteanalytica.com/industry-report/india-lithium-ion-battery-market#:~:text=India%20lithium%2Dion%20battery%20 market%20generated%20a%20revenue%20of%20US,the%20forecast%20period%202024–2032.5
https://www.mckinsey.com/industries/automotive-and-assembly/our-insights/battery-2030-resilient-sustainable-and-circularBesides substantial manufacturing capacities, ongoing advancements and investments make this region well-positioned for sustained growth in the foreseeable future. This optimistic outlook for electric vehicles (EVs) presents promising avenues for expansion within the Li-ion battery market. Additionally, the anticipated fall in lithium prices is poised to further bolster market expansion.6
Positioned strong to cater the global demand for LiB raw materials
LiB Growth Potential
Indias Li-ion battery industry
The surge in electric vehicle uptake, along with the burgeoning sector of renewable energy production, the necessity for energy storage, consumer electronics, and the rising call for sustainable energy storage options, have catalysed the expansion of Indias lithium-ion (Li-ion) battery industry. With a valuation of USD 2.5 billion in 2023, the industry is forecasted to surpass USD 5 billion over the ensuing five years. Demand for LiB batteries is expected to grow, reaching 260 GWh by 2030, driven by the increasing adoption of EVs in India. By FY33, this spike in demand will necessitate an additional 330 GWh of capacity, considering an average utilisation rate of 75%. The estimated capital expenditure (capex) for the next ten years is between USD 30-33 billion, with an assumed USD 90-100 million for the establishment of 1 GWh of battery capacity.7
Anode
Anode materials form crucial components of Lithium-Ion Batteries (LiBs), which power smartphones, EVs and renewable energy storage systems. The selection of anode material is critical as it directly influences factors such as discharge capacity, cycle life and the charging rate of LiBs.
Graphite materials are predominantly used as anode materials in the majority of LiBs worldwide due to their inherent structural stability, low electrochemical reactivity and optimal alignment for storing lithium ions. As the anode material, graphite facilitates the flow of electric current through the battery while enabling the reversible storage and release of lithium ions received from the cathode.
The recent advances in Silicon Anode Graphite promises higher Energy Density implying more range and capacity, lighter EVs for the same range, smaller batteries and reduced cost of Lithium Ion Battery storage.
During the charging process of a LiB, lithium ions are stored within the anode, while during discharging, these ions flow back to the cathode through the electrolyte. This cyclic movement of lithium ions between the anode and cathode is essential for the batterys operation and energy storage capabilities.
6
https://www.iea.org/reports/global-ev-outlook-2023/trends-in-batteries7
https://mnre.gov.in/document/need-for-advanced-chemistry-cell-energy-storage-in-india-part-i-by-niti-aayog-3/Cathode
In Lithium-ion batteries (Li-ion), the cathode plays a vital role in determining the batterys performance and characteristics. One commonly used cathode material is lithium iron phosphate (LFP), which is paired with a graphite electrode having a metallic backing serving as the anode. Unlike several other cathode materials, LFP exhibits a unique atomic arrangement, forming a crystalline structure that results in a three-dimensional network of lithium ions. This distinctive structure enhances electrical conductivity compared to other cathode materials like nickel, manganese and cobalt, which typically feature two-dimensional slabs.
One notable advantage of LFP cathodes is the non-toxic nature of phosphate, as opposed to cobalt oxide found in other cathode materials. Additionally, LFP batteries have the ability to maintain a constant voltage across higher charge cycles. These attributes make LFP cathodes a favourable choice for various applications, including EVs, renewable energy storage systems and consumer electronics. Overall, the increasing selection of cathode materials considerably influences the performance, safety and longevity of Lithium-ion batteries.
The recent advances in technology promises use of Manganese injected into the LFP to build LMFP, which promises long distance travel without potential toxicity and fire hazards in use of batteries involving Nickel and Cobalt whose availability poses a challenge too.
Global electronic vehicle (EV) market8
The year 2023 witnessed a sharp increase in electric vehicle (EV) sales, with volumes skyrocketing in nations like Thailand, Indonesia and India. Forecasts for EV sales in the Rest of the World category are promising; a jump to 8,40,000 units is anticipated, contradicting the assumption that EV adoption is limited to wealthy countries. Also, sales of commercial EVs are predicted to double from over 5,00,000 in 2023 to about 1 million in 2024, making this another historic year for the industry.
The global electric vehicle sales exhibiting optimism and is projected to increase, reaching around 17 million by the end of 2024. Still, the environment is supported by ongoing developments in battery technology, falling prices and the installation of almost 4 million public charging stations worldwide. These patterns are expected to continue, creating a framework for future expansion in 2025 and 2026, especially with the introduction of numerous reasonably priced models in Western markets.
The electronic vehicles (EV) market in India9
The market for EV batteries in India was valued at USD 16.77 billion in 2023 and is expected to reach USD 27.70 billion by 2028. This is a compound annual growth rate (CAGR) of 10.56% from 2023 to 2028. The fact that 60–65% of Indias battery pack components are imported, highlights the countrys enormous potential market. Indias EV market, estimated to be worth USD 3.21 billion in 2022, is expected to register a remarkable CAGR of 66.52% to reach USD 113.99 billion by 2029. The government of India has set an ambitious goal to achieve 30% electrification of the countrys vehicle fleet by 2030, in light of the growing sales of EVs nationwide.
The number of registered EVs in India as of the end of 2023 was around 3.5 Million. In 2022 and 2023, the EV sales were 1.0 and 1.5 Million respectively with a penetration of around 5% (Corresponding percentage of penetration at USA was 6% in 2023) . It is expected that by 2030, the Indian market will see EV sales exceeding USD 70 million with 4 Wheelers accounting for 10%, 3 Wheelers accounting for 15% and the remaining 75% contributed by 2 Wheelers.
Governments push for battery material is evident by these undertakings
• In 2019, the Faster Adoption and Manufacturing of Electric Vehicles in India Phase II (FAME India Phase II) Scheme was launched with a budget allocation of INR 10,000 Crores over a span of five years. To date, the FAME INDIA scheme has facilitated the sale of 11,18,682 vehicles, resulting in the conservation of 3,07,44,598 litres of fuel and a reduction of 6,20,60,142 kilograms of carbon emissions.
• The government initiated a Production Linked Incentive (PLI) scheme for the Automobile and Auto Component industry, allocating a budget of INR 25,938 Crores for 5 years staring from FY23.
8
https://www.bloomberg.com/news/newsletters/2024-01-09/electric-vehicle-market-looks-headed-for-22-growth-this-year9
https://www.thehindubusinessline.com/companies/indian-ev-battery-market-to-grow-to-28-billion-by-2028-report/article67426649.eceCarbon Black10
Carbon black, a variant of elemental carbon, is synthesized through the controlled vapour-phase pyrolysis of hydrocarbons and, through tight control of the manufacturing process, delivers a range of features including reinforcement, conductivity, pigmentation, rheology control, and many other properties. As a result, carbon black finds wide application in industries such as tyre manufacturing, plastics, coatings, printing inks, paints, batteries, rubber compounds, conductive packaging, film, and fibres. Recognized for its cost-effectiveness, versatility, and durability, carbon black extends the performance of tyres, reinforces rubber goods, acts as a colorant in coatings, provides conductivity in plastics, and delivers many other benefits across a range of applications.
Growth in carbon black is driven by a number of trends including adoption of electric vehicles (EVs), infrastructure investments, automotive lightweighting, and other trends. Carbon blacks are helping extend the life of EV tyres, which require enhanced reinforcement due to the additional torque from the electric motor. They are also extending the life of polyethylene pressure pipes by replacing aging water pipes, reducing water loss, enhancing agricultural production through protection of agricultural film and pipes from UV degradation, and providing other benefits that enhance sustainability across a range of end-uses. Significant investments in R&D are also helping develop high-quality carbon black with new uses such as increasing lithium-ion battery performance by enabling faster charging.
Speciality carbon black
Speciality carbon black is an engineered particle that provide additional features beyond ASTM commodity carbon black such as superior aesthetics in terms of colour, higher UV stability and conductivity and other benefits while being easier to process with less defects. Speciality blacks are tailored to specific industry applications to help end-users achieve higher performance in their production. In addition to plastics, coatings, printing inks, paints, specialised tyres, conductive packaging, film and fibres, speciality blacks are also used in belts, hoses, boots, fascia, gaskets, grommets, diaphragms, air springs, conveyor wheels and vibration isolation devices. Its value in various industrial processes is highlighted by its versatility. Speciality carbon black has grown almost 6%, attributed to a surge in demand in batteries, heightened requirements for plastics and rubber products, increased demand for packaging inks and coatings, and a growing awareness of the properties that carbon black offers across various materials. Himadri has been part of this growth through the expansion of its portfolio with new products for synthetic fibre, food contact applications, inks & coatings, and engineering plastics.
Allied industries
Tyre industry
In 2023, the global tyre market size totalled 1,859 million units as per Notch data. Looking ahead, the market is expected to expand further, reaching 2,260 million units by 2027. This growth trajectory reflects a CAGR of 3.8% during the period from 2022 to 2027. Several factors are propelling this growth. These include rapid advancements in tyre manufacturing technologies, robust expansion within the automotive industry, the enforcement of stringent regulatory policies, increasing consumer preferences for specialized and environmentally friendly tyres, and the escalating impact of urbanization and infrastructure development.
The global tyre industry is the largest consumer of carbon black, accounting for over 70% of global production, while the non-tyre rubber industry uses about 20%, the rest is taken by plastics, inks, coatings, and many other non-rubber applications.
10
https://www.imarcgroup.com/carbon-black-marketThis breakdown by application is similar within India. After China, India stands out as one of the major producers and consumers of rubber in the Asia-Pacific region. The automotive sector in India plays a major role in the nations economic performance, wielding substantial influence over technological advancements and macroeconomic expansion. Further, the sectors performance serves as a crucial gauge of tyre demand within the Indian market.
As of June 2023, the Indian automobile industry contributes approximately 6.4% to Indias GDP and 35% to the manufacturing GDP, establishing itself as a principal source of employment. Notably, vehicle production in India surged to 5.75 million units in 2023, marking a 5% increase compared to the previous year. This upsurge in automobile production signifies heightened demand for tyres and related materials, including carbon black, within the automotive sector. Given these factors, the demand for carbon black in Indias tyre industry is anticipated to remain robust in the coming years
Mechanical rubber goods
In 2023, the global industrial rubber market was worth around USD 29.7 billion. It is expected to expand further, reaching USD 40.0 billion by 2032. This growth trajectory is expected to register a CAGR of 3.3% during the period from 2024 to 2032. Mechanical rubber goods (MRG) constitute a significant segment of the market, accounting for approximately 20% of overall demand. Similar to tyres, carbon black plays a crucial role in MRG by optimizing performance through its reinforcing properties. This contributes to improved functionality in various applications, such as retreading, hoses, seals, belts, and other rubber goods.
Plastics, Ink and Coatings
Plastics, inks, & coatings are the largest applications for speciality carbon black in non-rubber applications. In plastics, it is used in electrostatic dissipative (ESD) plastics, agricultural films, plastic pressure pipes, moulded parts, food contact packaging, automotive, and consumer goods, as well as wires and cables. Its versatile properties enhance the aesthetics of plastic products but also extend the performance life. The inks and coatings industry leverages specialized grades of carbon black to achieve deep black pigmentation and exceptional UV stability in inks, paints, and coatings. This versatility of carbon black facilitates the creation of vivid and durable prints as well as surface finishes for diverse applications and promotes its demand. The key drivers for growth encompass infrastructure investments such as upgrading aging water pipes, expanding electrification to support EV charging stations, automotive lightweighting initiatives, and urbanization driving middle-class expansion. These growth drivers are expected to deliver almost 6% growth for non-tyre, non-rubber applications.
Coal Tar Pitch
Coal Tar Pitch (CTP) is a complex chemical generated by distilling coal tar and is a crucial raw material in various industries including aluminium smelting, graphite electrode production, surface coating of industrial material and chemical industries. Currently, the aluminium industry solely relies on coal-tar pitch as the primary binder for producing carbon anodes. Coal-tar pitch is widely used as the preeminent binder in anode production, primarily due to its effective interaction with coke particles during the mixing phase. It has the ability to wet the surface of coke particles and permeate their open pores, thereby facilitating the transformation of dry particles into a malleable paste conducive to shaping in the desired form.11
Coal Tar Pitch is a highly specialised chemical which has a significant impact on the aluminium production process. The pitchs quality directly impacts specific power consumption and carbon consumption in the electrolysis process. It also impacts the purity of the metal itself which makes it very critical in the process – especially for high value-added products. With its superior quality driven by world-class in-house technology, state-of-the-art infrastructure, customer specific customisations and thorough robust processes, Himadri offers unmatched advantages to the customers. Himadris technology and sustainability drive has also enabled it to derive advantages in product yield, conversion cost optimisation and energy efficiencies which results in sustainable price advantages for the customers.
India, being one of the major global producers of aluminium, exhibits a substantial demand for CTP. As a critical component in aluminium production, CTP significantly influences both the quality and cost of aluminium manufacturing processes. A significant variation of CTP is used to impregnate graphite electrodes used in electric arc furnaces for steel manufacturing. It serves as a binding and impregnating agent in the production of graphite electrodes essential for EAFs in steel plants. Coal tar pitch is also used to make high technology products like carbon fibres, anode for lithium-ion batteries (LiB), and more. Additionally, CTP acts as a foundational material for coatings and paints and finds applications in roofing and paving, thereby serving as a binder in various tar products. Coal tar pitch serves as a feedstock in the production of various chemicals, including naphthalene, phenol, and creosote. These chemicals are utilized in diverse industries, such as pharmaceuticals, textiles, and wood preservation.
Himadri Speciality Chemical Ltd is committed to sustainable business practices and environmental stewardship. The company adheres to stringent environmental regulations and continues to invest in eco-friendly technologies and processes aimed at minimizing its ecological footprint and addressing associated environmental and health challenges.
11
https://www.sciencedirect.com/science/article/abs/pii/S0016236120308711Allied industries Aluminium industry
The aluminium smelting sector is the primary demand driver in the CTP market, due to the prevalent requirement for aluminium across diverse industries. Globally, aluminium ranks as the second-most-utilised metal, following steel, with an annual consumption totalling 88 million metric tonnes, inclusive of scrap. Aluminium is a recyclable environment-friendly metal which has a host of applications in a number of diverse sectors - power, transportation, building, construction, packaging and many more. Increasing application, growing environmental concerns & a shift towards greater use of recyclable materials are driving growth in the aluminium market. The surge in infrastructure projects and automotive manufacturing is fostering growth within the metals and mining industries in India
Today aluminium manufacturing in India has a critical role for all the key sectors that will aid in its becoming a USD 5 trillion economy. India has the second-largest production capacity of aluminium in the world-about 4 million tonnes per annum (MTPA). The production of aluminium was 4.15 lakh tonnes in FY24. India being among the lowest-cost producers of aluminium holds a fair advantage in cost of production and conversion costs in steel and alumina.
It is predicted that India will be the "stand-out growth market" for aluminium consumption in the coming years as it continues to pursue construction projects to resolve an infrastructure deficit, which sees usage more than tripling to 9.5 million tonnes by 2030 from 2.6 million tonnes in 2021.
Multiple initiatives and focus of Govt. of India like Make in India, 100% rural electrification, Housing for All, Smart Cities, National infrastructure pipeline of Rs 100 lakh Crore, renewable energy and FAME (Faster adoption of manufacturing of Hybrid and EV) schemes for electric vehicles, increase in FDI etc. are some of the influencing factors that will boost the consumption of the metal in the country and further strengthen the future demand for aluminium.
Extensive growth in electric vehicles, renewables, modern infrastructure, energy-efficient consumer goods and greater dependence on strategic sectors such as aerospace defence, will drive Aluminium consumption to grow at a CAGR of more than 10%.
With its growing production capacity and competitive advantage in terms of raw material availability and low labour costs, India has emerged as a significant player in the aluminium global trade.
Graphite industry
Graphite electrodes are essential in Electric Arc Furnace (EAF) and Laddle Furnace (LF) processes, enabling the production of steel and non-ferrous metals. These electrodes act as consumables, conducting high current at low voltage for melting and alloying procedures.
Graphite electrodes typically consist of binder-graded coal tar pitch, calcined needle coke and impregnation-grade coal tar pitch. The healthy growth observed in end-user industries sets the stage for promising prospects in the near future for coal tar pitch, given its integral role in the production of graphite electrodes.
The metallurgy segment within the market encompasses electrodes and refractories, casting and foundries, with graphite electrodes playing a pivotal role in various industrial processes. The anticipated increase in steel production, particularly through the electric arc furnace process, is poised to drive demand for graphite. In refractories, natural graphite is used in the fabrication of crucibles and mag-carbon bricks, It is also used as a lining material in steel converters and electric arc furnaces. Moreover, graphite plays a vital role in steel moulding applications, where different forms of alumina-graphite are employed in continuous casting ware such as nozzles and troughs.12
According to the April 2023 Short Range Outlook (SRO) released by the World Steel Association, steel demand is forecast to rebound by 2.3% in 2023, reaching 1,822.3 million metric tonnes (Mt), followed by a projected 1.7% growth in 2024 to reach 1,854.0 Mt. Further, total world crude steel production amounted to 1,878.5 Mt in 2022, reflecting a 4.2% decrease compared to the previous year.13
Growth drivers14
• The recent reduction in subsidies by the Chinese government for EVs with a range exceeding 400 kilometres, from CNY 50,000 to CNY 25,000, has resulted in heightened demand for graphite electrodes within the coal tar pitch market in China.
• TheAsia-Pacificregionhasthelargestautomotive sector globally and holds a significant portion of the aluminium market share, primarily due to extensive industrial growth.
• The Asia-Pacific is expected to dominate the global coal tar pitch market owing to the rising demand for aluminium from the aerospace, automobile and space industries.
Refined naphthalene
Naphthalene is primarily produced through the distillation of coal tar or petroleum fractions. It is a volatile, fragrant, white and crystalline substance, can be extracted from petroleum or coal tar. It is primarily used in the production of phthalic anhydride, insecticides, low-volatile solvents, naphthalene sulfonates and moth repellents. Naphthalene is an essential manufacturing intermediary in the production of dyes, resins, insect repellents and plasticisers. It is particularly renowned as a key industrial compound utilised in the large-scale synthesis of plasticisers. The growing demand for Naphthalene, as an intermediate in the manufacturing of construction chemicals, is expected to drive the demand for this market. Textile industry is the leading end-user industry for Naphthalene in India. Refined form of naphthalene is used for domestic purposes as moth balls.
Naphthalene-based compounds find application across diverse sectors, serving as chemical intermediaries in textiles, pharmaceuticals, rubber-based products, imaging, agricultural chemicals, laundry detergents and construction. The global naphthalene market reached 2,250 thousand metric tonnes in 2023 and is projected to grow at a CAGR of 3.1% by 2032.15
Overall, the outlook for the naphthalene industry in India is positive. It is expected to continue to grow in the coming years due to the increasing demand from end-user industries and ongoing investments in manufacturing capacity and technology. The Indian government has also taken initiatives to support the growth of the naphthalene industry by providing various incentives to encourage investment in the sector.
Sulphonated Naphthalene Formaldehyde (SNF) and Polycarboxylate Ether (PCE)16
The global market for naphthalene and PCE-based admixtures witnessed substantial growth, reaching USD 15,360 million in 2022, at a CAGR of 4.85%. By 2028, it is estimated to reach USD 20,436.03 million. This expansion can be attributed to the exceptional properties of naphthalene and PCE-based admixtures, including enhanced mechanical strength, durability and reduced water retention. These characteristics have led to increased utilisation of naphthalene and PCE-based admixtures across diverse industries such as construction, paints, textiles, paper and rubber.
12
https://www.mordorintelligence.com/industry-reports/graphite-market 13 https://www.mordorintelligence.com/industry-reports/graphite-market 14 https://www.mordorintelligence.com/industry-reports/coal-tar-pitch-market15
https://www.chemanalyst.com/industry-report/naphthalene-market-565#:~:text=The%20global%20Naphthalene%20market%20 stood,from%20petroleum%20or%20coal%20tar 16 https://www.globenewswire.com/news-release/2023/02/23/2614676/0/en/Naphthalene-and-PCE-Based-Admixtures-Global-Market-Report-2023-Increasing-Demand-from-Construction-Industry-Bolsters-Sector.htmlHeightened global infrastructure and construction activities are the primary drivers fuelling the demand for naphthalene and PCE-based admixtures. With a rapidly growing global population, there is a corresponding surge in residential and commercial constructions. Admixtures play a pivotal role here by altering and enhancing the chemical and physical attributes of construction materials, particularly in reducing water usage for concrete while maintaining structural integrity.
Its clear from the 2024-25 interim Union budget that the government is prioritizing inclusive growth, particularly focusing on health, infrastructural development, and rural upliftment. The significant increase in the outlay for infrastructure by 11.1% to H 11,11,111 Crores, equivalent to 3.4% of GDP, is indeed noteworthy.17
Such a substantial investment in infrastructure is expected to have a ripple effect across various sectors of the economy. One sector that stands to benefit from this increased focus on infrastructure is the construction industry. With more funds allocated for infrastructure projects, there will likely be a surge in construction activities, including the development of roads, bridges, airports, and other public infrastructure.
As infrastructure projects gather pace, the demand for admixtures is expected to rise, driven by the need for high-performance concrete solutions.
The Indian cement industry is indeed aligned with the growth vision outlined in the interim Union budget. With a projected addition of 150-160 million metric tonnes per annum (MTPA) in capacity, the sector is poised for significant expansion. Its anticipated that 70-75 million tonnes (MT) of this capacity addition will be commissioned in the next fiscal year alone.18
Notably, large players are expected to account for a substantial portion, approximately 50-55%, of the planned capacity addition. This indicates the confidence of major cement manufacturers in the growth prospects of the industry and their commitment to capitalizing on emerging opportunities.
The market for naphthalene and PCE-based admixtures is expected to further develop due to their special qualities and critical role in resolving emerging concerns in the construction sector. During the projected period of 2023 to 2028, there will be attractive prospects for market participants caused by the growing demand for these admixtures as global infrastructure development accelerates and worries regarding water scarcity escalate.
Speciality oils
The Company produces several oils that cater to the specific requirements of various industries. These oils are derived as by-products of the Companys advanced multi-stage coal tar distillation process. Himadris state-of-the-art coal tar distillation facilities employ a sophisticated multiphase technique, ensuring the extraction of different types of oils.
Leveraging a continuous distillation approach, the Company achieves consistent cuts of distillates using a series of fractional distillation columns throughout the operation. This method facilitates the separation of oils into distinct grades based on their boiling ranges. Subsequently, these different grades of oils are meticulously blended in precise proportions through the Companys operational processes to meet the exacting demands of different industries.
17
https://www.cmaindia.org/interim-budget18
https://www.crisil.com/en/home/newsroom/press-releases/2024/01/cement-makers-to-add-150-160-mtpa-capacity-by-fiscal-2028. html?utm_source=crisil&utm_medium=social-media&utm_campaign=cement-makers-to-add-150-160-mtpaGrowth drivers19
• The global wood preservatives market is projected to be valued at USD 2.91 billion in 2024 and is anticipated to reach USD 3.64 billion by 2029, exhibiting a CAGR of 4.56% during the forecast period (2024-2029).
• The Asia-Pacific region is poised to witness significant expansion, driven by the flourishing housing construction markets in China and India.
• The Government of India has lowered the Goods and Services Tax (GST) on housing from 12% to 5%. This tax reduction is expected to stimulate the construction market, particularly for middle-class housing.
• India is expected to receive an investment of around USD 1.3 trillion in housing over the next seven years.
Clean Energy
Himadri is dedicated to providing sustainable energy solutions by leveraging cleaner alternative energy sources. As part of this commitment to conserve energy and safeguard the environment, the Company prioritises the reuse of industrial energy that would have otherwise been wasted.
To this end, the Company adopts an innovative approach by recycling the low-calorific waste gas generated during the carbon black process. Specially designed boilers are used to convert this waste gas into steam under high pressure and temperature. Subsequently, the high-pressure, high-temperature steam is used to power turbogenerators, effectively producing energy. This energy is supplied to the local electricity grid, thereby benefiting the wider community and is also internally deployed to power various operations within the Company. Over 90%32 of the power requirement is fulfilled by internally generated, clean energy sources. This integrated approach underscores the Companys commitment to sustainable energy practices and its ongoing efforts to minimise its environmental footprint.
Anti-corrosion products
The Company offers a selection of anti-corrosive products crafted from premium-grade high-temperature carbonisation coal tar. Renowned for their resistance to
19
https://www.mordorintelligence.com/industry-reports/wood-preservatives-market acid and alkali attacks, these materials are specifically engineered to provide superior protection against corrosion. The Companys anti-corrosion products ensure prolonged durability owing to their capacity to withstand diverse climatic conditions and the harsh salinity of seawater.Ideal for various applications, including petrochemical plants, ships, water purification facilities, distilleries and milk chilling facilities, the temperature and pressure specifications of these products are meticulously calibrated to deliver optimal performance and reliability.
Financial Highlights
(H in Crores)
| Standalone | Consolidated | |||
| Particulars | FY24 | FY23 | FY24 | FY23 |
| Revenue from operations | 4,184.89 | 4,171.84 | 4,184.89 | 4,171.84 |
| Earnings before interest, tax, depreciation, amortisation and foreign exchange fluctuation (EBITDA) | 632.37 | 408.17 | 635.39 | 419.00 |
| Profit Before Tax (PBT) | 573.14 | 271.81 | 573.86 | 280.25 |
| Profit After Tax (PAT) | 411.00 | 207.81 | 410.68 | 215.86 |
| Basic Earnings Per Share (EPS) (In H) | 9.17 | 4.94 | 9.16 | 5.13 |
| Diluted Earnings Per Share | 9.16 | 4.94 | 9.16 | 5.13 |
Changes in financial ratios and changes in return on interest
During FY 2023-24, the significant changes in the financial ratios of the Company and change in Return on Net worth as compared to that of the previous year are summarised below:
Details of Key Financial Ratios
| FY 2023-24 | FY 2022-23 | Variance (%) | Explanation for change in the ratio by more than 25% | |
| 1 Debtors Turnover (Sales/Average Debtors) | 7.09 | 8.10 | (12.47%) | Not applicable |
| 2 Inventory Turnover (COGS/Average Inventory) | 4.85 | 4.96 | (2.22%) | Not applicable |
| 3 Interest Coverage Ratio (EBITDA/Interest) | 10.99 | 8.39 | 30.99% | Increase in profitability resulting into improvement in Interest service coverage ratio |
| 4 Current Ratio (Current assets/Current liabilities) | 1.93 | 1.51 | 27.81% | Increase in current assets resulting in improvement in current ratio |
| 5 Debt Equity Ratio (Net Debt/Equity) | (0.05) | 0.09 | (155.56%) | Reduction in net debt & increase in shareholders equity on account of higher profitability. |
| 6 Operating Profit Margin (%) (EBITDA/Revenue) | 15.11% | 9.78% | 54.50% | Increase in operating profitability resulting into overall improvement in operating profit ratio |
| 7 Net Profit Margin (%) (PAT/Revenue) | 9.82% | 4.98% | 97.16% | Increase in operating profitability resulting into overall improvement in net profit ratio |
| 8 Return on equity (PAT/Average equity) | 15.82% | 10.34% | 53% | Increase in profitability resulting into overall improvement in return on equity ratio |
Research and Development (R&D)
The Company has a strong team of scientists and engineers who deploy best-in-class technologies to enable consistent innovation. It is this R&D team that helps the Company offer customised products and solutions that cater to changing market demands. The National Accreditation Board for Testing and Calibration Laboratories (NABL) has accredited the Companys state-of-the-art laboratories, which are powered by cutting-edge technology.
Product
Over the years, the Company has undertaken focused R&D efforts to develop products across the entire product value chain. Through forward integration, the Company has continuously introduced new innovative products at regular intervals.
Process
The Companys steadfast commitment to process improvement enhances its efficiencies. This dedication has resulted in better product yield, improved throughput and higher energy efficiency.
Technology
The Companys in-house technology development differentiates and enables it to compete in global markets. This capability helps the Company sustain its competitive edge consistently.
Process of R&D for product development
Conceiving the product based on market trend
Bench scale study
Pilot production for establishing the process
Production
Product offering
Customer feedback
Commercialisation
Quality
Himadri ensures that its products under go stringent quality controls, with an emphasis on achieving consistency and precision. Maintaining quality remains paramount across all operations, including product development and manufacturing, as this enables the Company to deliver on the expectations of global clients. The Company has an independent Quality Assurance (QA) team in place, which prioritises documentation and data control. The Companys focus on product quality has resulted in partnerships with various organisations and garnered recognition from the Indian government. To ensure adherence to quality standards, the QA team undergoes regular training and conducts audits at the Companys advanced research lab, accredited by the National Accreditation Board for Testing and Calibration Laboratories (NABL). It has streamlined processes across verticals- ISO 9001:2015 (Quality Management System), ISO 14001:2015 (Environment Management System), ISO 45001:2018 (Occupational health and safety management system), IATF 16949:2016 (International Automotive Task Force), ISO 27001:2013 (Information security Management System), ISO 50001:2018 (Energy Management System), ISO 37001:2016 (Anti-bribery management system), ISO 17025:2017 (NABL Lab Accreditation), SA 8000:2014 (Social Accountability) and more. These are a testament to its commitment to constantly add value to its clients while never compromising on quality, and its ability to manage the operations across workstreams. In addition to compliance with established regulations, processes and standards, Himadri prioritises environmental sustainability by manufacturing eco-friendly products through sustainable processes. This comprehensive approach to quality assurance underscores Himadris dedication to delivering excellence while minimising environmental impact.
Opportunities
Battery Materials
The battery materials sector is experiencing a surge in opportunities, primarily driven by the global shift towards EVs and a strong commitment to sustainability creating a vast market for companies in battery materials, especially those that can innovate and supply materials sustainably. As governments and consumers push for greener technologies, companies that provide low-carbon footprint materials are poised to gain a competitive edge. Furthermore, the need for a sustainable supply chain is prompting advancements in battery recycling and second-life applications, opening new business avenues. Overall, the convergence of EV adoption and sustainability initiatives is fostering a fertile ground for businesses in the battery materials space to grow and thrive.
Growth in allied industries
As the Indian economy continues to expand, there is growth expected in various application industries like construction, infrastructure, rubber industry, paints and many more. With the governments strong focus on infrastructure expansion including highway and construction, we are expecting a downstream demand impeatus for need to speciality chemicals to aid the construction processes.
Building partnerships
The Companys recent investments and acquisitions- Birla Tyres as a strategic partner, Sicona and Invati Creations are anticipated to help create a favourable market environment for the companys future growth. These would allow the company to not just foray into the B2C segment, but would also present opportunities for the company to broaden its customer base.
Sustainable product and service diversification
The surge in demand for sustainable and eco-friendly products presents a significant opportunity for the Company to capitalise on. By developing and manufacturing such products, the Company can better align itself with current market trends and cater to the evolving preferences of eco-conscious consumers, thereby potentially expanding its market share and enhancing its competitive edge.
Diversification in product line
The Company has diversified its product line and forayed into new markets that present promising growth opportunities. Particularly, the expansion into the lithium-ion batteries and coal tar segments holds significant potential for capturing new market share and driving revenue growth. This strategic move will further enable the Company to tap into emerging market trends and leverage the increasing demand for advanced energy storage solutions.
Exports
A major chunk of the global market now looks at diversifying its supply chain, reducing overdependence on select geographies/ supplier base, to better navigate probable geopolitical and regional challenges. This positions Inida in a favourable position, as an able alternative to many other asian countries.
Challenges
The Companys growth also depends on the growth of its downstream industries. Any technological economic disruption across these industries can pose a threat to its progress. The Company can ensure robust performance even during a downturn in the downstream industries by continuing to expand its product offerings, exploring new markets, and reaching out to new customers.
Human Resource
Human Capital Management: Our Commitment and Practices
The companys approach towards Human Capital is built on a commitment to not only attract and retain the best talent but also to foster an environment where innovation, diversity, transparency and productivity thrive. Over the past year, the Company continued to enhance its Human Capital Management practices to support our workforce and drive organizational success.
The companys Talent acquisition strategies helps it to attract diverse professionals at various levels who align with its corporate values and business objectives as it continues to venture into new business territories across its value chain. Its retention efforts are supported by competitive compensation, comprehensive benefits, opportunities for career development and sound engagement practices. The Company believes that capability enhancement programs are imperative to business success and thus last Financial Year, it has launched several programs focused on leadership, Process excellence, Digital competence and multiskilling, supporting continuous learning and adaptability in its rapidly evolving growth path. The Company believes that recognizing employees contributions and achievements at the right time is vital for fostering a positive work environment, motivating them, improving job satisfaction, enhancing performance, and commitment & loyalty towards the organization.
With its structured and transparent initiatives such as The Avengers (Best Team), The Pinnacle (Best of the Best Employee), The Shining Star (Best Employee of the Year), The Game Changer (Significant Contributor), The Rising Star (Best Debut), and more, the company has witnessed enhancement in employee performance level. These programs and recognition initiatives are designed around the belief that when employees feel they are heard or valued, they contribute more effectively which enhances transparency and alignment with organizational goals. Diversity and Inclusion (D&I) are not just part of the Companys policy but are embedded in its culture. This year, it has established a new D&I team to oversee its initiatives, which include bias training, mentoring programs for underrepresented groups, and partnerships with diverse suppliers.
Looking Forward
As the Company look to the future, it is excited about the opportunities to further integrate technology into its HCM practices leveraging new age technologies such as predictive analytics and machine learning. These will enable it to better predict staffing needs, understand employee behaviour, and personalize employee experiences, ensuring that Himadri remains a competitive and desirable place to work.
The Company are proud of the strides it has made in human resource practices and is committed to continuing its investment in the employees. The Companys people are the cornerstone of its success, and it believes that by supporting them, it are building a stronger, more sustainable business. An effective human capital practice demonstrates how organization values its people and contributes to overall business success.
Corporate Social Responsibility (CSR)
Himadri is committed to making a positive impact on society through its Corporate Social Responsibility (CSR) initiatives. The Company believe that businesses have a responsibility to contribute to the well-being of the communities in which they operate, and this belief is deeply ingrained in its corporate culture. As a socially responsible organization, it has integrated the United Nations Sustainable Development Goals (UNSDGs) into every aspect of its operations. The Board is directly responsible for designing CSR activities, and advancing relevant UNSDGs is a key element of its corporate strategy.
One of Himadris flagship CSR activities is its focus on Science-Technology-Engineering-Medicine (STEM education. Recognizing the importance of quality education in empowering individuals and communities, Himadri has undertaken various initiatives to support education in rural and underprivileged areas. The company has established schools, and provided scholarships to deserving students. Quality life through quality education is one of foundational understandings of Himadris business ethics.
Supporting rural developments
The Company has initiated a rural development program around all its manufacturing plants. This holistic approach includes constructing RCC houses, ensuring clean sanitation, providing drinkable water, and ensuring a reliable power supply.
Himadris CSR activities go beyond these areas with a focus on community development, womens empowerment, and skill development, among other initiatives. Through its CSR programs, it aims to create a positive impact on society while upholding its core values of integrity, respect, and responsibility.
The Companys ongoing rural development project near the Mahistikry plant has brought significant benefits to several underserved villagers, facilitating the construction of Pucca (RCC) houses in place of Kutcha (mud) homes; thereby enhancing their quality of life. The Company remains resolute in its commitment to the effective and responsible administration of essential urban resources and facilities.
Through its CSR wing, the Himadri Foundation, the Company organises camps in various nearby village areas, providing support- food and clothing during various festivals and at times of disasters or natural calamities.
Promoting Healthcare
The Company is committed to promoting healthcare in the communities it serves and operates in. It has set up healthcare facilities, conducted medical camps, and supported healthcare infrastructure development to ensure access to quality healthcare services for all. One of the key highlights of this commitment is its investment in developing a paediatric speciality cancer hospital.
The Company also helps with the provision of ambulances, medical equipment, and other essential supplies to the Lions Club Hospital in Dhanakhali, making a meaningful impact on the local healthcare system. These diverse efforts underscore the Companys commitment to the well-being of communities, making a tangible and enduring difference in healthcare accessibility.
Promoting Education
The Company offers educational books spanning all academic levels, to promote education among students from underserved communities. The Company also acknowledges the accomplishments of exceptional students by bestowing them with various prizes and sponsorships. Additionally, contributions have been made towards the construction of new school buildings and the establishment of a library.
Environmental, Health and Safety
To ensure the health and safety of the employees, customers, and stakeholders, the Company implemented a robust Occupational Health and Safety Management System (OHSMS). This system identifies, assesses, and mitigates risks associated with its operations, creating a safe and healthy work environment for everyone involved.
Our OHSMS implementation began with a thorough assessment of workplace hazards and risks, including machinery, hazardous materials, ergonomic challenges, and environmental factors. Through a comprehensive approach, it evaluates the likelihood and severity of these risks, prioritizing them based on their potential impact.
Following the risk assessment, the Company developed and implemented comprehensive Policies and Standards aimed at controlling and minimizing these risks. These policies cover various areas, including workplace safety, training, incident reporting, health and wellness, and compliance.
The Companys OHSMS is a dynamic system that evolves with changing circumstances, technological advancements, and organizational growth. It actively seeks feedback from employees and stakeholders to continuously improve the safety performance and foster a culture of safety throughout the organization
By implementing an OHSMS, the Company is not only meeting legal and regulatory requirements but also demonstrating its commitment to prioritizing the well-being of its workforce and the communities in which it operates. Since 2019, the ISO 45001-2018 Management System has been implemented covering the entire process and all seven plants of manufacturing and all layers of Employees and Workers. Health and safety is integral part of the Companys organizational values, and it strives to uphold these principles in everything it does.
The Company remains fundamentally committed to protecting the health and safety of all individuals affected by its activities. Its Zero Accident/Incident vision aims to eliminate all workplace risks, and underscored by a significant reduction in the Lost Time Injury Frequency Rate (LTIFR) since its launch.
The Company acknowledges and understands that good health and safety practices are essential for business success. As part of its commitment, it has introduced various non-negotiable standards that cover work practices, equipment requirements, emergency preparedness, and more. These standards have and continue to play a critical role in promoting a culture of safety and responsibility in all facets of the Companys business.
Continual improvement is at the core of its OHSMS, and the Company will continue to focus on achieving our vision of zero accidents and incidents. Therefore, it provides provide continuous training and awareness programs to all employees, contractors and visitors on safety protocols, emergency procedures and the use of personal protective equipment (PPE). Its Board of Directors provides invaluable direction and assistance to ensure that safety and sustainability are at the heart of all the strategic initiatives.
In conclusion, the Companys commitment to health and safety is embedded throughout the organization, and are dedicated to delivering value to its people by providing development opportunities and a safe working environment.
Industrial relations
The foundation of any industry is strengthened by its labour relations. The Company maintains open lines of communication with its personnel, ensuring they are informed about its objectives to foster a positive employer-employee relationship. This approach facilitates efficient operations with fewer disagreements between workers and management. Additionally, the Company conducts several development programs for its employees at various levels, creating a pleasant work environment. Through the implementation of productive and performance based policies, workplace relations remain positive. The Companys current policies prioritise the development and well-being of its talent pool while also safeguarding its broader interests. This alignment makes it easier for the Company and its employees to work together toward common goals.
Statutory compliance
The role of the Company Secretary as the Compliance Officer is to ensure the Companys compliance with SEBI requirements and listing regulations. In addition to the Company Secretary, the Chief Financial Officer (CFO), Chief Executive Officer (CEO) and Managing Director (MD) also function as compliance officers to prevent insider trading. Internal auditors have been recruited by the Company to ensure timely reporting of any potential non-compliance with the Companies Act, 2013, SEBI instructions and Listing Regulations, thereby mitigating associated risks. Compliance certifications are obtained from various management personnel, affirming adherence to key statutes.
Internal control system
The Companys Board of Directors holds responsibility for ensuring and establishing internal financial controls. Within the Company, internal control mechanisms for business processes, operational efficiency and compliance with all applicable rules and regulations are firmly in place. The Board also evaluates the adequacy and effectiveness of such controls. Policies, procedures, control structures and management systems align with the concept of Internal Financial Controls under the Companies Act, 2013, established at both entity and process levels to ensure compliance, regulatory adherence and accurate financial and operational data recording.
Regular internal inspections and audits are conducted to ensure the efficient execution of obligations. A comprehensive assessment of the Companys internal controls, accounting procedures and policies is undertaken. Senior Management evaluates and certifies the effectiveness of internal control mechanisms over financial reporting, adherence to the code of conduct and Company policies and compliance with established procedures in financial or commercial transactions, especially in cases of personal interest or potential conflicts of interest.
To strengthen the internal control process, independent internal auditors are engaged. The Company has well-established and comprehensive internal control systems, processes, rules, policies and procedures in place for monitoring and controlling operations across the entire organization and its subsidiaries. The Audit Committee reviews and approves the audit plan, meeting regularly throughout the year to discuss auditors reports and important findings. It receives reports on audit findings and corresponding measures taken.
The Company has implemented an internal control and audit system appropriate for its size and industry. The Audit Committee engages with the Companys statutory auditors to gather insights on financial statements, including the financial reporting system, compliance with accounting policies and procedures and the adequacy and effectiveness of internal controls and systems. The Management considers the Audit Committees views and recommendations in its decision-making processes.
Risk management
The organization has established risk management committees that identify internal and external risks which are unique including Occupational Health and Safety (OH & S), financial, operational, sectorial, sustainability (especially ESG-related concerns), informational, cyber security and others. The committee is responsible for monitoring and guiding the application of the risk management procedures and recommendation/ suggestion towards the risk management approaches. This includes assessing the effectiveness of risk management processes and systems of risk reduction, methods and procedures for the control of identified risks. In a dynamic operating environment, Himadri has been able to solidify its position a pioneer in its industry by adhering to its robust risk management framework.
Risk mitigation
The Company evaluates and reviews risks periodically to develop new strategies in response to evolving market conditions. The organization believes in mitigating risks at the rudimentary stage so that operations can continue uninterrupted without harming the People and Property. Through the combined efforts of the Audit Committee and the Management, risks are identified and minimised to the levels which can be predicted with reasonable accuracy. The following are some of the business risks and mitigation strategies adopted by the Company.
| Macroeconomic Risks | Operational Risks | Obsolescence Risks |
| Risk Description | Risk Description | Risk Description |
| A downturn in Indias economy could result in lower revenues for the Company, thereby leading to lower profitability. Risk also can arise from changing consumer preferences, where the consumer wishes to select products which are environment friendly/ cause less impact to the environment. | IT System failures, Data breaches, cyber threats and so on, can cause the Company harm and also pose a threat to its information, practices and processes and affect overall operations with disruptions. | The Companys manufacturing operations are subject to operating risks. Any usage of obsolete process or manufacturing of obsolete products could affect its operations by causing production halt at our manufacturing facilities. |
| Mitigation | Mitigation | Mitigation |
| It believes in constantly reviewing and optimising its operations- the main driver for reducing costs. The Company is committed to investing in R&D that enables it to innovate and stay competitive in the market, and further helps in opening up new revenue streams. Having an agile approach towards re-evaluation and recalibration of the sales mix, both at the geography and product segment level, to balance demand- supply requirements. | Through its learning & development initiatives, it tries to keep its employees aware of such threats, while constantly auditing its own systems and processes. The Company understands that cyber threats are evolving at a brisk rate. However, it believes it can navigate this risk effectively by continuing to adhere to safety protocols, and constantly upgrading its systems and processes. | To overcome this, the Companys R&D labs are constantly involved in the process of finding innovative ways to bring about new processes, products, or methodologies. It is their endeavour that has helped the Company to be at the forefront of many technological breakthroughs in our domain. |
| Supply Chain Risks | Capacity Expansion Risks | Market Presence Risks |
| Risk Description | Risk Description | Risk Description |
| The Company operates in an uncertain environment. Its regular business operations may be impacted through unavailability of raw material and fluctuating price of the same. Raw material price volatality and fluctuations in their availability could impact the margins for some of our product offerings. | Any deviations from realizing the projected values of the Companys expansion projects can affect its future financial projections and planning. | The Company operates in a highly competitive industry with a number of other manufacturers that produce competing products, both in India and internationally. With strategic facility location, the companys presence in the market also matters. |
| Mitigation | Mitigation | Mitigation |
| It has built a robust supplier base, to help it navigate through issues arising from a particular geography/ region. Moreover, it is constantly on the lookout to build new partnerships with competent suppliers, to help it deliver sustained quality. Moreover, it aims to maintain up to 60 days of inventory to ensure smooth operations at all times. Moreover, the Company keeps a sufficient safety stock of strategic raw materials and completed items. | It has always followed a phased expansion approach, which has allowed it to continually expand its capacityandoutreach.TheCompany closely monitors and tracks the progress of its new expansion projects. This will ensures visibility across the project stakeholders, concerning interdependencies and other associated risks. will closely monitor and track the progress of our new expansion projects, ensuring visibility across the project stakeholders, concerning interdependencies and other associated risks. | The Company operates a fully dedicated fleet of tankers to ensure timely delivery and procurement. It also owns several customised tankers catering to the clients demand. To remain competitive in the market we continuously strives to reduce its production and distribution costs, while improving its operating efficiencies and innovating overall product offering. Himadri enjoys a market presence of over 30 years. This presence has reaped goodwill for the Company across industries. Several aluminium and graphite companies in India have been customers of Himadri for the past 20 years. Moreover, leveraging its expertise, it is entering new businesses, which are in line with the push for sustainable development, helping us stay relevant in new growing markets. |
| Quality Risks | Environment, Health and Safety (EHS) Risks |
| Risk Description | Risk Description |
| All our products and manufacturing processes are subject to stringent quality standards and specifications. Any failure on our part to maintain the applicable standards and manufacture products according to prescribed specifications, may lead to loss of reputation and goodwill of our Company. | Every process-related activity across industries and domains has its inherent associated risks which can affect plants or properties in terms of Accidents/Incidents at the workplace and the ill health of its employees. |
| Mitigation | Mitigation |
| The Company has its own distillation facility, enabling the usage of raw materials for in-house production. Forward integration further enables the Company to develop and produce a rich quality base of value-added products. These products also help retain the key customers ensuring customer loyalty and low marketing cost. | Himadri has created a sustainable business by complying with established regulations to ensure all its activities are socially and environmentally responsible. The Company has made significant investments towards undertaking eco-friendly measures which has helped in making its facilities ‘Zero Discharge Plant. With the same impetus, we are on our way to fulfilling our ambitions-Vision Zero (Accident Incident) and Net Zero by 2050. |
Cautionary statement
Any forward-looking statements regarding expected future events and the financial and operating results of the Company are based on certain assumptions, the fulfilment of which the Company does not guarantee. These statements are subject to risks and uncertainties and the actual results may materially differ from those expressed or implied. Important developments that could affect the Companys operations include industry downtrends, whether global or domestic, significant changes in the political and economic environment in India or key markets abroad, tax laws, litigation, labour relations, exchange rate fluctuations, technological changes, investment and business income, cash flow projections, interest and other costs. The Company does not undertake any obligation to update forward-looking statements to reflect events or circumstances after the date thereof.
IIFL Customer Care Number
(Gold/NCD/NBFC/Insurance/NPS)
1860-267-3000 / 7039-050-000
IIFL Securities Support WhatsApp Number
+91 9892691696
Download The App Now
Follow us on
2024, IIFL Securities Ltd. All Rights Reserved
www.indiainfoline.com is part of the IIFL Group, a leading financial services player and a diversified NBFC. The site provides comprehensive and real time information on Indian corporates, sectors, financial markets and economy. On the site we feature industry and political leaders, entrepreneurs, and trend setters. The research, personal finance and market tutorial sections are widely followed by students, academia, corporates and investors among others.
Stock Broker SEBI Regn. No: INZ000164132, PMS SEBI Regn. No: INP000002213,IA SEBI Regn. No: INA000000623, SEBI RA Regn. No: INH000000248
This Certificate Demonstrates That IIFL As An Organization Has Defined And Put In Place Best-Practice Information Security Processes.
