The recent shutdown on factories violating emission norms by Chinese government has severely affected supply of chemicals across the world and also has unlocked the opportunities for specialty chemical companies based in India. Specialty chemicals are mostly used in a varied range of products such as pet foods, detergents, soaps and cosmetics. As per the market analysts, after the shutdown of Chinese companies, India will probably turn into a global manufacturing hub of specialty chemicals. Moreover, the government sanctioning 100% FDI will further boost the industry.
Furthermore, there are several other factors expected to push the growth of Indian specialty chemicals companies that include economical manufacturing costs, obtainability of skilled labor, strict intellectual property protection laws & favorable government strategies. Moreover, owing to production cuts in China, some of the Indian companies are all set to compete with its peers across the globe by growing their scale of operations.
In addition, as per a recent statistics, there are approx. 127 chemical companies listed in National Stock Exchange that have delivered an aggregate sales, operational profit and adjusted EPS (Earnings per share) growth in 2nd quarter of the fiscal year 2018-19. Now, among those 127 companies five are recommended as good buy opportunity, promising for noble return in a years’ time frame. Below is the list of those Indian Chemical Companies:
- Navin Fluorine International
Navin Fluorine International exports its product to Europe, North America, West Asia as well as Asia Pacific. The company anticipates growth of its inorganic fluoride segment to last due to the constant demand from the steel and aluminum companies.
- Atul Limited
Atul Limited has got its subsidiaries in the United States, the United Kingdom, China, Brazil and the UAE. Atul’s crop protection, bulk chemicals and polymers trades are expected to register a significant growth in upcoming months because of improved product acceptance, untapped potential for revenue and strengthening domestic as well as international markets position. Moreover, major segments & products of the company are all set for the next level of growth because of the higher consumptions, Greenfield capex and removing blockages in the way of production activity.
- Himadri Specialty Chemical
Himadri Specialty Chemicals firm supplies to the aluminum, steel, automotive, plastics and infrastructure segments. Moreover, company has a healthy cash flow as well as has spent a notable amount for the development of innovative products. Also, company’s debt situation will probably be stable as it capex requirements will be mostly met by in-house accruals. Furthermore, its distinctive proposition, value-added products and global footprint will bloster the growth of the company.
- Bodal Chemicals
Bodal Chemical mainly manufactures specialty chemical for paper, textile, plastic and leather companies. It is basically into the production and exportation of dye intermediates, sulphuric acid and dyestuff amongst other chemicals.
- Aarti Industries
Aarti Industries has around 16 units of manufacturer and is amongst the major supplier, exporter and manufacturers of specialty chemicals and pharmaceuticals. Moreover, its opportunities of import exchange will make it a substantial beneficiary of the shift in capability from China.