2021-12-15 09:52:47
• Globally, India is 6th largest producer of chemicals also set to become the 4th largest player in years to come. In 2019, the Indian chemicals market stood at US$ 178 billion and is forecast to reach US$ 304 billion by 2025.
• The specialty chemicals sector witnessed a significant growth of ~14% since 2015 vs a 5.7 percent CAGR across the globe, and is expected to reach US$ 70 billion by end-2020, followed by a CAGR of ~12-13% over the next five years. 1-2 percent incremental market share gain from China can result in high-teens growth rates here on.
• Globally, the specialty chemicals business accounts for about 20 percent of the $4 trillion chemicals industry. From having an insignificant presence (4.5 percent) in this segment, India’s share in specialty chemicals is expected to double over the next five years at a nearly 12 percent CAGR to $64b by CY25.
• Indian Govt. has allowed 100% FDI in industrial licensing under the automatic route, total FDI inflow in the chemicals sector reached US$ 18.06 billion between April 2000 and September 2020. In September 2021, exports of organic and inorganic chemical exports increased 29.65% YoY to reach US$ 2.37 billion.
• PLI Scheme worth Rs 5,000 crore for surfactants, dye, pigments, chemical, petrochemical sectors is in its final stages and can soon get approved to boost domestic manufacturing and exports. Government has launched 12 PLI scheme for different sectors which will directly or indirectly benefit the chemicals sector.
• The Indian chemical industry is at the cusp of a structural growth, led by the shift in global supply from China, increase in outsourcing opportunities due to global consolidation and domestic demand, fuelled by burgeoning consumption.
• Post China+1, specialty chemicals segment in India to gain disproportionately, Indian chemical manufacturers are well poised to emerge as a credible alternative, and, in some cases, primary suppliers to global firms.
• In Q2FY22, the chemical companies broadly reported a muted QoQ financial performance impacted by RM cost pressure and high fuel/energy/logistic costs. However, the severity of cost escalations is transitory and fuelled by external factors expect chemical prices to start easing from early 2022 in anticipation of normal production resumption in China after the Winter Olympics 2022.
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