16 February, 2024 16:02:50 IST 
Chennai-based Chemplast Sanmar Ltd expects to commission its paste PVC expansion project in Cuddalore by the fourth quarter of the current financial year, the company informed in an investor presentation.
"The 41-ktpa (kilo tonne per annum) paste PVC project is expected to start commercial production in Q4 of FY2024. This will further cement our position as the leading paste PVC producer in India," said the company's MD Mr. Ramkumar Shankar. The company's existing facility has a capacity of 66-ktpa.
"Despite the recent uncertainty in the industry, we are confident of the long-term potential of all our businesses and are strengthening our capabilities and relationships to grow in a sustainable manner," he said," he said.
Chemplast Sanmar has reported a consolidated net loss of Rs. 89.38-crore, during the third quarter (October-December 2023). The consolidated profit after tax for the corresponding quarter of last financial year stood at Rs. 27.14-crore.
"After a relatively better second quarter, Q3FY24 performance ran into heavy weather due to further correction in PVC prices on account of dumping from China and other countries, slow down in other chemicals (caustic soda, chloromethanes) business due to the over-supply situation in India, increase in key feedstock, prices and adverse impact of the lag effect in correction of VCM prices," Mr. Shankar said.
However, he noted that the boom in the infrastructure and real estate sectors is driving demand for PVC. "We expect a gradual recovery in prices and margins over the next 2-3 quarters. The other chemicals business is also expected to witness improvement in prices in the next 3-4 quarters once the excess supply is absorbed by the market," he added.
Last year, Chemplast Sanmar had said it would invest Rs. 1,000-crore for expanding capacities of the paste PVC unit and its Custom Manufactured Chemicals Division (CMCD) unit at Berigai (Tamil Nadu). The CMCD produces advanced intermediates in pharmaceutical and agrochemical markets. Phase 1 of the CMCD project was commissioned during the first half of this fiscal.
Custom-manufactured chemicals
On the phase II expansion project, the company said it was expected to be completed in the first quarter of FY25. The two-phased expansion project is aimed at expanding capacity from 1,068-mtpa to 4,500-mtpa.
"In our CMCD's business, the pipeline is healthy. We commercialised three new products this year and a number of products are under various stages of development. Despite the challenges on account of the downturn in the global agrochemicals industry and the consequent inventory rationalisation, we expect this business to deliver a reasonable growth during the year. While commercial production from phase 1 of the expansion project has commenced, phase 2 is expected to be completed in Q1 FY25, informed Mr. Shankar.
