Indian chemicals industry well poised to capitalize growth opportunity
Indian chemical industry estimated at USD 178bn, is sixth largest in the world and fourth largest in Asia. The industry manufactures more than 80,000 products for industries as diverse as textiles, agrochemicals, automotive and pharmaceuticals among many others. Speciality chemicals which is a sub‐segment, forms ~ 20% of domestic chemical industry. Despite stupendous growth (~1.3x GDP growth) observed over last decade or so, the industry continues to be fragmented and forms just ~3‐4% of global chemical sales, significantly trailing China (~36% of global chemical sales). Nevertheless, growing domestic consumer base, increase in disposable incomes, changes in lifestyle and supportive government policies are likely to propel the industry into a phase of superior growth, whereby the industry is expected to reach USD 300bn by FY25. In addition, as tougher environmental norms force Chinese manufacturers to retract from exports market, additional opportunity is opening up for Indian manufacturers.
Q3FY22 Earnings Preview