SRF: R-22 price rose to Rs335/kg (+12.0% QoQ) in Q3FY23, but volumes were down 15.3% YoY to 2.6kte. In packaging films segment, spreads contracted QoQ for both BOPET and BOPP, which has put pressure on SRF’s packaging films margin.

Gujarat Fluorochemicals: PTFE price jumped 5.8% QoQ / 24.0% YoY to Rs1,023 while volumes fell 11.4% YoY to 3.1kte. Other fluoropolymer prices dipped 0.8% QoQ, and volumes surged 308% YoY to 1.1kte.

Archean Chemical: Bromine price remained flattish QoQ, but volumes dipped 41.0% YoY to 2kte while SOP price dipped 35.7% QoQ.

Clean Science: Clean Science’s Q3FY23 margins were likely helped by 0.5% QoQ rise in guaiacol price to Rs384 and 15.9% QoQ decline in phenol price to Rs103.

Galaxy Surfactants: Lauryl alcohol price dipped in Q3FY23 to Rs148, down 22.6% QoQ; this should help Galaxy improve its volumes as a result of reducing cost pressures on FMCG companies.

Rossari Biotech: Four key raw material prices have started falling, which has aided margin improvement.

EPL: Should see some relief in margin pressures due to fall in polymer price (down 9.3% QoQ).

Sudarshan Chemical: Pigment prices were down 3.4% QoQ and volumes down 37.3% YoY to 20.2kte.

PCBL: Carbon black export price fell 9.7% QoQ to Rs125 and export volumes were down 10.3% YoY.

(Note: All prices are in Rs/kg)

SRF Ltd: Packaging films spreads declined

·   R-22 price jumped 12.0% QoQ (30.2% YoY) to Rs335 in Q3FY23. Fluorspar (acid spar) price inched up 2.1% QoQ / 34.5% YoY to Rs38. R-22 spread (to fluorspar and chloroform) was Rs213 vs Rs177 in Q2FY23. R-22 price rose to Rs341, up 3.5% MoM, in Dec’22. Export volumes dipped 15.3% YoY to 2.6kte. We are incrementally concerned about the rapid decline in R-22 export volumes, which could be structural. The domestic market may have a similar trend (basically, shift to HFC is happening faster than expected).

·   MDC (methylene chloride) price fell 24.6% QoQ / 28.4% YoY to Rs41; methanol and chlorine prices have increased. Our analysis suggests spread/margin in MDC for SRF should be lower QoQ. MDC import volumes fell 29.2% YoY to 14.4kte. MDC prices were up 44.8% MoM to Rs55 in Dec’22.

·   NTCF price was down 6.3% QoQ / 7.0% YoY to Rs124 in Q3FY23. Caprolactam price dipped 17.7% QoQ / 11.1% YoY to Rs146. NTCF-caprolactam spread was negative at Rs22 vs a negative Rs45 in Q2FY23. Notably, NTCF import volumes shrank 41.8% YoY to 10.8kte, implying weak demand.

·    BOPET price was down 15.1% QoQ / 8.0% YoY to Rs138. PTA price declined 15.3% QoQ / rose 11.7% YoY to Rs69, and MEG price was down 7.7% QoQ and 29.9% YoY at Rs40. BOPET-PTA/MEG spread contracted 16.3% QoQ and 16.1% YoY to Rs64 (vs Rs77 in Q2FY23). On MoM basis, spread shrank 2.0% to Rs63 in Dec’22.

·  BOPP price dipped 9.4% QoQ / 9.4% YoY to Rs166 while polypropylene (PP) price dipped 6.5% QoQ / 25.4% YoY to Rs81. BOPP-PP spread contracted 12.0% QoQ and expanded 14.0% YoY to Rs85 (vs Rs97 in Q2FY23).

Gujarat Fluorochemicals – PTFE price continues to be strong

·    PTFE price was up 5.8% QoQ / 24.0% YoY to Rs1,023 (vs Rs967 in Q2FY23). PTFE (to R-22) spread dipped 5.7% QoQ, but rose 12.2% YoY to Rs321 (vs Rs340 in Q2FY23). PTFE export volumes were down 11.4% YoY to 3.1kte.

·    Other fluoropolymers price dipped 0.8% QoQ / rose 35.1% YoY to Rs2,382 (vs Rs2,402 in Q2FY23). Export volumes surged 307.5% YoY to 1.1kte.

·    R-22 price increased 12.0% QoQ / 30.2% YoY to Rs335. Fluorspar (acid spar) price was up 2.1% QoQ / 34.5% YoY to Rs38. R-22 spread (to fluorspar and chloroform) was Rs213 vs Rs177 in Q2FY23.

·    Caustic soda price rose 3.9% QoQ / 16.0% YoY to Rs59 (vs Rs57 in Q2FY23).

·    MDC (methylene chloride) price dipped 24.6% QoQ / 28.4% YoY to Rs41 while methanol and chlorine prices have increased. Our analysis suggests spread for MDC is likely to be lower QoQ.

Archean Chemical – Bromine price is firm

·   Bromine price remained flattish QoQ and increased 26.1% YoY to Rs431 (vs Rs431 in Q2FY23). Export volumes were down 41.0% YoY to 2.0kte.

·   SOP price dipped 35.7% QoQ / rose 47.7% YoY to Rs47 (vs Rs73 in Q2FY23). Export volumes were down 73.2% to 727te.

Clean Science – Phenol price decline aid margins

·  Guaiacol price was up 0.5% QoQ and 12.8% YoY to Rs384 (vs Rs382 in Q2FY23).

·    Phenol price dipped 15.9% QoQ and dipped 3.4% YoY to Rs103 (vs Rs122 in Q2FY23).

·   Methanol price rose 6.1% QoQ / fell 26.4% YoY to Rs26. Acetic anhydride price was up 4.0% / down 9.4% YoY to Rs106.

Galaxy Surfactants (GSL): Lauryl alcohol price continues to decline

·   Lauryl alcohol price stood at Rs148, down 22.6% QoQ and 5.7% YoY, vs Rs191 in Q2FY23. In Dec’22, price dipped 2.3% MoM to Rs144.

· Price of LAB (linear alkyl benzene), a petroleum-based surfactant, was down 7.3% QoQ, but up 17.3% YoY to Rs153.

Rossari Biotech: Input price inflation eases

· Rossari uses four key input materials – surfactants, acetic acid, acrylic acid and silicone oil.

·   Price of lauryl alcohol, key basic raw material for surfactants, was Rs148, down 22.6% QoQ / 5.7% YoY, vs Rs191 in Q2FY23.

·   Acetic acid price dipped 18.7% QoQ / 47.1% YoY to Rs41 in Q3FY23 (vs Rs50 in Q2FY23) and was down 2.6% MoM at Rs40 in Dec’22.

·   Acrylic acid price fell 33.9% QoQ / 33.7% YoY to Rs110 (vs Rs167 in Q2FY23). It was down 6.5% MoM at Rs104 in Dec’22.

·   Silicone oil price was down 7.0% QoQ / up 5.2% YoY to Rs442 in Q3FY23 (vs Rs475 in Q2FY23).

EPL Ltd: Decline in polymer price

·    Price of LLDPE, a key input for laminates, was Rs89, down 9.3% QoQ / 9.1% YoY, vs Rs98 in Q2FY23. It dipped 4.1% MoM to Rs87 in Dec’22.

Chemplast Sanmar: S-PVC import volumes dipped in Q3FY23

·    Paste PVC price increased 5.2% QoQ / 40.1% YoY to Rs174. Chemplast buys EDC for paste PVC, price of which has plummeted 24.3% QoQ / 47.7% YoY to Rs36. Paste PVC-EDC spread stood at Rs114 in Q3FY23 vs Rs87 in Q2FY23. EDC prices rose 85.2% MoM to Rs55 in Dec’22.

·   Suspension PVC (S-PVC) price was down 23.1% QoQ / 32.6% YoY to Rs76. VCM price dipped 14.4% QoQ / 43.1% YoY to Rs61. S-PVC-VCM spread was Rs15 in Q3FY23 vs Rs27 in Q2FY23. VCM prices dipped 15.0% MoM to Rs55.

·   MDC (methylene chloride) price fell 24.6% QoQ / 28.4% YoY to Rs41 while methanol and chlorine prices increased. Our analysis suggests spread for MDC is likely to be lower QoQ.

·   Caustic soda price was up 3.9% QoQ / 16.0% YoY to Rs59 (vs Rs57 in Q2FY23).

·   Paste PVC import volumes rose 30.6% YoY to 4.3kte; S-PVC volumes were down 5.9% YoY to 118kte.

Sudarshan Chemical (SCIL): Organic pigment export volumes shrink

·   Organic pigment price fell 3.4% QoQ / rose 8.8% YoY to Rs640 in Q3FY23 vs Rs663 in Q2FY23. Organic pigments are inclusive of all colours including CPC. Export volumes were down 37.3% YoY at 20.2kte. There has been a slowdown in demand for pigments (particularly for plastics segment), which has hurt export volumes.

·    Azo pigment mixture price was down 4.8% QoQ / up 9.0% YoY to Rs519 while its export volumes fell 24.0% YoY to 11.1kte.

·    Inorganic pigment price was up 6.9% QoQ / 9.4% YoY to Rs121 vs Rs113 in Q2FY23.

PCBL: Carbon black export price dipped in Dec’22

·    Carbon black price was down 9.7% QoQ, but up 42.8% YoY to Rs125 (vs Rs139 in Q2FY23). Export volumes were down 10.3% YoY to 48.2kte. Price dipped 6.1% MoM to Rs120 in Dec’22.

Atul Ltd

·     2,4-D price rose 0.3% QoQ / 5.1% YoY to Rs265. Export volumes rose 39.2% YoY to 11.2kte.

·     Paracresol price inflation was 2.7% QoQ / 19.9% YoY at Rs304. Export volumes were down 83.4% YoY to 0.6kte.

·     Epoxy price was down 20.4% QoQ / 29.3% YoY at Rs253. Export volumes rose 10.6% YoY to 7.1kte.

·     Resorcinol price rose 0.7% QoQ / 30.8% YoY to Rs839. Export volumes contracted 84.5% YoY to 73te.

Vinati Organics

·     Ibuprofen price rose 31.5% QoQ / 26.5 YoY to Rs1,504 (vs Rs1,144 in Q2FY23).

·     IBB price was up 0.9% QoQ (7.8% YoY) to Rs200.