R-22 prices rose to Rs244/kg (down 5.0% QoQ / up 37.5%) in Q4FY22-TD, but volumes were down 81% YoY to just 325te. This could be partially due to plant shutdown for Gujarat Fluorochemicals, but we are not worried as companies sell their entire quota allocated for full year.

In packaging film segment, spread has increased for both BOPET and BOPP. This is despite anticipation of spreads dipping due to new capacity expansion, while higher margins should keep helping SRF. Lauryl alcohol prices rose again in Jan’22 and now stand at Rs167, up 6.3% QoQ. Inflation in Rossari Biotech’s four key raw materials will keep company margins under pressure, while prices have cooled to some extent but are unlikely to sustain in the near term.

Pigment prices have increased (good for Sudarshan Chemical) on QoQ basis, but it has slightly dipped MoM belying expectations of further inflation. EPL will continue to face challenges due to elevated polymer prices. PTFE prices have risen 13.7% YoY to Rs939, in line with GFL commentary about price increase; PTFE volumes grew 20% YoY in Jan’22. Carbon black export volumes have grown 62% YoY, hence PCBL will see higher mix of exports (which have lower spreads compared to domestic sales).

(Note: All prices stated below are in Rs/kg; Q4FY22 prices include data for only Jan’22)

SRF Ltd: R-22 prices steady, but high; packaging film spread strong

R-22 prices declined 5.0% QoQ (up 37.5% YoY) to Rs244 in Q4FY22-TD. Fluorspar (acid spar) prices were up 8.2% QoQ / 8.7% YoY at Rs31. R-22 spread (to fluorspar and chloroform) was at Rs126 vs Rs150 in Q3FY22. R-22 prices were down 15.5% MoM to Rs244 in Jan’21. Export volumes have plummeted 81% YoY to 325te in Jan’22.MDC (methylene chloride) prices rose 25.2% QoQ / 84.3% YoY to Rs72; methanol prices and chlorine prices have increased. Our analysis suggests spreads / margins in MDC for SRF should be higher.NTCF prices were up 50.0% QoQ / 13.6% YoY, to Rs199 in Q4FY22. Caprolactam dipped 2.0% QoQ / rose 40.9% YoY at Rs160. NTCF-caprolactam spreads were at Rs39 vs negative Rs31 in Q3FY22. Notably, NTCF import volumes dipped 37.5% YoY to 3kte.BOPET prices grew 3.3% QoQ / 29.8% YoY to Rs155. PTA dipped 5.1% QoQ / rose 40.3% YoY to Rs59, and MEG prices were down 16.9% QoQ / up 8.5% YoY at Rs48. BOPET-PTA/MEG spreads were up 14.3% QoQ / 28.9% YoY to Rs88 (vs Rs77 in Q3FY22). On MoM basis, spreads expanded 9.8% to Rs88 in Jan’22.BOPP price inflation was 1.3% QoQ / 24.1% YoY at Rs186 while polypropylene (PP) prices were down 15.3% QoQ / up 2.9% YoY at Rs92. BOPP-PP price spread was up 25.6% QoQ / 55.7% YoY at Rs94.

Navin Fluorine (NFIL): R-22 spread high

R-22 prices dipped 5.0% QoQ / rose 37.5% YoY to Rs244. Fluorspar (acid spar) prices were up 8.2% QoQ / 8.7% YoY to Rs31. R-22 spread (to fluorspar and chloroform) was Rs126 vs Rs150 in Q3FY22. NFIL should be negatively impacted due to QoQ higher chloroform prices.

Chemplast Sanmar: PVC spreads improve

Paste PVC prices were up 8.2% QoQ and 19.6% YoY to Rs135. Chemplast buys EDC for paste PVC, which is up 1.6% QoQ / 71.3% YoY to Rs70. Paste PVC – EDC spread stood at Rs19 in Q4FY22-TD vs Rs10 in Q3FY22.Suspension PVC (S-PVC) prices rose 5.1% QoQ / 62.0% YoY to Rs118. VCM inflation was 1.7% QoQ / 32.1% YoY at Rs110. S-PVC-VCM spreads were Rs9 in Q4FY22-TD vs Rs5 in Q3FY22.MDC (methylene chloride) prices rose 25.2% QoQ / 84.8% YoY to Rs72; methanol and chlorine prices have increased. Our analysis suggests Chemplast spreads for MDC rose QoQ.Caustic soda prices were down 4.4% QoQ / 101.2% YoY to Rs49 (vs Rs51 in Q3FY22).Paste PVC import volumes dipped 21% YoY to 1.3kte; and S-PVC volumes declined 48% YoY to 27kte in Jan’22.

Sudarshan Chemical (SCIL): Organic pigment realisation expanded 21.3% YoY

Organic pigment prices rose 4.8% QoQ / 21.3% YoY to Rs617 in Q4FY22-TD vs Rs589 in Q3FY22. Organic pigments are inclusive of all colours including CPC. Their export volumes were flattish YoY at 10kte in Jan’22. However, prices dipped 0.7% MoM in Jan’22.Azo pigment mixture prices increased 5.0% QoQ / 22.3% YoY to Rs499 vs Rs476 in Q3FY22.Inorganic pigment prices were up 8.3% QoQ / 19.8% YoY to Rs119 vs Rs110 in Q3FY22.

Galaxy Surfactants (GSL): Lauryl alcohol prices hardened in Jan’22

Lauryl alcohol prices were at Rs167, up 6.3% QoQ and 36.5% YoY, vs Rs157 in Q3FY22. The rise in Jan’22 was 4.0% MoM to Rs167.LAB (linear alkyl benzene), a petroleum-based surfactant, prices were up 0.5% QoQ / 48.8% YoY to Rs131.

Rossari Biotech: Input material prices remained elevated

Rossari uses four key input materials – surfactants, acetic acid, acrylic acid, and silicone oil.Lauryl alcohol, key basic raw material for surfactants, prices were at Rs167, up 6.3% QoQ / 36.5% YoY, vs Rs157 in Q3FY22.Acetic acid prices rose 3.0% QoQ / 73.2% YoY to Rs79 in Q4FY22 (vs Rs77 in Q3FY22). In Jan’22, the price was Rs79, down 8.4% MoM.Acrylic acid prices have risen 7.6% QoQ / 90.8% YoY to Rs179 (vs Rs166). Acrylic acid was Rs179 in Jan’22, down 0.1% MoM.Silicone oil prices were 13.9% QoQ and 101.4% YoY higher at Rs478 in Q4FY22 (vs Rs420 in Q3FY22).

EPL Ltd: Polymer prices were steady in Jan’22

Prices of LLDPE, a key input for laminates, were at Rs101, up 3.7% QoQ / 36.5% YoY, vs Rs98 in Q3FY22. Prices rose 0.1% MoM to Rs101 in Jan’22.

Vinati Organics

Ibuprofen prices dipped 28.1% QoQ / 60.6% YoY to Rs855 (vs Rs1,189 in Q3FY22).IBB prices rose 1.3% QoQ (36.8% YoY) to Rs172.

Atul Ltd

2,4-D prices rose 12.0% QoQ and 71.2% YoY to Rs282. Export volumes rose 27.4% YoY to 3.2kte in Jan’22.

Paracresol price inflation was 8.8% QoQ and 86.2% YoY at Rs276. Export volumes dipped 8.4% YoY to 961te in Jan’22.

Epoxy prices were down 4.3% QoQ and up 40.9% YoY at Rs343. Export volumes rose 10% YoY to 2.3kte in Jan’22.

Resorcinol prices dipped 3.0% QoQ and were flattish YoY at Rs661. Export volumes fell 143% YoY to 272te in Jan’22.

Gujarat Fluorochemicals – PTFE prices rose sharply

PTFE prices were up 13.7% QoQ and 35.4% YoY to Rs939 (vs Rs826 in Q3FY22). PTFE (to fluorspar) spread expanded 14.3% QoQ and 38.6% YoY to Rs858 (vs Rs751 in Q3FY22). PTFE export volumes were up 20% YoY to 1.3kte (up 12% MoM) in Jan’22.R-22 prices dipped 5.0% QoQ / rose 37.5% YoY to Rs244. Fluorspar (acid spar) prices were up 8.2% QoQ and 8.7% YoY to Rs31. R-22 spread (to fluorspar and chloroform) was Rs126 vs Rs150 in Q3FY22. GFL should be negatively impacted from higher chloroform prices QoQ.Caustic soda prices were down 4.4% QoQ / up 101.2% YoY to Rs49 (vs Rs51 in Q3FY22).

PCBL

Carbon black prices were up 5.6% QoQ and 31.3% YoY to Rs93 (vs Rs88 in Q3FY22). Carbon black export volumes were up 62% YoY to 22kte in Jan’22

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