Corporate Performance

Published: July 15, 2022
Updated: July 15, 2022

Meghmani Finechem - CPVC resin plant to boost revenues

Ahmedabad-based Meghmani Finechem Limited, a leading chemical manufacturer, recently announced the successful commissioning of its chlorinated polyvinyl chloride resin (CPVC resin) plant at Dahej in Gujarat. The newly commissioned facility, with a production capacity of 30,000 tonnes per annum (tpa) is the largest of its kind in India. The plant has been commissioned on time and without any cost overrun.

In India, CPVC resin demand is around 140 kilo tonnes per annum (ktpa) and is expected to grow by around 13% CAGR over the next five years. Approximately 95% of the CPVC resin demand in India is met through imports. The new plant will reduce the dependence of CPVC resin consumers on imports, thereby helping the country save its foreign exchange reserves.

CPVC resin is used in manufacturing CPVC pipes and fittings. CPVC pipes have high heat resistance and chemical resistance properties. Considering its features, CPVC is widely used for domestic (households) and industrial purposes.

CPVC resin is a high-value product. Considering the current prices of CPVC resin, MFL expects the asset turnover ratio to be above 2.0x, which will improve the company’s absolute EBITDA and will end up providing a higher RoCE, creating value for all the stakeholders.

Mr Patel noted, “On commissioning of the CPVC resin plant, we are moving in the direction of being a multi-product company and this will increase revenue contribution from the derivative and specialty chemical segment. Also, this will further strengthen our fully integrated complex, as part of the raw material for CPVC resin will be available within the plant itself.” MFL has state-of-the-art manufacturing facilities in Dahej (Gujarat), one of the leading PCPIR regions in the country. The facility is a backward and forward integrated and automated complex with a well-established infrastructure and captive power plants. The company is India’s 4th largest manufacturer of caustic soda, chlorine and hydrogen, and a leading manufacturer of caustic potash, chloromethanes and hydrogen peroxide. It is also the first to set up an epichlorohydrin plant

MFL is further expanding into chlorotoluene and its value chain to strengthen its position in the specialty chemical segment. The company is focused on sustainable value creation and has also been awarded with the ‘Responsible Care’ certificate.