• Shekhar Yadav

Regular Updates

Updated: Mar 15



In this Blog, I will be updating on whatever new information I have or thoughts about certain things.


15.03.22


Caustic Soda Lye Prices


Caustic Soda Flakes Prices


ABS Prices



PVC Prices





05.03.2022


Welspun India Ltd- Q3FY22 Concall : There is a supply glut(oversupply) of home textiles in the US market. Even the complete shipment of Christmas order had not reached US market by the time of concall.

There is likely to be destocking for a couple of quarters before they start restocking again.

Sales is likely to suffer.


26.02.2022


Thematic report on Indian Chemical Sector


Link


26.02.2022


Fluorination Sector - Thematic View On Navin Fluorine, SRF And Gujarat Fluorochemical: HDFC Securities


LINK


16.02.2022


Initiating coverage on Indigo Paints by Edelweiss:


Indigo+Paints+-+initiating+coverage-Aug-21-EDEL (1)
.pdf
Download PDF • 3.84MB


15.02.2022


Excellent paper by James Montier of GMO capital on portfolio managers inclination to be compared against Index return rather than Absolute return.


Montier
.pdf
Download PDF • 1.23MB

07.02.22


CreditAccess Grameen out of woods after a long time:


https://www.myinvestmentdiary.com/post/creditaccess-grameen-limited-analysis




07.02.22


Change in BSE Circuit limits/price bands from 07.02.22:

https://www.bseindia.com/markets/equity/eqreports/sur_price_monitoring.aspx?expandable=6


31.01.22


Pharma


I was just curious to find out the filing fee paid by pharma companies to USFDA.


For ANDA(Formulations), it comes out to be ₹1.7cr and for DMF(API), it comes out to be ₹56 lakhs.

Source: https://www.fda.gov/industry/fda-user-fee-programs/generic-drug-user-fee-amendments



31.01.22


Book Reviews: One of the best book I have read in the recent past is: Richer, Wiser, Happier by William Green



The book is about the personality traits and what are the other habits successful investors have.


The best investors are not like other people. They are Iconoclasts, Mavericks and Misfits who see the world differently from the crowd and follow their own peculiar path, not just in the way they invest but in the same they think and live.

Some people in the race don't have the tribal gene of following others as they can think for themselves.

They are unemotional about their decisions, they can't be overly influenced by what other people think. The only way to beat the market is to diverge from the market.


The books covers the traits and journeys of some well-known and some not so well known names:

Sir Franklin Templeton, Howard Marks, Jean Marie Eveillard, Joel Greenblatt, Nick Sleep & Qais Zakaria, Charlier Munger etc


18.01.22


DCM Shriram Ltd- Q3FY22


Excellent result by DCM Shriram Ltd.

Revenue increased by 26% YoY

EBITDA increased by 46% YoY

PAT increased 38% YoY


Improved performance was led by their Caustic soda business. Caustic soda prices increased almost by 80% during the quarter while the increase in cost was not that much. While the Caustic soda volumes were up only by 8%, the value increase was 107%.



DCM Shriram Ltd- Slide from company's presentation


18.01.22


US Cotton textile import data; Source: Otexa


Despite high base, Indian exports continue to rise at an excellent pace for the month of Nov 2021.


US Cotton Textile import Data

Companies to benefit: Welspun India, Trident, Indo Count, Himatsingka etc


18.01.22


Commodity Chemical Prices

Caustic Soda Lye Prices
Causitc Soda Flakes Prices

Acetic Acid Prices
ABS Prices

PVC Prices

27.12.21


Excellent interview of the promoter of HP Adhesives(Recent IPO). She lost her husband early and built the business on her own and later on was joined by her son.





27.12.21


Blog on 'Indian Adhesive Industry': Link


23.12.21


Acetic Acid Prices


Companies: Jubilant Ingrevia, Laxmi Organics


23.12.21


PVC Prices:


Companies: Chemplast Sanmar etc



23.12.21


Caustic Soda Lye prices:


Caustic Soda Flakes Prices:

Companies: Meghmani Finechem, Gujarat Alkali, DCM Shriram etc


23.12.21


Notes from K R Choksey on site visit to Meghmani Finechem Facility recently.

Meghmani Finechem Notes

Meghmani Finechem Notes


18.12.21


Due to supply chain issues (China is now looking inward) and robust demand, companies are going for both backward integration to secure their supply chain as well as expanding their capacities to meet the demand.


17.11.21


All Commodity Chemical companies stock prices continues to fall for more than a month despite rising commodity prices and increasing spread.


Eg. Meghmani Finechem, Chemplast Sanmar, I G Petrochem, BEPL etc.


Looks like an opportunity to add.


09.11.21


The high prices of Caustic soda is confirmed by management of Gujarat Alkali in an interview yesterday.



09.11.21


Domestic Caustic Soda Price remained elevated even as Coal prices have corrected significantly





06.11.21


"An investor who can reduce a significant bit of allocation to stock markets near the peak of a bull run and further increase allocations when market starts to come off, progressively will make a far superior return on his portfolio over a longer run than a very smart and clever stock picker. Investing is as much as an art of capital allocation as it is an art of stock picking" from the book 'The PolyCycle Investor'



05.11.21


Very good video on India & its growth prospects reality




02.11.21


Ethyl Acetate:

The other competitive solvents such as Toluene, MIBK, MEK, Acetone, Cyclohexane, etc. are getting replaced with the greener solvent Ethyl Acetate in the industrial applications. Ethyl Acetate is manufactured by Jubilant Ingrevia, Laxmi organics and other companies into Acetyl value chain.


This is predominantly due to the following:

• Faster evaporation of solvent helps in quick drying in end-use application

• Companies claim the bio-content of the raw material (Ethyl Acetate) from their manufacturing operations

• Eliminating the ‘dangerous substances’ tag from the product label of manufactured goods (where greener

solvents like Ethyl Acetate is used)

• Less toxicity of Ethyl Acetate when exposed to humans; Acceptable allowance of ETAC in the human body

is more than other solvents

• Optimum solubility in the solvent blends


Source: Laxmi Organics DRHP

02.11.21


After a dream run of Coal Prices, a plunge in prices driven by Chinese govt intervention.

Source: https://markets.businessinsider.com/commodities/coal-price


22.10.21


Chinese commodity price database: Link below



Link: http://www.sunsirs.com/uk/prodetail-608.html


20.10.21

L&T Technology came out with good numbers for Q2FY22. In the interview, the CEO talks about 3 key changes happening in the IT sector:

  1. Companies are restructuring themselves

  2. Growing need for Cybersecurity & ESG

  3. The Great resignation in the US requiring the need for automation


10.10.21

Good video to understand Meghmani Finechem businesses!




07.10.21


Caustic soda prices continues to trend higher.

Source: www.indianpetrochem.com

Electricity/Power cost is the major cost in manufacturing Caustic soda, other being salt, water and methanol.


Source: https://www.eurochlor.org/wp-content/uploads/2021/04/12-Electrolysis-production-costs.pdf


Companies to benefit: Meghmani Finechem

India's is 4th largest manufacturer of caustic soda and has CAPTIVE POWER PRODUCTION OF 94MW. Also, the company in the last 3 years have done a capex of ₹956cr which got completed recently. Likely to benefit.


06.10.21


With Sintex struggling with its balance sheet issues, other plastic pipe players are ramping up the Water tank capacities. Eg, Prince Pipes, Astral Pipes, Apollo pipes etc. Another avenue for growth.


06.10.21


Market share capture by Indian Cotton Home textile exporters to US continues.

Below is the cotton import data by the US govt for the month of August 2021 compared with August 2020.


Cotton sheets grew 87.8% YoY

Cotton terry towels grew 56% YoY

Cotton Bedspreads grew 64.2%

Other cotton items grew 73% YoY


Source: Textiles and Apparel (trade.gov)

Companies to Benefit:

Welspun India

Himatsingka Seide

Indo Count Industries

Trident


29.09.21


HEG Ltd- turnaround in performance in Q1FY21.


  1. Graphite electrode prices have started moving up. It has moved up by 15-20%.

  2. Company has got rid of its high cost inventory completely

  3. Current capacity utilization stands close of 85%

  4. Growing capacity utilization by end customers i.e. Steel companies

  5. Steel prices at all time high






29.09.21


Excellent interview - Deepak Nitrite's Maulik Mehta - Love the way he accepts and explains his mistakes


Also, high shipping cost is helping the company as more and more domestic customers are procuring locally and ready to pay a premium.





23.09.21

Acetic Acid prices




18.09.21


Pthalic Anhydride Prices continues to rise.


Companies that benefits: Thirumalai Petrochem, IG Petrochem



Also, the raw material Ortho Xylene has risen quite a bit.


13.09.21


PVC prices continues the uptrend.


03.09.21


List of sector wise presentation by ICRA : Link


03.09.21


Iron ore prices are on a sharp falling streak. After touching a high of $220 on July 19th, 2021, the prices are now trending at $140 on 03 Sept 2021, a drop of 36% due to curb on steel production by China.


Source: Link


Companies going to be adversely affected: Godwari Power & Ispat, Sarda Energy


01.09.21


Howard Marks presentation on 'The truth about investing'

Howard-Marks_The-Truth-about-Investing
.pdf
Download PDF • 320KB


31.08.21


A good way to know about the upcoming IPO's fundamental and understanding the sector is by listening to the IPO Roadshow by the company's management team.


Goto Youtube--> Type 'trendlyne ipo roadshow'


You will get a list of such video presentations.


Link


You can also try with other keywords such as 'trendlyne + name of the company' etc


27.08.21



PVC prices are on a uptrend again.

Companies to benefit: Chemplast Sanmar, Prince Pipes and other pipe manufacturers



26.08.21

India is one of the top formulation drug exporters in the world, its pharmaceutical industry relies heavily on imports of bulk drugs. As the industry matured and grew, Indian players graduated to the highly lucrative "formulation" part of the value chain compared to API.

Source: CII KPMG report on API; April 2020 (Page no 18)


66302
.Indian20API20Industry2020Reaching20the20full20potentialKPMGCIIThought20Leadership20r
Download INDIAN20API20INDUSTRY2020REACHING20THE20FULL20POTENTIALKPMGCIITHOUGHT20LEADERSHIP20R • 4.08MB

26.08.21




25.08.21


The pricing pressure in the generic pharma business is due to:

  1. Consolidation of supply chain

  2. Faster ANDA approval by USFDA

  3. Entry of lot of small and mid sized companies

While solid dosage forms have long been the largest segment, Sterile liquid(vials) are currently enjoying the highest growth.




Source: Link


21.08.21


WHEN THE PRICE OF A PRODUCT IS SAME FOR IMPORTED ONES AS WELL AS DOMESTICALLY MANUFACTURED ONES, THE DOMESTIC BUYERS WILL PREFER DOMESTIC MANUFACTURER INSTEAD OF AN IMPORTED ONES DUE TO THE BELOW REASONS(In the light of Anti dumping or other duties):


1. LOWER LOGISTICS COST

2. NO FOREX RISK

3. LESSER PAPERWORK

4. CAN ORDER SMALLER QUANTITIES


19.08.21


How does a branded player in any sector grow?

  1. Increase the distribution: Need to make the product available across so that branding/marketing is effective

  2. Introduce new SKUs(products) : Use the same distribution channel to push more products to increase revenue

  3. Introduce products in adjacent segments : Think 'Tank' for Astral Pipes

  4. Spend on marketing & advertisement

Eg. Polycab, Prince Pipes, Astral pipes, Havells etc


18.08.2021

MDF & HDF prices have gone through the roof in the ongoing quarter(Q2FY22). Everyone is scrambling to get hold of the materials(MDF & HDF)

Companies to benefit: Greenpanel Industries Ltd, Rushil Decor, etc

Source: HIL Ltd Concall (time: Intial 5-10minutes of the call)


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