Atul Ltd 2022-23

43 The products falling under these product groups are used by customers belonging to the Adhesives, Aerospace and Defence, Automotive, Composites, Construction, Electrical and Electronics, Food and Beverage packaging, Footwear, Marine, Paint and Coatings, Paper, Sport and Leisure, Transport and Wind Energy industries. The product groups comprise 47 synthetic products and 268 formulations. Liquid epoxy resins, solid epoxy resins, solvent cut resins, cycloaliphatic resins, epoxy phenol novolac, multifunctional resins, aromatic amines and their adducts, 4,4’-Diaminodiphenyl sulfone and 4,4’-Dichlorodiphenyl sulfone are some of the key products. During 2022-23, sales decreased by 2% from ` 1,546 cr to ` 1,513 cr. Sales in India decreased by 2% from ` 945 cr to ` 927 cr; bulk sales in India decreased by 7% from ` 751 cr to ` 700 cr, whereas retail sales increased by 17% from ` 194 cr to ` 227 cr. Sales outside India decreased by 3% from ` 601 cr to ` 586 cr and Polymers Product groups: epoxy resins, curing agents, reactive diluents, sulfones, protective paints, epoxy sealants, tapes and adhesives based on epoxy, synthetic rubber, polyurethane, cyanoacrylate, PVC and PVA formed 39% of the total. Growth on account of volume was 7%. The world market for epoxy resins and curing agents is estimated at US$ 12 bn and is growing at about 3%, while the Indian market is estimated at US$ 380 mn and is growing at about 6%. Seven major companies dominate the world marketplace. The world market for sulfones (curing agents) is estimated at US$ 393 mn and is growing at about 6%. The user industries, Construction, Defence, Electrical and Electronics, Paint and Coatings are growing well, particularly in India. The Company will participate in this growth by – i) improvingmanufacturingandworking capital efficiencies, ii) debottlenecking and adding capacities, iii) introducing new products and iv) widening market reach in new geographies. Cheaper imports and new entrants in the market will keep the market competitive and may keep margins under pressure. Since the two main raw materials, namely Bisphenol-A and Epichlorohydrin, are imported, fluctuations in foreign exchange may impact margins. to a significant loss in sales of high-performance pigments. Rudolf Atul Chemicals Ltd (RACL), a joint venture company formed in 2011-12, provides a complete range of textile chemicals in the Indian market; its sales decreased by 8% from ` 121 cr to ` 111 cr, primarily because of volume. The size of the world Textile Dyestuff industry is estimated at US$ 6.6 bn and is expected to grow at about 3% in the coming years. China continues to be the largest manufacturer of dyes followed by India. The world market for high-performance pigments is estimated at US$ 5.9 bn (constitutes both organic and inorganic pigments) and is expected to grow at about 4% in the coming years. The main user industries, namely, Textile, Paper, Paint and Coatings will continue to be influenced by macroeconomic and geo-political factors. The Company along with RACL is expected to grow by - i) improving capacity utilisation and managing cash flows ii) introducing new dyes and textile chemicals, iii) developing newer applications for existing products and iv) broadening the market reach in new geographies. Fluctuations in foreign exchange, high inflation in export markets, low demand and competition from China may impact sales realisations. Treatment costs are expected to remain high because of stricter regulatory norms and increasing demand for the implementation of green chemistry principles and ESG compliance.

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