Vikas Ecotech

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About The Company

Vikas Global One Ltd was incorporated in the year 1984. The company started a business of trading and distribution of Petroleum and Petrochemical products. The company has since undergone backward integration of its business to manufacturing of high-end products used in Plastic, Rubber, Footwear and Packaging industries while alongside acting as distributor of global conglomerates with niche in specialty chemicals and polymers

 The manufacturing plants of the company are spread in various geographical locations across India, in the state of J&K and Rajasthan. This has been done keeping in mind the strategic and locational advantages about the availability of raw material, tax incentives, subsidy grants as well as the market potential for finished goods. These industrial units have speedy connectivity to Road, Rail, and Air transport. The company has built the plants with the best of the machinery and technical know-how available from the world’s leading suppliers. The manufactured products of the company have been well received in the market and have the further scope of greater development with increased production capacities. The products manufactured by the Company are environmentally friendly. The company is also actively working on establishing its new manufacturing units in western part of the country since it will help Company to mark its presence in unchartered territories of the highly industrialized western geography of India. The locations will be near to sea ports providing greater, cheaper and easy scope of exports. The company is contemplating to expand their current capacity to tap the global markets especially in those countries wherein India has signed free trade agreements, which entitles Indian companies greater scope and larger benefits. The company is also planning to open office of its subsidiary company in Singapore with dual purposes of launch its products in the global market and channelizing the imports at a much better price for its domestic requirements.

 

Key Milestones

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Industry Overview

India's specialty chemicals industry is valued at about $25 billion, has successfully delivered 13 per cent growth over the past five years, primarily led by domestic consumption. By constituting about 3 percent of the global specialty chemicals market, this sector has great potential and is to grow to 6-7 percent in 2023 with market size in the range of $ 80-100 billion.The applications of specialty chemicals market includes advanced ceramic materials, construction chemicals, cosmetic chemicals, water management chemicals, oil field chemicals, textile chemicals, food additives, and others such as rubber processing chemicals, and specialty paper chemicals.

Speciality chemicals by functions include adhesives and sealants, catalysts, corrosion inhibitors, antioxidants, flame retardants, separation membranes, synthetic dyes, specialty pigments, demulsifiers, rheology modifiers, and water-soluble polymers. The chemical industry is a key enabler for other industries. As chemicals are consumed in varying proportion by every industry (rightly from electronics to paints, from pharmaceuticals to cosmetics), without chemicals sustainable development of other sectors is not possible.

The growth for specialty chemicals is driven by both domestic consumption and exports. Speciality chemicals have applications across consumer (e.g., personal care chemicals), industrial (e.g., water chemicals) and infrastructure (e.g., Construction chemicals) segments are driven by the overall growth of the Indian economy.

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Growth drivers for the specialty chemicals industry can be listed as -

  • Domestic availability of raw material at competitive prices
  • Strong demand growth in the consumer industry and a domestic industry that supports ‘premiumisation’ of products
  • Competitive cost of manufacturing
  • Investment in R&D and
  • An ecosystem to support industry and innovation

 

Products Portfolio

Since three decades, Vikas Ecotech has pioneered innovations in toxin-free specialty chemicals in India. The company provides environmentally responsible, specialty chemical solutions to a diverse customer base globally. Products are approved by most international legislations for use in safety-critical food and drinking water applications.

Product Range:

  • Specialty Additives -Vikas Ecotech offers an extensive range of toxin-free, high-performance additives for use in a variety of manufacturing applications.
     
    • Organotin Stabilizers- Vikas Ecotech is the first and only Indian company with an integrated in-house facility to produce FDA-approved Organotin Mercaptan (Methyl Tin Mercaptide) PVC heat stabilizers from tin metal ingots.
    • Dimethyl Tin Dichloride- Vikas Ecotech manufactures high-performance Dimethyl Tin Dichloride (DMTDC) - a raw material for producing Organotin stabilizers.
    • Plasticizers
      •     ESBO
      •     Chlorinated Paraffin
    •  Flame Retardants- Vikas Ecotech is the premier supplier of Aluminium Trihydrate (ATH) – a widely used flame retardant and smoke suppressant due to its versatility and low cost. ATH provides high-performing alternatives for manufacturers seeking halogen-free flame retardant additives.
    • Chlorinated Polyethylene- Vikas Ecotech manufactures high-quality Chlorinated Paraffin (CPW) - a secondary plasticizer & economical flexibility for PVC applications. It is typically used with phthalate plasticizers.
  • Polymer Compounds- Vikas Ecotech is a leading manufacturer of specialty rubber-plastic and polymer compounds for the global market.
    •   Thermoplastic Rubber (TPR) Compounds
    •   Thermoplastic Elastomer (TPE) Compounds
    •   Ethylene Vinyl Acetate (EVA) Compounds   

Recycled Materials-  Vikas Ecotech is a leading manufacturer of specialty recycled materials for the global market.

  • Poly Vinyl Chloride (PVC) Compounds- Using recycled raw material, the company creates virgin-grade PVC compounds which offer consistency in quality & performance. Vikas Ecotech manufactures a diverse range of customized product grades for high fire resistance, low smoke emission, and high strength properties.
  • Polyethylene Terephthalate (PET) Compounds- Vikas Ecotech manufacturers a wide range of differentiated PET compounds from the virgin and recycled PET. Recycled PET is manufactured on a fully integrated state-of-the-art plant to create consistent and good quality material for use in a variety of industrial applications.
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Customer and Segment Diversity

Vikas Ecotech has identified nine key sectors that would drive growth for its specialty chemical business. They are Agriculture, Automobile, Wires & cables, organic & Inorganic chemicals, Polymers, Healthcare industry, Packaging, Artificial leather, and footwear. This sector diversity will ensure that any demand contraction or technology-led change does not affect your company in a severe manner.

Secondly, the company rolled out a customer acquisition strategy of owning large B2B customer accounts. This will help company engage with a few large customers in depth rather than spreading us thin across multiple retail buyers. B2B customers can now get stabilizers, plasticizers, compounds, and additives from a single one-stop solutions partner – a value proposition that is difficult to replicate. However, the company will ensure that no single customer impacts more than 10% of the total revenues. While each of the above is growth sectors both in domestic and global demand, the company aims that each sector should contribute not more than 10-15% of the total revenues and will continue to look for newer growth sectors to spread its.

Some of the clients are-

  • RR Kabel
  • Relaxo Footwear
  • Liberty
  • Escorts
  • KEI
  • Havells
  • Apollo Pipe
  • SRF

 

Geographic Presence

Global Presence-

Country wise network

As a two-star export house, products were exported to 20+ countries across Asia, Africa, Europe and the Americas.

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Domestic Manufacturing Facilities

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 Key Initiatives and Capex

In FY18, Vikas Ecotech’s business will be demerged into two public companies with the purpose of improving its strategic focus, simplifying operating structures and inducing more efficiency in capital allocation and structuring.

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 Commissioning of new export-oriented unit at Noida SEZ, National Capital Region

  • Construction commenced for new plants at Kandla to augment exports and explore new domestic markets
  • Commenced construction of its state of the art manufacturing plant and Innovation (R&D) Centre at Dahej, Gujarat with Capacity to produce 6,000 MT of Organotin stabilizers (MTM) and 5,000 MT of special polymer compounds annually with Planned investment of Rs. 30 crores
  • Capacity expansion of Rajasthan unit, Organotin stabilizers 1,200 MT and specialty compounds 8,500 MT per annum
  • Formation of new advisory board to fine-tune the strategic growth direction of the company
  • Quality certifications that recognize company’s Organotin stabilizer, Tinmate, as safe for use in food-grade applications.
  • Upgradation of company ratings indicating improved fundamentals
  • MoU with Navigate Corporation, Czech Republic to transfer Hydal technology
  • Commenced production of Polypropylene compounds for use in the white-goods industry

 Revenue Analysis

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 Competitive Advantage

  • VET has 250+ workforce and products are exported to 20 countries, like Bangladesh, Pakistan, Sri Lanka, China, UAE, Turkey, Spain, Singapore, Germany, Ukraine, and the USA.
  • VET formed a strategic tie-up with PPF, India’s 3rd largest PVC pipes mfg. firm for supply of specialty chemicals to replace current with eco-friendly variants
  • VET produces Organotin Stabilizers which are required to produce Lead-free non-toxic, safe and eco-friendly PVC pipes. It’s a valuable tech. available to only a few producers worldwide
  • VET aims to produce bioplastic by using waste cooking oil through a technology called Wastol-P and grow as one of India’s leading eco-friendly firms. It has entered into a contract with Haldiram, the large snack mfg. For the supply of waste cooking oil.
  • VET is rated highly on lean business operations, aggressive growth – both mfg. Capacities and workforce, good R&D team, eco-friendly products and growth in domestic & export market.
  • Good R&D that works with prospects and customers to develop new products & solutions. The recent revenue upswing was the result of years of R&D.
  • Capacity additions will start from Dahej, Noida and Bhuj plants in FY18
  • Remarkable cost consciousness including salaries for promoters and employees.
  • The current customer base is derisked across a large number of firms and industries, providing stability.

 Financial Analysis

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