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Companies that make critical products for their clients (intermediates, sp chemicals) where an inferior product would make significant damage & the cost of which is a small part of customer’s operations, enjoy bargaining power.
But, here it is very important that they sell to many small customers rather than a few large ones. Specialisation in niche markets yields great margins unless there is technological obsolescence.
#Syngene
#suven
#paushak
#nocil
#dcal
#hikal
No big listed co would run the risk of taking small reductions in price of inputs. Especially when stakeholders would easily question the miniature quantum of savings. MNC tyre companies, biologics, pharma, crop protection, and sp chemicals are examples..
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