Thread by @drprashantmish6

#Balaji amines-Mcap 1280 Cr , CMP 397
1- Company is in Amine segement manufacturing ( a) amines (b) derivatives ( c) speciality chemicals
2- 50-60% revenue from pharma and API , 15-20% from agrochemicals and rest from dye, textile, water treatment chemicals and other segments

3- Clientele include ( a) amine -Jubilant, Dr Reddy , Aurobindo ( b) Amines derivatives-Sun , kores , wanbury (c)Speciality chemicals-Indian oil , Hikal , Mylan , Zydus and many others
4-High entery barrier with around 25 products

5- EBITDA margins between 18-20 % in last few qtrs , ROCE and ROE > 20 in last 3-4 yrs , debt around 250 Cr

6- Currently Methyl Amine capacity is 48000 TPA ( alkyl amines 30000 TPA and after debottlenecking it will be 45000) no exapansion in this segment

7- Ethyl Amine capacity 6000 TPA ( alkyl 15000 TPA ) and capex is going on for another 16500 which will be completed in FY 2021-

ethyl alcohol is raw material and used in pharmaceuticals like riboflavin , xylocaine , lignocaine, ampicillin, amoxicillin, cephalexin,metoprolol, and many herbicide and pesticides

8- Morpholine current capacity is 10000 Tons and in till q3 manufacturing was 8000 Tons - very few players in world -Morpholine is used as a boiler water treatment additive in steam systems of power plants and refineries, and waxing fruit so that they can last longer and fresh .

9-recently started manufacturing Acetonitrile from November 19, onwards with installed capacity of 9,000 tons and gradually increasing production, right now acetonitrile price is high which company feel that is not sustainable for long term so it developed another product

Tetrahydrofuran ( THF ) which can be manufactured on same line as acetonitrile and If there is any volatility in price, going ahead their plan to manufacture Acetonitrile for six months and THF for six months. No company in India manufactures THF and its demand of 15,000 tonnes

THF used in PVC and pharma apart from many other uses. 10-Another Capex is going on for Di-Methyl Carbonate (DMC). ( 9900Tons)The demand for Di-Methyl Carbonate is about 8,000 tonnes in India, which is currently met fully by import

11-The Di-Methyl Carbonate goes in the API market .For polycarbonate it is one of the main raw material.

11-DMA HCL capacity is 25000 Tonnes and approval for 7500 more but capex not started- it is used for manufacturing Metformin ( anti diabetic drug)
Above mentioned are only capex products, Balaji is having many other products also .

12-Balaji Specialty Chemicals Private Limited, Is a subsidiary of the company which imanufactures
niche products like Ethylenediamine (EDA), Piperazine (PIP) and Diethylenetriamine
(DETA), till now all these products are imported and now company started mfg in India

and currently running to 10-15% capacity and most of the contract with foreign companies will end by March so April onward utilisation will improve ( First Company in India to manufacture EDA , PIP, DETA )

13- Ethylene diamine capacity 37350, used in pesticide and polymers , piprazine 4050 tons used in API and oilfield, Diethyltriamine 780 tpa used in pharma and polymers .

14- many people don’t like its diversification to hotel business also but I don’t think so
This is what I know , please add more .

15- @threadreaderapp unroll

India is currently importing 29000 tons of EDA, 8000 tons PIP , and 4000 tons DETA ,

If government impose anti dumping duty on DMF which is a product of Balaji then current capacity utilisation from 20 % can go up to 60-65% according to management.

#Balaji Amines some updates Ethylene Diamine , Piperazine, AEP,DETA production started in H2 FY 20 and signed contract with leading agrochem companies ( Subsidiary Balaji speciality)

Company expects peak utilisation from subsidiary in 2022 with expected revenue at peak utilisation around 350-400 Cr

Greenfield expansion-( ethylamine and Dimethyl carbonate )3-4 month delay expected due to covid Fy 20 pharma contribution to revenue around 51%and agrochemicals 26% .

# BALAJI AMINES Concall update DMF utilisation historically 20% , fy 19-20 utilisation was around 30% and if government impose anti dumping duty them utilisation may go to up significantly.

Balaji speciality chemicals-revenue increased to 21 Cr from 4 Cr in q3 and operating profit of 92 lakh as compare to loss of 2.5 Cr in q3, subsidiary debt is 130 Cr

Hotel business- last 3-4 months not operations and fix cost of 20-22 lakh Balaji amines operating at 80-85% capacity and speciality chemical 30-40% capacity utilisation. Standalone debt zero and consolidated debt 130 Cr for subsidiary

For Greenfield capex which is delayed due to corona company already spent 70-77 Cr and expect additional capex of around 70 Cr So 130 Cr debt for subsidiary and 20-25 Cr working capital for subsidiary and 100 Cr working capital for Standlone Balaji amines-260 Cr

Greenfield expansion will be completed in q4 and revenue will start coming in q1 22
Company after Greenfield field expansion will start producing DMC ( 30 Tonns per day ) current price 150 per kg

No major import of Raw material from China
Mancozeb which is banned by government in agrochemicals but it has other uses also like polymer industries , oilfield and mancozeb domestic use is banned not export .

Fy 21 company expects 30-40% utilisation of capacity in speciality chemicals subsidiary and with full utilisation revenue potential with even lower price expected more then 250 Cr .

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#Balaji amines-Excellent bottom line growth due to operational efficiency, top line almost flat due to COVID , fy20-21 ( Both Brothers are in my PF )

Balaji amines-DGTR recommends anti dumping duty on DMF , if it is implemented then positive for Balaji amines .

#Balaji amines - Excellent results, announced new capex , CFO not up to the mark .