Adiya Birla Chemicals is a member of Aditya Birla Group .This company taken over by Aditya Birla Group in 2005 and now it is a 51% subsidiary of Hindalco Industries.ABCIL manufacturing inorganic chemicals, like caustic soda, chlorine, resins , hydrochloric acid, aluminium chloride , bleaching powder ..etc.Its products find applications in sectors like Soaps and Detergents ,Pulp and paper,Textiles ,Water treatment,Dyes and colours ,Aluminium ,Food Processing ,Lubricants .etc .After the acquisition by Aditya Birla Group , company added capacities substantially and also included many new products into its offering.Last year Company completed a large acquisition by buying out Kanoria Chemical’s chloro chemicals division at a cost of Rs.830 Cr.With this acquisition ABCIL’s caustic soda capacity increased from 1,05,000 tpa to 2,20,000 tpa.Now ABCIL is upgrading the caustic soda plant of this facility by most modern technology with a capital outlay of another Rs.150 Cr . Renovated plant is expected to re-start commercial production in next few months.This new technology will increase capacity and reduce power cost substantially ,which will reflect in margins going forward. Chlor Alkali business is cyclical in nature and it is going through better times . Considering the tight supply demand conditions in favor of Chlor –Alkali producers ,further price hikes also expected in next few quarters . This company will be one of the biggest beneficiary of the emerging opportunities in this sector backed by the large capacity and strong management capabilities of Aditya Birla Group. Company raised its debt level to fund the above mentioned large acquisition but a favorable pricing situation for its products is expected support the cash flow going forward. Investors with medium term view may consider it @ CMP of Rs.89, and keep a close watch on the price trend of its products.Sock is traded both in NSE and BSE
Link to Company Website HERE
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