Apcotex Industries held a conference call on 28 January 2022 to discuss the results for the quarter ended Dec'21 and way forward. Mr. Abhiraj Choksey- Managing Director, Mr. Anand V Kumashi- Company Secretary and Mr. Sachin Karwa – Chief Financial Officer of the company addressed the call.

Highlights of the Concall

• Quarterly volumes grew YoY for both Q3 and 9MFY22 due to the full benefit of all de bottlenecking projects, all of which were completed between Q2 and Q3. In addition, it witnessed a healthy, broad based volume growth across most industries, customers and geographies.

• Export sales contribution grew to 21% of overall sales to Rs 53 crore in Q3FY22

• Work on new expansion projects is on schedule and expected to be completed around Q2/Q3 of FY23

• Volume growth during the quarter was 20%

• The company is running at 100% capacity utilisation.

• The company expects sustainable margins to be in the range of 12-13% to 17-18% depending on the crude oil prices.

• The company was able to maintain its Ebitda margins during the quarter despite inflationary trend in raw material prices as it was able to pass it on to the customers

• The company has increased its footprints in Maharashtra while it has entered markets of Gujarat, Madhya pradesh and Goa in terms of Apcobuild. Apcobuild has grown by around 150% in 9MFY22

• The company expects exports to be around Rs 200 crore in FY22

• The company has announced current capex for Nitrile Latex in Valia and a multipurpose plant in Taloja with additional capacities of around 60000 tonne with total capex of Rs 180 crore and expected revenue of around Rs 500 crore. Further an incremental capex of Rs 100 crore it would be possible to generate additional revenues of Rs 300-00 crore

• The company has about 30% less market share in NBR business in India, and we are hardly exporting. In the long run, even though is, it is not a very high growth industry, compared to latex products, the company believes that there is a good opportunity for import substitution in India, as well as export into Southeast Asia, Middle East and Asia. So the company plans to double its capacity in FY23-24 depending on macro environment.

• Apcobuild revenues currently are very small part of revenues. However it expects to be a larger chuk in 3-5 years.

• The company is fairly well diversified in terms of sectoral contribution to revenues, nothing more than 20% of overall sales