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
