India's Economic Growth and Chemical Sector Opportunities

India's growing economy, now the second largest in Asia, presents a significant opportunity in the chemical sector, particularly for import substitution. This potential is driven by the country's expanded capacity to support local investments in chemicals that were previously imported from countries like China.

Import Substitution Opportunity

• India's previous $2-trillion economy made local chemical production unfeasible as the consumption was limited to only 20-30% of the output.
• As a $4-trillion economy, India can now consider investing in local chemical plants for import substitution.
• The import substitution opportunity is estimated at $25-30 billion, excluding the hydrocarbon value-chain.
• Chemicals used in household items, such as those in shampoos and soaps, are primarily imported from China and could be produced domestically.

SRF's Strategic Investments

• SRF is planning to invest significantly in the import substitution sector over the next 3-5 years.
• The company has shifted its focus from technical textiles to chemicals, with speciality chemicals becoming its largest revenue generator.
• SRF supplies active ingredients to major global crop protection companies like Syngenta, Bayer Crop Sciences, and BASF, with revenues around $1.7 billion.
• It is a leading supplier of refrigerant gases for the domestic air conditioning market.
• SRF has formed a new partnership with Chemours, a leader in fluoropolymers, used in high-heat applications and sensitive industries such as semiconductors and batteries.