Meghmani Finchem Limited (MFL) announced the commissioning of the 30,000 tonnes per annum (TPA) capacity Chlorinated Polyvinyl Chloride (CPVC) Resin Plant on Monday at Dahej in Gujarat. MFL’s entry into this product is in line with the Central Government’s initiative of Aatmanirbhar Bharat and Make in India.
MFL informed that CPVC resin demand is around 1,40,000 tonnes per annum (TPA) and it is expected to grow by around 13% CAGR over the next five years. Approximately 95% of the CPVC resin demand in India is met through imports. This new plan of action announced by MFL will reduce the dependence of CPVC resin consumers on imports thereby helping the country save its foreign exchange reserves.
Commenting on the commissioning of the CPVC Resin plant, Mr Maulik Patel, Chairman and Managing Director, MFL said, “Production of CPVC resin has started and it is under approval process with various customers. We estimate that it will take around 3 months for the approval and stabilisation process. We expect that volume of CPVC resin should pick from Q3FY22 onwards and should reach optimum capacity utilisation by Q1FY24. ”
CPVC resin is used in manufacturing CPVC pipes and fittings. CPVC pipe has a high heat resistance and chemical resistance properties. Considering its features, CPVC is widely used for domestic (households) and industrial purposes. Considering the current prices of CPVC resin, MFL expects the asset turnover ratio to be above 2.0x, which will improve the company’s absolute EBITDA and will end up providing higher ROCE (Return on Capital Employed), ultimately creating value for the shareholders.
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