Page 146 - Tata Chemical Annual Report_2022-2023

Integrated Annual Report 2022-23 01-83 84-192 193-365
Integrated Report
productivity. As part of the Fourth Industrial Revolution, rebalancing of the global supply chain reinforces
the installation of IoT devices, including in the chemical the attractiveness of India, which will remain one
industry, has grown by 16% in the last 5 years. In addition, of the fastest growing chemical markets globally.
investments in AI reached US$ 32 billion by 2020, with an With government support and schemes, companies
annual growth rate of around 40%. are investing in local production and distribution
networks to meet the growing demand in the
Companies are improving their safety lag indicators, region, and reduce supply chain risks associated
such as TRIFR (Total Recordable Injury Frequency with long-distance transportation and geo-political
Rate) and PSI (Progressive Safety Index), with the help conflicts.
of digital technologies like remote monitoring, smart
cameras, predictive maintenance, Virtual Reality (VR) c. Indian Chemical Industry
and Augmented Reality (AR), to provide workers with The Indian chemical industry is the 6 largest producer
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virtual training and simulations to practice safety of chemicals globally and 3 in Asia. India ranks 14 in
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procedures and emergency response.
chemical products’ exports and 8 in imports. The Indian
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Automation is helping streamline the production chemical industry stood at US$ 232 billion in 2022, and
process, reducing manual labour and minimising the is expected to reach US$ 304 billion by 2025, registering
risk of human error. a CAGR of 9.3%. The cumulative FDI equity inflow in the
chemical industry (excluding fertilisers) was US$ 20.96
Digital twin technologies are effectively used billion from April 2000 to December 2022. This constituted
to replicate physical assets or processes, thus 3.35% of the total FDI inflow across sectors.
considerably reducing the capex and time. Blockchain
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technologies in the chemical industry are helping India is the 4 largest producer of agrochemicals globally
track the movement of chemicals and materials and reached a value of almost US$ 6 billion in the year 2022.
throughout the supply chain, providing greater The market is further expected to grow at a CAGR of 8.5%
transparency and traceability. between 2023 and 2028, to reach a value of almost US$ 9.82
billion by 2028. Agrochemicals sector exports accounted
Supply Chain Resilience - The industry's complex for US$ 4.84 billion in CY 2022 with Y-o-Y growth of 28.7 %,
supply chain involves the production of basic chemicals, while imports were US$ 1.69 billion with Y-o-Y growth of
intermediate chemicals and specialty chemicals, and (2.39)%. Increased Government initiatives to assist farmers
encompasses multiple stages, including sourcing of raw and rapid technological advancements are propelling the
materials, manufacturing, transportation and distribution. growth of the agrochemicals sector.
The pandemic exposed the vulnerability of supply chains 3. Company Overview
in the chemical industry, causing delays and congestion Specialty chemicals constitute 22% of the total chemicals
in ports and rail transportation, and led to the creation and petrochemicals market in India. The sector is expected
of new local systems. Regulatory influences, geo-political to reach US$ 40 billion by 2025. A significant opportunity
uncertainty, and the need to meet decarbonisation goals for the Indian chemical industry is the increasing demand
are further adding to the challenges. for specialty chemicals globally. Another opportunity for
the industry is the growing demand for green chemicals,
In the post-pandemic world, successful supply chains which are eco-friendly and sustainable.
will need to balance agility, efficiency and resilience,
while considering the costs and carbon footprint. For CY 2022, the export value of chemicals and allied
products was up by 5% year-on-year, to US$ 63* billion, while
E-commerce is becoming an increasingly important imports were up 22% year-on-year, to US$ 95.96* billion.
channel for chemical companies to reach customers,
particularly for specialty chemicals. Online The Indian chemical and petrochemical sector is expected
marketplaces and digital platforms are enabling to attract an investment worth ` 8 lakh crore by 2025.
companies to offer greater product visibility, pricing The Union Budget 2023 is a growth-oriented, progressive
transparency, and more efficient ordering processes. and prudent budget with specific focus on stability,
sustainable and inclusive development, announcing
The Asia-Pacific region has become a key growth
market for the chemical industry, with China, India, *HS Code Chapter 28-32, 3301-3302, 3402-3404, 35,38, 3901-3914,
and Southeast Asia leading the way. Economic 4001-4003, 4005
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Statutory Reports Financial Statements
Management Discussion
& Analysis
various policies which will generate demand for a variety and oral care applications. The Company has a domestic
of chemicals including construction chemicals, emission market leadership position in prebiotics, and has built
control catalyst, polyurethanes, TPU (Thermoplastic a robust and high-growth fermentation platform that
Polyurethane), bio-pesticides, etc. Further changes in provides attractive future growth opportunities. The
BCD (Basic Custom Duty) rates of various goods like flagship product - fructo-oligosaccharide, is a prebiotic
crude glycerin, denatured ethyl alcohol, acid grade dietary fibre that promotes the growth of gut microbiome,
fluorspar, specified chemicals for manufacture of pre- and improves digestive and immune health.
calcined ferrite powder, etc. would provide impetus to the
domestic demand for these products. However, the Indian Rallis India Limited (‘Rallis’), a listed leading agri
chemical sector, which has all the ingredients to become sciences company, with a product portfolio offering
a global manufacturing hub, continues to await the much comprehensive crop care solutions, including active
expected and anticipated production-linked incentive ingredients and formulations for crop protection, crop
scheme, which has unfortunately not been announced in nutrition, seeds and biopesticides. A strong distribution
network, with over 7,200 dealers and 1,00,000 retailers,
Budget 2023.
reaches a multitude of India’s farmers, covering 80%
The Indian chemical industry has numerous opportunities, of the country’s districts, and having export access to
considering the supply chain disruption in China and 60+ countries. It is a leading global manufacturer of
the trade conflict among the US, Europe and China. active ingredients such as Acephate, Hexaconazole,
Anti-pollution measures in China will also create Pendimethalin and Metribuzin. Rallis is expected to drive
opportunities for the Indian chemical industry in specific its growth through manufacturing capacity expansion
segments. The dedicated integrated manufacturing and widening customer reach.
hubs under Petroleum, Chemicals and Petrochemicals
Investment Regions (PCPIR) policy is expected to attract The Company’s businesses are supported by the pillars
an investment of ` 20 lakh crore (US$ 276.46 billion) by of safety, sustainability, operational excellence, customer
2035. Additionally, special incentives through PCPIRs or focus, innovation and digitalisation. The Company has
SEZs (Special Economic Zones) to encourage downstream committed to reducing its carbon footprint with focus on
units will enhance production and further boost the net neutrality. Its Carbon Capture and Utilisation (CCU)
industry growth. plant in the UK is the first of its kind to be commissioned
in that geography. It captures CO emitted by the
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Source: Union Budget 2023, IBEF, Ministry of Commerce, Expert gas-powered energy system, and uses it as a feedstock
Market Research to manufacture high purity sodium bicarbonate for the
pharma and food industries.
A part of the US$ 128 billion (revenue for FY 2021-22)
The Company supports key communities with
Tata Group, Tata Chemicals Limited (‘the Company’ or development models that are sustainable and scalable.
‘TCL’) is a sustainable chemistry solutions company. It also promotes biodiversity in a significant way through
The Company operates through two verticals - Basic plantation, ecosystem creation, species conservation,
Chemistry (Alkali Chemicals - Soda Ash, Sodium Bicarb, as well as water and resource conservation around its
Salt, Silica & other Halogen Chemicals) and Specialty plants. Through its wholly-owned subsidiary, Ncourage
Products (Specialty Silica, Prebiotics & Formulations, Social Enterprise Foundation, the Company is focussed on
Agrochemicals and Seeds). The Company’s product initiatives like livelihood creation, capacity building, rural
portfolio provides key ingredients to many of entrepreneurship development, market linkages, and
the world’s leading brands for glass, detergents, enriching lifestyle through quality products and services.
pharma, food, animal feed, and other industries. These initiatives are woven around core intervention
The Company is a global major in Soda Ash and Sodium areas that include empowerment of rural women, youth,
Bicarbonate (market position of 3 and 6 respectively), farmers, providing safe drinking water, animal care and
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with manufacturing facilities in India, US, UK and Kenya. clean energy.
The specialty products vertical, with focus on Green Innovation at Tata Chemicals is focussed on delivering
Chemistry solutions, comprises Highly Dispersible Silica value to the customers by integrating chemistry with other
(‘HDS’) and Prebiotics. HDS was developed based on sciences. At present, the Company has three centres for
patented technology for rubber, food, feed, detergents innovation located in Pune and Bengaluru.
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