Contribution of ARV to total sales is 42% as mentioned by Dr. Chava in concall today.
ARV API’s: 379 crores
ARV FDF: 267 crores
Total: 646 crores.

Q1FY23 discussion on BQ.

https://www.youtube.com/embed/h9nGY1M4G24

There is no doubt that new products will start with lower margins and improve over an year or two. The management had mentioned this in almost all the con calls. I was curious if sale of new products have already started in Q1 itself as the RM inflation was expected to increase higher in Q1 (Apr to Jun) due to Ukraine war and etc. Crude prices have started falling, so RM cost pressure should subside over the next few quarters, hence the important number that I am watching is topline and capex. As long as they are able to increase revenue regularly, they can get back to better margins (or absolute profits in worst case as long as revenue keeps increasing).

Competition is there for every company. So far they have done well and this is one area to keep watching regularly.

As per Q3FY22 Concall the company has launched 2 new products TBHQ and PBQ in production(mentioned in presentation Q1FY23 as well). HAL’s production is expected from Q2FY23.

There was 4% increase in RM costs in Q1FY23. There could be 2 reasons i.e. product mix or Raw material cost increase. I remember Phenol being 50% of RM costs in Q4FY22 and Phenols price reduced by 7.4% in last 3 months

so it must be other 50% of RM used to make other products. So my logical conclusion is product mix might have changed (as mentioned in slide No. 5 Q1FY23) in favour of TBHQ and PBQ, where they will have to offer discounts to increase market share.

Anyway I would like to hear from the Management itself.

CSTL increased MEHQ production by 50% for internal consumption to BHA. Vinati is a major customer for CSTL, and both being a world leader in their sector means both are interdependent. It is fair for Vinati to backward integrate to improve their margins but for CSTL it has to find buyers for their products to maintain their market leadership.