Demand reduction may not be proportionate across companies. And it may not be absolute as well. It will be somewhere in between.
If it is proportionate then all companies will suffer same % of demand reduction. But for argument sake if it is in absolute terms then ‘x’ MT of demand reduction with a company of 100x capacity will be just 1% compared to 50% for a company of capacity 2x.
But yeah, integrated players could weather the situation longer while the weaker players bankrupt. And when the situation reverses, the company which survived will make a killing.
Disc: Have a tracking position in GPIL.
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