Thanks to some valuable feedback, learnt that there is a significant second round of capacity additions taking place – both KLJ and Thirumalai are adding about 1 lakh MT each over and above the current domestic capacity of ~5 lakh MT. This ICRA report mentions that it will take a few years for domestic demand (~5 lakh MT and growing at ~8%) to be able to absorb the new capacity.
For years these companies didn’t expand capacity when there was a shortage, so wonder what is prompting the current expansion spree. Will keep this on radar but for now there seem to be better opportunities if the market corrects.
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