About the company-
1. Products- INDUSTRIAL CHEMICALS- Iso Propyl Alcohol, methanol, Ammonium nitrate(AN), Dilute nitric acid(DNA), strong nitric acid(SNA), concentrated nitric acid, Propane, Hydrogen
FERTILIZERS- nitro phosphate 24:24:0,bentonite sulphur, bio fertilizers,water soluble fertilizers and select mixtures
MINING SERVICES AND CONSULTATIONS- Only manufacturer of Technical ammonium nitrate in India which is a key ingridient in mining industry
Holistic mining services provider of end to end solution in geology, mine consulting and contract mining
VALUE ADDED REAL ESTATE-
Ishanya – India’s first true Lifestyle Centre. Located in Pune, Western Maharashtra

1. Plant capacities-
   Installed Capacity Unit (MTPA)
   Ammonia -1,28,700
   CNA- 1,38,600
   DNA- 7,02,900
   Methanol- 1,00,000
   Iso Propyl Alcohol- 70,000
   TAN (across Taloja & Srikakulam)- 4,69,000
   CO2 – 33,000
   Nitro Phosphate -2,29,500
   Bentonite Sulphur- 25,000

2. Company strengths-

Over three decades of technology depth, financial prudence
and human motivation

Multi-product portfolio spanning a variety of sectors – built in
resilience against economic downturns

Plants at Taloja, Western Maharashtra, India

100% Subsidiary – Smartchem Technologies at Srikakulam,
Andhra Pradesh

Ranked Fourth among chemicals manufacturers in India

Only manufacturer of 24:24:0 in India

Amongst market leaders in India for specialty products, water
solubles, specialty fertilisers and Sulphur Bentonite

Among the best recognised brands in the industry—Mahadhan
and Bhoodan— drawn across a wide range of fertiliser products

Network of 4,500 dealers and sub-dealers to ensure penetration
across 7 states – Maharashtra, Karnataka, Gujarat, Madhya
Pradesh, Punjab & Haryana

Strong farmer relationships through 12 Saarrthie centres serving
11,500 farmers

The only IPA and TAN manufacturer in India & the largest Nitric
Acid and AN producer in SEA

Assimilated world’s finest technologies available for products

DFPCL has invested resources in India for production of major
fruits such as grapes & banana. The advantages of these two major
crops in India are:
Large acreage under these two crops therefore good quantity of fruit
is available for marketing
Quality and supply chain is fairly streamlined with packing facilities.
DFPCL’s next mandate crop is Pomegranate
Pomegranate is grown almost round the year with 90% of the area in
Maharashtra – our current location
DFPCL’s agronomists will supervise for production and quality.
DFPCL’s outreach to major cities for domestic sale of fruits &
vegetables
Supply to major super markets as well as into whole sale trade
Proximity to the Middle-East markets as well

1. NEW PROJECTS-
   Recently announced two new projects in Agri-business at a total
   investment of Rs. 415 crores

Capacity augmentation project at Taloja
Project will more than double the existing capacity at the integrated
fertiliser complex
Will enhance capacity of NPK grades complex fertilisers from 2,29,000
MTPA to 6,00,000 MTPA

Company will gain additional flexibility to produce all NP / NPK grades
with fortification of micro-nutrients

Greenfield Bentonite Sulphur plant
New BenSulf plant at Panipat in Haryana – Northern India
Plant will produce 32,000 MTPA of BenSulf
Both projects are expected to be completed in 30-months from
commencement

WEAKNESSES
Capital Intensive business
Average return on equity figures
Business employs a good amount of Debt

INTERESTING FACTS-

Liberal dividend policy

In May 14, the supply of natural gas from RIL,GAIL to Deepak’s Fertilizers was stopped resulting in a huge blow for the company via cost over runs.

As a result the financial performance of the company in the past 6 qts has been poor. Net margins have fallen from 6-8% to 2%.

However when the gas supply resumes( as Delhi High court has directed the govt to do so in Jul and Oct this year), it will be a huge trigger for the company resulting in huge gains in EPS

Agressive promoter group buying in the company post the stock price correction (in Jan-Mar qtr, increasing the stake by 4.5% to 50%)

By all indications, gas supply should be restored next year and hence the earnings may explode.

Thus it can end up becoming a huge turnaround opportunity

Looks, management made a provision now of Rs 64 cr(Royalty-disputed amount) in Q2 and it may be the reason for increment in expenses. How to get Kaveri’s results conference call info.

Thanks
Sreedhar M

I dont understand why this is a corporate governance issue ‘against’ the minority shareholder.

Lets say you invest with a partnership where one partner is 80% and other 20%. There is some mis-understanding between the partners and now the junior partner wants a bigger share. The main partner has two options
a. Pick a fight on principle as the junior partner is going back on his work and see the value of the company suffer. So instead of have a 3X in 5 years, one is left with a 1.5 X
b. Be rational and give away 10% of the partnership, but ensure that we have a slight smaller piece of a larger pie.

As a minority shareholder, rationally thinking, what should we prefer ? option a ‘feels’ better, because it is equivalent to what we sometime go through when a hire an auto where after the reaching the destination the driver asks for more money

on top of this the management has shared their thinking and have asked for approvals. This episode does not leave a good taste and creates an apprehension in mind (will this happen again ?). but how is this is a corporate governance issue ?

https://www.kpmg.com/IN/en/IssuesAndInsights/ThoughtLeadership/The%20Indian%20Chemical%20Industry%20-%20New%20Directions,%20New%20Hope%20(2003).pdf
This report by KPMG tho old but gives a decent overview abt how the chemical industry is gng to pan out over time.
Main categories are: Basic-Speciality-Knowledge Based. The third category is growing the fastest. Pharma and agrochemicals are part of knowledge based category. And the next big driver is biotechnology. Sorry dont have the link, but the report says that from abt 5 billion USD this has the potential to be 100 billion USD by2025.
Rgds