InvestorQ : Is it true that specialty chemical companies are planning to sharply hike their capital expenditure in this year?
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Is it true that specialty chemical companies are planning to sharply hike their capital expenditure in this year?

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Rashi Mehra answered.
3 months ago
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That is absolutely correct. In fact, specialty chemicals companies expect a 50% spike in the capex this year on the strength of robust export demand. Total capital investment in the current year is estimated at Rs.6,200 crore, which is twice that of last year. In the previous two years, exports gained after China imposed environmental clamps on their domestic specialty chemicals makers.

It is not just export demand that has spurred this higher capex but even domestic demand and prices have also been very robust in the last couple of years. With the supply chain constraints imposed by the Chinese experience, the US and EU based companies are consciously reducing their dependence on China. This is also benefiting Indian specialty chemicals companies. The business grew at 11% CAGR between 2015 and 2021.

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