PCBL Chemical Charts Ambitious Expansion Strategy Amid Global Market Shifts
PCBL Chemical has unveiled an ambitious expansion strategy to strengthen its global footprint amid shifting market dynamics in the carbon black industry.
With rising demand for high-quality carbon black across the tire, rubber, and industrial sectors, PCBL is increasing production capacity, enhancing sustainability measures, and optimizing its supply chain to meet evolving industry needs. This market report explores PCBL’s investment approach, the impact on global carbon black supply, and key industry trends shaping the future of sustainable carbon black production.
PCBL Chemical is positioning itself for significant growth through strategic expansions and capacity additions across multiple business segments, capitalizing on emerging global chemical market opportunities.
The company is making substantial investments in its manufacturing capabilities, with a recent development allocating 116 acres of land in Andhra Pradesh’s Naidupeta region.
This new site represents the company’s sixth manufacturing location, which can house roughly 400,000-450,000 metric tonnes per annum (MTPA) of carbon black capacity. It is strategically positioned near ports like Kattupalli and Krishnapatnam, enabling efficient logistics and cost-effective goods movement.
“The first phase of this expansion will involve establishing a 150,000 MTPA carbon black plant, with an estimated investment of approximately INR 9.5-9.6 billion and a projected timeline of 2-2.5 years,” said Raj Gupta – Chief Financial Officer – PCBL Chemical Limited.
The company’s current manufacturing capacity has already been expanded, with the company recently commissioning a specialty line of 20,000 MTPA in Mundra, bringing its total capacity to 790,000 MTPA. The company is simultaneously pursuing multiple expansion tracks, including a brownfield expansion of 30,000 tonnes in Tamil Nadu and a second phase expansion of 60,000 tonnes, accompanied by a 12 MW green power project.
In the specialty chemicals domain, PCBL is making significant strides. The company has launched ECOZENTM6000, a new product grade based on recycled materials, demonstrating its commitment to sustainability.
The company has also been certified with International Sustainability and Carbon Plus (ISCC) certification, underscoring its dedication to responsible production and circular economy principles.
The company is particularly bullish about its export markets, especially in Europe and North America. Despite current geopolitical challenges stemming from restrictions on Russian Carbon Black exports, PCBL sees this as an opportunity to expand its market presence. The company has increased its international sales volumes, with Western market contributions rising from 7-8 percent historically to approximately 35 percent currently.
The specialty Carbon Black segment shows promising growth, with projected full-year sales volume expected to reach 63,000-64,000 tonnes, compared to 57,000 tonnes last year. “Management anticipates gradual margin improvements in this segment over the next 2-4 years as they move up the value chain,” said Gupta.
A fascinating development is the company’s nano-silica project. PCBL is currently establishing a pilot plant for sampling, with plans to develop a 2,000-tonne commercial facility. “Now, this 2,000 tons, based on our back-of-the-envelope calculation, should give us somewhere around INR1,700-1,800 crores kind of a top line and roughly about INR800-900 crores kind of EBITDA,” said Gupta.
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