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CHEMICAL & PROCESS WORLD
MAY 2013
Editorial
Rising with
renewed vigour
EDITORIAL ADVISORY BOARD Dr Kishore Shah
Chairman and Managing Director, Sauradip Chemical Industries Pvt Ltd
Dr P D Samudra
Executive Director - Sales and Member of the Board, Uhde India Pvt Ltd
Pratik Kadakia
Principal, Roland Berger Strategy Consultants Pvt Ltd
Ravi Kapoor
Managing Director, Heubach Colour Pvt Ltd, and Chairman – Gujarat Chapter, Indian Chemical Council
Sunil Chaudhari
Country Manager - South Asia, AspenTech India
“THE heaviness of being successful was replaced capabilities. On the other hand, the weaknesses by the lightness of being a beginner again… include inadequate infrastructure, feedstock It freed me to enter one of the most creative shortage and stringent regulations. Amid such a dynamically evolving periods of my life.” ecosystem, we present you the inaugural edition These famous words by Steve Jobs said during an important turning point in his career of Chemical & Process World ! A brand new B2B still hold great significance in today’s world and communications platform that will empower may continue to do so in the years to come. The the chemical & process industry with strategic laws of nature expect progressive individuals insights as well as current trends pertaining to the above aspects and beyond. Spread over three to continually change, renew and rejuvenate themselves so that subsequent generations stay distinct sections – ‘Market Analysis’, ‘Business Initiatives’ and ‘Allied Services’, this special ahead in nearly all aspects. These thoughts cannot be more appropriate edition offers a healthy mix of expert perspectives to the chemical and process industry today, on an array of topics that range from changing business dynamics to steps when it prepares to leap Chemical & Process taken to tide over turbulence into the future by not only World, the brand new B2B to suppliers’ strategies to meet unshackling itself from the traditional boundaries but communications platform, will new industry requirements. We believe that you will also integrating principles of keep the industry informed benefit from exploring this sustainability, right from the and empowered with current special edition with the same planning stage to numerous trends as well as strategic zeal with which we have operations in the entire insights for the future. enjoyed putting it together. value chain. The highly informative pieces In this context, it is vital to acknowledge some socio-economic megatrends of actionable knowledge can enable concrete – resource optimisation, health & nutrition and steps in your journey ahead and help realise the vision of a new world filled with opportunities. globalisation of technologies & workforce – that are shaping business priorities of tomorrow. We also look forward to your valuable views Impacts of these are increasingly visible in and opinions! Signing off with another profound quote, by terms of declining energy intensity in chemical George Bernard Shaw that goes “Life isn’t about manufacturing, minimising effluent discharge, finding yourself. Life is about creating yourself.” growing footprint of recyclable products and increasing share of bio-feedstock. A SWOT analysis of the Indian chemical industry shows its strengths as a fast-growing domestic market, a strategic location to cater to some of the emerging economies, lowcost skilled workforce, R&D capability and Manas R Bastia manas@network18publishing.com world-class engineering & conceptualisation
May 2013 | CHEMICAL & PROCESS WORLD | 7
Inaugural Edition Special .......................
Riding out global turbulence: Tightrope walk for the chemical industry
29-81
CONTENTS
The chemical industry has been walking a tightrope to sustain growth amid global market uncertainties. Read on to know more on the changing business dynamics, and the strategies adopted by chemical manufacturers and allied service providers to ride out global turbulence. Guest Editorial “Innovation will demarcate the long-term players from small businesses” Dr Joerg Strassburger.................................... 14 Cover illustration: Chaitanya Dinesh Surpur
Editorial ...................................................... 7 Rising with renewed vigour News, Views & Analysis................................ 18
Country Representative & Managing Director, LANXESS India Pvt Ltd
“The time for effective industry-academiagovernment partnership is now” Pratik Kadakia ................................................ 15 Principal, Roland Berger Strategy Consultants India
Technology & Innovation ............................... 24
“Apt survival strategies will ensure future success”
Automation Trends ...................................... 82 Advanced radar system: A versatile tool for improving process fault diagnosis
Ravi Kapoor ................................................... 16
Olle Edvardsson, Rosemount Senior Technologist, Emerson Process Management
Strategy ................................................... 84 Streamlining production: Reducing operational cost with reliability
Chairman – Gujarat Chapter, Indian Chemical Council, and Managing Director, Heubach Colour Pvt Ltd
In Conversation With
26 “Troubled times present some of the best opportunities to buy assets”
Projects & Tenders ...................................... 85 Event List ................................................. 86 Event Preview ............................................ 88 Engineering Expo Hyderabad 2013 Starting on a pearly white slate Products............................................. 90 List of Products .................................. 102 List of Advertisers ............................... 103
Dr Deepak Parikh, Managing Director & Vice Chairman, Clariant Chemicals India Ltd
Highlights of Next Edition -: Special Focus :Engineering, Procurement & Construction -: Insight & Outlook :Pollution Control
Details on page no. 77-78, 86, 88-89
May 2013 | CHEMICAL & PROCESS WORLD | 9
CONTENTS INAUGURAL EDITION SPECIAL MARKET ANALYSIS
Tracking changing business dynamics due to fluctuating markets
ALLIED SERVICES
Strategies adopted by suppliers to meet the changing requirements of chemical industry
Global economic meltdown 2008-2009 ......30
Equipment manufacturers .....................66
A forgotten past or driver for sustainable change?
Enabling customers to resolve efficiency challenges
Dr Alexander Keller, Partner, Roland Berger Strategy Consultants GmbH
Chemical manufacturing .......................32 Beating the slowdown blues with vigour
Siddharth Paradkar, Principal-Logistics, Tata Strategic Management Group (TSMG), and Manish Panchal, Practice Head - Chemicals & Energy Business, TSMG
Indian chemical industry.......................36 Aiming high to unleash the market potential
Aashish Kasad, Partner & Tax Leader - Chemicals Practice, Ernst & Young Pvt Ltd
Best-in-class HR strategies ...................68 A key enabler for talent retention in chemical sector
Case study - Aspen Technology ...............70 Innovative solutions for process industry challenges
Industry Voice Alok Kishore ....................................................................72 Country Manager - Flow Control, Metso Automation (India) Pvt Ltd
M&A activity .....................................38 Fine prospects likely in specialty chemicals
Navroz Mahudawala, Founder, Candle Partners, and Sameer Shah, Vice President, Candle Partners
Daksh Malhotra................................................................73 Director - Marketing, Everest Group
K Narayan ........................................................................74 GM - Execution and Quality, TÜV SÜD South Asia
Dr Naushad Forbes ..........................................................75
Industry Voice
Director, Forbes Marshall
Jaimin Vasa .....................................................................40 President, Gujarat Chemical Association, and Chairman MSME Committee, Gujarat Chamber of Commerce & Industry
Satish Wagh.....................................................................42 Chairman, Chemexcil
Savan Godiawala..............................................................43
Rakesh Aggarwal .............................................................76 Director – Operations, Cole-Parmer India
Satya D Sinha .................................................................80 CEO, MANCER Consulting
Sunil Khanna ...................................................................81 President and Managing Director, Emerson Network Power, India
Senior Director, Deloitte Touche Tohmatsu India Pvt Ltd
BUSINESS INITIATIVES
Steps taken by chemical manufacturers to tide over the turbulence
Industry Voice
Chemical manufacturers .......................44
Bhupendra Patel...............................................................55
Ande Prathap Reddy ........................................................54 Chairman and Managing Director, Balaji Amines Ltd
Uncertainty propelling innovative strategies
Managing Director, Jemby Chem Ltd
Paints sector .....................................46
Chairman, President & CEO, Chemtura Corporation
Craig A Rogerson ............................................................56
Of possibilities and bright prospects for M&As
Paul Sanders....................................................................58
Case Study - AkzoNobel .......................50
Prakash Raman ................................................................60
Enhanced customer collaboration for better business gains
Steve Stilliard...................................................................61
Dr Mosongo Moukwa, Vice President - Technology, Asian Paints Ltd
Managing Director - Europe, Middle East, Africa and India, Honeywell Fluorine Products Managing Director, Solvay Specialities India Pvt Ltd
Case Study - WACKER ..........................52
Vice President and Managing Director - Indian Subcontinent, Huntsman Corporation
Riding high on research-oriented approach
Zarir Langrana..................................................................62 Chief Operating Officer - Chemical Business (India), Tata Chemicals Ltd
Note: ` stands for Indian rupee, $ stands for US dollar and £ stands for UK pound, unless mentioned otherwise
May 2013 | CHEMICAL & PROCESS WORLD | 11
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May 2013 | CHEMICAL & PROCESS WORLD | 13
Guest Editorial | Dr Joerg Strassburger
Dr Joerg Strassburger
Country Representative & Managing Director, LANXESS India Pvt Ltd
“Innovation will demarcate the long-term players from the small businesses� IT is evident that the Indian chemical industry, like dismissed any longer. It is a critical aspect to protect many others, has not been spared from the brunt of the the environment and improve health & safety standards global economic uncertainty. Demand levels have gone of the people working in chemical plants or living in down worldwide for key industries such as automotive nearby areas. In turn, this plays a key role in building and construction; pricing pressures have increased, a positive image of the industry, which is currently not naturally making it difficult for small- and mid-sized favourable for growth and employment. In order to manufacturers to stay afloat. However, this scenario is remain competitive, chemical companies should strive likely to prevail only in the short and mid term, as the to achieve economies of scale for the products they buoyancy of our economy lies in the ever-increasing manufacture. As a result, consolidation may also take demand from the growing number of consumers and place, which will allow sharing of synergies and effective their increasing purchasing power. This will only rise utilisation of available resources. manifold in the years to come. But Government, on the other benefits from this upsurge in demand hand, has a substantial role to To remain competitive, may not come easy without certain play in facilitating the growth of chemical companies should proactive steps, both by the industry the Indian chemical industry. The and the government. strive to achieve economies long-term growth will depend on Innovation will demarcate the the effectiveness of government of scale for the products long-term players from the small policies. Unfortunately, the present they manufacture. businesses and will also determine policies and regulations are not the growth of the industry. As a quite investor-friendly, both in reaction to economic slowdown, companies would terms of domestic and foreign companies. Increasing usually cut costs, but the more effective way of looking burden in terms of taxes, rise in gas prices, high costs at it would be to improve operational and process-related pertaining to logistics and infrastructure, and nonefficiencies in the organisation. It is also important to uniform compliance to environmental regulations are understand the future needs of the customer and tap some factors, which are making India unattractive for the right products for the right market – this could be investments. Infrastructure development for chemical achieved by application-oriented innovation. The global parks, Petroleum, Chemicals & Petrochemicals and local megatrends such as mobility, urbanisation, Investment Regions (PCPIRs) have a long way to go, need for water, etc, are important indicators of economic which means that the companies have to invest more with success in the long term and any chemical business that regard to compliance and sustainability requirements. takes these trends into consideration is likely to thrive. Government support is quintessential on all these fronts; Innovation will call for investments in technology, else the economic crisis may turn out to be a long haul which may be capital-intensive; but this cannot be for the industry.
14 | CHEMICAL & PROCESS WORLD | May 2013
Pratik Kadakia | Guest Editorial
Pratik Kadakia
Principal, Roland Berger Strategy Consultants India
“The time for effective industryacademia-government partnership is now” THE Indian chemical industry is challenged with issues of centres successfully as shown by DuPont, Momentive, availability of feedstock, technology and people; need for etc. These and many other examples in CRAMs, better infrastructure; and a poor image. If this was not agrochemicals, dyes and pharmaceutical intermediates lead challenging enough for the industry captains to navigate us towards establishing the fact that wherever there is an through, along came the slowdown witnessed globally and opportunity to extract or create value, Indian chemical in India impacting the growth margins and cash flows companies and entrepreneurs have successfully done adversely. This has resulted in the growth focus turning that – a learning for all to leverage strength and build a towards optimisation, with a cautious approach to pursue sustainable business advantage. opportunities selectively. This has also led to CEOs thinking The issue then is a larger one, will the Indian chemical hard, once again, on what is their company’s competitive industry be competitive on a global scale, given its advantage; what options exist to enhance or acquire because enterprising stakeholders who are keen to make their mark in the absence of a compelling one worldwide. While there is not much – if such times were to drag longer – debate on the excellent prospects for Wherever there is an survival could get difficult. the Indian chemical sector over the opportunity to extract A review of how chemical long term, the concern continues to companies are coping with this be if we will serve it from India or or create value, Indian scenario reveals some interesting chemical companies have not. Prospective FTAs and cheaper aspects of the strategy they follow imports from China and other nations successfully done that. and there can be lessons for all to could drive a wave of consolidation in adopt. Reliance Industries Ltd (RIL) India, which implies growth, alliances has announced a world-scale petrochemical project at or even closure for many companies. This means that Jamnagar using the off-gas from its single-largest refinery each firm will need to further strengthen its capabilities in the world to address the market gap in downstream addressing its competitive advantage to capitalise on the products, leveraging feedstock and ability to manage forthcoming trend. At a collective level, the time for world-scale projects. BASF, LANXESS, Rallis, etc, have effective industry-academia-government partnership is now! leveraged their access to customers and markets through The Jurong Island model of Singapore has long been cited investment in plants and technologies. These examples as an example for our chemical parks to take off ensuring show that building capabilities around the core strengths is growth in basic chemicals and availability of feedstock for the response of many Indian chemical companies to survive downstream specialties. Singapore has since moved on with and gain competitive advantage during these times. Also, more investments in downstream specialties at Jurong, and while companies continue to be challenged when it comes with the US getting more competitive backed by shale gas, to attracting and retaining talent, they have leveraged the it is a lead indicator for us to move quickly and effectively available pool of technical manpower well for global R&D in India.
May 2013 | CHEMICAL & PROCESS WORLD | 15
Guest Editorial | Ravi Kapoor
Ravi Kapoor
Chairman – Gujarat Chapter, Indian Chemical Council, and Managing Director, Heubach Colour Pvt Ltd
“Apt survival strategies will ensure future success� THE Indian chemical industry is going through challenging to various bottlenecks. There is delay on the part of times today, and the past year was no different. Of course, government in approving projects in the chemical zone, different segments of the chemical industry, viz basic, and some of the key reasons is growing awareness about specialty and knowledge-based, faced issues specific to ecological issues as well as increasing pressure on industry their respective segments, but overall the industry faced & regulatory authorities due to potential pollution and tough times. In general, companies in the chemical sector hazard management issues. Some connected issues have have registered either flat or top line growth, but in most been water availability and increasing costs of power, both cases, have been definitely challenged in corresponding of which are serious matters affecting the growth of the bottom line growth. Effectively, the industry had to chemical industry in India. scramble to hold marketshare; but this has come at a In such a scenario, a big help can come from price as it had to sacrifice bottom lines, if not in absolute speedy implementation of Petroleum, Chemicals and terms, at least in the Earnings Before Petrochemical Investment Regions Interest, Taxes, Depreciation and which could have given a Companies that practise (PCPIRs), Amortisation (EBIDTA) percentage. boost to the growth of the industry; but sustainable development; unfortunately this has not happened This classic squeeze originated due to number of reasons. and the development is at a slow pace. focus on research; and For many sectors, there is global It is a known fact that India has a low manage cost structures over-capacity, with investments in share in the chemical industry, being will emerge stronger. greenfield or expansion having been less than 3 per cent; and it does not ordered at the time when the global seem likely that this will drastically economy was on a rise. But now, there has been an increase in the near future. Another weakness of the Indian uneasy lull in the global economy. This has put pressure industry has been its inadequate spending on research and on capacity utilisation leading to marketshare protection, development. To the best of my knowledge, this has not consequently putting a downward pressure on profitability. significantly increased over the past years, at least as a In the Indian context, what has added to the problem is percentage of the gross sales of a company. the high interest rates, increase in gas & energy cost, fresh Hence, there should be clear focus on urgent and wastewater-related costs, not-as-expected growth in implementation of PCPIRs and SEZs to give the domestic demand, uncertainty in exports due to heavy necessary growth impetus to the industry. I strongly believe Forex fluctuation, and continued dependency on imports that companies that practise sustainable development; of intermediates & raw materials. focus on research; and manage their cost structures Other serious issues for chemical industry in India will emerge stronger and will be poised for growth when are pertaining to environment, and difficulties in starting the demand increases. Apt survival strategies will ensure greenfield projects or expanding current capacities due future success.
16 | CHEMICAL & PROCESS WORLD | May 2013
News, Views & Analysis
ORGANIC PIGMENTS
Coromandel’s NPK plant goes on stream Coromandel International’s 65-tonne per hour urea-grade NPK plant at Kakinada in Andhra Pradesh has been successfully commissioned Uhde India. The by commissioning of the C-Train at Coromandel’s fertiliser complex boosts the fertiliser major’s combined phosphatic fertiliser capacity to 3 MMTPA from its complexes at Kakinada and Visakhapatnam. The project was executed by Uhde India on LSTK basis and is based on the state-of-the-art Pipe Reactor technology from Incro of Spain. ..................................................
Powergas bags SHE Award
Powergas has bagged the CII western region, Safety, Health & Environment (SHE) Award. The jury appreciated the innovative practices of Powergas and its commitment to install high safety, as well as create health & environmental consciousness among its employees. The trophy was received by Shrikar Sule, Associate DirectorManagement, and Umanath Kamath, HSE Head (Pune). ..................................................
BASF India posts improved sales in FY 2012-13
BASF India Ltd registered an increase in sales of 12.1 per cent during the fiscal year ended 2012-13 as compared to the previous year. The total sales figure has gone up to ` 39,406 million as compared to ` 35,159 million in the previous year. Export sales of ` 2,746 million were recorded in the current fiscal year.
Heubach Colour and Toyo Ink sign JV pact
Heubach Colour and Toyo signing the JV pact for organic pigments
The Gujarat-based Heubach Colour Pvt Ltd (HCPL) and Japan-headquartered Toyo Ink SC Holdings have signed an agreement to establish a JV company, Heubach Toyo Colour Pvt Ltd, for setting up an azo pigment manufacturing plant at Ankleshwar. The new JV company will cater to their individual needs as well as work closely towards common business objectives of developing new product and leveraging capabilities of global marketing & sales of organic pigments. The JV will have
the advantage of synergising the technological expertise and experience of Toyo with Heubach’s efficient and sustainable production model strategically located in India. The new JV will strengthen Heubach’s presence in international market especially South East Asia. The construction of the JV’s factory is expected to be finished by May 2014 after which commercial production would start with annual capacity of 2000 tonne. Ravi Kapoor, Managing Director, HCPL, said, “The pigments manufactured by the new JV company, will use sustainable and eco-friendly process. Heubach’s global philosophy of sustainable growth complements well with Toyo’s strategy of utilising the synergy between different products within its group.” Soon after commissioning of production plant in May 2014, the JV will manufacture, sell and export disazo pigments for different applications in ink industry primarily printing inks, resin colouring, etc.
INVESTMENT
Clariant chalks out ` 32 crore investment in India Clariant Chemicals India Ltd recently announced a ` 32-crore investment at its Roha facility to bring an additional 50 per cent capacity of pigments in India. “In India, we are optimistic about the pigments business. We are one of the leading players in this industry. We just announced a major investment in Roha,” said Dr Deepak Parikh, Managing Director, Clariant Chemicals India Ltd. The company recently announced its Q1 2013 figures where it Dr Deepak Parikh recorded sales turnover (net of excise) of ` 277.5 crore during the quarter ended March 31, 2013. The profit before tax and exceptional items of ` 35.4 crore was up from ` 34.2 crore in the first quarter of 2012. Mahua Roy
CAPACITY EXPANSION
UNP Polyvalves opens manufacturing facility In order to meet the growing demand for corrosion-free valves, pipes and pipe fittings in the process industries, UNP Polyvalves has set up another manufacturing facility at Makarpura GIDC, Vadodara, Gujarat. Urmil Shah, Director, UNP Polyvalves (India) Pvt Ltd, noted, “We already have two plants in Makarpura GIDC and this would be the third plant of the company. With, this, we aim to increase our production capacity by 35 per cent. The total constructed area is about 14,000 sq ft. Further, keeping in mind the space constraints, the manufacturing facility would be divided into three floors, ie ground plus two floors.” He added, “The demand for these types of valves is majorly in the chemical and petrochemical industries as these kinds of valves are mainly used for corrosive applications.” The company has been providing solutions to almost every leading chemical and petrochemical giant in India and is also exporting to other countries.
18 | CHEMICAL & PROCESS WORLD | May 2013
Avani Jain
News, Views & Analysis
TECHNOLOGY SEMINAR
Henkel appoints Business Director in India Henkel Adhesive Technologies India, a subsidiary of Henkel AG & Co KGaA, Germany has appointed Ashish Pradhan as Business Director for Industrial Adhesives Division. Pradhan will be responsible to drive the business processes and improve the profitability of the Industrial Adhesives Division that caters to food, flexible packaging, shoe, construction, printing and diaper industry among others. ..................................................
Uhde organises caustic soda-chlorine technology symposium in Mumbai
Panel discussion in progress
The ThyssenKrupp Uhde Group – world leaders for membrane cell electrolysis technology – presented the latest developments in the field of caustic soda-chlorine at a recently held technology symposium for its customers and business associates in Mumbai. The symposium was jointly organised by ThyssenKrupp Uhde of Germany and
Uhde India, the Group’s largest subsidiary, which enjoys a pre-eminent position in the caustic soda membrane cell market with over 70 per cent of the marketshare. The symposium, which was attended by leading Indian caustic soda manufacturers as well as customers from abroad, showcased the latest developments in the field including the Generation VI ‘Zero Gap’ Membranes, the NaCl ODC Technology and the HCl Electrolysis Technology for the recovery of chlorine from hydrochloric acid. It included presentations from Uhde India’s customers Nirma and DCW Ltd, and the Group’s membrane suppliers E I Dupont and Asahi Glass Chemicals.
WACKER starts VAE plant in China
AWARD
Wacker Chemie AG officially ramped up its new production plant for vinyl acetateethylene copolymer (VAE) dispersions at its Nanjing site ( Jiangsu province, China). With the additional 60,000 metric tonne from the second reactor line, the local VAE dispersion capacity is doubling to total 1,20,000 metric tonne per year. ..................................................
Vasa Pharmachem Pvt Ltd, a pioneer in chemical and pharmaceutical raw material manufacturing, has been featured in the elite list of top 100 Indian Small & Medium Enterprise (SMEs). The India SME 100 Awards is a recognition accorded to the company as achiever in growth and profit after scrutinising over 42,000 SMEs nominations received from all over India. The award is instituted by the India SME forum supported by Government of India (Ministry of MSME) and Bank of India for developing a culture of entrepreneurial spirit and building a robust SME space in India. Jaimin Vasa, Managing Director, Vasa Pharmachem Pvt Ltd, noted, “This is an important milestone for us as this certifies that we have constantly stood up to our promise and delivered high impact, cost-efficient products to our suppliers.”
Honeywell to modernise Idemitsu’s complex
Idemitsu Kosan has selected Honeywell’s Experion Process Knowledge System (PKS) to modernise the integrated control room at its Tokuyama refining and petrochemical complex to promote operational efficiency, safety and reliability in Japan. As a part of this modernisation effort, the company will deploy abnormal situations management, alarm management, and cyber-security solutions. The implementation of Experion PKS is expected to be completed by the end of 2014.
Vasa Pharmachem receives SME award
Avani Jain
POLICY MATTERS
Policy reforms needed to revitalise investments: LANXESS At the recently held Annual Chemical Weekly Business Outlook conference in Mumbai, Dr Joerg Strassburger, Managing Director & Country Representative, LANXESS India Pvt Ltd, made some strong recommendations to improve logistics and infrastructure support for chemical plants. Such measures are essential to accelerate the implementation of Petroleum, Chemicals and Petrochemicals Investment Regions (PCPIRs) and to enhance the
competitiveness of the Indian chemical industry. He underlined that government support in terms of improvement in infrastructure such as road, rail and land availability; introduction of favourable policies to attract investment & key raw material suppliers and anchor investors in PCPIRs; and increase speed of implementation of different projects – for example, through single window clearance – is quintessential for the growth of the chemical industry.
RECOGNITION
Dr K S Murthy receives international award
Dr K S Murthy (left) receiving the award
20 | CHEMICAL & PROCESS WORLD | May 2013
The UK-based Society of Dyers and Colourists (SDC) recently awarded Dr K S Murthy, Technical Consultant, Pidilite Industries Ltd, Silver Medal of the Society for his sustained support to the Indian textile industry. Richard Straughan, President, SDC, presented the award to Dr Murthy at an event, which was held at Bradford (the UK) and graced Prof Ian Rattee (Former Head of Colour Chemistry and Dyeing at the University of Leeds) & SDC members.
News, Views & Analysis
WATER TREATMENT
Ecolab acquires Purate business from AkzoNobel Ecolab Inc has reached an agreement to acquire AkzoNobel’s Purate business, which specialises in global antimicrobial water treatment technology. Completion of the transaction is subject to customary regulatory clearances and other standard closing conditions. “Chlorine dioxide is recognised as an excellent antimicrobial agent to control biologic growth primarily in cooling towers and a wide variety of other industrial water treatment applications. Purate’s patented technologies complement our offerings globally, including our 3D TRASAR
technology programmes, which help address our customers’ needs for clean water within industrial manufacturing and reduce total cost of operations,” said Timothy Mulhere, Executive Vice President & President - Global Water & Process Services, Ecolab Inc. 3D TRASAR technology combines chemistry, remote services and sophisticated monitoring and controls to improve a range of industrial operations to help customers reduce water use, improve energy efficiency and lower total cost of operations.
RESEARCH & DEVELOPMENT
Everest Group’s R&D facility receives DSIR’s recognition Everest Group’s in-house R&D facility located at Bahadurgarh unit has received recognition from the Department of Scientific and Industrial Research (DSIR), Ministry of Science and Technology, Government of India. According to a company press release, Everest is the first and only blower & vacuum systems manufacturer in the country to have received this recognition. The Group has strongly realised and felt the shift of the industry towards energy-efficient solutions. Today, it stands as one of the upcoming names in the vacuum industry, a fully integrated and diversified company involved in the engineering, evaluation, designing, manufacturing, testing, execution, post sales & service of pressure and vacuum systems. “We aim to build the most cost-effective development firm through the blending of our world-class ‘best practices’ with local experience and knowledge. We cater to the needs of local emerging economies,” said Amit Kapur, Director, Everest Group. Everest is the largest producer of roots blowers in South East Asia having effective presence in STP & ETP (wastewater treatment) industry, pneumatic conveying systems, aeration systems, aquaculture etc, to name a few. The Group had diversified into design and installation of innovative systems for chemical & pharmaceutical industries based on technologies, which have low impact on the environment, are energy efficient and have low operation & maintenance costs. SPECIALTY CHEMICALS
ISCMA organises AGM in Mumbai
(L-R) Dr Kishore Shah, Deepak Bhimani, Raju Schroff, Ajay Shah, R B Mohile at the inauguration
The 59th Annual General Meeting (AGM) of the Indian Speciality Chemicals Manufacturers’ Association (ISCMA) was held recently in Mumbai. The meeting discussed various issues pertaining to the industry. Speaking at the meeting, Ajay Shah, Senior Executive, VicePresident, Reliance Industries Ltd, noted that the targets set by the National Manufacturing Programme to ramp up the share of
manufacturing from the current 16 per cent of GDP to 25 per cent by 2025, will provide a fillip to growth of specialty chemicals industry. Deepak Bhimani, President, ISCMA, urged the specialty chemicals industry to consider the ecological impact of the many chemicals it uses and produces, before it puts them out into the market. “Technological solutions are available to take care of environmental issues that arise from chemical manufacturing,” he noted. On the occasion, the ISCMA honoured Dr Kishore Shah, former President, ISCMA, with a ‘Lifetime Achievement Award’ for his yeoman services rendered to the association during his multiple terms as President. R B Mohile, Managing Director, CLAIMS Pvt Ltd, and Raju Schroff, Chairman and Managing Director, United Phosphorus Ltd, also spoke on the occasion.
Vertellus Specialties forms JV in China Vertellus Specialties Inc, one of the largest producers of pyridine, picolines and pyridine derivatives in the world, has entered into a JV with Weifang Green Olive Chemical Co Ltd (Green Olive) called Vertellus Specialty Chemicals (Weifang) Co Ltd. It will significantly expand Vertellus capacity of pyridine and picolines in China. Vertellus will own the majority of the outstanding equity of the JV and will leverage its industry-leading technology to begin production of pyridine and picolines at Green Olive’s facility in Weifang, China. ..................................................
SABIC to collaborate with MIT
The Saudi Basic Industries Corporation (SABIC) has signed an initial agreement with Massachusetts Institute of Technology (MIT) in the US, to work together to develop new practical innovations.This is aimed at meeting global needs such as developing unconventional feedstock, innovating new material solutions for challenging applications, among others. ..................................................
Patade joins Perma Pure
Rupesh Patade has joined Perma Pure as Technical Manager for India. Patade adds to Perma Pure’s investment in the strategically important Indian market. Patade comes to Perma Pure with a degree in Electronic Engineering and a strong background in technical support of analytical OEMs in the power and pollution control industries.
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News, Views & Analysis
EXPANSION
Mettler Toledo exhibits robot at POWTECH Mettler Toledo, a global leader in weighing technology, has showcased a robot at POWTECH, Nuremburg, Germany. The robot is made in collaboration with Asyril SA, a developer of miniature mechatronic devices of automation in micro, nano and biotechnology. The robot is an automatic vial-weighing device that replaces manual weighing and calibrating. ..................................................
LyondellBasell’s net increases by 44 per cent in Q1
LyondellBasell Industries announced earnings for the first quarter 2013 of $ 906 million. First quarter 2013 EBITDA was $ 1,585 million, a 25 per cent increase from the fourth quarter 2012 and a 29 per cent increase from the first quarter 2012. The increase was primarily a result of improved operating results across all segments, other than refining, which had a planned maintenance turnaround. ..................................................
Invensys launches performance management solution
Invensys has come out with a product dubbed as Real-Time Performance Management solution which helps companies align their financial and operational KPIs. Built on several of the company’s software offerings, as well as its consulting and integration services, the Real-Time Performance Management solution helps lower operating costs, improve safety and increase reliability & asset utilisation by linking financial and operating metrics.
WACKER inaugurates technical centre in Brazil Strengthening its presence in South America, Wacker Chemie AG has inaugurated its expanded technical centre, including training centre, near São Paulo, Brazil. The new regional competence centre combines R&D, applications technology, and a basic- and advancedtraining facility for silicone and polymer applications under one roof. The expansion focusses on the labs for polymer binders, which are primarily used in construction chemical applications. The integrated WACKER ACADEMY training facility, which is also being expanded, is furnished with a new practice room and offers an ideal platform for industry-specific networking among customers, distribution
partners and WACKER specialists. With the expansion, the Brazil technical centre is increasing its local expertise in applications technolog y, know-how transfer and service, and thereby serves the strongly growing markets for highquality silicone and polymer products in South America. “In expanding our technical centre in Brazil, WACKER is ideally prepared for growing local demand, especially for construction, paint and coating applications. With this facility, which is unique in the region, we can further improve our technology leadership in high-quality chemical products,” said Danilo Timich, Managing Director, Wacker Quimica do Brasil.
BUSINESS INITIATIVES
Kemira revamps growth strategies Kemira has sharpened its strategies to increase its growth in the business. By the end of 2020, Kemira aims to become a leader in the industry and technology in chosen target markets. Its strategy aims four key areas – business, growth, geographical focus and innovation. As far as business focus is concerned, Kemira continues to provide expertise and tailored combinations of chemicals for water-intensive industries. It focusses on pulp & paper, oil & gas, mining and water treatment to improve its customers’ water, energy and raw material efficiency. It considers paper and oil & mining segments as profitable, and wants to ensure growth through differentiated product lines (eg, polymers, sizing and other process chemicals). Mature markets continue to be important for all segments, whereas the focus in the emerging markets is on selective expansion. In the emerging markets, China and Indonesia are the key markets for the paper wet-end chemistry. In line with this, the segment management of paper will relocate to Hong Kong as of September 1, 2013. Brazil and Uruguay will remain important markets for the bleaching chemicals used in pulp industry. Oil & mining is targeting expansion in selected countries in South America as well as in the Middle East and Africa. AUTOMATION SOLUTION
Honeywell launches centre in Singapore Honeywell inaugurated a new ASC in Singapore as a part of its global deployment of demonstration centres around the world. Designed to showcase Honeywell Process Solutions’ (HPS) state-of-the-art technologies to customers and partners in the Asia-Pacific region, the centre will help customers appreciate how Honeywell technologies can improve their operational safety, L-R: Yew Chai, Senior Solutions reliability and efficiency. “Our customers face an intensely Consultant, HPS, and Leong Hon Mun competitive global environment and the establishment of this centre will help them to understand and deploy key technologies that can enhance their competitiveness. Honeywell’s solutions can help reduce risks during project pre-deployment and improve bottom line performance during operations,” said Leong Hon Mun, Sales DirectorSouth East Asia, HPS.
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Technology & Innovation
Fisher L2e level controller helps increase reliability and accuracy in level applications THE Fisher L2e level controller from Emersons brings full electric level control to a wide variety of applications in production and processing systems. It uses a rugged force-balanced displacer sensor to detect the level of a single liquid or the interface of two liquids. The controller’s new advanced knife-edge sensing design combines with aerospace quality switch technology to provide rugged, reliable and accurate level control. A fully electric level control loop, consisting of the L2e level controller used in conjunction with a Fisher easy-Drive electric actuator powered D3 or D4 control valve, helps to eliminate emissions and increase uptime, as well as requires less maintenance than conventional pneumatic level loops. The L2e zero and span adjustments enable tuning for a wide variety of level loop applications. Additionally, the controller is certified for use in hazardous areas and is NACE compliant for sour service. By scanning the QR code on the inside cover of the L2e, instrument technicians have access to 24/7 field support for set up, calibration and loop tuning. THE new Triconex Safety View software solution from Invensys provides the highest level of safety integrity for critical alarm and bypass management applications. It is the world’s first software solution certified by TÜV Rheinland to IEC 61508:2010. Safety View draws attention to changes in process conditions that require immediate attention, giving operators, maintenance engineers and shift
Triconex Safety View is the world’s first alarm and bypass management software to be TÜV-certified for use in up to SIL3 process safety applications to manage operational risk with confidence. It is a PC-based HMI dedicated to safety critical alarms and is independent of the control system. It also provides an alternative to traditional hard-wired alarm annunciator panels.
Triconex Safety View solution provides superior alarm and bypass management personnel better visibility into the process so that they can take actions that reduce risk, optimise total cost of ownership and increase overall asset performance. As far as applications are concerned, Safety View software is an operational tool that provides situational awareness of critical conditions and visibility into the process risk being managed. It provides contextual information to facilitate decision support.
The Safety View software supports Invensys’ industry-leading family of Triconex safety instrumented systems Tricon (SIL3), Trident (SIL3) and Triconex General Purpose (SIL2) systems. It allows plant personnel to acknowledge individual and group alarms, reactivate alarms acknowledged by an operator during the previous work shift, apply and remove bypass tags etc.
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New MT3809 VA simplifies design and maintenance BROOKS Instrument, a leading provider of advanced flow, pressure, vacuum, level and vapour delivery solutions, has launched the MT3809 armored variable area (VA) flow meter. The instrument is designed to perform effectively in extreme conditions in chemicals, petrochemicals, oil and gas, and LP gas applications. The MT3809 provides unprecedented flexibility to use a single flow meter regardless of application, process configuration or flow rate. It works accurately across a vast range of operating temperatures – from -196ºC to 420ºC (-320ºF to 780ºF) – and at pressures to 1380 bar (20K psi). Even in demanding applications measuring gases, liquids and steam, the MT3809 delivers 2 per cent full-scale/1.6 VDI accuracy. The explosion-proof housing meets the most stringent hazardous-area classifications worldwide, and a flameproof option is available for IIC/ Class 1 Division 1 locations. Brooks guarantees that the MT3809 can be built with specified country-of-origin materials. In addition to offering flexibility, MT3809 can help simplify design and maintenance, reducing downtime and saving money. Installation is fast and easy, construction is of rugged stainless steel, and weldneck flanges provide long-term durability in all configurations. No back pressure is needed for gas applications, and ASME sealing specifications are met with a standard gasket, eliminating the cost of custom gaskets. The Brooks line of rugged metal tube variable area meters (rotameters) is ideal for high pressure, high temperature, and other demanding flow applications where safety is a concern.
In Conversation With | Dr Deepak Parikh
Troubled times present some of the best opportunities to buy assets …says Dr Deepak Parikh, the newly-appointed Managing Director & Vice Chairman, Clariant Chemicals India Ltd. In an elaborate discussion with Mahua Roy, he talks about the way forward for Clariant in India and the best strategies to counter economic slowdown.
Now that you have taken up the leadership of Indian operations, what are your top three priorities?
Photo: Joshua Navalkar
I have clearly defined the priorities as: growth of Clariant in India; creating synergy among the different BUs; and identifying the growth pockets in the country. When it comes to growth, we see significant opportunities within the businesses we operate in, especially pigments, masterbatch, Industrial and Consumer Care, etc. Within that also we are working towards a ‘new-newnew’ strategy. When elaborated it means, creating new product development having customised innovations for India; acquiring new customers, thereby creating greater market penetration; and finally, identifying new application areas to bring in global ideas for Indian needs. As we saw in the Q1 results for Clariant,
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Dr Deepak Parikh
our Indian business showed sales growth of 16 per cent, while India’s GDP grew at 6 per cent. Talking about synergy, we have a great team with brilliant skill-sets. We look forward to create a harmonised business synergy, with a redefined portfolio. For example, we operate in pigments, additives, and masterbatches. To make masterbatches, one needs the other two. This way, we are trying to seek internal synergy in sourcing and streamlining manufacturing operations. Here is another example. We participate in the paints sector, for which there is requirement of pigments, biocides and additives. Thus, two to three of our businesses can find opportunities there, by operating in harmony. And finally, we are actively looking into the future with respect to where the growth pockets are for specialty chemicals in India. We are implementing and executing global strategies, while keeping the local needs in mind.
Which are your most promising BUs? Each BU has its own strength and need. The reason we have multiple products in multiple BUs is to provide breadth to the customers. In some countries, one segment acquires more importance. In India, we are optimistic about the pigments business. We just announced ` 32 crore investment in Roha to bring an additional 50 per cent capacity of pigments in India. Moreover, the masterbatch business supports the buoyant packaging industry. In the specialty chemicals sector, with our JV partner Sud Chemie, we are able to offer differentiated catalysts and adsorbents to the industry. When it comes to additives business, there is much room to expand in areas such as waxes, antioxidants, UV stabilisers, etc. We plan to play a part in not only offering the product, but integrated solutions for the market segments we operate in, by collaborating with the customers as well as end-users.
Which are the consumer trends you plan to tap? We are in the process of understanding the needs and focus of each business and
consolidate the information. However on a macro scale, we see vibrant growth for Clariant in India with the growth of the automotive, construction and home & personal care sectors. Similarly, there is huge untapped potential in the packaging, footwear and printing industry.
How should companies counter global economic slowdown? The basic strategies to counter slowdown include streamlining costs & operations, making sure one manages the inventory efficiently, and ensuring a good working capital and cash flow. But the important thing that differentiates leaders is the ability to foresee storms coming your way. The mantra is to be agile and flexible to take quick advantages of opportunities coming your way. As a result, global companies must quickly optimise production from one base to another. Managing logistics becomes important, especially if the company is dealing with global sourcing. As margins shrink, ensuring right production planning is important. Also, it is to be noted that even during slowdown, not all segments are equally hit with the same magnitude. Diversity of the portfolio is also an enabler during tough times. Capturing the profit-making BUs and maximising profits is a brilliant strategy. In addition, companies need to identify key customers and suppliers, and work together to tide over tough times. During slowdown, cash is king. Troubled times present some of the best opportunities to buy assets. It is a good strategy to have inorganic growth during slowdown. Some of the biggest buyouts/ acquisitions could have happened around 2008-09, but not many of them had cash flow due to tough economic conditions. Thus, one of the key points in our financial matrix is how much money is tied up and how much is free.
Can you elaborate on Clariant’s global divestment strategy and future plans? On global level, as we did portfolio management and analysis, it became clear that out of the 12 businesses, 5 had
UP CLOSE & PERSONAL All-time favourite motivational book…
‘Blue Ocean Strategy’, which talks about creating innovations and opportunities for growth, which others do not see.
Your business mantra...
The glass is not half full; it is always half empty. There is so much more you can do.
Motivational factor…
People – I get my creative energy from people surrounding me and inspiring them.
Competition according to you…
Competition is like golf. One is always competing with oneself to excel. to be divested in two phases. The first phase transaction has been completed. These businesses, I would not exactly call sunset industries, but with our foresight of profitability, growth with relatively high margins, they did not fit our criteria. Therefore, came the global decision to divest three businesses in phase 1. Very soon, we plan to spin off the leather and detergents businesses. It was a difficult decision to continue to be profitable under such circumstances, as technology, IP rights, etc, are all interconnected. Also, accelerated growth cannot happen when you put capital in brown or greenfield projects. We are looking for interesting opportunities to invest our capital. The acquisition of Sud Chemie was strategic to our business as we did not operate in the catalyst space. Going forward, we plan to invest in such specific and technically complex products to be part of our portfolio. We plan to reposition ourselves through technological solutions to be a player in offering innovative and customer-centric approaches so as to ensure sustainable margins over time and become almost recession proof. We invest heavily in R&D and have just hired a leader for overall R&D operations to approach Clariant’s businesses on a macro level. This will help us achieve a holistic growth across the board. Email: mahua.roy@network18publishing.com
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Inaugural Edition Special
Riding out global turbulence
Tightrope walk for the chemical industry GLOBAL economy has been witnessing turbulence starting with financial crisis in 2007-08 to the present debt crisis in Europe and slowdown in other markets (developed as well as emerging). This resulted in industrial sectors, including chemical, turning topsy-turvy. Pressure on profitability, rising input costs, constraints on spending, uncertainty in new projects, stagnation in exports, etc were some of the challenges before the chemical industry. These prompted chemical manufacturers to change their business strategies for propelling growth in the troubled waters. Some have succeeded, but many are yet to find ways to deal with the current market uncertainties. Following three sections delve deeper into the changed business environment and strive to offer some actionable solutions: Market Analysis : Tracks changing business dynamics due to fluctuating markets Business Initiatives : Steps taken by chemical manufacturers to tide over the turbulence Allied Services : Strategies adopted by suppliers to meet the changing requirements of chemical industry
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Market Analysis | Global economic meltdown 2008-2009
THE economic crisis 2008-2009 hit the global economy and the chemical industry in a way that might not have been witnessed for over 50 or more years before. And this crisis was followed by the fastest recovery the industry ever saw – with record sales and profits in 2010 and 2011. In the dawn of a potential new period of economic struggle, the question is, if the chemical industry has taken 2008-
production increasing by 210 per cent and 148 per cent respectively, and the construction output in China rising in the same period by 177 per cent. This clearly shows that the economic crisis has not changed the fundamentals, but accelerated a development well-known for many years – first and foremost, the stagnating growth in the US and Europe, and continuous growth in Asia.
change came from elsewhere. With the shale gas boom in the US and the exploration of non-conventional resources in regions such as China, a number of competitors followed a ‘as well as’ strategy – being close to cheap feedstock and to the customer base. The consequences will be seen much more in export-focussed regions like the Middle East than for example in Europe. The latter will continue the
forgotten change?
A driver for sustainable
past or
DR ALEXANDER KELLER
The economic crisis of 2008-2009 severely impacted the global chemical industry. Though the industry is on the recovery path, it still has a long way to go to achieve the pre-crisis growth rate. Long- and short-term growth plans, right product portfolio management, increasing customer base, etc are some strategies that chemical companies should adopt to survive in the market. 2009 crisis as a lesson and driver for a sustainable change or just as another challenge that has been overcome.
The facts In 2010 and 2011, the chemical industry probably saw the fastest recovery ever; but has there been a real comeback to pre-crisis levels? A look at the output of major customer industry segments paints a slightly diverse picture. Here are two examples, the automotive industry output in Europe in 2011 only achieved 92 per cent of its record high in 2007, the corresponding figure for Northern America stands even lower at 87 per cent. In the construction industry, the numbers are pretty similar with 90 per cent for Western Europe and dramatic 68 per cent in the US. At the same time, China and Asia portray a complete different picture, with car
The chemical industry in the economic context How did the chemical industry act in that context? Looking at the chemical industry as two big clusters – petrochemicals and specialty chemicals (for the sake of simplicity) – shows large differences where the industry was coming from and how the crisis impacted the strategies for the future. The petrochemical industry, accustomed in managing volatility for decades, went in the crisis with an ‘either/or’ strategy, meaning being either close to cheap feedstock or close to the customer base as the recipe for success. Export-focussed investments in the Middle East and build-up of capacity in the booming Asian markets have been the method of choice, and the economic crisis did not change that. The fundamental
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(ongoing) strategy of differentiating by technology and innovation, but in the Middle East, the direction is clearly pointing towards the development of a local customer base, strongly supported by local governments. The second cluster, the specialty chemicals, has been praised long time as haven of profitability, growth and competitive differentiation, and was therefore subject to many strategies of chemical players. In 2008-2009, however, many players had to recognise that being closer to the customers also meant being closer to customers’ ups and downs. Consequently, this led to considerations of how to continue following a ‘specialties strategy ’ while ensuring attractive growth and managing volatility. Of the many activities, two subjects are commonly identified – a more thorough approach
Global economic meltdown 2008-2009
on portfolio management and searching for ways to broaden the customer base. Strict portfolio management was driven by a stricter assessment where a real competitive edge is given, thus leading to a series of divestments and a selective acquisition approach to strengthen the portfolio on the other side. Clariant’s recent divestment of textile, paper and emulsions, and the acquisition of Süd-Chemie is just one example. To fight volatility, industry players were targeting customer segments showing less of it in the past crisis times, especially when leveraging so far attractive, but highly volatile customer industries such as automotive and construction. The personal care industry, agrochemicals or food/ feed-related chemicals are examples mentioned frequently and consequently in the focus of strategic considerations of many players.
Regional strategies But what does it mean for the regional set-up of the global chemical industry? As previously shown, the economic crisis accentuated the developments seen before and confirmed that a balanced regional set-up is more important than ever. However, looking at the activities of multinationals in Asia, it can be clearly seen that a rethinking process started. With Asia becoming a more substantial part of the business, it was not just a growth engine at any price, but became responsible for profitability as well. More careful and focussed investment decisions over the last one to two years prove this.
Outlook for the industry It can be stated that the chemical industry has reacted to the economic crisis in a short- as well as long-term perspective, but more importantly, has put the learning into the broader context of the market/competitive framework. To understand that, it has to be recognised that historically the chemical industry has had a particular
long-term perspective and planning horizon. In particular, in the US and Europe, the industry took a direct learning from the crisis – how to adjust capacities in short-term and quickly react to changing market conditions, but equally important how to provide enough resources in time to benefit from the recovery. From a structural/strategic standpoint, the chemical industry will continue to leverage favourable feedstock conditions; however, the crisis showed that volatility is not just a challenge for petrochemicals commodity players, but also a subject when closely ser ving customer industries that are being highly volatile in demand. Considering this, portfolio management requires an additional perspective, providing stability and fighting volatility by careful and intelligent diversification.
The economic crisis confirmed that a balanced regional set-up is more important than ever. Regional strategies have been adopted as well. Besides the obvious redirection of investments to the US, thanks to the shale gas, the investments into Asia are in principle unchanged. What started is a rethinking process, away from a pure market growth capture to a more profitability-oriented approach. This goes along with taking a more broader look at Asia, giving significantly more attention to other destinations than China, such as India, Indonesia, Thailand, Vietnam but not to forget growth regions outside Asia like Brazil. The economic crisis 2008-2009 might have been the most severe that many managers in the chemical industry have seen, but it has not been the first and will not be the last. The short-term forecasts for 2013-2014 see stagnation in Europe, a shale-gas fuelled positive
SURVIVAL MEASURES Challenges Stagnation in demand in Europe Slow economic recovery in the US Slowdown in the Asian market Economic crisis affects not just commodity chemicals, but also specialty chemicals Being closer to customers, specialty chemical makers faced high market volatility Strategies Stay close to cheap feedstock as well as to the customer base Adopt a more thorough approach for portfolio management and broaden the customer base Target end-user segments that are less prone to volatility Profitability in Asia should be key for global success development in the US, and ongoing, but country-by-country, heterogeneous growth in Asia. This being complex enough already, the long-term outlook is even more blurred. The major questions are if and when Europe will return to a (slow) growth path; how strong and how long the shale gas boom will last; and where the Asian growth story will first start slowing down. In any case, the chemical industry has proven to have a well-equipped tool box of strategic and operational measures in place; however to manage the manifold changes ahead will be an ongoing challenge. Dr Alexander Keller is the Partner at Roland Berger Strategy Consultants GmbH with global responsibility for the Practice Group Chemicals. His experiences comprise various projects with strategic and operational focus, in particular, evaluating the chemicals and petrochemicals markets in Western/Eastern Europe and Asia (with focus on China and India) to evaluate appropriate growth/entry strategies for international as well as local players in the aforementioned markets. Email: alexander_keller@de.rolandberger.com
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Market Analysis | Chemical manufacturing
SIDDHARTH PARADKAR AND MANISH PANCHAL
Demand for chemicals in India has grown at a rate higher than the GDP and has shown resilience even in tumultuous times over the last couple of years. This demand is driven by sustained growth in end-use industries and considerable rise in exports. However, chemical companies having aspirations in the Indian market must fulfil some key imperatives to meet the growing demand. THE India growth story is fast losing its charm. While the sub-prime crisis of 2008 proved to be only a small bump on the GDP’s growth path, the Eurozone debt crisis coupled with domestic stagflation threatens to definitively alter the economic growth curve. India’s GDP growth dropped from over 8 per cent in FY10 & FY11 to approximately 6.5 per cent in FY12, a nine-year low. GDP growth projections have been cut to 5.5 per cent by RBI, in view of the rising current account deficit, persistent inflation and policy paralysis.
exception of the auto sector, most other sectors such as food & beverages (F&B), paper, electronics, leather & textiles have continued to grow at a rate higher than the overall index. All these industries happen to be major end-users of chemicals and provide rationale for the resilient overall demand for chemicals (negative demand from auto is balanced by other key sectors). Thus, growth in major end-use industries is contributing significantly to sustained growth in demand for chemicals. Another key contributor to demand growth is the potential for increase in per capita consumption of major chemicals India’s chemical market: Streak of in the country. Consumption of specialty sunlight chemicals such as construction chemicals, The slowdown in GDP is not evenly personal care ingredients, water treatment, distributed across all its components, inks, etc, is also low. Therefore, given the especially in manufacturing industry. low current consumption levels, there is From the Index of Industrial Production significant scope for increase in per capita (IIP) data, it is evident that with the consumption of chemicals. India’s chemical India’s consumption of select chemical categories vs China imports also point to Segment Unit India China growing demand. While Fertilisers kg/hectare 142 331 imports had been growing Pesticides 0.6 2 at an annual growth rate Pharmaceuticals $/capita 14 42 of 20 per cent over the Personal care 5.5 20 five-year period from Concrete admixtures $/m3 of concrete 1 2 FY06 to FY11, import 4.1 10.5 Water treatment $/bn m3 of growth during the FY11 municipal water chemicals to FY13 period has been Plastics kg/capita 6 22.8 a strong 14 per cent. Man-made fibres 2.4 13 Chemical exports have Paints 1.5 4.5 also shown a steady Printing inks 0.1 0.3 growth of 15-16 per Source: Secondary research
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cent, both during the five-year period of FY06 to FY11 and FY11 to FY13. While EU and the US have traditionally been India’s largest export destinations, the Middle East, ASEAN, Latin America, Africa, and Australia have emerged as new destinations, offsetting the impact of muted demand for chemical export to EU and the US from India. Growing demand from major end-use industries such as pharma, textiles, and F&B; increasing intensity of consumption and new export destinations provide an opportunity for chemical companies to set up or expand operations in India.
Production lagging demand Resilient demand has ensured greater participation of companies in chemical sector. It becomes apparent that domestic manufacturers is trying to take advantage of this demand; however with India still being a net importer of chemicals (imports exceed exports by 28 per cent approximately), a carefully thoughtout strategy is required for domestic manufacturing to become self-sufficient. Domestic production will have to overcome several challenges in order to keep up with the demand, especially post downturn. The key challenges faced by the industry include: Disadvantaged feedstock position Limited access to technology leading to imports in some technologyintensive sub-segments
Chemical manufacturing
STRATEGIC PLANS Challenges Eurozone debt crisis and lower demand from other developed markets Disadvantaged feedstock position Limited access to leading technology Lack of adequate infrastructure Low focus on innovation/R&D Survival tips Explore new export destinations such as Asia, CIS countries, Russia, Latin America and Africa Focussing on specialty chemicals segment, which has much lower dependence on hydrocarbon feedstock Securing key feedstock through acquisitions or JV in overseas market or bio-feedstock route Setting up integrated refinery to ensure supply of feedstock for downstream industry Partnering with foreign players to gain access to latest technology Lack of adequate infrastructure Low focus on innovation/R&D
India must base the future growth of its chemical industry on successfully utilising its access to large demand clusters while effectively addressing these key challenges. Chemical companies with ambitions for the Indian market must meet certain key imperatives in order to serve the domestic demand and explore import substitution opportunities. Given below are some imperatives for production growth.
Securing feedstock The evolution of the chemical industry globally provides valuable pointers to understand how countries/ regions have ensured growth, despite a disadvantaged feedstock position. For example, the European chemical industry, which was faced with limited carbon-based feedstock availability, focussed on specialty chemicals segment that has a much lower dependence on hydrocarbon feedstock than base chemicals. Effective leveraging of its strengths in technology and access to markets enabled the growth of specialty chemicals segment, which currently accounts for around
40 per cent of the total chemical sales (excluding pharmaceuticals) in Europe (compared to about 20 per cent in India). European chemical companies also set up subsidiaries in oil-producing countries to minimise feedstock risk. Similarly, recent strategy adopted by China is to increasingly look at owning assets in Africa and West Asia to guarantee supply of key feedstock. Indian companies should also work towards securing raw material supply, subject to availability of relevant acquisition targets/JV partners. Companies such as India Glycol have created a global presence based on production of organic chemicals through bio-feedstock route. Integrated planning by HMEL at Bhatinda and IOCL at Panipat has ensured supply of feedstock for downstream petrochemicals in Northern India, which has no nearby ports.
Technology capability Licensing is a possible way to access latest technology. To ensure long-term technology capability and faster access, chemical companies can partner with foreign players for a JV/collaboration. One such example is the recent tie-up by BPCL with Korea-based LG Chemical for making propylene-based downstream products.
Infrastructure With implementation of Delhi-Mumbai Industrial Corridor (DMIC), Petroleum, Chemical and Petrochemicals Investment Regions (PCPIRs) and other infrastructure development programmes, the situation is expected to improve. Meanwhile, industry players can explore and evaluate options of coming together to develop and utilise common infrastructural facilities. New plants could be set up around existing zones/mother plants and utilise established infrastructure on a fee-based model without having to set up their own. Chemical companies in China have used a cluster approach for growth.
Innovate for local needs Product innovations for meeting the needs of Indian populace could be
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enabled by several major technologies such as bio-technology, renewable energy and clean technologies including biofuels, technologies to enable low cost vehicles, wireless connectivity, water management, etc. Frugal innovation could enable creation of these products and services at affordable prices. Development of an ultra-low-cost car like Tata Nano or a low-cost water purifier like Swach, are quintessential examples of frugal innovation to meet the needs of the masses. These innovations required significant support from the chemical industry for development of lightweight & durable plastic composites, use of nano-chemistry for water purification using rice husk, etc. To meet such needs effectively, Indian chemical industry must closely collaborate with end-use industries to develop unique and affordable products.
The road ahead The Indian chemical industry is poised to bounce back. To further boost industrial production, the government introduced the National Manufacturing Policy (NMP) in 2011, which aims at increasing contribution of manufacturing to GDP to 25 per cent within a decade (currently stagnant at 15-16 per cent). Several chemical clusters are expected to be established in the future, mostly backed by PCPIR policy, SEZs and State Government initiatives (eg Dahej, Mangalore, Vapi). As policy-led initiatives progress, the industry must exploit the opportunity by focussing on manufacturing to meet the domestic demand, innovating to address local needs, leveraging inherent strengths and effectively addressing major challenges. Siddharth Paradkar is the PrincipalLogistics at Tata Strategic Management Group (TSMG), a leading Indian owned management consulting firm in South Asia.
Manish Panchal is the Practice Head of Chemicals & Energy business at TSMG. Email: info@tsmg.com
Market Analysis | Indian chemical industry
THE Financial Year (FY ) 2012-13 has not been encouraging for the chemical industry globally, which faced multiple challenges such as Eurozone crisis, slow recovery in the US and weak economic development of emerging economies. Global chemical production has reportedly grown by 2.6 per cent in 2012, which is slower than in the previous year (+3.8 per cent). This was a natural fallout of the slower growth in demand for chemical products in 2012 compared to the previous year. An area of particular concern is Asian countries (except Japan), where demand has reduced (2012: +7.7 per cent; 2011:
sector (other than fertilisers) represented 2.06 per cent of the overall FDI inflow. The sector attracted cumulative FDI of $ 2,690.2 million in 2010-11. FDI inflows had increased during 2010-11 to 2011-12, due to strong economic growth of India, and M&A deals. However, due to slowdown in the economy and erosion of investor confidence, FDI in India has declined significantly during the period April-October of FY 2012-13 ($ 789.4 million) as compared to corresponding period for the previous FY ($ 7,007.6 million).
share in 2012. Japan remains the second biggest acquirer in Asia, followed by India. Not deviating from global trends, the deal value by Indian acquirers crashed in 2012 largely due to slowdown and weak economic reforms. Despite the global slowdown, Indian chemical sector is likely to witness significant growth in coming years, since per capita consumption of chemicals is still low in India. A high level of fragmentation and a strong growth forecast highlights the potential of M&As in the chemical sector. Indian companies are likely to continue to scout for targets that would provide them with access to new markets
Aiming high to unleash
the market potential AASHISH KASAD
The Draft National Chemical Policy 2012 rightly states that the Indian chemical industry could aspire to achieve much more, and its growth potential (conservatively estimated at 11 per cent pa) is limited only by its imaginations. However, amid global slowdown, this industry is keeping a constant watch on key economic reforms from the Indian Government to serve as a growth catalyst to leverage on the potential in the Indian market. +9 per cent) in comparison with higher growth rates of recent years largely due to general economic slowdown. However, the Indian chemical industry growth rate showed a recovery during 2012-13 from the global economic slowdown and European crisis by recording a positive growth rate, despite a slowdown in Indian economy.
FDI inflow since 2008-09 Between April 2000 and August 2011, the FDI inflow in the Indian chemical
2010-11 2,690.2
Effect of slowdown on M&As Globally, deal activity declined significantly in 2012 across all regions and sectors as investors were concerned about the global economy and faced high valuations. Deal value reduced to $ 49 billion after a record year in 2011 ($ 151 billion) due to lack of major deals; 2012 had the largest proportion of lowvalue deals in the past decade. Further, in Asia, overall M&A volume by Asian acquirers declined by 26 per cent in 2012 with China dominating with a 41 per cent
FDI inflows in India – chemical industry ($ million) 2011-12 April-October 2011-12 April-October 2012-13 7,534.1 7,007.6 789.4
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Indian chemical industry
and/or boost their product portfolios as well as enhance their technical capabilities. Private Equity (PE) activity in general has been muted due to ongoing economic slowdown in the short term; however, as some of the fundamentals for the sector on the domestic front remain intact, the PE activity, specifically in chemicals and agrochemicals, would show an increase.
Competitiveness of Indian chemical industry The Indian chemical industry, estimated to be a $ 108-billion industry, ranking sixth in the world and third in Asia, is emerging as one of the focus destinations for chemical companies worldwide. It accounts for around 3 per cent of the global chemical industry. Compared to the US, Europe, and China, there is comparatively low usage of specialty chemicals in India, and hence the untapped potential in this area of chemical industry is immense. According to a report released by McKinsey & Co, India’s specialty chemical industry is likely to grow 4-5 times to $ 80-100 billion by 2020 from the current market size of $ 22 billion. As per a report by Tata Strategic Management Group and FICCI, Indian organic chemicals market is expected to grow at a rate of 5 per cent to reach 3.53 million tonne by FY 2014. Further, even though the Indian agricultural sector is highly dependent on monsoons, the market for agrochemicals is expected to grow at a high growth rate of 11 per cent pa to reach $ 6.4 billion by FY 2016 and the fertiliser demand in India is expected to grow by 6 per cent to reach 78 million tonne in FY 2016, which is higher than M&A activity in India Particulars FY10 FY11 FY12 Number of deals Domestic 35 23 19 Inbound 13 5 5 Outbound 5 11 6 Total 53 39 30 Deal value ($ million) Domestic 223 63 315 Inbound 226 6 75 Outbound 170 1246 455 Total 619 1315 845
SURVIVAL STRATEGIES Having placed their bets on the promising macro-economic outlook for the country in the long term, the Indian chemical manufacturers have largely adopted strategies that would result in benefits in the long run. Given below are some of the strategies adopted by the chemical companies expanding, in late 2011 and 2012, in the face of a slowdown: Strategy: Increasing production capabilities, and thereby reaping benefits from the domestic market Company : Himadri Chemicals and Industries Ltd Objective : To invest ` 19 billion to expand its coal tar business in India Company : Asian Paints Objective : Investment for additional capacity of 50,000 kilo litre to its existing 1,50,000 kilo litre Strategy: Establishment of R&D centre for technology upgradation, new innovations and cost reduction Company : Wacker Chemie Objective : Expanded its technical centre in Mumbai to include laboratories, applications technology and test equipment for polymer dispersions for coatings and paint applications Company : Clariant Chemicals Objective : Opening a new laboratory for research on crop protection Strategy: Joint ventures (JV) to expand to new markets and use each other’s capabilities Company : Reliance Industries Ltd and SIBUR Objective : To jointly invest $ 450 million and annually manufacture 1,00,000 tonne of butyl rubber in Jamnagar, India Company : Modi Rubber Ltd with Asahi Organic Chemicals Industry Co Ltd Objective : For manufacturing of resin-coated sands the global growth rate of 2 per cent. The demand for basic petrochemicals is expected to grow by 9.7 per cent. Further, other industries such as automotive, construction, textiles and consumer products have an immense potential for growth in India, which would impact the chemical industry positively.
On a positive note The intentions expressed by the Government of India in Draft National Chemical Policy 2012 (NCP 2012), if implemented effectively, will create a positive environment required to achieve the estimated growth in chemical sector. The government has planned some dedicated PCPIR to facilitate the cluster approach, thereby having best infrastructure facilities for chemical companies. Towards this, the government has already identified six PCPIRs, of which four have been given final notification (Dahej, Cuddalore, Paradip, Vizag). Further, as per the NCP 2012, it is also considering setting up a single-
window support mechanism to expedite the process of implementation of projects by chemical industry, setting up of dedicated chemical centres and a National Chemical Centre, which would result in holistic and integrated growth. Reforms along with the estimated growth rate in the Indian chemical sector are a welcome sign for companies to invest in this market, despite the current slowdown. The chemical companies that are established in India have recognised the potential in India and are investing in the R&D centres with international standards; expanding existing production capabilities with latest technologies; entering into joint ventures to enter into new markets, etc. This should certainly see India rising up in the global ranks in the next few years to come. Aashish Kasad is the Tax Partner – Chemicals Practice at Ernst & Young Pvt Ltd. For details, contact Padma Chourey on email: padma.chourey@in.ey.com
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Market Analysis | M&A activity
Fine prospects likely in
specialty chemicals NAVROZ MAHUDAWALA AND SAMEER SHAH
‘Volatile industry in volatile times!’ – that seems to summarise the view of the chemical industry. A sector, which always gets perceived as having commodity contours, actually surprised quite a few analysts by its performance this year. While the Eurozone crisis and a general slowdown in emerging markets continued to haunt the sector’s fortunes, relatively there were several bright spots. THE economic turmoil has slowed down the mergers & acquisitions (M&A) activity in the chemical industry including Asia. However, things could take a positive turn in 2013, with signs of economic recovery, especially in the US. In India, one can expect more deals in specialty segment in near future.
Global environment Let’s first take a look at the global scenario in the last year (CY 2012). Profitability for global specialty companies increased. Research shows that Median EBITDA
M&A DEALS Some bad news Globally, M&A activity continued to remain low in 2012 In 2012, M&A activity in the BRIC nations declined by around 12 per cent as compared to 2011 M&A in the Indian chemical sector has been on a downhill over the last three years Things to cheer about Globally, profitability for global specialty companies increased in 2012 compared to 2011 Asia was centre of M&A activity with more than 43 per cent marketshare in the deal value In India, though the M&A activity remained flat in 2012-13, the aggregate deal value increased compared to 2011-12
(Earnings Before Interest, Taxes, Depreciation, and Amortisation) margins for specialty chemical companies stood at 17.5 per cent in 2012 as compared to 15.3 per cent in 2011 – the best performance in the last five years. Globally, deal activity continued to remain low in 2012 as companies remained cautious to invest in an environment of economic volatility. The specialty chemical space registered consolidated deal value of $ 23.7 billion, lower than the median deal value for the last 10 years of about $ 31 billion. However, interestingly the multiples stacked up. The average EV/ EBITDA multiple for 2012 was 10.4 (x), while for commodity chemicals deals, it was 8.6 (x). Geographically, most deal activity was centered around Asia, with more than 43 per cent marketshare in the M&A deal value. This was majorly on account of the continued domestic consolidation in the highly fragmented Asian markets. North American regions had the secondlargest share of about 24 per cent. The key marquee deal in 2012 was private equity group Carlyle’s acquisition of Dupont’s automotive coatings business for around $ 5.14 Enterprise Value (EV). The deal occurred at a ballpark 10 (x) EV/EBITDA (pre-corporate costs allocation). A few years back, it was expected that a large part of global M&A would be driven by the Brazil, Russia, India and China (BRIC) nations. However,
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a cooling economy in China and India ensured that M&A activity in the BRIC nations declined by around 12 per cent as compared to 2011. Another interesting trend being observed in the last few years (and continued in 2012) was the focus of several petrochemical and basic chemical companies on ‘targets’ outside the traditional chemical industry focus. These were forward or backward integration deals and were seen with targets in sectors such as mining, oil & gas and rubber production.
Indian environment While the sector managed to report average growth numbers, profitability evidently took a hit. Following were the conclusions from Candle Partners Analysis of Indian chemical companies of different sizes for the nine-month period between April-December 2012:
For mid-sized companies (sales lesser than ` 500 crore)
Average sales growth was 10.5 per cent
in the first nine months of FY 2013
EBITDA margins declined from
14.1 per cent to 13.7 per cent
For large companies (sales greater than ` 500 crore) Average sales growth was a much lower 5.8 per cent EBITDA margin decline was sharper – from 15 per cent to 12.7 per cent
M&A activity
The cumulative sales of the above mid- and large-sized companies taken for the analysis was approximately ` 40,000 crore, and hence can be considered as fairly representative of the sector. Most of the larger companies in the list were in commodity capex-intensive sectors such as fertilisers, soda ash, petrochemicals – these continue to face demand challenges. However, most of the mid-sized companies operate in fine/specialty chemical areas of agrochemicals, additives etc wherein margin pressure is lesser. M&A in the Indian chemical sector has been on a downhill over the last three years with the number of deals dropping from 53 in 2009-10 to 37 in 2010-11 and 30 in 2011-12. Though the activity remained flat in 2012-13 with 31 deals, the aggregate deal value increased threefolds from around $ 784 million in 2011-12 to $ 2.2 billion. However, the overall number is a bit of a misnomer as it includes two large big ticket deals aggregating almost $ 1.9 billion. These two marquee deals involving Indian companies were Hinduja Group’s lubricants subsidiary Gulf Oil Corp’s acquisition of US-based specialty chemicals company Houghton International for $ 1.05 billion; and Rain Commodities’ acquisition of Belgiumheadquartered coal tar pitch manufacturer Rütgers N.V. for $ 917.5 million. While the domestic activity had volumes (ie 18 deals), the consolidated value was negligible. Agrochemicals continued to witness some strong M&A activity with Coromandel International’s acquisition of Liberty Phosphate Group for around $ 70 million as a key deal.
Expected deal environment in 2013 Globally, various surveys done by analysts seem to suggest that CY 2013 would be a good year for M&A in chemical industry. Lower borrowing costs and the liquidity lying with several large acquirers are critical reasons cited. The US could potentially lead the way with initial signs of recovery already being witnessed in deal activity. The key would continue to be performance of the construction and consumer goods sectors – two end-use sectors that drive chemical demand. As far as India is concerned, limited activity is expected in basic chemicals. However, specific sectors within fine chemicals (agrochemicals/pharma intermediates) and specialty chemicals (flavours & fragrances, plastic additives) may witness some consolidation activity. Private Equity (PE) activity would continue to be largely restricted around agrochemicals and specific specialty chemical areas. Navroz Mahudawala is the Founder of Candle Partners – a boutique investment bank with sizeable focus on chemicals & lifesciences sectors. Email: navroz.mahudawala@candleadvisors.com
Sameer Shah is the Vice President at Candle Partners. Email: sameer.shah@candleadvisors.com
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Market Analysis | Industry Voice - Jaimin Vasa
“The chemical industry’s R&D spend needs to go up significantly from current levels” Changes witnessed since 2008-09...
Jaimin Vasa, President of Gujarat Chemical Association, and Chairman of MSME Committee, Gujarat Chamber of Commerce & Industry, in an interaction with Avani Jain, suggests strategies that can be adopted by the chemical industry to beat economic meltdown.
The Indian chemical industry has evolved from a producer and supplier of basic chemicals to the domestic market in a highly regulated environment to an industry with diverse product portfolio in an open economy. The global financial crisis has created havoc in the world economy. India is also experiencing the ripple effects of this international turmoil. After steep growth for several years, the country’s economy witnessed a slump starting September 2008. A high inflation rate and wavering industrial growth made survival harder for India’s industrial sectors. Due to the global downturn, demand for chemicals from large end-use industries such as construction, automotives, electronics, etc, dropped by 4 to 5 per cent in 2008. Post 2009, the global economy began to improve and recover, and the Indian chemical industry has also been quick to follow suit on the path to recovery, largely driven by domestic demand.
Strong R&D initiatives... The major trends that can be seen across segments are that the domestic market continues to offer high growth potential; competitive pressure is increasing in imports and global players are entering India; and there is increasing focus on lowering of costs. In light of
SURVIVAL TIPS There needs to be significant investments in R&D spends, capacity creation, backward integration, technology development, alternative application of chemicals manufactured, creation of new markets, access to feedstock and development of a larger pool of skilled human resources.
these trends, the focus of the industry should be or rather has been on understanding the precise requirements of customers; increasing R&D efforts to develop molecules as per demands; innovation to develop new process technology as well as new products; green chemistry for environment protection; and alternative chemical synthesis to develop high-quality & lowcost manufacturing facilities. So far, because of high demand in the domestic market, most of the chemical producers focussed on meeting domestic demand rather than exports. However, the export prospects seem to be good in the light of the fact that Asian region is increasingly emerging as a large producer as well as consumer of chemical products. However, due to lack of research and development, the Indian industry lacks technical knowhow. Thus, the chemical industry’s R&D spend needs to go up significantly from current levels. To promote investments in R&D and green technologies, fiscal incentives such as accelerated depreciation, tax benefits, subsidies, etc, should be provided.
Importance of developing human capital during such times... Corporations are recognising the importance of investing in their employees now more than ever. Companies are beginning to understand that to stay on top in the global economy, they need to place more emphasis on developing and retaining their people. As of the human resources front, adequate educational infrastructure is required to impart vocational training to develop additional requirement of skilled workers. Email: avani.jain@network18publishing.com
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Market Analysis | Industry voice - Satish Wagh
“Building good human capital is the need of the hour” Performance of chemical industry in the last five years…
Satish Wagh, Chairman, Chemexcil, in an interaction with Avani Jain, points out that the growth of chemical industry will be sustained, if there are constant innovations, and products are manufactured as per market requirements.
Growing at an average rate of 12.5 per cent, the Indian chemical industry contributes 5 per cent to the country’s GDP. Despite the growth, in 2008-2009, the industry saw a downfall due to economic slowdown and registered a growth of only 5 per cent. However, since April 2009 onwards, the Indian chemical industry bounced back by growing at 11.5 per cent. And, the financial year 2012-2013 saw prices of petrochemicals being largely influenced by the weak EU economies and volatility in the US. The Indian market started on a slow note in the beginning of 2012, but showed signs of recovery in the second half of the year. Thus, with the overall slowdown in the Indian economy and its resultant impact on the end-use industries, the chemical sector witnessed moderate growth since last five years.
Strategies adopted by companies to beat market uncertainties… There cannot be any standard business plan for chemical companies in India to sustain growth during the slowdown. Every company will require a different strategy as this industry comprises different segments such as basic, specialty and knowledge chemicals. Also, the Indian chemical industry caters to a wide range of end-use industries. However, the basic strategies remain the same like
STEPS FOR BEATING SLOWDOWN
Strong green approach Constant R&D activities Favourable government initiatives Recruitment of chemistry graduates
strong green approach, robust R&D, etc. Further, favourable government initiatives and recruitment of right talent can help.
On need for innovations to survive in the market… It is seen that in turbulent times, the growth of any industry depends on how well it understands consumer needs and how effectively products are positioned in the minds of consumers. Thus, specialty chemicals segment grew at a rapid pace as it manufactured products as per the requirements of consumers. Also, the knowledge chemical segment remained largely insulated during the global economic downturn due to technological innovation. In present times, the growth of chemical industry will be sustained, if there are constant innovations.
Importance of investment in human capital development… At present, the chemical industry in India recruits non-chemistry graduates to market chemicals and its allied products. The main purpose of the employers behind this is to save money as these employees demand less salary. However, as these employees are unable to understand the basics of chemistry, growth of chemical companies is hampered. Thus, building good human capital is the need of the hour.
Significance of domestic demand… With increased purchasing power, consumers are demanding good quality products. This offers tremendous scope for innovations in the chemical industry. Hence, the demand for chemicals in India is founded on a strong domestic demand rather than on exports. Email: avani.jain@network18publishing.com
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Industry voice – Savan Godiawala | Market Analysis
“Customisation of technology and products is a trend” Changes in chemical industry since economic meltdown… Some factors contributing to changes in chemical industry post 2009 are emergence of new markets, shale gas discovery and advanced materials systems driving organic growth, and stimulating activities in M&A and strategic alliances. Although M&A activity levels have been lower than those in 2007 and 2008, both in terms of number of deals and average deal value, significant M&A activity is still underway. Few apparent changes include chemical industry witnessing portfolio alignment as companies took steps to strengthen balance sheets, pursue consolidation strategies, and establish foothold in new markets. Largesized organisations are revisiting their plans, business verticals, and costs; in some cases, non-core operations and assets are being restructured or hived off; and even outsourcing of manufacturing operations are being contemplated by companies to reduce costs.
Demand for more innovations… Innovations in chemical industry have always remained in focus as these enable industry players to have an edge over competitors. The industry has also witnessed increased trend of customised development of technologies, products by manufacturers jointly with customers.
COMBATTING DOWNTURN Significant focus on new products
and markets Focus on value-added products Local governments offering schemes to
support R&D activities Innovative solutions remain priority
With rising costs of input and skilled labour, technology transfers have taken place to geographies with lower production costs. Local government schemes have also played vital role in offering assistance to create R&D centres in these geographies. Innovative solutions continue to remain an important factor for market positioning, customer loyalty and gross margins.
Two most important strategies the industry has adopted… Strategies keep evolving; recent strategy trends include securing long-term supplies through effective supply chain management. Volatility in raw materials has huge impact on bottom line. In order to reduce risks related to market volatility, industry players enter into long-term supply contracts, also with a view to manage inventory at optimum level and avoid large blockage of funds. Product innovation and focus on emerging markets are some other trends seen in the competitive environment. Companies have expanded their operations in emerging markets witnessing faster economic growth. Thrust on R&D would continue to be an important factor.
Lessons learnt… Several companies moved out of noncore business areas; focussed on emerging markets, strategies for higher value-added products and less cyclical businesses in order to be more competitive and create prospects for sustainable business. The industry witnessed increased interest in bio-based chemicals, and in some geographies, higher concentration on specialty chemicals. Companies are trying to de-risk their operations as one of the learnings from slowdown.
Savan Godiawala, Senior Director, Deloitte Touche Tohmatsu India Pvt Ltd, in a conversation with Prasenjit Chakraborty, highlights how post 2009 the chemical industry witnessed dynamic changes on account of creation of new markets, discovery of shale gas, stimulating activities in M&A, etc.
Email: prasenjit.chakraborty@network18publishing.com
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Business Initiatives | Chemical manufacturers
Uncertainty propelling
innovative strategies
PRASENJIT CHAKRABORTY
It has been a turbulent journey for the chemical industry globally in the last few years due to uncertain economic scenario. This has prompted the industry to take some important measures such as shifting the manufacturing base to developing countries, focussing on emerging markets, spending more on R&D, etc, to overcome the turbulence. THE chemical industry is completely dependent on the demand in the end-user segments such as automotive, construction, consumer goods, etc. These sectors were among the most affected ones during the global meltdown, which in turn impacted the chemical industry as a whole. The economic slowdown has compelled the chemical companies worldwide to take several decisions for the greater interest of the sector. According to Chemicals, Materials & Foods Practice team, Frost & Sullivan, some of the major changes observed in the global chemical industry, post-recession, are regional shift of production and demand; expansions and lower operating rates, and region-wise concentration of chemical portfolio. Regional shift of production and demand: Recession affected the developed world more severely than the developing nations. Furthermore, East Asia and the Middle East countries recovered swiftly after the recession to record 5-8 per cent growth. The reduced demand in the US and EU, coupled with higher demand in developing nations and lower costs promoted shift of production to East Asia and the Middle East. Many new capacities were added, and others relocated from the US and EU to regions such as China. Expansions and lower operating rates: Riding on the high growth rates during prerecession period, many companies had aggressive expansion plans. However, post-recession while growth recovered, growth rates were flat, especially in key geographies such as China and India. This led to overcapacity across various chemical segments resulting in lower operating rates. This response, once short-term, has now become one of the long-term features in the industry, as it believes that these measures have provided the required flexibility to survive the critical times. Region-wise concentration of chemical portfolio: With shift in demand and production, and the restructuring & consolidation in the chemical industry, a regional segregation of various chemical segments has emerged.
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With stronghold in R&D, developed regions such as the US and EU have retained the specialty chemicals portfolio that sells lower volumes at higher margins. The Asian and Middle East regions have concentrated on production of bulk, basic chemicals, petrochemicals and polymers where they hold the advantage of lower costs and access to large volume markets.
Innovation, the key In a typical industry environment, innovation is the key for healthy growth. However, global recession forced most of the companies to embrace aggressive innovation to survive and to chart a growth strategy for sustainability. “While there is a tendency to reduce R&D spending during recession, some companies have focussed on driving innovation to find solutions. Companies have innovated not only in the area of product development, but also in terms of strategy and approach,” observes Chemicals, Materials & Foods Practice team, Frost & Sullivan. Take the example of Chemtura Corporation, it significantly increased its spending on R&D. “Our R&D expenditures reached $ 44 million in 2012; an increase of 16 per cent when compared with 2011,” reveals Craig A Rogerson, Chairman, President & CEO, Chemtura Corporation. Due to recession, some of the major companies, especially in North America and EU, resorted to a shift from commodities to specialties. The companies started positioning themselves from scale and commodity operators to specialty and services operators. This kind of paradigm shift was essential for survival as most commodity companies shifted their production base to low-cost regions such as East Asia and the Middle East.
Major strategies Overall, the chemical industry has adopted several steps to beat the slowdown. However, consolidation and restructuring, and increased focus on emerging markets
Chemical manufacturers
and products have been the most vital among all strategies. Consolidation and restructuring: Some of the major chemical companies have consolidated their product portfolio, developed with a focus on a mix of core competency and highly sustainable products. Others have been divested or shelved. There have also been a few mergers and acquisitions to achieve this particular consolidation. Furthermore, restructuring with the objective of cost optimisation has been witnessed in the industry. The restructuring has been aimed at achieving the optimum mix of workforce capital, technology and overall profits. Increased focus on emerging markets and products: Post-recession, regions such as East Asia and the Middle East were the first to bounce back and poised to have a sustained growth in the long term as well. This prompted most of the global chemical players from across the spectrum to invest in the emerging markets. Apart from various subsidiaries that are already in operation, there are a few investments in the pipeline. “Some examples include the $ 20-billion joint venture between Saudi Aramco and Dow Chemical building in Jubail by 2015; BASF India plans to invest EUR 150 million to build a new chemical production site in western India etc.
Issues concerning India According to a report by Deloitte, titled ‘2013 Global Chemical Industry Mergers and Acquisitions Outlook’, the Indian economy currently is facing issues such as widening Current Account Deficit (CAD), weak domestic currency, mounting inflation, rising costs & volatile markets and slowing GDP growth. However, with easing interest rates and improving overseas market conditions, India is believed to move faster and attract significant investments. And within the sector, specialty chemicals, commodity chemicals, agrochemicals, fine chemicals, petrochemicals, paints and coatings, etc, have seen interests from several strategic investors. However, India’s chemical sector has witnessed a slowdown in deal activity with its number of deals declining to 30 in FY12, as compared to 37 in FY11 and 53 in FY10.
According to the aforementioned report, the aggregate disclosed deal value dropped to $ 845 million in FY12 from $ 1,314 million in FY11. The year 2012 witnessed several cross-border M&A activities. Big companies such as Chemtura, Cytec tried to strengthen their footfalls in India through acquisitions. November 2012 saw some major deals worth $ 10 billion announced such as ONGC-Kashagan field ($ 5 billion deal); and Gulf Oil-Houghton International’s $ 1.05 billion transaction. Asian giant Japan also seems to be recovering well post-tsunami and showing signs of trade expansions with neighbouring countries. Large diversified cash-rich entities such as Mitsui, Otsuka, and Idemitsu have signed deals in pharma and agrochemicals segment. The rapid expansion by mid-size chemical companies, on account of strong domestic and export demand, led the Private Equity (PE) investors registering keen interest in the sector. Some of the noticeable deals are Everstone’s investment of about $ 30 million in Crystal Phosphates; IFC’s investment in Laxmi Organic Industries Ltd; and Carlyle’s investment in Visen Organics Ltd.
Consolidation in terms of capacities and product portfolio has been the key strategy post-recession. The report also mentions that there were some significant regulatory changes, which could have its impact on M&A activities in India. First, the new guidelines of the Competition Commission of India (CCI) came into effect from June 1, 2011. According to these guidelines, CCI can approve M&As if the targeted Indian company generates revenues of at least $ 150 million or has an asset base of at least $ 50 million. Security and Exchange Board of India (SEBI) has amended the Takeover Code. Now, the threshold for triggering an open offer has been increased to 25 per cent from 15 per cent. Under the new Takeover
TIPS FOR GROWTH Challenges Lower demand in Europe & the US Inability to meet the demand for innovative products Securing long-term supply agreement Manufacturing highly sustainable products Positioning from commodity operators to specialty and services operators Strategies for security New capacity additions in low-cost economy Increasing focus on emerging markets Focussing on core competency Restructuring with the objective to optimise resource utilisation Increasing R&D spending Divesting or acquiring assets to meet short- and long-term objectives Code, the open offer size has been raised to 26 per cent from 20 per cent. This will largely support the requirement of growth capital of Indian companies.
Learnings from economic slowdown Pre-recession, some players in the chemical industry were on an aggressive expansion drive on the basis of speculated growth. Large-scale capacities were being planned, keeping high growth rates in mind. Mergers and acquisitions were primarily aimed at expansion and the resulting immediate gains in marketshare. Product portfolio was also being diversified aggressively with less focus on assessment and focus on future sustainability. “All these factors resulted in the companies being highly leveraged on credits. This in turn made the companies highly adverse to survival during credit crisis. With the experience during recession, companies have learnt to have a balanced approach towards short-term gains and long-term growth objectives. Consolidation in terms of capacities and product portfolio has been the key strategy post-recession,” points out Chemicals, Materials & Foods Practice team, Frost & Sullivan. Email: prasenjit.chakraborty@network18publishing.com
May 2013 | CHEMICAL & PROCESS WORLD | 45
Business Initiatives | Paints sector
ONLY a handful of M&As was witnessed in 2012 in the paints and coatings industry largely because of uncertainties, triggering a low level of confidence among CEOs. The Eurozone crisis and the wider uncertainties thrown up by the debt crisis are to be blamed for the relatively slow 2012 for chemical M&As. The anxiety over uncertainty in the economic outlook also made it hard for buyers and sellers to agree on value of assets. Paints and coatings companies have struggled to grow in a weak economy and have been wary of risky moves like acquisitions. Instead, they have been contemplating either peeling off dissimilar or underperforming units, or acquiring
corporate environment favours mergers and acquisitions: reasonably priced targets, strong corporate balance sheets, cash piles and low costs of funding. Low expectations of growth in 2013 should also act as a driver, as companies seek market consolidation to remove costs and improve earnings.
Sherwin Williams buying Comex In November 2012, Sherwin Williams signed a definitive agreement to acquire the privately held Mexican architectural paint maker Comex Group for $ 2.3 billion including debt. Christopher M Connor, CEO, Sherwin-Williams, told investors that Comex will be the company’s largest
PPG’s purchase venture In December 2012, PPG agreed to buy Akzo North American architectural paint business, which includes the Glidden coatings line, for $ 1.05 billion. The business being sold had 2011 sales of about $ 1.5 billion. Akzo acquired the business in 2008 as part of its $ 16 billion acquisition of ICI. In the years since, Akzo has turned the unit around. However, the Dutch firm has now decided to focus its architectural paint business on certain European markets and other high-growth regions. For PPG, this purchase will more than double the size of its North American architectural coatings business
Of possibilities and bright prospects for M&As DR MOSONGO MOUKWA
With paints & coatings companies struggling to grow in an uncertain market, only a few merger and acquisition (M&A) deals were witnessed in 2012. But 2013 may paint a bright picture as conditions improve with expected rise in demand for paints & coatings, and companies planning to divest non-core businesses, especially after uncertainties subside. to expand. Two major acquisitions came into view at the end of 2012 in the area of paints and coatings, with the announcement of Sherwin Williams buying Comex, and PPG buying the North American business of Akzo. This is on top of DuPont’s performance coatings business moved into the hands of private equity giant Carlyle Group. In 2013, investment bankers are hopeful about renewed activity as some of the uncertainties are getting resolved. The US election and the China’s leadership transition have been completed, and the Eurozone disaster scenarios have subsided. In many respects, the
acquisition to date and will enhance its position in architectural paints in the Americas. Comex had sales of $ 1.4 billion last year, mostly from company-owned stores in Mexico, the US and Canada. The company operates 16 manufacturing sites and employs more than 7,200 people. Sherwin-Williams has taken part in the paint industry consolidation over the past four years, having acquired Becker Acroma Industrial Wood Coatings, Sayerlack, Inchem, and Becker Powder Coatings US. The company should benefit from this large acquisition. There are 16.5 million shares remaining for repurchase as of January 2013.
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and boost its network of company-owned stores to about 1,000. It expects the integration will yield $ 160 million in savings over a three-year period. Analysts have commented that Akzo succeeded in converting Walmart to Glidden paints from Sherwin-Williams’ Dutch Boy brand in 2011, but it has since suffered under relentless price pressure from the retail giant. PPG, being familiar with big retailer merchandising tactics, may be able to do better as the US housing market recovers in the coming years. A share buyback, a strategic acquisition, and an increase in the dividend are the reasons for PPG stock price.
Paints sector
DuPont’s divestment
Potential assets
DuPont has sold its performance coatings division to the Carlyle Group, a private equity firm, for $ 4.9 billion plus the assumption of $ 250 million in liabilities. DuPont Performance Coatings is one of the world’s largest suppliers of auto and industrial coatings, with sales of $ 4.3 billion last year, about 13 per cent of DuPont’s total. The business employs more than 11,000 people in 70 countries. Three-quarters of its sales are outside the US. Yet, in recent years, performance coatings have lagged behind other DuPont businesses in growth and profitability. The company had explained that its long-term compounded annual growth rate targets are 7 per cent for sales and 12 per cent for earnings per share. DuPont businesses in agriculture and nutrition, bio-based products, and advanced materials were better suited to meet those targets. The Carlyle Group has announced that the company will be renamed Axalta Coatings Systems.
There is a lot of interest among sponsors to acquire assets. Companies need M&A to grow in a low GDP context, and there is plenty of available financing and equity capital. Right now, however, there is a shortage of assets, which is a factor hindering deals, but eventually, market forces will rule. Transaction multiples will be relatively high and it will be a good time to be a seller in 2013. The lack of assets for sale may also shift in 2013 as large companies seek to divest non-core businesses and private equity firms seek exits for long-standing investments. Dow Chemical has announced that it will seek to sell unspecified underperforming businesses with sales of around $ 1 billion by the end of 2013 as part of its sweeping restructuring plan. Analysts anticipate that those divestitures would most likely be downstream businesses with weak intellectual property. Clariant is seeking to divest its emulsions, detergents and intermediates, paper specialties and textile chemicals business units by the end of 2013. Investment bankers expect companies to reassess their business portfolios and divest non-core businesses, especially after uncertainties subside. Chemical companies that have made acquisitions in the past several years and have not announced any major divestitures include US-based Ashland (acquired International Specialty Products); US-based Ecolab (acquired Nalco); Belgium-based Solvay (acquired Rhodia); and Eastman Chemical (acquired Solutia).
M&As DILEMMA Challenging circumstances The Eurozone crisis and the wider uncertainties thrown up by the debt crisis Uncertainties resulting in a reduction in confidence among CEOs Uncertainty making it hard for buyers and sellers to agree on value of assets Paints and coatings companies have been wary of risky moves Factors favouring M&As M&A activity likely to be renewed in 2013 as some of the uncertainties are removed Companies to reassess their business portfolios and divest non-core businesses Corporate environment favours M&A with reasonably priced targets, strong corporate balance sheets, low costs of funding, etc Low growth expectations in 2013 may lead to further market consolidation The US housing market appears to have turned a corner
The low level of M&A matters A giant acquisition can bring in a lot of risks to a company. Sherwin Williams recent expansion in China and the Comex acquisition, which is the largest in the company’s history, bring with it significant risks. The North American market is highly competitive. While a giant wave of M&A can be harmful, an unusually low level of deal-making can be damaging to corporate health as well. Economists sometimes argue that a dearth of M&A is bad news because it is a sign that business confidence is
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low. Actually, it should be the other way around. It is the rise in business confidence that is the central desirable outcome here. There are more powerful reasons as to why a persistent drying up of deal flow should be a concern. Mergers and acquisitions tend to support economic activity. They can provide an exit for a struggling company and a quick route to expansion for a growing one. The ability to buy and sell companies is part of the tool kit of running and building an enterprise. When deals become hard to complete, there is a risk that companies are missing opportunities they should have taken, to their long-term detriment. This is a grave danger as the world is changing fast. The pace of globalisation makes the business rationale for doing deals at least as strong as it has been in recent years. A possible loss of competitiveness is also another reason for why M&A matters. There is little point in looking at the economic backdrop to help identify what might produce an increase in deal-making. The Eurozone crisis does not appear susceptible to a swift resolution, while consumer demand is low. Where to look may be in the fact that a concentration of strategic deals in a particular sector tilts the balance such that it becomes irrational for a company to sit on the sidelines rather than also taking part in consolidation. An unexpected deal announcement acts as a signal that more normal conditions apply. The ownership changes that took place within the paints and coatings industry with Sherwin Williams, PPG, Akzo and DuPont have come at a time when the US housing market appears to have turned a corner. Those deals could represent the trigger for the paints and coatings industry. Dr Mosongo Moukwa is Vice President (Technology), Asian Paints Ltd, Mumbai. He was Vice President (Global Technology), Reichhold, North Carolina. He is a member of the American Chemical Society, the Commercial Development and Management Association and the Licensing Executive Society. Email: mosongo.moukwa@asianpaints.com
Business Initiatives | Case Study - AkzoNobel
Enhanced customer collaboration for better business gains MAHUA ROY
Answers to tackle slowdown sometimes lie where we least expect them to. Customers often offer deepest insights, which can be extrapolated and converted into business gains for any company. Be it addressing sustainable solutions or increasing the productivity, collaboration with the customers can prove most fruitful as a strategy for companies. CREATING not just profit but shared value along with key customers is the way forward to tackle inherent problems related to slowdown. This in turn has the capacity to drive the next wave of innovation and productivity growth in the business environment. Yes, aiming to strategically reduce costs to a minimum while also maximising profits is the basic deliverable for a company during tough economic conditions. But, this cannot be achieved by top-down dictations. Customer collaboration is
SUSTAINABLE EFFORTS TO DIFFERENTIATE The company has created five pillars of
sustainability – energy, transport, waste, product and community Dramatic reduction of energy consumption at the factory in Thane, where roof sheets were replaced, with opaque sheets changed to transparent ones Krishna, Hyderabad factory uses technology that is the most contemporary in the world, with the lowest water consumption as well as the lowest consumption of energy per unit. Expanding this factory has also helped in reducing primary freight carbon dioxide emissions by reducing the transportation distance to service the south India market
the prime fitment in this situation. Firms have focussed on enticing consumers to buy more and more of their products. In the backdrop of growing competition and short-term performance measures, and even shorter product lifecycles, companies resorted to waves of restructuring, personnel reduction and relocating to low-cost regions, as quick surgical measures. The results were often commoditisation, price competition, little true innovation, and no clear competitive advantage. But identification of customers as an important resource can create incredible opportunities for a company to innovate and differentiate itself. “Impressive growth and green technology are among the key words here. Our company’s industrial coatings business provides some of the most advanced coatings and inks available on the market. There is an amazing range of products from protective coatings business, which offers extensive range of high-performance coatings and fire protection systems for assets across a wide range of industries both offshore and onshore,” says B Ramakrishnan, Managing Director, AkzoNobel Coatings India. He further claims, “In marine coatings, we are a technology leader in fouling control & abrasion, chemical& impact-resistant coatings for vessels
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being built, repaired or maintained; automotive and aerospace coatings for vehicle refinish; and powder coatings for a wide array of applications including furniture, automotives, information technology, appliances, the architectural market and general industry.”
Idea databank AkzoNobel Coatings took a strategic decision for boosting new product development. The company invited its key customers to share their feedback on the products and solutions offered by the company and also present an ideal wishlist or suggestions. This served as the drawing board for the R&D team and they knew where to begin the process of innovation. “Being customer-centric enables to achieve a positive status in the industry. It shows our commitment to deliver quality in its highest form and stay close to our customers. In the end, it is them we are serving,” adds Ramakrishnan. This approach has practically driven technology and innovation tremendously. One hundred ‘ideas’ were captured thus by the company. Companies increasingly view the opportunity to refocus on the value versus cost spectrum, via a process of mass customisation. This means that consumers were provided with extra value on a cost-conscious basis. But maintaining
Case Study - AkzoNobel
the sustainability of this model start to garner popularity. Earlier, B Ramakrishnan is a challenge. In times of the paint industry could not Managing Director, AkzoNobel Coatings India slowdown when innovation think of making brighter and becomes a differentiator, R&D vibrant colours without the use If people and planet are efforts acquire the driver’s seat. of harmful lead and chromium. managed properly, profit flows Cost-competitive solutions are We took a big step and our entire automatically. Sustainable efforts need of the hour as budgets manufacturing site today is lead and innovation are two ways to tighten across the value chain and chromium-free. Yes, we have achieve differentiation to stay of the market. As a company, taken a hit on the cost, but we ahead in difficult times. we are always innovative, are offering something positive always ahead and dedicated to the society. As a company, we development. AkzoNobel has shown to our stakeholders; our values realise that our vision for a green sustained efforts towards R&D and laid co-exist with the bottom line,” adds tomorrow has little or no meaning unless emphasis on the development of waterRamakrishnan. it is incorporated in all our products. So based coatings. be it chemicals or coatings, the intent is to Spearheading innovation AkzoNobel wants to lead this initiative ensure that the focus remains on creating The paints and coatings industry is in India. As a company, it has always a healthy planet,” explains Ramakrishnan. one which is directly affected by global maintained health, safety & environment The company follows a peopleslowdown considering its dependence on as an integral part of the product planet-profit sustainability doctrine. crude oil. Fluctuating costs affect margins development process, which helps to Ramakrishnan concludes, “If people substantially, and thereby create a ripple ensure that coatings’ impact is minimised and planet are managed properly, effect on productivity as well. Of course, throughout the product lifecycle. Ecotech, profit flows automatically. Sustainable process reorganisational measures are an initiative by AkzoNobel, promotes efforts and innovation are two ways to necessary, and adoption of lean principles the development and use of more achieve differentiation to stay ahead in is the way to consider; but more important environment-friendly coatings. “In 10 difficult times.” Email: mahua.roy@network18publishing.com is the emphasis on in-house product years from now, water-based coatings will
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Business Initiatives | Case Study - WACKER
Riding high on
research-oriented approach PRASENJIT CHAKRABORTY
WACKER, to a large extent, has been able to counter economic uncertainties mainly due to its global presence. Hence, the company is not dependent on sales from a particular region, and more than 80 per cent of its sales come from outside Germany. However, its semiconductor business is severely affected and the company is looking at ways to revive this segment. THE economic downturn in the EU certainly had its effects on businesses in most European countries. Its effect is distinctly visible in other countries around the world, too. Naturally, the consequences were felt in some parts of Asia, particularly in China and India. The economic slowdown has affected different companies in different ways and the magnitude also varies. For
TAKING AN ‘UP’ TURN Challenges To revive semiconductor business Offering products to meet the exact customer needs Strengthening profitability in semiconductor arena Offering unique services Strategies adopted Not depending on sales from a particular region Having 22 technical centres in key regions Increased spending on R&D Close interaction with customers
WACKER, semiconductor business segment was the most affected. In contrast, its chemical divisions performed well, despite weaker economic environment. “Our polymers division, for example, generated for the first time sales of over one billion Euro in 2012. Our silicones and bio-solutions divisions posted higher year-on-year sales. And among our solar customers, demand growth is strong, too,” says Raman Trikala, Managing Director, WACKER India. The stable growth of WACKER even in such difficult times is mainly attributed to its presence across geographies. It is important to mention here that only 15 per cent of its sales come from Germany. “Our stable growth is mainly due to our global setup and 85 per cent of our sales are generated outside Germany, with Asia being the biggest growth driver,” says Trikala. One of WACKER’s strengths is the combination and risk profile of its various lines of business. Its wellbalanced portfolio and global presence in all key markets make WACKER
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well-positioned even in a challenging market environment.
Strong R&D initiatives It has been seen that R&D is the backbone for all reputed companies around the world. WACKER is also no exception. “We rank among the most research-intensive chemical companies in the world, with annual R&D expenditures of about 4 per cent of our sales. Compared to 2011, our R&D spending increased by almost 1 per cent,” reveals Trikala. Research is carried out on two levels at WACKER – on the corporate level at its central research facility (R&D) in Munich, where the focus is on basic and product research for establishing new business opportunities, and further in the divisional research departments, which concentrate on market and applicationdriven research. Additionally, WACKER runs 22 technical centres in all key regions, which offer customer support and develop new products & tailor-made
Case Study - WACKER
product applications for regional markets taking into consideration locally available raw materials and climatic conditions. “In the last six months, we set up two new centres and expanded two existing ones. It means we are constantly investing in our R&D,” says Trikala.
Cost-cutting measures WACKER’s semiconductor business has been facing rough weather, and sales & earnings declined due to the current global economic situation. For this reason, it continued to streamline the production of smaller wafers. A site in Japan was closed, as was a smaller diameter production line in the US. Consequently, the remaining production sites for these wafer diameters have better capacity utilisation rates. “With this, we are strengthening the profitability of our business,” he says.
Raman Trikala
Managing Director, WACKER India
Our stable growth is mainly due to our global set-up and 85 per cent of our sales are generated outside Germany, with Asia being the biggest growth driver.
Trikala. In order to cater to the specific needs of the Indian customers, its local branch in Mumbai provides an opportunity to learn about all the relevant aspects of modern polymer and silicone chemistry & related applications, and formulate solutions to suit tailor-made customer requirements.
Customer-centric approach
The way ahead
One of WACKER’s five goals is dedicated to its customers. Its constant endeavour is to provide customers with effective solutions for their businesses by providing them with highquality products and unique services. A good example is its international network of training centres – WACKER ACADEMY. “This is our platform for sharing product and applicationrelated technical know-how and information with our customers and partners around the world,” says
The decline in semiconductor business is mainly due to lower polysilicon prices. That is why in semiconductor business it is concentrating on cutting costs and ensuring appropriate profitability and, in particular, sufficient cash inflow from operating activities. “In our polysilicon business, we want to continue enhancing our productivity and costefficiency, thereby simultaneously strengthening our market leadership,” concludes Trikala. Email: prasenjit.chakraborty@network18publishing.com
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Business Initiatives | Industry Voice - Ande Prathap Reddy
“Process improvement is the need of the hour” Impact of current economic uncertainty on the company…
Ande Prathap Reddy, Chairman and Managing Director, Balaji Amines Ltd (BAL), in conversation with Avani Jain, states that continuous efforts to improve process efficiency is imperative for future growth.
BAL is primarily focussed on manufacturing alkyl amines and their derivatives. These are predominantly used in growth markets with mature chemical industry environment. The applications of our products are in niche areas that end up being non-discretionary in nature, thus assuring continued demand even during global downturn. This has ensured growth for our organisation over the past 10 years, resulting in consistent increase in both the top line as well as bottom line. About 15 years ago, we started the process of acquiring export customers so as to reduce risk associated with excessive dependence on domestic market. So, by the last downturn, our exports had grown sufficiently to provide us a good cushion against the domestic and international slowdown, and allowed us to focus on strong customer relationship building exercise both domestically as well as internationally.
Markets you are currently concentrating on... BAL has gradually increased focus on the international markets such as Europe and North America. As a result, 30 per cent of the turnover is from exports. We have been actively looking towards entering
TURNING CHALLENGES INTO OPPORTUNITIES The recent downturn resulted in BAL’s renewed focus on optimising costs while minimising environmental impact. The company also benefited from its increased focus on international markets since this has helped in reducing risks associated with volatility in domestic markets.
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into Eastern Europe, Russia as well as playing a more dominant role in the Asian markets, besides developing our network in these areas. The key challenges that we face, at present, are complex legislation in overseas markets, weak export logistics and insufficient export incentives to match those enjoyed by international competitors.
Cost-cutting measures taken… BAL’s plants have been developed indigenously and continually revamped over the last two decades to maximise productivity levels with minimum capital outflow and optimal utilisation of utilities and raw materials. Further, hydrogen gas, which is generated as a by-product in one of our plants, is used as fuel for thermic fluid heating units.
Government’s role to aid industry growth... The government should consolidate all the acts into an Integrated Chemical Legislation, covering the entire lifecycle of chemicals. It should also expedite swift implementation of GST to lower transaction costs and avoid cascading of taxes. Further, simplification of registration approval procedures, especially for pharmaceuticals and agrochemicals should be done by the government.
Message to entrepreneurs during such testing times... Inculcating a process of ongoing cost reduction is imperative. Also, process improvement is the need of the hour. Continuous R&D in new products and existing process improvement need to be an organisational goal supported by senior management, with commitment on both financial and organisational aspects. Email: avani.jain@network18publishing.com
Industry voice - Bhupendra Patel | Business Initiatives
“Intensive R&D activities is the need of the hour” Impact of current economic uncertainty on your business...
Top three priorities for the company for now…
In times of recession, our exports are highly affected. Since last six months, the demand is low from countries such as China and Taiwan. Also, the Dollar and Rupee fluctuation has proved fatal for the industry, especially for the small- and mediumscale industries. Further, the unfavourable government policies for exports have also affected the industry. Despite the reduced exports, the demand from domestic market has increased. This is helping the company, to a large extent, during this economic downturn as 60 per cent sales is from the domestic market.
The top priority of the company is to comply with environmental norms and manufacture environment-friendly products. Next is to improve the quality of products. Last but not the least, invest in R&D activities so as to manufacture innovative products.
Ways to sustain growth… In order to stay afloat, we indulge in clean practices, ie comply with environmental norms. We are investing huge amounts in R&D activities for product innovation and creating a brand image so that our products are distinct from others. We are also focussing on standardising processes and products. We are improving our marketing strategies so as to grab a large marketshare. Also, we are trying to adapt to the customer demands so as to maintain steady growth in such uncertain economic situation.
BEATING SLOWDOWN Indulge in clean practices, ie comply
with environmental norms Invest in R&D activities for product
innovation and creating a brand image so that the product stands apart from others Focus on standardisation of processes and products Improve marketing strategies Adapt to the customer demands so as to maintain steady growth
Cost-cutting measures taken… We have ensured proper purchase mechanism for raw materials, thus cutting on costs. We conduct energy audits, machinery audits etc, so as to find out wasteful costs and bring about improvement. We are trying to reduce the labour costs by employing semi-automatic machines and less labourintensive techniques & processes. Also, the processes are consolidated to reduce the manufacturing time, thus saving costs and cutting on effluent discharge.
Your take on cutting investment on R&D during slowdown… It is absolutely wrong as until and unless, you have a strong product, you will not be able to sell it in the market. This calls for product innovation, which could be only possible through strong R&D initiatives. Intensive R&D activities are the need of the hour, as otherwise, companies would not be able to gain an edge in the domestic as well as international markets.
Bhupendra Patel, Managing Director, Jemby Chem Ltd, in an interaction with Avani Jain, explains importance of environment-friendly products for ensuring growth of chemical companies in the present times.
Key lessons learnt... We have learnt that investment in the R&D sector is the key to the growth of a company. Further, steps taken towards saving energy, water etc, can help in cutting costs, increasing goodwill and making a huge impact in the path of growth. Email: avani.jain@network18publishing.com
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Business Initiatives | Industry Voice – Craig A Rogerson
“New product development is critical to overall growth” Steps taken to maintain a steady growth…
Craig A Rogerson, Chairman, President & CEO, Chemtura Corporation, in an interaction with Prasenjit Chakraborty, underlines the fact that it is mandatory to know the exact needs of end-consumers.
We have positioned ourselves well to serve the electronics and energy, transportation, and agricultural markets, where several major global trends – population growth, scarcity of natural resources, and shift in consumer markets towards faster-growing regions – drive the potential for continuing growth in demand for our products. We have built upon our historical strength in the US and Europe to expand our business geographically, thereby diversifying our exposure to many different economies. Our business portfolio serves numerous different global industries, customers and applications, thereby providing us with further diversification. Furthermore, we see opportunities for demand recovery as the year progresses, led by the AsiaPacific region. With the investments we have made in people and facilities, our businesses are better positioned than in the past to capture the benefits of economic recovery as it happens.
On spending on R&D… Our research and development expenditures totalled $ 44 million in
SURVIVING DOWNTIME Challenges faced Demand is cyclical Rising cost of raw materials Ensuring right price of end-products To reach targeted growth by 2016 Solutions adopted Focussed approach to potential areas Expanding business in different regions Spending more on R&D Priority for sustainable products
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2012, about 16 per cent more from 2011. As a specialty chemical developer and manufacturer, our competitive strength lies in continually developing and engineering new products & processes that meet our customers’ changing needs. We are investing in innovation to strengthen our new product pipelines and will license or acquire technologies to supplement these initiatives. We focus on the development of products that are sustainable, meet ecological concerns and capitalise on growth trends in the industries we serve. Our businesses conduct R&D activities to develop new as well as optimise existing production technologies, and to develop commercially-viable new products and applications while also maintaining existing product registrations required by regulatory agencies around the world.
Cost-cutting measures… In November, we entered into an agreement for the sale of our antioxidant business. As a result, we now report them as a discontinued operation. We already have detailed plans in place to promptly eliminate the stranded functional costs arising from the transaction and will implement them upon the closing of the transaction, thus preserving our margin.
On increased customer interaction… Our vision is to create sustainable competitive advantage for our customers by combining our experience and expertise in cutting-edge technologies with a deep understanding of their end-use applications, making us an indispensable partner in solving their toughest problems. For this purpose we have R&D, Application Development
Industry Voice – Craig A Rogerson
Centres in China, Brazil, the US and the UK, where we routinely work with our customers to identify and resolve their current and anticipated future challenges. Recent results include a joint development agreement with Caterpillar Inc for novel applications of Duracast hot-cast urethane pre-polymer technology for construction and mining equipment; Emerald Innovation 3000, a greener flame retardant for polystyrene foams; and GeoBrom products for cleaner energy through mercury removal applications in coalfired power plants.
Importance of innovation… New product development is critical to our overall growth and profitability, not only to tide over economic downtimes, but to grow and be more profitable at all times. In 2012, we generated nearly 10 per cent of revenue from products that are less than five years old. Our goal is to be at or above 30 per cent by 2016 through a process of product and application innovation & extension.
Two most challenging areas in your business… The cyclical nature of the chemical industry and increase in the prices of raw materials are two major challenges we face. On one hand, it helps that we have a variety of businesses whose distinct customer bases may experience cyclicality but not necessarily in sync with each other. So that, when one of our markets is weak, the others are not necessarily so. On the other hand, we purchase significant amounts of raw materials and energy for our businesses. The cost of these raw materials and energy, in the aggregate, represents a substantial portion of our operating expenses. The prices and availability of the raw materials we utilise vary with market conditions and may be highly volatile. Over the past few years, we have experienced significant cost increases in purchases of petrochemical-based products, tin, soyabean oil, and other raw materials. We have attempted to match increases in the prices of raw materials or energy with corresponding increases in product prices.
Importance of Indian market and steps taken to increase marketshare… The Indian market is important to us, as is the broader AsiaPacific, which is one of the fast-growing regions of the world. Chemtura recently agreed to acquire the bromine assets in India of Solaris ChemTech, which provides our Great Lakes Solutions business with a cost-competitive bromine source closest to our fastest growing customer base. For Chemtura as a whole, this acquisition represents increased presence in this fast-growing region and growth in our target industry segments of electronics, energy and agriculture. Additionally, the 40-acre site at Vadodara will allow for future expansion of all Chemtura businesses in this growing market. Email: prasenjit.chakraborty@network18publishing.com
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Business Initiatives | Industry voice - Paul Sanders
“Testing and evaluating products locally is important” Challenging areas for business…
Paul Sanders, Managing Director, Honeywell Fluorine Products in Europe, Middle East, Africa and India, discusses with Mahua Roy about the company’s new technologies, which suit the needs of customers in tumultous economic scenario.
The flourine industry globally is driven by four main drivers and challenges. First is environmental compliance. Currently, India is focussed on the phasing out of hydrochlorofluorocarbon (HCFC) and the global focus is on GWP reduction. Hence, industry here is looking for solutions that are not just non-ozone depleting but also low GWP. Second driver is performance. In India, companies need to comply with the ‘star’ rating system set up by the Bureau of Energy Efficiency (BEE). So companies are looking for the right solution to improve energy efficiency of their existing and new product range. Third comes costeffectiveness. When phasing out HCFCs, a manufacturer has to consider the impact on total cost of the unit and the changes in plant & machinery. Last but not the least is safety, which is not only critical at the plant where the equipment is manufactured, but also during actual use and servicing the equipment at customer sites.
Changing business requirements in last five years... As per India’s commitment to the Montreal Protocol, starting 2013, we need to start phasing out HCFC R22,
LEARNINGS TO FOLLOW Emphasise
on development and nurturing of local R&D base to offer glocalised solutions to region-specific problems Offer higher energy-efficient products that help cut down overall cost of ownership; keeping in mind the cost efficiency of the products & services Extensive and continuous participation in strategic tradeshows
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a commonly used refrigerant product. Consequently, manufacturers today are evaluating various non-ozone depleting refrigerants to replace R22 from their product lines. Thus, refrigeration industry today is looking to understand, evaluate and adopt replacement alternatives for R22, which can not only maintain but also improve energy efficiency. Ambient conditions in India can be different across regions and also from other countries. Hence, testing and evaluating products locally is important.
Changes brought in your approach to serve customers… The refrigeration sector in India in quite under penetrated and has a high growth potential. At the same time, the industry faces significant challenges of not just phasing out HCFCs but also improving their energy efficiencies. So our priority in India is to introduce our global product portfolio and help Indian companies develop products leveraging our global expertise.
Impact of economic slowdown... The recent global economic scenario has led to increased emphasis on energy efficiency. Customers today are looking for products, which can reduce their operational costs significantly. Hence, for us it is important that we develop and commercialise products that are not only environmentally compliant, but also demonstrate superior energyefficiency performance. Also, we see that product needs can change according to regions. Hence, having a local R&D establishment for the region is important to support customers and develop product propositions specific to their needs. Email: mahua.roy@network18publishing.com
Business Initiatives | Industry voice - Prakash Raman
“Our focus is on enhancing efficiency of operations” Steps taken to tide over economic turmoil… In the present scenario, our key focus is on innovation. We have put our best resources to ensure that our innovative products continue to offer valueaddition to customers. Thus, we are not reducing our resource deployment towards these efforts. Considering the current challenging scenario, high focus is on enhancing efficiency of the operations and making them costeffective. Also, there is continuing focus on cash flow.
Prakash Raman, Managing Director, Solvay Specialities India Pvt Ltd, in conversation with Avani Jain, stresses on the need of product innovations for sustainability of business, even in times of economic turbulence.
Priority areas for sustaining growth… At present, specialty polymers business is among our top priorities, ie, we want to continuously innovate and offer value-addition to our customers. We are also looking for opportunities to enhance the geographical presence. The focus is also on identifying opportunities in emerging markets such as India and optimising our operations to meet the demands of our customers more quickly.
BRAVING THE STORM The key strategies that will enable companies to stay afloat during a slowdown are as follows: Focussing on innovation so as to offer value to customers Continuously making investments for enhancing R&D activities Enhancing efficiency of operations and making them cost-effective Delivering solutions that address megatrends emerging in developing markets Identifying opportunities to enhance the geographical presence
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Impact on exports… We have plants in India that cater to the global market and are bound to be impacted by the economic scenario. So, we have to be agile for managing such scenarios. Thus, we are continuously formulating strategies for making our plant highly efficient and flexible, and at the same time, looking for further growth opportunities in the domestic market.
Target sectors… In India, our key focus is on pharmaceutical packaging, chemical process industries, wire & cable, and healthcare. We are continuously investing towards delivering solutions, which address megatrends such as water, healthcare, electronics, automotive, etc, emerging in developing markets.
R&D to the rescue… We firmly believe that investment in R&D activities and product innovation is the key to long-term sustainability of the business. Thus, we are continuously making investments for enhancing our R&D activities. That is why we inaugurated our global R&D centre in Vadodara recently. The main purpose behind this was to enhance our external collaborative efforts with universities and other institutes.
Acquisition or divestment decisions… Solvay has recently acquired Sunshield Chemicals. We have made investment in R&D activities by opening new global R&D centre in India. In future, we are looking for opportunities to enhance our presence in India. Email: avani.jain@network18publishing.com
Industry voice - Steve Stilliard | Business Initiatives
“Sustainability coupled with productivity has been our focus area” Steps taken to maintain a steady growth... The key strategy has been the adjustment of the manufacturing footprint to provide closer proximity to our end-markets. This in turn has resulted in generating reduced response times to our customers. In addition, we have seen tangible results in case of improved cost-competitiveness. Underpinning these structural changes is continuous attention to operational effectiveness, even at a micro level. Huntsman has learnt the best techniques around the world as regional economies face similar challenges. As a result, we have been able to continue a strong growth trend across the diverse business profiles through a number of strategically managed initiatives.
Emerging opportunities... We see a lot of potential within our textiles business sector. As of now, we are
SLOWDOWN IMPACT ON HUNTSMAN IN INDIA… Huntsman has been able to grow its business strongly across many sectors, despite the overall slowdown in growth across the Indian economy. However, the increased competitiveness in many markets has led to a sharper approach to supply chain management, and a deeper appreciation of the benefits, which can flow from a closer collaboration and partnership with customers and suppliers. The sustained implementation of solutions to many of the difficulties brought about by increased volatility and uncertainty has fundamentally strengthened Huntsman’s business, and will stand us in good stead when growth begins to recover to previous levels. As they say, every cloud has a silver lining.
concentrating on driving new business opportunities in digital printing and higher value household & apparel textiles.
Investing in product developments in these tough times... Intensive R&D efforts can actually bail out a company in tough economic situation. Huntsman has in fact stepped up its investment in new product development initiatives over the past two to three years. This has been aimed at addressing the customers’ needs for both improved costeffectiveness within their own processes, as well as the need to respond to calls for improved environmental performance. So, sustainability coupled with productivity has been the focus area for Huntsman. However, in my opinion, new product development initiatives are not a panacea for a business in a slowing economy, but it must be one of the pieces of the jigsaw if a business is to survive and prosper in these circumstances.
Supply chain management during the present challenging times… A feature of slowing economic conditions is the volatility of the forecasting process among our customers, aggravated by their changing policies on stocking and de-stocking. This can lead to poor forecasting accuracy, suboptimal plant operation and unplanned additional cost. One of the beneficial outcomes of this recent period has been the realisation of partnerships with key customers, which have allowed the development of shared information to drive lower costs for both parties. These partnerships will outlive the current slowdown to build platforms of enhanced business performance.
Steve Stilliard, Vice President and Managing Director Indian Subcontinent, Huntsman Corporation, in an interaction with Mahua Roy, explains how Huntsman braved tough economic conditions.
Email: mahua.roy@network18publishing.com
May 2013 | CHEMICAL & PROCESS WORLD | 61
Business Initiatives | Industry Voice - Zarir Langrana
“We are going through a journey of transformation” Initiatives taken to maintain growth during economic turmoil...
Zarir Langrana, Chief Operating Officer - Chemical Business (India), Tata Chemicals Ltd (TCL), elaborates the strategic decisions and changes brought about by the company to be more sustainable even in troubled economic times, during an interaction with Mahua Roy.
We have maintained our commitment to offer improved, value-enhancing products & solutions to our customers. Some of our recent launches testify this dedication. To offer this, we have brought about significant changes in our framework to serve the customers. We aim to offer sustainable solutions aided with a responsible business model. Resource optimisation, alternative sources of fuel and raw materials, and maximising reuse and recycling are the key drivers in our operations. We have initiated the practice of lean manufacturing & operating strategies at our facilities and across our value chain, with the simplification of operations, as far as possible. Leveraging innovation, we have offered superior value to our customers and end-consumers, thereby excelling in both B2B and B2C markets.
On supply chain optimisation… We have taken several measures to make our supply chain tighter and valueaccretive across all our global locations.
STAYING AFLOAT IN TOUGH TIMES It is crucial for a company to remain completely vigilant at all times in periods of boom or during a slowdown. Increased unpredictability and volatility are going to be the new norm. Organisational resilience to this comes out of agility, speed and flexibility in processes & practices. A culture of continuous innovation and continuous improvement is key to staying ahead of the curve. Needless to add, the spotlight at all times is the customer the organisation serves and the constant ability to offer superior value..
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Strategically, in some geographies and businesses, we have increased the focus on automation, while in certain other geographies, we have brought about innovative approaches to be closer to our customers. We continually optimise supply bases to markets that we serve and leverage on logistics costs in order to meet customer requirements with superior efficiency and engagement.
Importance of R&D investment... In times of slowdown, it is perhaps more essential for a company to invest in R&D initiatives and new product development. This offers a brilliant competitive edge to stay ahead of peers in the industry. It also shows the commitment of a company to offer sustainable solutions, which enable value creation for customers. TCL offers solutions across three segments – living, industry and farm essentials (LIFE). At the enterprise level, we are going through a journey of transformation of changing focus from being primarily a commodity chemicals-driven company to a solution-focussed one. Our priorities lie in the fields of food, water, health, and climate change. We are increasingly building closer interfaces with the end-consumers and leveraging on cutting edge technology. The Tata Chemicals Innovation Centre is home to world-class R&D capabilities in the emerging areas of nanotechnology and biotechnology.
Focus markets... While India and the domestic consumer will continue to be our prime focus, we are also concentrating on building our presence in a significant manner in the growth markets of South East Asia, Africa and Latin America. Email: mahua.roy@network18publishing.com
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Allied Services | Equipment manufacturers
Enabling customers to
resolve efficiency challenges RAKESH RAO
Last few years saw challenging economic scenario due to slowing economic growth and squeezed profit margins. Budgetary constraints and dampened mood of the chemical industry have made customers wary of adopting new technologies. As a result, equipment suppliers are looking at smart strategies to meet fluctuating business needs in times of economic uncertainty. THE economic slowdown directly impacts the consumption of chemicals in the user-industries. This has trickle-down effect on process equipment industry. This has prompted suppliers to change their strategy. Navalkishore M Kadwani, Marketing Manager, Nalco Water India Ltd, opines, “The strategies and approach we undertake during a growing market would not help us sustain our operation during the slowdown, as we need to be highly competitive and provide products & services, which will meet customers’ expectations in terms of low input costs.”
Impacting demand While investments in new projects are down, chemical manufacturers are now going into de-bottlenecking and improving processes. Chemical companies are adopting more cautious approach for investing in high-end machinery; at the same time, they are now judicious in procuring consumable products. Rakesh Aggarwal, Director – Operations, Cole-Parmer India, says, “Unlike basic laboratory equipment, which generally costs hundreds or thousands of dollars, high-end systems often demand investments that are far more significant. The demand for basic equipment will always be there. But, budgets for high-end systems decreased in 2012 and might see a challenging phase in the short run too.” According to Kadwani, the two most challenging areas are: Providing quality service against cost
pressures in the present competitive environment Developing innovative technologies and solutions as there would be constraint on the innovations budget As customers look for economic alternatives, customer retention is a tough task. This hampers the future investment plans and hence longer growth period cannot be predicted with ease. Adds Sunil Khanna, President & Managing Director, Emerson Network Power, India, “Economic uncertainty has impacted overall growth of the manufacturing sector leading to heavy cost cutting and low capital investment due to budget constraints.” The tough market situation has helped the industry realise the importance of optimum utilisation of infrastructure. These have paved new way for service providers offering solutions for resource optimisation. Dr Naushad Forbes, Director, Forbes Marshall, says, “It is essential to take a holistic view of plant economics. It is important to put in place the right diagnostics to help you know how you are doing on a daily basis instead of using thumb of the rule or guesswork.”
Efficient solutions In order to meet the changing needs of customers in highly challenged external environment, equipment manufacturers are adopting innovative strategies as follows: Localisation: Rising cost of raw materials and weak domestic demand
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have put additional pressure on profit margins of equipment suppliers. To meet the fluctuating business needs in a cost-effective manner, suppliers are now focussing on localisation with respect to sourcing raw materials and manufacturing. Emphasising on TCO: With chemical manufacturers emphasising on reducing production costs, equipment suppliers are offering solutions with minimum Total Cost of Ownership (TCO), thus helping customers optimise operational costs associated with their critical infrastructure. Internalising solutions: While external factors are never in one’s control, internal processes are. Enhancing business efficiencies by improving internal processes is one of the must-do things for any company. Quick RoI: As customers become demanding, equipment suppliers are focussing on applications where their products can bring a tangible and visible benefit to the customers. Quick Return on Investment (RoI) – and not just a quality product – has more takers. Revisiting priorities: A company needs to revisit its priorities to ensure laser-share strategy focus. Daksh Malhotra, Director-Marketing, Everest Group, says, “A slow market presents an opportunity to evaluate every product, programme and person. Anything that does not contribute to your core discipline needs to be closely scrutinised. Watch
Equipment manufacturers
for revenue declines, competitive price cutting and deteriorating receivables. Intensify your budget discipline and monitor variances every month.” Focussing on top customers: According to Pareto’s Principle, the 80/20 Rule, in anything a few (20 per cent) are vital and many (80 per cent) are trivial. For successful business, it is important to focus on one’s leading customers. And this has to be aggressively followed even in challenged external environment. “In tight markets, your customers may be tempted by aggressive pricing from hungry competitors. If you maintain strong relationships with your best customers, you will earn their loyalty,” opines Malhotra. Offering more than just products: ‘Offer solutions and not just products’ seems to be the new adage for every equipment supplier. “Customer expectations in terms of product features and prices seem more demanding these days. We at Cole-Parmer focus on solutions for the customers rather than
sell equipment and that is why we have benefited decently,” says Aggarwal. Continue to innovate: Competition is fast catching up in process equipment sector and differentiation between products is diminishing. While quality of product still plays a role, it cannot be your only Unique Selling Point (USP). Hence, companies are coming out with innovative products that complement the existing offering and help equipment manufacturers to influence the buying pattern of their users. Kadwani adds, “We need to be innovative and try to introduce technologies, which can help the industry to minimise resources and improve efficiencies.”
A smart approach to success In turbulent times, enhancing efficiency is a daunting task. Increasing productivity by identifying areas for improvement in current processes is the key to sustained growth in a troubled economy. Kadwani says, “Economic slowdown makes us look at our operations and optimise our
input costs so that we remain competitive in the market. Second, an important lesson during a slowdown is that with limited growth opportunities, we need to minimise attrition to maintain growth; this becomes increasingly difficult because competition would be putting a lot of cost pressure during such time.” It is said that lessons learnt during trying times stay with you for life-long. This is also true to businesses that have survived and thrived in challenging market. Khanna concludes, “What we have observed is a heightened sensitivity towards productivity in the industry. At the moment, its fallout can be sensed from the higher benchmarks in terms of uptime, speed of deployment, as well as automation. Growing infrastructure requirements to take care of overruns have necessitated a planned management of all infrastructure systems. Manufacturers are prompted to adopt a flexible and smarter approach in response to uncertainty.” (With inputs from Prasenjit Chakraborty)
Email: rakesh.rao@network18publishing.com
May 2013 | CHEMICAL & PROCESS WORLD | 67
Allied Services | Best-in-class HR strategies
A key enabler for talent retention in chemical sector MAHUA ROY
Gary Becker, the Nobel Prize-winning economist, coined the term ‘human capital’. He is famous for his resonating words – the basic resource in any company is the people. It is not the infrastructure assets, or balance sheets, or the products & services one offer. Managing human capital in an effective manner can ensure profitability for the industry, good times, or bad.
THE chemical industry has globally faced the repercussions of the economic downturn. Noticeable HR trends were practised across this industry. The recession created a situation where a large number of chemical companies needed to develop new competencies and capabilities, besides changing their strategies. As a result of these changes, they ended up making key changes in the composition and size of their workforces, as well as managing them in a more guided manner.
MANAGING TALENT CRUNCH The industry should work together to
create brand awareness Top chemical companies need to
expand their search base to incorporate hiring from colleges other than few top ones Hiring from B/C tier institutes can help solve the issue of talent crunch, because once that happens, the institutes will automatically upgrade their quality Hiring from other chemical subsectors is a good option It is necessary to create a diversified workplace with multi-talented people who can offer a different perspective to challenges
Current priorities for the HR team As the global economic downturn hit the chemical industry, the HR department across the chemical industry has clearly defined its priorities. “Performance management; leadership and management development; employee communication and engagement; and talent management & restructuring are the top areas of concentration for HR managers,” says Hussain Tinwala, National Practice Head - Engineering & Manufacturing, TeamLease Services Pvt Ltd. Emphasis on talent management is one of the key areas of development. Difficult times force a company to try out innovative HR strategies to ensure talent retention and motivation. “Focus on short-term fixes had relatively little impact on the bottom lines of business. Those organisations that emphasised on this gained slightly more than those that did not, but it was not a strong relationship and the results too were quite short-term. The stronger relationship was associated with increasing the use of practices that have tangible results,” adds Tinwala.
Topmost winning strategies The need of the hour presently is to concentrate on the following high impact strategies to retain talent in troubled times.
68 | CHEMICAL & PROCESS WORLD | May 2013
Maintain a leadership pipeline: Creating a pipeline of leadership talent is key to any business’ future growth. “It is imperative for the top level of an organisation to make leadership talent management a priority, and put its money into long-term plans, as opposed to short-term ones. If companies are worried about their talent pipeline, they have to develop their people to align themselves with the company’s visions,” says Tinwala. Work-life balance: In difficult times, there are high cases of employee burnouts, both physically as well as emotionally. As layoffs become a routine phenomenon, companies cannot afford losing the productivity of the star performers also. As a result, offering an effective work-life balance becomes a necessary function. “Most companies in India are using benefits such as flexible timings, telecommuting, crèche facilities and concierge services as an attraction and retention strategy. Companies should see the work-life balance as a business proposition since progressive companies carry business forward with employees and families,” says Tinwala. Recognition of talent: Recognising and rewarding star performers is one of the most effective tools to attract and retain the right talent. Companies
Best-in-class HR strategies
Hussain Tinwala in India are looking at reward in general, a specialty chemicals National Practice Head - Engineering & systems more seriously, and are company scouts for talent only Manufacturing, TeamLease Services Pvt Ltd adopting total rewards practices in the same domain and not that include compensation in from say, polymers or pharma Companies should see the work-life both cash and kind. Besides, industry. It is necessary to create balance as a business proposition recognition in the form of a diversified workplace with since progressive companies carry appreciation and attention from multi-talented people who can business forward with employees leaders enable the employees to offer a different perspective to and families. look up to them and emulate challenges,” explains Tinwala. their values. Ensuring longSuch a strategy will term growth and development definitely result in lower of talent in an organisation are among team, and nowadays, these leaders take attrition rates as also wage costs. “When the key deliverables of the leadership personal initiatives in ensuring that you have an over-qualified employee, young talent get relevant inputs. it is difficult to meet their aspiration Exercising right skilling: Matching levels and, therefore, the chances of the jobs with a particular level of training employee moving on to something more Take a genuine interest in the future rather than hiring over-skilled workers challenging are higher,” says Tinwala. path of an employee’s career is gaining prominence across industries. Creating roles and responsibilities by Encourage employee engagement via Companies use this strategy to tide over a evaluating the merits of the candidate CSR initiatives manpower supply crunch and to broaden in the same company is a profitable Getting the leadership team to interact their talent base. The chemical industry is move. For eg, if your design engineer is and inspire the workforce frequently yet to see the benefits of this strategy in excited about branding and marketing Recognising and rewarding employee a huge manner. “In the chemical industry, initiatives, you can easily create a role performance the openness to hiring from other sectors for him in your own company before he Trusting employees with challenging is minimal. Even hiring from other starts looking elsewhere. projects Email: mahua.roy@network18publishing.com chemical subsectors is rare. For example,
MOTIVATING EMPLOYEES
May 2013 | CHEMICAL & PROCESS WORLD | 69
Allied Services | Case study - Aspen Technology
Innovative solutions for
process industry challenges RAKESH RAO
Sticking to the core of the company’s value proposition is what it took Aspen Technology (AspenTech) to become one of the world’s leading suppliers of software that optimises process manufacturing. Even today, when market uncertainties are grappling companies, AspenTech continues to follow the same strategy, ie being at the forefront of innovation in the process industries. ACCORDING to the United Nations Environment Program 2012 (UNEP) report, significant growth in chemical production is expected in developing countries in the period 2012-2020, but developed countries will witness modest growth. “This report clearly places AsiaPacific growth (from 2012 to 2020) ahead of the pack at 46 per cent. Of this, China and India are slated to grow at 66 per cent and 59 per cent respectively,” says Sunil Chaudhari, Country Manager - South Asia, AspenTech.
Growth visible, but challenges persist Although the long-term scenario presents healthy growth prospects, the current market uncertainty presents challenges before the chemical manufacturers. Hence, companies are looking to optimise their resources. Chaudhari observes, “In both better and worse
economic times, the chemical industry relies heavily on hydrocarbon-based feedstocks, and energy-efficiency and maximum throughput of existing assets become increasingly critical issues.” According to him, other key factors impacting the industry include: Increasingly competitive landscape due to globalisation Margin squeeze due to low-product pricing power Maintaining asset effectiveness at high plant utilisation rates Increasingly stringent governmental regulations Increased market volatility and eroding customer loyalty In order to overcome these challenges, chemical manufacturers have to adopt an integrated solution set that can tackle inefficiencies end-to-end throughout engineering, planning & scheduling, and plant operations processes.
Chemical production: Predicted growth (2012-2020) 46%
Per cent change, 2012- 2020
Regions
Asia-Pacific
Africa & Middle East
Western Europe
Latin America
North America
24%
Emerging Europe
35%
33% 25%
40%
Source: UNEP 2012 report
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Growth enablers During slowdown, chemical companies often face an investment dilemma. While investment in IT & automation improves efficiency of the chemical companies, these companies have constraints with respect to capital availability. So how can software solution providers convince the customer about their solutions? Chaudhari answers, we can convince the customer by going
back to the profitability value proposition. For instance, he explains, aspenONE for chemicals maximises plant profitability by: Optimising feedstock selection and scheduling, given actual plant constraints Improving and accelerating process innovation, thereby reducing time-tomarket for new products Optimising plant performance and reducing process variability, given the trade-offs between capacity, yield and energy Standardising manufacturing workflow around best practices for high quality and high yield Improving capital efficiency through maximum asset utilisation
Reducing environmental risk For better customer acceptance, AspenTech offers companies the flexibility to implement this solution incrementally based on areas that will bring immediate benefits with a roadmap for incremental value delivery. “aspenONE for Chemicals is a comprehensive and integrated solution set, offering a fully scalable and modular approach. It also leverages existing installations of AspenTech products, extending those solutions for increased benefits,” says Chaudhari. Understanding options within a global network of assets and being able to optimise these assets are key supply chain business drivers for chemical companies. The company’s aspenONE
Case study - Aspen Technology
Supply Chain for Chemicals segment such as pharmaceuticals, Sunil Chaudhari Country Manager - South Asia, AspenTech enables manufacturers to consumer packaged goods, power, increase operational efficiency metals & mining, pulp & paper, through improved planning and and biofuels industries use our Stick to the core of your company’s scheduling of the production process optimisation solutions value proposition and the value will and distribution process. to help them deliver improved “The solution’s easy-to-use financial and operating results sell itself. AspenTech has always interface leverages a Microsoft in the face of varied process been at the forefront of innovation look & feel and provides manufacturing challenges. in the process industries. fast access to information Stick to core that can expedite profitable Ask Chaudhari about the lessons responses to unexpected market and optimisation capabilities. PSVPlus he has learnt from the economic slowdown, demands and opportunities, a necessity offers additional capabilities that will and he aptly replies, “Stick to the core of in an increasingly competitive eventually enable AspenTech to provide a your company’s value proposition and the marketplace,” he adds. complete overpressure protection system value will sell itself.” optimisation capability. This will result in Getting equipped for tomorrow He explains, “From our roots at MIT increased engineering efficiency, reduced To meet the ever-changing requirements to the groundbreaking release of aspenONE capital and increased safety & reliability of customers, automation companies V8, AspenTech has always been at the for AspenTech customers,” observes are offering new solutions and adding forefront of innovation in the process Chaudhari. new functionality to existing products. industries. With integrated aspenONE The addition of PSVPlus will give its AspenTech has also launched a few solutions, process manufacturers can customers the ability to model pressure solutions in recent times. While implement best practices for optimising relief scenarios, which is a critical activity AspenTech announced the latest their engineering, manufacturing, and in the design and operation of every enhancements to the aspenONE process supply chains. As a result, AspenTech process plant. This makes it possible optimisation software suite in February customers are better able to achieve their to generate inherently safer and more this year, it launched aspenONE V8 operational excellence goals – increasing efficient designs. software in December 2012. capacity, improving margins, reducing Getting your priority right In order to expand its product costs, and becoming more energy efficient.” To stay competitive in the current offerings, AspenTech acquired the Today, aspenONE solutions are used economic scenario, AspenTech has PSVPlus software product from Softbits by virtually every leading company in identified three strategic priorities. Consultants Ltd in September 2012. “The the process manufacturing industry. Over According to Chaudhari, these are: aspenONE Engineering suite provides 1,00,000 users at over 1,500 companies Capitalising on key growth market leading process plant modelling have come to rely on us to achieve superior opportunities: Most of our customers are financial and operating results. “Over still using a fraction of the functionality 30 years of AspenTech leadership and available to them and very few are utilising experience is built into our market-leading Challenges in chemical industry AspenTech across our engineering, supply aspenONE software, which represents Economic uncertainty affecting chemical chain, and manufacturing solutions. best practices for process optimisation. It industry Continuing to invest in innovation: redefines ease-of-use in software for the Less investment by chemical companies In fiscal year 2012, we invested 16 per process industries. It makes operational in new technologies due to slowdown cent of our revenues in R&D in order excellence achievable and – even in the Increasingly competitive landscape due to deliver the most valuable innovation face of today’s market challenges – easier to globalisation to our process manufacturing customers than you think,” claims Chaudhari. worldwide. These innovations are delivered He has one message for chemical AspenTech’s solution incrementally as part of the aspenONE companies, “They should look for ways Convincing the customer by offering the process optimisation software suite to maximise their profits and reduce profitability value proposition every quarter. inefficiencies”. And by partnering Offering a gamut of solutions to Growing market for software with AspenTech, he believes that they customers across functions – usage: Moving forward, we expect to can maximise and sustain operational engineering, supply chain and see continued solid demand in our core manufacturing performance and profitability with the Continue to invest in innovations industry vertical segments – in energy, agility to react quickly to market demands Expanding market for its software chemicals and engineering & construction. and opportunities. solutions Email: rakesh.rao@network18publishing.com Similarly, companies in the non-core
EFFICIENCY TIPS
May 2013 | CHEMICAL & PROCESS WORLD | 71
Allied Services | Industry voice - Alok Kishore
“The lesson learnt during economic slowdown is to keep innovating” Meeting customer expectations amid uncertainties…
Alok Kishore, Country Manager - Flow Control at Metso Automation (India) Pvt Ltd, in an interaction with Avani Jain, underlines the challenges faced by the company during economic slowdown and the proactive steps taken to combat this situation.
reducing waste in the process industries worldwide, ie chemical, pulp & paper, utilities, refining and food processing. We are continually looking for new ways to help process industry customers become more efficient and productive. We have also acquired specialty valve company Valstone in Korea, which would help address critical valve applications, especially in power plant applications.
We have become more focussed on applications where our products bring a tangible and visible benefit to our customers. Quick Return on Investment (RoI) now has more traction than ever. It is no longer sufficient to have a quality product; we need to further prove that it has direct relationship to a customer’s process and profit. All established players would need to move up the value chain. Competitors are fast catching up in technology, and differentiation between products is diminishing. Quality of product still plays a role, but will not sustain in the long run. Hence, it is important to come out with innovative products & offerings, which complement the existing offerings and help companies to influence buying patterns of users.
Demanding areas for your kind of business…
Initiatives taken to maintain business growth...
Role of IT & automation solutions in improving efficiency…
We have acquired Expertune, a US-based company that designs pre-packaged industrial software aimed at maximising productivity and efficiency, and
IT & automation can bring in high levels of efficiency in everything one does, and this is the reason that our investment in this area is still continuing. This helps us economise our products, reduce cycle time for order processing. The same trend is also observed by us with our clients, where IT is helping reduce the buying process. Moreover, e-tendering, e-auctions are helping our customers to reduce the manual intervention in buying process.
OVERCOMING CHALLENGES More focus on applications where the
products bring a tangible and visible benefit to customers. Offering innovative products that complement the existing offerings and help companies to influence buying patterns of users Investment in IT & automation as this helps in economising the products, reduce cycle time for order processing.
First, client retention as the clients look for economical alternatives and solutions. Second, planning for future investments and growth plans. The growth and slowdown cycles have become compressed. Longer growth period cannot be predicted with ease, hence it is a challenge to plan and invest for growth actions.
Biggest lesson from economic slowdown… The biggest lesson is to keep innovating and catering to changing demands of our users. Email: avani.jain@network18publishing.com
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Industry Voice - Daksh Malhotra | Allied Services
“It is important to revisit your strategy and focus like a laser” Your approach to stay competitive in changing times… One of the best decisions by Everest Group was the journey towards becoming world class. Everest adopted the Business Excellence model defined by European Foundation for Quality Management (EFQM) along with the Balanced Score Card methodology. We have been organising many internal workshops and customer interactions to understand the implied needs of our customers, thereby introducing new & better products into the marketplace. This also helped in reducing waste as well as the cost of production on a continual basis; bringing innovativeness and creativity in all our process areas and thus delighting our customers. We started from the company’s vision, strategy and the value proposition – the reasons customers repeatedly buy from our company. We have plans of setting up the most modern manufacturing facility with inhouse Department of Scientific & Industrial Research (DSIR) registered R&D facility, which would not only roll out good reliable products but also assist in meeting the targeted expansion programme.
Importance of value-additions… A focus on innovative design and highquality machined parts has earned Everest a reputation for excellent workmanship among its users. Our commitment to total quality in both our products and services is the foundation upon which
TIPS TO TURN THE TIDE
EFQM system adopted Interaction with customers increased Introducing new products Paying more attention to important clients
our future business is based. Some of our recent achievements include design & manufacture of seal-less roots blowers. Besides, we have also designed and manufactured solvent recovery systems to curb pollution. These systems not only play an important role by making the process eco-friendly but also recover precious solvents for reuse. The demand for such systems is growing exponentially due to increasing environmental awareness and corporate responsibility.
Challenging areas of business… Innovation in products is necessary, so that it creates a condition for growth. Another challenge is to market to potential customers effectively and retaining existing customers.
Learnings from economic slowdown… It is important to revisit your strategy and focus like a laser. When times are good, you might get sloppy and lose your focus. A slow market presents an opportunity to evaluate every product, programme and person. Anything that does not contribute to your core discipline needs to be closely scrutinised. If spending time with customers is your highest value driver, then cancel non-essential meetings and go see your best customers. Stay alert for early warning signs. Watch for revenue declines, competitive price cutting and deteriorating receivables. Intensify your budget discipline and monitor variances every month. Focus on your best customers. Not all customers are equal; some are lot more profitable than others. If you maintain strong relationships with your best customers, you will earn their loyalty.
Daksh Malhotra, Director-Marketing, Everest Group, in an interaction with Prasenjit Chakraborty, highlights that prevailing economic uncertainties have compelled Everest Group to adopt various new strategies to excel in business.
Email: prasenjit.chakraborty@network18publishing.com
May 2013 | CHEMICAL & PROCESS WORLD | 73
Allied Services | Industry voice - K Narayan
“In troubled times, enhancing the productivity is a huge challenge” Changes in your approach to meet customer needs during economic turmoil… We at TÜV SÜD South Asia have diversified the service offering in the target sectors of chemical, oil & gas by increasing the service mix. This has primarily helped us in fulfilling the expectations of our customers. The main emphasis of our product portfolio and services lies in rendering a vast range of services from the conceptualisation-tocommissioning phase.
Value-additions to services to cater to chemical industry…
K Narayan, General Manager - Execution and Quality, TÜV SÜD South Asia, discusses with Mahua Roy as to how the troubled economic times made the company offer differentiated solutions to enhance productivity in the chemical industry.
With an extensive network of international and local experts, our core strength lies in world-class expertise and delivering services to ensure compliance with the international standards. As a trusted and reliable solutions provider with a strong reputation and global recognition, we aim to add extensive value to our customers’ demands. We offer deep insights and experience from our global & local experts with the right technical know-how and deliver a cost-effective solution that meets all the required parameters. We also value-add
EMPHASIS ON SAFETY The product and services portfolio of TÜV SÜD heavily concentrates on safety. This shows that even during uncertain economic conditions, chemical majors have been demanding safety solutions at the installations. TÜV SÜD expertise lies in integrated inspection of plants, equipment and components while plant is or has been operational; systematic safety assessments and support for safety issues, and more importantly, damage analysis and assessment so that a mishap is never repeated.
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the customers by training and transfer of knowledge even in the remote locations of the world.
Two most challenging areas for your kind of business amid market uncertainty... Presently, I can pinpoint the two biggest challenges haunting our business as uncertainty in project delivery and delay in the launch of new products.
Change in business requirements of your clients in last five years... In the past few years, we have noticed that international chemical majors have increasingly started relying on manufacturers in India. Also, there is a growing trend we observe where these international chemical majors have strategically commenced procurement from India for their international projects. Such increased demands and globalisation within the chemical & process industry have emanated from international chemical majors to access manufacturers on International Standards such as European, American or Russian, which have to be followed stringently. We have also noticed that there is a change in mindset while engaging our services. Instead of independent assessors of quality, the client is keen to involve TÜV SÜD as an extended arm taking care of quality on their behalf. This is seen as a welcome trend.
The next step… In troubled times, enhancing the productivity is a huge challenge. Achieving that as well as identifying areas for improvement in current processes are key learnings from a troubled economy. Adding value and partnering with your customers is key. Email: mahua.roy@network18publishing.com
Industry voice - Dr Naushad Forbes | Allied Services
“Energy conservation is a must for survival” Effects of market uncertainty on the chemical industry…
Need for right energy management strategy during slowdown…
Like every sector, the chemical industry has also been hit by the slowdown. The Indian chemical industry has been facing increasing competition, especially from bulk imports from countries like China whose scale is far larger than ours. The segments that are holding their own and doing well are those that have some speciality and compete on technology.
The process industry is so broad-based that it is difficult to apply a single formula; but it should continue to do well by investing in process efficiency enhancement – whether it is steam as a utility or automation and control of processes. While the potential for energy saving has always been huge, the change in the demand for conservation to survive is creating the momentum for energy conservation that we are seeing today.
Steps taken to ride out slowdown… Project activity is well down and investment is going into de-bottlenecking and improving processes. We are working with existing plants to increase energy efficiency and improve plant processes. We have seen a positive change in the approach towards energy efficiency. Ten years ago, energy conservation was something good to do. Today, energy conservation is a must for survival: that is a much more powerful imperative. As prices – for materials and finished products – are increasingly dictated by global markets, what remains within our control is conversion cost, and energy costs are perhaps our greatest opportunity for cost reduction in the country today.
EMPOWERING GROWTH SOLUTIONS Improve internal processes to enhance
efficiencies Focus on improving energy efficiency
and plant processes Have a holistic view of plant economics Have energy conservation target
and track it regularly using right diagnostic tools
Advice to chemical companies on process equipment selection… It is essential to take a holistic view of plant economics. One should aim for the right steam system the first time. Sometimes one is tempted to go in for short-term efficiency measures or look for less expensive solutions, and consider doing something later; this proves to be expensive in the long term. The company should have an energy conservation target and track it on a monthly basis. It is important to put in place the right diagnostics to help you know how you are doing on a daily basis instead of using thumb of the rule or guesswork.
Lessons from economic slowdown…
Dr Naushad Forbes, Director, Forbes Marshall, during a conversation with Rakesh Rao, opines that focussing on improving internal processes is the best way to face the uncertain external environment.
One should rely on internal factors. We have worked on improving our internal processes, focussed on all-round better efficiencies. We have invested in a strong R&D team and have had a steady output of new products and product lines year after year. We look at the slowdown as an opportunity to improve and strengthen our company. We have strengthened our business, finance, people and customer-related processes. Email: rakesh.rao@network18publishing.com
May 2013 | CHEMICAL & PROCESS WORLD | 75
Allied Services | Industry voice - Rakesh Aggarwal
“Delivering innovative products at a reasonable price is a challenge” Impact of slowdown on lab equipment market… The Indian lab equipment market is growing at a fast pace, courtesy small value equipment. The pharmaceutical industry business has contributed to the growth of the lab equipment market. The country today has become one of the preferred destinations for manufacturing of pharmaceuticals at a mass scale. This is due to a well-balanced cost-quality equation. Customers have become more sensitive to quality lapses as the cost of these lapses has had detrimental impacts on their bottom line. The focus on automation
Rakesh Aggarwal, Director – Operations, Cole-Parmer India, in conversation with Rakesh Rao, emphasises on the importance of offering solutions and not just selling equipment to succeed in the long term.
MEETING NEEDS IN CHANGING TIMES User’s dilemma R&D budget cuts in the public sector & academic institutions Customers are more demanding in terms of product features and prices Increasing focus on automation and productivity improvements The Indian customers have become more quality conscious High-end instruments are still imported Research labs need to produce fast results Allied services’ solutions Lab equipment makers need to: Offer high-speed, high-quality, dependable products Offer complete solutions rather than just equipment Provide ‘future-proof’ equipment so that they do not become obsolete in a few years Upgrade their manufacturing facilities to compete with imported products
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and productivity improvements has become central to the success of pharmaceutical companies and, in turn, the lab equipment manufacturers that provide these solutions. On the other hand, the industrial segment and academia have experienced a major setback. This slowdown in growth is primarily due to the research and development (R&D) budget cuts in the public sector (mainly research institutions), academic institutions and universities gradually closing down courses in biotech (due to low employment prospects), and above all, the slow GDP growth of the Indian economy.
Secret of success in challenging market… Sometimes, it may have been a bit challenging, but I have not seen any decreasing trend. But yes, customer expectations in terms of product features and prices seem more demanding these days. We at Cole-Parmer focus on solutions for the customers rather than sell equipment, and that is why we have benefited decently.
Steps to be taken to overcome challenges… The Indian customers have become more quality conscious in the last 10 years, which has led to a significant change in the pharmaceutical equipment manufacturers and pharmaceutical companies. Changes are likely to continue in the coming years as well. Delivering innovative, world-class quality products at a reasonable price and time are among the challenges that the industry faces.
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Exhibitor Profile
Industry voice - Rakesh Aggarwal
When it comes to high-end instruments, we still have to rely on manufacturing facilities overseas, which means we have to consider the time and cost involved in moving the products; this adds to the overall cost that the customer ends up paying. The weakening trend of Indian Rupee also has a negative impact. W ith regulator y guidelines becoming tighter every year, equipment manufacturers with better designs are benefiting by delivering ‘future-proof ’ equipment. This builds the confidence of customers in realising that with evolving regulatory requirements, their capital expense will not become obsolete in a matter of three to four years. Therefore, to overcome these challenges, manufacturers have to upgrade their manufacturing facilities to make products competitive with – if not better than – foreign products. And of course, we expect some favourable financial policies and a stable Indian Rupee.
Emerging trends in the lab equipment industry…
Short- and long-term outlook for lab equipment industry…
The market environment is changing fast and has become more competitive and challenging. The lab equipment manufacturers/suppliers have to grow faster in order to meet the latest needs of research and development organisations. The industry is focussing on a consolidated experience for consumers because this is what the customer is looking at today. They want their instruments to have a smaller footprint with less space consumed. They want to have user-friendly interfaces such as intuitive touch screens and menudriven instruments. They also want the facility of data acquisition, protection, and better analytical tools. Research labs today need to produce fast results. Lab equipment that is high speed, high quality, and dependable, gives the best returns in the long run.
Like general supplies, basic equipment is essential for day-to-day laboratory functions. Laboratories rely on equipment such as cold storage, mixers, shakers, and stirrers, and therefore anticipate periodic replacement of these tools. So, the demand will always be there. Conversely, budgets for high-end systems such as analytical instruments, separation technologies, laboratory automation, and other new or pre-owned lab technologies decreased in 2012 and might see a challenging phase in the short run too. Unlike basic laboratory equipment, which generally costs hundreds or thousands of dollars, high-end systems often demand investments that are far more significant. So, with better economic conditions and focus on a consolidated experience for the consumers, the market will definitely show good numbers to grow in the long term. Email: rakesh.rao@network18publishing.com
May 2013 | CHEMICAL & PROCESS WORLD | 79
Allied Services | Industry Voice - Satya D Sinha
“HR personnel can develop an environment of faith and trust” On hiring trends in chemical industry in tough economic times... Hiring trend has definitely slowed down since 2008 as the production volume has gone down to as low as 3.6 per cent between the period 2004 and 2009 compared to 4.4 per cent from 1999-2004. Companies today are ready to wait and hire the best talent available in the market.
Top HR strategies of companies...
Satya D Sinha, Chief Executive Officer, MANCER Consulting, in conversation with Mahua Roy, speaks about the role of HR in motivating and retaining employees in tough economic conditions.
The HR today is keeping itself abreast of global trends. It is intricately involved in career planning for the employees. More importantly, HR personnel play a key role in developing an environment of faith and trust, which is pivotal during tough times. Also, it plays an integral part to make Performance Management System (PMS) a serious and valuable affair for the development of employees. Apart from this, the HR is involved in counselling and guidance activities.
Measures to be taken by employees… It is in the best interest of employees that they should adapt to working out of their comfort zones. They need to maintain good relationships with their
HR STRATEGIES DURING TOUGH TIMES Getting involved in career planning
for employees Developing an environment of faith
and trust Making PMS a valuable exercise Counselling and guidance Offering work environment full of zeal
and enthusiasm
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reporting manager. It is also important to understand that these days multi-tasking is not an option; it is becoming mandatory and highly reflects on the productivity and adaptability of employees. Nowadays, companies are demanding multi-tasking employees, who are able to work in an unstructured and matrix environment.
Regarding salary hikes in these times... It is a welcome note that salary hikes have remained between 5-10 per cent across the industry, irrespective of the appraisal score and performance of an employee in these tough times.
On non-monetary incentives to motivate employees... As the young workforce increases, employees are not really satisfied with just the monetary incentives provided by the company. Hence, companies have to extend these incentives to a nonmonetary basis, wherein the comfort and the zeal of an employee towards an organisation is maintained. Quick examples include providing cab facilities, recreational facilities, etc, which perhaps make work environment more fun loving, especially when the employees have to deal with difficult work deadlines. This keeps the employees motivated and dedicated towards the organisation. It is a general observation that companies have been motivating and supportive in uncertain economic conditions. The biggest fear of an employee of losing the job is the major area of concern. Under such circumstances, the HR needs to provide a deep sense of security to the people working with them. Email: mahua.roy@network18publishing.com
Industry Voice - Sunil Khanna | Allied Services
“During economic duress customers demand top-notch performance of equipment” Strategies undertaken to meet emerging market requirements… It is an ongoing challenge to meet fluctuating business needs in a costeffective manner, more so in times of economic uncertainty. Last year presented a challenging economic scenario owing to market concerns, which impacted profit margins as companies had to deal with rising cost of raw materials and weak domestic manufacturing. As a result, vendors are looking at cost reduction techniques with a focus on localisation. Reducing energy consumption, cutting costs, and increasing product availability was our mantra. As companies are working round-the-clock with an emphasis on lowest possible operational costs, Emerson Network Power has adapted its approach at multiple levels in order to deliver solutions with minimum Total Cost of Ownership (TCO) without compromising on availability.
Product upgradation… The tough market situation has helped the industry realise that infrastructure has to work in tandem with fluctuating business dynamics. Awareness levels have improved owing to business uncertainty, and an opportunity exists in the evolved buyer mindset. We have augmented our product offerings apart from the power and cooling segments. We have invested in the best-of-breed technologies and
STRATEGIES ADOPTED TO STAY COMPETITIVE
Investing in modern technologies Constant innovation on products Added new UPS systems to Liebert portfolio Offering solutions with minimum TCO
propagated industry best practices, supplying the most cost-effective solutions to help customers manage capacity, efficiency and availability of critical infrastructure. Our solutions deliver true value through speedy implementation, adapting to demand and reducing operational costs. In addition to our capabilities in protecting critical infrastructure in manufacturing facilities, we are innovating constantly across all product lines to reflect development in contemporary technologies.
Two most challenging areas… Economic uncertainty has impacted overall growth of the manufacturing sector, leading to heavy cost-cutting and low capital investment due to budget constraints. But, we have seen that in times of economic duress customers demand top-notch performance and absolute availability in lowest cost. But budgetary constraints make it a tough task to convince customers that critical infrastructure spends can greatly enhance business value. The dampened mood of the sector makes customers wary of adopting new technologies.
Lessons you learnt… What we have observed is a heightened sensitivity towards productivity in the industry. At the moment, its fallout can be sensed from the higher benchmarks in terms of uptime, speed of deployment, as well as automation. Growing infrastructure requirements to take care of overruns have necessitated a planned management of all infrastructure systems. Manufacturers are prompted to adopt a flexible and smarter approach in response to uncertainty.
Sunil Khanna, President and Managing Director, Emerson Network Power - India, while speaking to Prasenjit Chakraborty, stresses on the need to invest in sophisticated technologies and inculcate best practices to stay competitive even in tough times.
Email: prasenjit.chakraborty@network18publishing.com
May 2013 | CHEMICAL & PROCESS WORLD | 81
Automation Trends | Advanced radar system
A versatile tool for improving process fault diagnosis OLLE EDVARDSSON
Radar level measurement technology has proven to be a powerful, cost-effective, reliable, accurate and versatile solution for a range of difficult applications. Direct level radar measurement is immune to density, conductivity and other process fluid changes as well as temperature & pressure variations, and most vapour space conditions. With no moving parts and no need for re-calibration, maintenance is minimal. THE health & safety regulations and the need to reduce maintenance costs and improve reliability resulted in the development of the first radar level instruments and then better performing instruments with increased functionality, at lower cost. Today, radar is the fastest growing level measurement technology across an expanding application base. It is replacing traditional technologies such as displacers, bubblers, capacitance, ultrasonic and hydrostatic, especially in applications where radar has a distinct advantage, such as when there are changes to liquid density. The radar technology is now available in two forms – a top down ‘through-air’ non-contacting transmitter, and contacting guided wave radar (GWR) transmitter that uses a guide wire or rod. Both are capable of measuring almost any liquid. Non-contacting radar is ideal for aggressive and corrosive liquids, while GWR is particularly suitable for low dielectric, high temperature and pressure liquids such as hydrocarbons, or solids such as plastic pellets.
knock-out vessels. In this application, rapid level changes are possible and the response time of the transmitter is critical. High performance radar enables automatic control of level, reduces flare emissions and allows full use of tank capacity. Since it is a direct measurement, no adjustments are needed if fluid density changes. Fluid property changes have no impact on radar measurement accuracy. Similarly, radar can handle a full vacuum to several hundred psi over broad temperature ranges. Other applications range from simple day-to-day storage tanks to more complicated applications such as blending and reactor vessels.
Guided wave radar
Through-air radar relies on the ‘echo’ signal being reflected back from the liquid surface to the transmitter. In difficult applications, stray signals bouncing around the tank or in the ullage caused by reflections or interference can disrupt the measurement. Difficult surface conditions such as heavy foaming can reduce echo sizes considerably. However, advances in signal processing and surface tracking enable reliable, repeatable measurement in the face of challenges such as agitators, heating coils or beams. Non-contacting radar devices can use different frequencies, typically 6 GHz, 10 GHz or 26 GHz. The higher frequency is most commonly used and results in a narrower, concentrated beam width and smaller antenna diameters that are suitable for mounting on valves or smaller and taller openings. Devices using a lower frequency are better for turbulence and condensation as well as splashing viscous liquids. One common use of through-air radar in the oil and gas sector is on flare
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Courtesy: Emerson Process Management
Non-contacting radar
GWR is where a pulse of microwave energy is transmitted down a probe rather than through the air. This product is an easy fit for many applications and minimises concerns associated with in-tank issues such as obstructions, foaming and turbulence. Modern software allows the detection and tracking of the interface between two liquids, for example, in a separator, giving users a reliable measurement to optimise control. Because GWR transmitters are contacting devices, they may be disrupted in some hydrocarbon applications where difficult conditions such as very low dielectrics or product coating the probe can significantly reduce the reflected signal. GWR is widely used in the process industries and the list of applications is long, including separators, free water knock-out vessels, water and skim tanks, natural gas liquids storage, accumulators and ammonia storage. All these applications are critical for the quality of the finished products as well as for safety, and using high performance GWR will ensure a highly reliable and accurate level measurement.
Advanced radar system
For steam applications of more than 400-500 psi (30-35 bar), GWR systems are available that have a dynamic vapour compensation method to ensure the accuracy of the device in such an environment. Similarly, in applications where the signal reflection sometimes is too weak, there are functions to provide an alternative measurement, such as probe end projection, where the unit uses a combination of the known length of the probe and an online measurement of dielectric of the material to determine level.
Recent developments Recent developments have seen both non-contacting and contacting radar level measurement devices incorporating much faster signal processing speeds leading to shorter cycle times. Previously difficult applications such as measurement in small vessels, or for fast filling/emptying cycles are now possible. In addition, echo analysis has improved, thanks to increased sampling rates. This has increased the accuracy of measurements. In challenging applications, the sensitivity of the radar device is critical. Most failure modes are a result of signal loss. Improving the sensitivity can therefore increase availability. New sensors are also enabling radar devices to work in extreme operating conditions such as high temperature (up to 400°C) bitumen applications, lower portions of distillation towers and cooker feeds. The sensors themselves can also be made of special materials that offer increased chemical resistance. When combined, these two features open up a host of new applications that were previously not possible. A further example of ever-broadening applications for radar comes when corrosion resistance and high strength material such as Duplex 2205 stainless steel is used for the probe and stainless steel housing is used to cope with harsh environments. This makes the device ideal for offshore installations such as in the North Sea. The latest radar devices have much lower operating voltage, and therefore consume less energy. This paves the way for wireless connectivity using batteries or solar cells rather than requiring available
existing power cabling or the installation of new cabling. End-users are now looking for a level measurement solution that is simple and easy to install & operate as well as offering low-operating costs. Radar devices are today easy to install in both new and existing systems. The latest devices adopt user-friendly interfaces with simple guided configuration and extensive online help. Maintenance is another area where costs can be significantly reduced. Radar devices now include a self-checking system, whereby the device will inform the operator if something is wrong. Some of the key diagnostics for today’s radar level measurement systems specifically include signal strength, level measurement status, validity of the measurement, fill or empty tank status, and process changes such as the appearance of foam or turbulence. Signal diagnostics can determine if probe cleaning is needed, allowing maintenance to be scheduled only when needed. Some of the most exciting developments in radar level measurement technology are the use of tank graphs – effectively ‘maps’ of the tank echoes. By analysing and comparing such graphs over time, users can identify trends, which may be helpful in planning maintenance or making long-term improvements.
Wireless connectivity With WirelessHART now a fully approved IEC standard, one can expect to see an increasing variety of measurement devices available to endusers. For level measurement, only vibrating fork and differential pressure technology is currently available with integrated WirelessHART connectivity. One can also expect to see both GWR and non-contacting radar with integrated wireless in the future. However, existing wired radar devices can already benefit from the availability of wireless adapters. This is a device that one can retrofit on any existing two or four-wire HART instrument, allowing one to transmit up to four variables and HART status information. The data is sent wirelessly, via a gateway, to
an asset management system, whereby the information can be interrogated by operators and maintenance staff. When connected to existing devices, the adapter opens up the possibility of transmitting a range of secondary variables in addition to the primary variable – level. This enables users to access the stranded HART measurement and diagnostic information, which can be used to make improvements in quality, safety, availability and operations, while reducing maintenance costs. A wireless adapter enables the process level device to be fully managed and monitored remotely. Parameters such as signal strength and signal quality can be transmitted as secondary process variables and these can be used by operators to monitor the health & performance of the device, as well as gain insights into the processes. In future, with higher levels of integrated wireless connectivity, radar devices will become easier to commission and use, eventually reaching a point where they offer pushbutton set-up capability. Users can look forward to increasing signal sensitivity as well as the ability to automatically compensate for more changing process conditions. They can expect to see radar devices that have sensors capable of detecting the dielectric change of the upper medium in interface applications and automatically compensating to ensure the accuracy of measurement. One can expect higher frequencies such as 60 and 80 GHz to be used by non-contacting radar, as well as having double frequency in the same radar device. We will probably see more innovative probe and antenna designs & certified SIS radars. Without doubt, we will also see further developments in enhanced instrument diagnostics that will enable remote interrogation of instrument condition and advance warning of potential problems. Olle Edvardsson, Rosemount Senior Technologist at Emerson Process Management, is the inventor and brain behind using radar level for tank level gauging. Email: marcom@emersonprocess.co.in
May 2013 | CHEMICAL & PROCESS WORLD | 83
Strategy | Streamlining production
Reducing operational cost with reliability MAHUA ROY
Faced with ever-increasing price competition for their products, chemical companies are constantly searching for ways to cut costs across their operations. This, in turn, puts persistent pressure on engineers to reduce both capital and operating expenditures without compromising their plants’ reliability and performance in any way. Streamlining of operations can go a long way in offering this benefit. CHEMICAL manufacturers need to identify strategic opportunities to reduce operating costs and increase profits, especially in times of economic slowdown. Striving to re-engineer and streamline the manufacturing processes is one of the key ways to tackle this issue. A manufacturing plant can achieve substantial benefits through simplified steps that give more output and efficiency with little complexity. The need for increased capacity, reduced unit cost and equipment replacement often prompts a fresh look at the whole process. Process simplification means change. Some resist this because there are associated worries about the reliability of the new configuration, or even fear of job losses. The aim of process simplification is to improve efficiency and achieve operating savings, not to eliminate jobs. Indeed, streamlining may enable redeploying staff to higher value activities. Those experienced in simplification focus on the benefits of the improvements and, how to implement them in a phased way, if that better suits the situation. “We have introduced significant changes in our framework to serve the customers. Resource optimisation is a key strategy, which has helped us save costs as well as increase productivity at our manufacturing locations. Lean manufacturing strategies have helped us reduce the turnaround time to reach our customers, thereby making us stay ahead in the market, despite tough economic
times,” says Zarir Langrana, Chief Operating Officer - Chemical Business (India), at Tata Chemicals Ltd.
Identifying bottlenecks Succeeding at process simplification does not demand reinventing the process altogether. Rather, it requires focussing on how streamlining can improve a process. By recognising evident avenues for changes for enhancing the efficiency and profitability of a chemical process, the process can be given a kickstart. One needs to study the existing process to find out where possible downfalls are in the manufacturing process. “First step in this process is to know what is happening in the first place. Start with reports and statements that your processes already generate. Take time to analyse findings. Talk to the staff. Make a good assessment of what the current situation is and then move on to what would make things better,” says B Ramakrishnan, Managing Director, AkzoNobel Coatings India.
Investing in training Taking every detail into consideration, one needs to make sure that adequate training for all employees is made available. “This will help the employees to know exactly what is expected and know how important it is that they do their best. As a process gets increasingly streamlined and simplified, so, too, do training and maintenance,” says Ramakrishnan.
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Customer feedback One of the biggest pillars in manufacturing streamlining efforts is the collaboration with customers. The feedback and review on the service or products is the most important step to consider. Factors such as quality management, timely deliveries, etc can become a lot more insightful once customer feedback is taken seriously. “You might be spending too much on manufacturing for product features that customers do not need, while neglecting the things they want,” says Ramakrishnan. “The most important point to consider for simplifying and streamlining of manufacturing operations is to make sure that complicated steps that are not necessary are effectively eliminated. The basic principle of lean manufacturing rests on the fundamental stand that non-value-added steps are removed,” adds Langrana. A custom blueprint for streamlining internal processes, lean principles have helped to increase production at many plants. Manufacturing is a process, which is inherently complex. There are times when things could go wrong and often there exist certain avenues that present tempting shortcuts, which can appear to be the easy option. Due to all these variables, occasionally not everything may go according to a set plan. What is required in the end is the forward looking strategy of leaders, which put lean principles on the forefront. Email: mahua.roy@network18publishing.com
Projects
Aliphatic hydrocarbon fluid
MEHTA PETRO REFINERIES LTD
Dimethylformamide & dimethyl amine hydrochloride
Project type
BALAJI AMINES
PUNJAB CHEMICALS & CROP PROTECTION LTD
New facility
Project type
Project type
Mehta Petro Refineries Ltd is planning to set up a new chemicals plant at Bharuch in Gujarat. The project involves manufacture of aliphatic hydrocarbon fluid.
New facility
Project news
New facility
Punjab Chemicals & Crop Protection Ltd is planning to set up a new chemicals plant at Thane in Maharashtra. The plant will manufacture phosphoric acid.
Bharuch, Gujarat
Balaji Amines is planning to set up a chemical plant to produce dimethylformamide (DMF) and dimethyl amine hydrochloride (DMA HCL) at Solapur, Maharashtra. The investment for the project is ` 30 crore.
Not known
Solapur, Maharashtra
Not known
Planning
` 30 crore
Planning
Contact details: Mehta Petro Refineries Ltd A/101, Shreyansh Apartments Kesar Baug CHS Ltd L T Road, Borivali (West) Mumbai, Maharashtra-400091 Tel: 022-40899404/9444 Fax: 022-28980360 Email: info@mehtapetro.com
Planning
Contact details: Punjab Chemicals & Crop Protection Ltd Oberoi Chambers II 5th floor, 645/646 New Link Road, Andheri (West) Mumbai-400053 Tel: 022-26747900 Fax: 022-26736193/78 Email: enquiry@punjabchemicals.com
Project news
Project location Project cost
Project news
Project location
Implementation stage
Phosphoric acid
Project cost
Project location
Thane, Maharashtra Project cost
Implementation stage
Implementation stage
Contact details: Balaji Amines Balaji Tower, No. 9/1A/1 Hotgi Road, Asara Chowk Solapur, Maharashtra Tel: 217-2451500, Fax: 217-2451521 Email:info@balajiamines.com
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PRESSURE VESSEL AND HEAT EXCHANGER
FTIR GAS ANALYSER
ORG : Qatar Chemical Company Ltd TRN : 15906330 DESC : Design, fabrication & supply of pressure vessel and heat exchanger BOD : May 21, 2013 LOC : Qatar BT : Global (ICB)
ORG : Ministry of Defence TRN : 15922980 DESC : Supply of portable continuous FTIR-based hydrogen fluoride & other allied thermally decomposed gas analyser BOD : May 21, 2013 LOC : Delhi BT : ICB
ORG: Organisation’s name, TRN: Tendersinfo Ref No, DESC: Description, BOD: Bid Opening Date, LOC: Location, BT: Bidding Type
Information courtesy: Tendersinfo.com 1, Arch Gold, Next to MTNL Exchange, Poisar, S V Road, Kandivali (W), Mumbai - 400 067, Maharashtra, India Tel: 022-28666134 • Fax: 022-28013817 • Email: parmeet.d@tendersinfo.com
May 2013 | CHEMICAL & PROCESS WORLD | 85
Event List
NATIONAL The trade exposition on chemical plant, equipment and process industry; February 2014; at Surat International Exhibition & Convention Centre, Surat, Gujarat FOR DETAILS CONTACT: HYDERABAD
Andhra Pradesh, May 31-June 3, 2013 India’s premier industrial trade fair on products and technologies related to Machine Tools, Hydraulics & Pneumatics, Process Machinery & Equipment, Automation Instrumentation, Packaging & Auxiliaries, IT Products, Electrical & Electronics, Material Handling and Safety Equipment.
FOR DETAILS Network18 Media & Investments Ltd
Ruby House, 1st Floor, J K Sawant Marg, Dadar (W), Mumbai 400 028. • Tel: 022 3003 4651 • Fax: 022 3003 4499 Email: engexpo@network18publishing.com
COPEXPO WHAT
: A trade show for industrial paint and coating industry, which will be attended by industrialists, policy makers, dealers, researchers WHEN : June 07-09, 2013 WHERE : Chennai Trade Centre, Chennai
Tel: 044-22501986, 22501987 Email: office@smartexpos.in ...........................................................................
ARC INDIA FORUM WHAT
: An event that will highlight the latest developments in new processes and technologies WHEN : July 11-12, 2013 WHERE : Hyderabad, Andhra Pradesh For details contact: ARC Advisory Group Tel: 080-25547116 Email: ramang@arcweb.com ...........................................................................
PETROWORLD INDIA WHAT
For details contact: Smart Expos
Network 18 Publishing
Ruby House, A-Wing, 1st Floor, J K Sawant Marg, Dadar (W), Mumbai 400 028. Tel: 022 3003 4651 • Fax: 022 3003 4499 Email: b2b@network18publishing.com
WHEN
: An event showcasing novel technologies in oil & gas sector : August 22-24, 2013
WHERE : Bombay Exhibition Centre, Mumbai For details contact: Inter Ads Exhibitions Pvt Ltd Tel: 0124-4524200/4201 Email: siddharth@interads.in ...........................................................................
INDIA CHEM GUJARAT WHAT
: The exhibition will showcase the latest products, machinery, equipment and developments in the chemical industry WHEN : October 24-26, 2013 WHERE : Gandhinagar, Gujarat For details contact: Federation of Indian Chambers of Commerce & Industry Tel: 011-23738760/8770 Email: ficci@ficci.com
INTERNATIONAL PETRO.T.EX AFRICA WHAT : Focussed event on refineries & oil WHEN : May 14-16, 2013 WHERE : Gallagher Convention Centre, Midrand, South Africa For details contact: Exhibition Management Services Tel: +(27)-(11)-7837250 Email: director@exhibitionsafrica.com ...........................................................................
OIL AND GAS ASIA 2013 WHAT
: Exhibition focussing on latest technologies in the fields of oil, gas and petrochemical engineering
WHEN : June 05-07, 2013 WHERE : Kuala Lumpur Convention Centre, Kuala Lumpur For details contact: Allworld Exhibitions Tel: +44 (0)20 7840 2100 Email: info@oesallworld.com ...........................................................................
DYE+CHEM BANGLADESH 2013 WHAT
: International exhibition on dyes and fine & specialty chemicals WHEN : September 05-08, 2013 WHERE : Bangabandhu International Conference Centre, Dhaka, Bangladesh
For details contact: CEMS-Global Asia Pacific Pte Ltd Tel: + (65) - 6829 - 2144 Email: contact@cems-dyechem.com ...........................................................................
CHINA ADHESIVE WHAT
: Exhibition focussing on adhesive and sealant products, WHEN : September 25-27, 2013 WHERE : Shanghai Everbright Convention & Exhibition Center, Shanghai
For details contact: CCPIT Sub-Council of Chemical Industry Tel: +(86)-(10)-64275419 Email: contact@chinaexhibition.com
The information published in this section is as per the details furnished by the respective organiser. In any case, it does not represent the views of CHEMICAL & PROCESS WORLD 86 | CHEMICAL & PROCESS WORLD | May 2013
Event Preview | Engineering Expo Hyderabad 2013
HYDERABAD May 31–June 3, 2013 HITEX Exhibition Centre
Starting on a pearly white slate SWETA M NAIR
An epicentre known for its rich lineage in art, literature, architecture and cuisine, Andhra Pradesh is getting its shine on. Attracting business interest from across the country and the globe, the capital city of Andhra Pradesh, aesthetically called the ‘City of Pearls’, will be hosting Engineering Expo organised by Network 18 Publishing for the very first time. Scheduled to be held in Hyderabad during May 31–June 3, 2013, at HITEX Exhibition Centre, the Expo is expected to be an exciting episode for many first-timers. A preview… LOCATED in the southern region of the country, Andhra Pradesh shares its borders with the states of Tamil Nadu, Odisha and Karnataka. According to Census 2011, the state has a population of about 84 million and has a population growth rate of about 11 per cent. Housing the vibrant city of Hyderabad – a wellestablished hub for sectors such as IT and telecom – the state has considerably grown in the last decade in terms of its technological offerings. Due to its good infrastructure like roads and proximity to ports, new investments are trickling in the manufacturing, heavy industries and engineering goods segments.
HIGHLIGHTS OF THIS EDITION 150+
expected exhibitors
15,000+
Business transactions worth ` 50 crore expected
4,500+
visitors expected
products on display
Spread over an area of more than 50,000 sq ft
Showcasing more than 35 diverse industry categoriessolutions
Natural sheen The land of the Chowmahalla Palace, Charminar, Golkonda Fort and the revered biryani beckons business alliances as it plays host to Engineering Expo for the first time. Tying up with this Expo is the Micro, Small & Medium Enterprises (MSME) Development Institute, Hyderabad, that falls under the ambit of the Government of India. Talking about the venue city, G R Akadas, Director, MSME Development Institute, Hyderabad, says, “This city has the highest number of Central Public Sector Undertaking (PSU) companies and R&D set-ups. The PSUs and defence undertakings require a lot of engineering components to be outsourced from MSMEs. Now, under the Public Procurement Policy, it will be mandatory for these PSUs to procure a minimum of 20 per cent of their annual requirements from MSMEs.” The marked growth in the automobile and auto parts, poultry farming, textiles & apparel and bulk drugs & pharmaceutical industries has given Andhra Pradesh an industry-friendly image. The state is home to over 300 electronics hardware units that manufacture electronic boards and devices. Some of the key electronics markets are located in Visakhapatnam, Hyderabad, Vijayawada, Samalkot,
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Kakinada and Anakapalle. It was also the first Indian state to announce and implement the Electronics Hardware Policy. Attributing the state’s growth to its encouraging industrial policies, Rashmi Ranjan Mohapatra, National Sales Manager, KEMPPI INDIA, explains, “To turn the state into an electronics manufacturing hub, the state plans to convert the existing Fab City and Aeronautical SEZ into centres of excellence. The government has also planned to set up a 400-acre electronics hardware cluster in Maheshwaram, near Fab City. With Central Government assistance, the first brownfield clusters will come up near Anantapur, where computer hardware products will be manufactured. Creating a common fund under public-private participation, providing 10 per cent subsidy on capital equipment for technology upgradation, besides a 25 per cent subsidy on lease or rentals of up to ` 0.5 million a year for three years are other measures taken up by the State Government.”
Cultured business Amid these developments, the state has a couple of issues that bring down its attractiveness. The recent hike in power tariff by the Andhra Pradesh Government from ` 3.97 to ` 4.9 per unit might not
Engineering Expo Hyderabad 2013
have much impact on the larger players but the smaller players might have to face the music. Moreover, the issue related to the demand of creation of another state has brought businesses to a standstill. “Demanding a resolution to the Telangana issue by carving out a separate state comes to forefront every now and then. This does interrupt business (but only on a temporary basis); not all areas in the state are affected by it,” points out V Siva Prasad, Managing Director, Landsky Engineers Pvt Ltd. In a positive flip, with 26 universities, 740 engineering colleges turning out 2,00,000 engineers per year, Andhra Pradesh has a large pool of skilled workforce. The presence of companies such as P&G, Apache, Hyundai Motors, Kobelco, AMD, HCL Infosystems, Celetronix, WEP and Celestica has given the state a natural boost. The state is the base for many infrastructure companies such as GMR, GVK, SOMA, and IVRCL. Besides these, major gas suppliers and local pearl production units are some of the inhabitants of Andhra Pradesh.
Economic treasure Engineering Expo, which is all set to grace the city of Hyderabad for the first time, brings along a lot of expectations. Spread on an area of over 50,000 sq ft, the Expo, with more than 150 exhibitors, is anticipated to attract about 15,000 visitors. When asked about his company’s participation in the Expo, Prasad informs, “In the past, we have participated in other expos. This is the first time we are participating in an exhibition organised by Network 18 Publishing. At the fair, we would be displaying material handling equipment, air compressors, encoders, etc.” By providing industry players a platform, Engineering Expo is a small, yet significant, drop in the industrial revolution taking place in Andhra Pradesh. Offering his perspective on the same, Ganesh Parthsarthy, CEO, Tussor Machine Tools (I) Pvt Ltd, opines, “The market here is manufacturing friendly, but it still has a long way to go. For Tussor, the business is
good in Hyderabad. At the Expo, we will be exhibiting CNC machines, turning centres and precision lathe, among others.” Having travelled across different Indian cities, Engineering Expo has selected Hyderabad as the host city after much ground research. Sharing his views on the Expo’s continued success, Sandeep Khosla, CEO, Network 18 Publishing, says, “After 11 successful years of service to the industry, Engineering Expo today has established itself as India’s largest multilocation trade show on manufacturing. The Expo is a preferred destination for SMEs as well as manufacturing & engineering organisations to further their growth and that of the industry at large. For the 2013-14 season, we have 10 editions spread across an equal number of locations of a rising India. Keeping our esteemed exhibitors and valued customers in mind, we have made elaborate provisions to offer a never before experience. These, we reckon, will add substantial traction to the industrial growth of the nation.”
Hyderabad is the financial capital of Andhra Pradesh; it is the state’s largest contributor to the GDP. A precious gem Hyderabad is the economic and financial capital of Andhra Pradesh; it is the state’s largest contributor to the GDP, state tax and excise revenues. Over the last decade, Hyderabad has posted dramatic growth figures; it is expected that it will continue to grow in the ensuing years. Since the 90s, its economic pattern has changed from being primarily service-oriented to one with a broader and more diversified spectrum, including transport, commerce and communication. This trend is only set to accelerate as the proposed Chennai–Bengaluru Industrial Corridor attracts more projects to the region (since it will pass through Chittoor,
NEW ATTRACTIONS IN THIS EDITION Institutional Buyer Involvement Plan to
attract delegations from large corporate and major institutions Improvised visitor profiling —profile, scan, filter and bring in visitors as per exhibitors’ requirements Providing business networking support to exhibitors by leveraging Network 18 Publishing’s industry connect Credit rating facilities for the benefit of exhibitors Providing complete travel solutions for exhibitors Offering logistics services to ensure smooth cargo handling, custom clearing, transport compliance, etc.
Nellore and Anantapur districts). Also, new investments in manufacturing, heavy industries and engineering goods are being witnessed. Moreover, in some cases, the power supply is much better here than in the rest of Andhra Pradesh. With the Indian financial year closing in March, the timeline of the event is suitable as industry players can plan and present customers their new offerings. Content with the event dates, Mohapatra adds, “At the Expo, we will be displaying some products that suit the exact needs of the pharma, aerospace and power industries. We are planning to launch a new product for power/infrastructure that can create an impact on their production cost and the industry as a whole.” Sharing this upbeat outlook is Akadas, who adds, “Hyderabad is an ideal place for conducting trade fairs. During the last financial year, we organised four national level vendor development programmes with exhibitions; the response was very good. As most PSUs are keen to develop MSME vendors to meet their 20 per cent target, the MSME sector is sure to get a boost in marketing prospects. Since the quality and standards are the essential criteria for any upcoming supplies, the demand for modern machinery and processes will encourage machinery manufacturers as well.” Email: sweta.nair@network18publishing.com
May 2013 | CHEMICAL & PROCESS WORLD | 89
Products
and other identification using GUI software, which can be separately bought with the instrument. Uniphos Envirotronic Pvt Ltd Valsad – Gujarat Tel: 260-2730156/158 Email: cel@uniphos.com Website: www.uniphos.com before One must consider the cost of the product ed purchasing so as to secure definite and assur returns over a period of time.
Manisha Kadam (Assistant Manager) Ashok Industry
LEVEL LEAF FILTER Sharplex level leaf filters are used for polishing filtration in post filtration stage to trap the fine particles from the filtrate of main filter. The filter elements have filter surface at both the sides, and hence the filters become compact even at higher filtration areas. The filter medium can be cloth or paper. The filters are available from 2m2 upto 15m2. Sharplex Filters (India) Pvt Ltd Navi Mumbai - Maharashtra Tel: 022-27696322/6339 Email: sharplex@vsnl.com Website: www.sharplex.com
AIR MONITOR The air monitor developed by UEPL is a microprocessor-based, non-dispersive spectrophotometer tailor-made for the analysis of the five pollutants SO2, NO2, NH3, Cl2, O3 at parts per billion levels. The instrument is light-weight and moderately priced. Ambient air is sampled for the required time duration, eg 4, 8 or 24 hours. The Uniphos air sampler can sample three different gases simultaneously using three impingers filled with recommended gas absorbing solvents. The solutions from the impingers are further treated with other reagents to form coloured dyes. The measurement of absorbance on this coloured dye is made on the Envirotrack. The analysis is simple and all the calculations are done by the microprocessor with results displayed on the instrument. The results can also be transferred to a computer or laptop with date, time, location
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ANAEROBIC ADHESIVE Anaerobic adhesive is pre-applied to threaded parts, which forms a unique coating that converts ordinary fasteners into self-locking and self-sealing fasteners. Dry to touch, the pre-applied threadlocker becomes an integral part of the fastener and stays inert until parts are used. During assembly process, the pre-applied threadlocker is activated by assembly forces, releasing anaerobic adhesive that locks and seals parts securely. Sonlok pre-applied products may be used successfully, without solvents, in extreme temperature and pressure environments to lock and seal against air, steam, most fluids and lubricants. These are available in a wide range, from 1 ml capsule to 10 ltr carboy. Parson Adhesives India Pvt Ltd Vadodara - Gujarat Tel: 0265-6541638, 2972191 Mob: 09428511765, 09825299551 Email: bijay@parsonadhesives.in Website: www.parsonadhesives.in
DIGITAL TRANSMITTER The Uniphos-5OO(DT) digital gas transmitter is a microprocessor-based smart transmitter with an easy to read back-lit LCD display. The transmitter provides an RS- 485 digital output (enabling low cost 2 wire looped wire communication) as well as the industry standard analog 4-20 mA output. The transmitter utilises smart sensor technology, using hot swappable sensors, where all of the sensor information is stored on an EPROM. The transmitter has two LEDs for low and high alarms and an optional relay card with 3 x NOINC potential free relays. In addition, it also displays the date of calibration, the range of gas detection, TLV and the STEL. It also has the provision of non-intrusive calibration by means of a magnetic wand. This makes it ideal for hazardous area installation and calibration, as it is not possible to open the transmitter enclosure and do the calibration, in such an environment. Uniphos Envirotronic Pvt Ltd Valsad – Gujarat Tel: 260-2730156/158 Email: cel@uniphos.com Website: www.uniphos.com
Products
FLUID BED DRYER This fluid bed dryer is ideal for rapid and even drying of chemical, pharmaceutical and food products. Its salient features are 65 per cent open perforated air distribution plates along with Dutch weave mesh, on line sampling port, 2.5 kg to 500 kg batch capacity, explosion relief disc, uniform drying at low temperature, top mounted pneumatic cylinder (directly coupled) for shaking (without wire rope system), intrinsically safe earthing system, which ensures complete elimination of static charge, heating mode electrical/steam/thermic fluid, pneumatically operated inflatable seals provided for filter bag and product container sealing with pressure switches & FRL to ensure fail-safe operation. All contact parts are SS 316 as per GMP standard. The machine finds application in chemicals, pharmaceutical and food products industries. Fluid bed dryer comes along with all documentation like DQ, IQ, OQ, and FAT as part of standard procedure. Jay Pharma Equipments Mumbai - Maharashtra Tel: 022 - 32155790 Email: jkpharm1@gmail.com Website: www.jaypharmaequipments.com
ANTI-VIBRATION CORK SLABS The anti-vibration cork slab offers polymers and cork, whose ideal combination ends up in making a product that has better resistance to ageing, compression set, water and oil. The unique structure of cork filled up with tiny air pockets absorbs the vibration caused by the equipment. It is available in sizes of 458 x 458 mm with a thickness of 22 mm. Corrub Industries Kolkata - West Bengal Tel: 033-22301524 Email: natcork@airtelmail.in Website: www.corrubindustries.com
PAINT SPRAY ROOMS The paint spray rooms help to improve painting quality and maintain a pollution-free environment. Vacuum is created with the help of axial flow fan, and thus air is sucked from outside. Paint trap filters can be replaced periodically, which separates painting zone from other departments. Synco Industries Ltd Jodhpur - Rajasthan Tel: 0291-2741571, Mob: 09829022258 Email: synco_2000@yahoo.com Website: www.synco.co.in
May 2013 | CHEMICAL & PROCESS WORLD | 91
Products
RIBBON BLENDER The ribbon blender is an efficient and versatile blending machine for mixing of dry granules and powders homogeneously. Approximately, twothird of the volume of the container of ribbon blender is filled to ensure proper mixing. The ribbon blender gives best result for mixing of dry powder and granules due to the design and shape of the mixing ribbon and product container. These are manufactured in a range of 25 kg to 5,000 kg batch capacity in mild steel and stainless steel. It features less working time, no dust formation, less maintenance cost, less service after sales. Application areas include food processing, pharmaceutical, chemical pesticides, fertilisers and cosmetic industries. Aries Engineers Thane – Maharashtra Tel: 022 – 28555751 Mob: 09323649078, 09930992671 Email: ariesengineers@yahoo.com, info@ariesengineer.com Website: www.ariesengineer.com
SILICONE TRANSPARENT TUBING These transparent tubings are made from 100 per cent pure silicone rubber by using fully automatic state-of-the-art machineries and technologies. Silicone transparent tubings are manufactured under stringent quality control and having the following distinguished features: it is made from medical grade silicone rubber, which complies with USP Class VI requirement & FDA 21 CFR 177.2600, temperature resistant from -80°C to 250°C (-110°F to 480°F), non-reactive to body tissue and fluid, non-adherence to tissue. It remains unaffected by most water soluble materials and is sterilisable by steam, dry heat, ethylene oxide (ET) and gamma radiation, which resists oxidation, ozone and radiation. It has an indefinite shelf-life. Silicone sleeves are also manufactured. It finds application in food, pharma, chemical, medical, heavy engineering, thermal power stations and PSUs. AMI Polymers Pvt Ltd Thane - Maharashtra Tel: 022-28555107/631 Mob: 09223290931 Email:amipolymer@vsnl.com Website: www. amipolymer.com
LABORATORY CENTRIFUGES These laboratory centrifuges model R-8C BL & R-8M are suitable for routine sample analysis in medical, hospital, pathology and institutional laboratories. With a wide choice of rotor heads and adaptors, these units are truly versatile. These are ideal for growing routine application in biochemical and clinical labs, for
92 | CHEMICAL & PROCESS WORLD | May 2013
hematocrit, corpuscle percentage contents in blood, serum analysis and precipitate separation. These have dynamic brake for quick deceleration, microprocessor controller with digital display, smooth & soft start and inverter fault detection with auto shutdown. Remi Elektrotechnik Ltd Mumbai - Maharashtra Tel: 022-40589888 Mob: 09820627422 Email: sales@remilabworld.com Website: www.remilabworld.com
VERTICAL PRESSURE LEAF FILTER Vertical pressure leaf filter is used for filtration of liquids with suspended solid contents up to 7 per cent. No filter cloth is required. It provides automatic dislodging of filtered cake by pneumatic vibrator or oscillating sluice header. Dry or wet cake discharge is possible. Filtration area is up to 120m2. The various application areas are resins, bleaching earth/activated carbon, crude oil, sulphur, ni-catalyst, glucose, fatty acid, brine, winterisation, electrolyte and beverage industry. Material of construction is CS, SS, SS904L, titanium, hastelloy, monel, polypropylene/teflon coated. Sharplex Filters (India) Pvt Ltd Navi Mumbai - Maharashtra Tel: 022-27696322/6339 Email: sharplex@vsnl.com Website: www.sharplex.com
PUMPS Masterflex pumps are used for fluid transfers, which are highly reactive and toxic, and is mainly used for mercury transfers where controlled pouring is virtually impossible. The total system consists of the Masterflex I/P precision brushless drive with analog remote along with the Masterflex I/P pump head and compatible Tygon long-life tubing. The quantity of the mercury flow can be controlled by varying the pump speed and occlusion. The mechanical components of the pump do not become contaminated. The mercury only comes into contact with the tubing, which decreases the risk of exposure to elemental mercury and its vapours. The only concern is about safe discarding of the tubing, during which it becomes necessary to replace it. Finally, because the tubing is clear, the operator can visually observe the transfer, which provides an added level of confidence that the process is working well. Cole-Parmer India Mumbai - Maharashtra Tel: 022-6716 2222 Email: vinita.singh@coleparmer.in Website: www.coleparmer.in
Products
3/8" INCH SIMPLEX SPROCKETS Roller chain drives require correctly designed and accurately cut sprocket teeth in order to give satsfactory service and quiet operation. Sprocket wheels are manufactured from quality materials.Teeth are machine-cut for correct tooth from tooth thickness and profile. Machine tooth surfaces are smooth and providing full contact with chain rollers, assuring maximum life of chain and sprocket wheel. Albro Engineers Pvt Ltd Pune - Maharashtra Tel: 020-26169546, Mob: 9850062164 Email: albropune@yahoo.co.in Website: www.albroindia.com
FUEL PUMP Fuel pump has 600 models of fuel units to choose from. Small capacity burners are available from 10 to 1,000 kw for light oil, kerosene applications, pumps with or without solenoid valve. Singlestep or two-step operation models available are AN, AL, AS, AT, A2L. Medium capacity burner are from 400 to 3,000 kw for light oil or heavy oil applications. Pumps with or without hydraulic cut-off model are D, AJ, E, J. High capacity burner are from 3000 to 30,000 kw. Pumps with electric preheater facility for heavy oil applications models are T, TA etc. Classic Enterprises Mumbai - Maharashtra Tel: 022-22034496 Email: classic@bom3.vsnl.net.in Website: www.classic-combustion.com
ALARM MANAGEMENT DEVICE Alarm management system for the process industry is a measuring instrument with flexible programmable display, which provides new practical options in process monitoring. The measuring values do not have to be analysed first because the display indicates at a glance whether the preset measuring values are exceeded and immediate intervention is required. Baumer India Pvt Ltd Pune - Maharashtra Tel: 020-2528 6833, 09850688300 Email: sales.in@baumer.com Website: www.baumer.com
May 2013 | CHEMICAL & PROCESS WORLD | 93
Products
ROTOR UNITS The high-quality stainless steel desiccant rotor cassettes provide greater flexibility to AHU manufacturers. Applications requiring air to be supplied at lower dewpoints can be effectively and efficiently achieved using cooling coils. Specifically designed for use in customised air handling units, all cassettes include the SSCR silica gel rotor, geared drive motor, rotor drive system, radial and peripheral seals. Its dehumidifying capacity is at 20°C/60 per cent RH. Jay Jagannath Air Equipments Vadodara - Gujarat Tel: 0265-3913451 Mob: 09925003183 Email: bpathak81@hotmail.com Website: www.jjgroup.com
MOTOR PROTECTION RELAY This instrument displays various parameters, trip count and trip data on 8-digit alphanumeric display, and has separate LEDs for individual fault indication. This is four-user programmable output relay, it is built in self-supervision, and self-testing feature helps maintenance. It provides easy operation by 5 push buttons. It also has RS485 port for serial communication with ‘MSCOM’ user-friendly software. Larsen & Toubro Ltd Mumbai - Maharashtra Tel: 022-67054902 Email: karthikm@lntebg.com Website: www.lntebg.com
NETWORK GAS CHROMATOGRAPH The Agilent 7890A is a state-ofthe-art gas chromatograph that provides superior performance for all applications. Key to its performance is the use of advanced electronic pneumatic control (EPC) modules and high performance GC oven temperature control. Each EPC unit is optimised for its intended use with a specific inlet and detector option. State-of-the-art detector electronics and the fullrange digital data path enable peaks to be quantified over the entire concentration range of the detector in a single run. Agilent Technologies India Pvt Ltd New Delhi Tel: 011-46237100 Email: agilent@agilent.com Website: www.agilent.co.in
94 | CHEMICAL & PROCESS WORLD | May 2013
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Products
ELECTRONIC HUMIDISTAT AND CONTROLLER Measuring range is from 30°C up to +80°C. Accuracy is <±2 per cent RH and <±0.5°C in the full measuring range. Each sensor comes with a calibration protocol for 0 per cent RH and 75.3 per cent RH. The sensor can easily be changed and after setting the calibration parameters on the display the <±2% RH accuracy is obtained again. A 10 m sensor cable and wall mounting device is included; 20 m sensor cable is optional. Jay Jagannath Air Equipments Vadodara - Gujarat Tel: 0265-3913451 Mob: 09925003183 Email: bpathak81@hotmail.com Website: www.jjgroup.com
OIL FREE AIR COMPRESSOR The oil free air compressor is heavy duty cast iron compressor fitted with a high performance motor. It has starter kit: DOL or star-deltas and aerodynamically designed pulleys are driven by a V belt. The power rating is 2.25 kW and 3 hp, maximum pressure is of 8.5 bar and air receiver capacity is 150. Din-Tech Control Pvt Ltd Ahmedabad - Gujarat Tel: 079-22820008,+91-079-22821417 Email: info@dtcpl.in Website: www.dtcpl.in
REACTION VESSELS These industrial reactors are fabricated to accuracy using qualitative material and are constructed either in MS or SS. These vertical reactors are provided with different capacities ranging up to 25 KL and comprise the following construction elements: sturdy construction, leak proof and durable and finds application in various industries such as pharmaceutical, fertilisers, food and dairy, petrochemical, pharmaceutical, pulp and paper, dyestuff and chemical engineering. The various types of vessels available are jacketted reactor, limpet coiled reactor and internal coil reactor. Aries Engineers Thane – Maharashtra Tel: 022 – 28555751 Mob: 09323649078, 09930992671 Email: ariesengineers@yahoo.com, info@ariesengineer.com Website: www.ariesengineer.com
May 2013 | CHEMICAL & PROCESS WORLD | 97
Products
PORTABLE SHOT BLASTING MACHINES S7-150 is recommended for light job and intermittent requirement of blasting. An economical model, light weight and mobile, it can be operated by one operator. S7-300R is recommended for medium production work and has all the features of production machines. For automatic start/stop, the machine can be provided with remote control unit. take Before taking delivery of any machine, one must help trials of the product for a short time. This will s. determine the productâ&#x20AC;&#x2122;s efficiency and effectivenes
Sharayu Sawant (Director) Shruti Flexipack Pvt Ltd
HEAT EXCHANGERS AND CONDENSERS The range of heat exchangers include fixed shell and tube type, floating, full double expanded and double tube sheet type. These heat exchangers are used for various applications in industries, namely, fertilisers, chemicals, petrochemicals, pharmaceuticals and other allied industries. Capacity of the heat exchangers ranges from 1 sqm to 150 sqm of heat transfer area. Kwality Process Equipments Pvt Ltd Thane - Maharashtra Tel: 0250-2453438 Email: sales@chemicalequipments.com Website: www.chemicalequipments.com
DESICCANT AIR DRYERS The desiccant air dryer provides energy-efficient heatless design and low noise levels. Its features include corrosion resistant body, fits in less space, is light weight. It also saves energy, ensures depressurisation safety, with minimal serviceable spares. The desiccant media can be replaced. Din-Tech Control Pvt Ltd Ahmedabad - Gujarat Tel: 079-22820008,+91-079-22821417 Email: info@dtcpl.in Website: www.dtcpl.in
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Synco Industries Ltd Jodhpur - Rajasthan Tel: 0291-2741571 Mob: 09829022258 Email: synco_2000@yahoo.com Website: www.synco.co.in
CENTRIFUGAL AIR BLOWER It features energy savings with fans variable intel vanes, high pressure atomisation/combustion air as per specific requirement to suit burners, highly efficient design impeller fabrication in aluminium/MS riveted high strength construction fitted with hub, minimum overhung and weight design for low starting inertia. Different drive offer for direct coupled/directly mounted on motor shaft/VEE belt and optional accessories like inlet/outlet silencer, air control devices are available. Other applications are cooling, air knives, fluidising system, glass blowing, drying and various process system. Capacity is up to 75,000 M3/hr. Pressure is up to 1,500 mm WG. Vacunair Engineering Co Pvt Ltd Ahmedabad - Gujarat Tel: 079-22910771, 09824036375 Email: info@vacunair.com Website: www.vacunair.com
OIL BURNER CONTROLLER The LOA 21 & 24 series of burner control serves in conjunction with the QRB type light detectors, photocells for fully automatic startup and supervision of single- or two-stage pressure-jet oil burners of small capacity. The burner controls of the LAL range are designed for the control and supervision of atomising expanding flame burners of medium to high capacity. These are universally applicable and can be used for both multi-staged and modulating burners as well as for burner of stationary air heaters. Classic Enterprises Mumbai - Maharashtra Tel: 022-2203 4496 Email: classic@bom3.vsnl.net.in Website: www.classic-combustion.com
Products
CORROSION PROTECTION The ECP (Enhanced Corrosion Protection) has been established which can provide an improved rust resistance over 120 hours in salt spray atmosphere. It has a zinc coating with black passivation for valve component parts in steel and cast iron, Black opaque anodizing for aluminium caps, electronic boxes and protection and Natural gloss light grey anodizing for aluminium name plates. It also provides Black plastic encapsulation (Rynite) for other coils and for coilâ&#x20AC;&#x2122;s nut rings ATOS SPA Bangalore - Karnataka Tel: +91-80-23613840 Email: manish@atosindia.in Website: www.atos.com
AUTOMOTIVE PAINTS The NC automotive finish is a single component, air-drying, and nitrocellulose based paint. Refinishing coating is ideal for auto car and other vehicle to get good abrasion resistance, petrol and oil resistance with better polishing property. The NC super finish is economical single component, air-drying, nitrocellulose
based paint. Refinishing is coating ideal base coat for auto car and other vehicle to get good abrasion resistance, petrol & oil resistance with better polishing property. The paint is also good for furniture and appliances coating where fast drying is required. Emperol Colours Pvt Ltd Mumbai - Maharashtra Tel: 022-2506 5576 ,09869711706 Email: emperol@rediffmail.com Website: www.emperolcolours.tradeindia.com
HIGH PRESSURE TRIPLEX PLUNGER PUMP The high-pressure triplex plunger pump series 4500 with unloader and safety valve has an electric motor or diesel engine assembled with a centrifugal pump. It supplies pressurised clean water at pump inlet. The water inlet temperature is 50 0C, plunger diameter is 22 mm and holds 37 litre per minute. UT Pumps & Systems Pvt Ltd Mumbai - Maharashtra Tel: +91-022-32992488 Email: info@utpsl.in Website: www.utpsl.in
May 2013 | CHEMICAL & PROCESS WORLD | 99
Products
FLANGE FACER The electro-mechanical flange facer is offered for ID clamping or OD clamps or face clamping, depending upon the job requirement. The flange facer consists of a rotary drive unit, horizontal arm, electrical control panel and operatorâ&#x20AC;&#x2122;s console. Powered quill mechanism is optionally offered for depth of cut setting and for boring operations. The spindle (rotary drive shaft) is supported by a pair of heavy duty taper roller bearings in the front and by a pair of ball bearings on the other end. Bearings are lubricated for life with molybdenum sulfide grease. The rotary movement ranges from 2 to 20 rpm in a step-less range through vector VFD. The spindle is made of EN-24, hardened and ground. The box type ram and the ram housing are made of high grade CI. Shenoy Engineering Pvt Ltd Bengaluru - Karnataka Tel: 080-28361767 Email: shenoyengg@gmail.com Website: www.spm-india.com
CABLE CARRIER The cable carrier requires no separate motor/power for operating. A single system can be used for conveying data, power and hydraulic hoses. It has no direct exposure of cables to environment as the cables are covered and secured inside the chain, no contact with coolants, oils, chips etc and no running or maintenance cost as it is fully integrated to the moving part of the machinery or the equipment. It is easy to assemble/disassemble and maintain and requires less shut-down time. It also ensures reduced noises as compared to other cable management systems. Different routing of cables such as circular, vertical, lateral, etc is possible. Kabelschlepp India Pvt Ltd Bengaluru - Karnataka Tel: 080-4115 8997; Email: gm@kabelschlepp.in Email: gm@kabelschlepp.in Website: www.kabelschlepp.com
IN-SITU FERMENTOR It offers computer compatible control system on request and has temperature, pH, O2 and pCO2, pressure and level as an option. Jacketed pressure vessel is made of stainless steel with standard ports. Audio visual annunciation system is provided to track parameter set point failures. It has double mechanical
100 | CHEMICAL & PROCESS WORLD | May 2013
shaft seal with steam condensate and circulation ensureinglong life. It provides detachable modular 19" standard control rack and provides accurate controls with digital readout for aeration. Shree Biocare India Ahmedabad - Gujarat Tel: 079-40084116 Mob: 09898999146 Email: shreebiocare@gmail.com Website: www.fermentorsolution.com
CABLE AND HOSE CARRIER It was developed specifically for use in environments with heavy contamination from chips and dirt. The all-round closed structure effectively prevents the intrusion of foreign bodies into the cable space and allows for reliable protection right up to the connection area. The covers can be opened and removed easily on the inside or outside to load the cable carriers. The interior can be modularly partitioned with various divider solutions for even cable distribution. The optimised geometry and a triple encapsulated stroke system allow it to span extensive unsupported sections. The integrated gliding surface makes the cable carrier the ideal solution for long travel lengths. Integrated noise damping ensures that the cable carrier is running silently and with low vibration at all times. Kabelschlepp India Pvt Ltd Bengaluru - Karnataka Tel: 080-4115 8997 Email: gm@kabelschlepp.in; Website: www.kabelschlepp.com
DEHUMIDIFIER It has washable rotor; dry air connection (optional); operates at dew-points below 0°C; condenses out the moisture; stainless steel chassis; and accumulates all energy in the dry air. A-30 B has nominal capacity1 (kg/h):0.5; dry airflow2 (m3/h):400; static pressure at disposal (Pa):0; heater power (kW):1; maximum electric consumption (kW):1.20; supply fuse 230V/50Hz, (A):10; weight (kg):32. A-30 Bp has nominal capacity1 (kg/h):0.5; dry airflow2 (m3/h):400; static pressure at disposal (Pa):200; heater power (kW):1; maximum electric consumption (kW):1.22; supply fuse 230V/50Hz, (A):10; weight (kg):32. Jay Jagannath Air Equipments Vadodara - Gujarat Tel: 0265-3913451, Mob: 09925003183 Email: bpathak81@hotmail.com Website: www.jjgroup.com
Products
SUCTION BLASTING MACHINE The suction blasting machine is based on induction-suction principle. The suction blaster is recommended for cleaning and de-burring small and medium size objects. It ensures uniform and continuous cleaning and finishing each time through the automatic abrasive reclaimer unit. Synco Industries Ltd Jodhpur - Rajasthan Tel: 0291-2741571, Mob: 09829022258 Email: synco_2000@yahoo.com Website: www.synco.co.in
SAFETY SWITCHGEAR The PSR is a comprehensive range of safety switchgear. In addition to the basic approvals for mechanical and plant engineering, the modules are also approved for process engineering, furnaces and shipbuilding. It offers high standard for monitoring safety relevant signals. All connections are pluggable, coded, and designed as both screw or twin springcage connection. With compact and space-saving design, the PSR modules offer increased isolation between input/output and enabling/
signaling current circuits. It is controlled via one/two channels with or without cross-circuiting detection. Phoenix Contact (I) Pvt Ltd New Delhi Tel: 011-3026 2800 Email: response@phoenixcontact.co.in Website: www.phoenixcontact.co.in
TWO WIRE TEMPERATURE TRANSMITTERS These transmitters LTX-3000-H-2 accepts (Pt-100) or thermocouple or variable resistance signal as the input and provides DC current output of (4-20) mA proportional to mV or resistance values. The transmitter is linearly calibrated to the signal produced by a thermocouple or RTD sensors and is not to the actual temperature. Libratherm Instruments Pvt Ltd Mumbai - Maharashtra Tel: 022-28963823 Mob: 09821136685 Email: libratherm@libratherm.com Website: www.libratherm.com The information published in this section is as per the details furnished by the respective manufacturer/distributor. In any case, it does not represent the views of Chemical & Process World
May 2013 | CHEMICAL & PROCESS WORLD | 101
List of Products
Product
Pg. No.
3/8” inch simplex sprocket ................................ 93 Acoustic enclosure ................................................ BC Air cooled heat exchanger ................................... FIC Air cooled steam condenser ................................. FIC Air monitor ............................................................90 Alarm management device .....................................93 Aluma coat ...............................................................3 Anaerobic adhesive .................................................90 Analytical instrumentation .....................................47 Anti-vibration cork slab..........................................91 Automatic and contained discharge........................39 Automotive paint....................................................99 Bag filter .......................................................... 69 Ball check valve .................................................. 5, 53 Ball valve .......................................................... 19, 53 Ball valve - screwed end..........................................94 Ball valve - teflon lined .............................................6 Ball valve - three piece design.................................94 Basket filter.............................................................69 Bellow and dip-pipe .................................................6 Bio-diesel plant ......................................................67 Blender .................................................................101 Bush ......................................................................53 Butterfly valve ................................................... 19, 53 Butterfly valve - teflon lined .....................................6 Cable and hose carrier .....................................100 Cable carrier .........................................................100 Cake pressing .........................................................39 Cartridge filter ........................................................69 Centrifugal air blower.............................................98 Centrifugal fan .......................................................33 Ceramic coating .......................................................3 Check valve ............................................................19 Check valve - teflon lined .........................................6 Chemical process equipment ............................ 59, 99 Chemical pump ......................................................94 Chemical tank ........................................................97 COD analyser.........................................................57 Coloumn and chemistries .......................................47 Condenser ............................................................101 Continuous nitration system ............................ 59, 99 Continuous or batch filtration ................................39 Cooling tower ...................................................... FIC Corrosion protection ..............................................99 Corrugated tube heat exchanger .............................12 CSR ......................................................................49 Dehumidifier ..................................................100 Desiccant air dryer..................................................98 Diaphragm valve.....................................................53 Digital transmitter ..................................................90 Dry van pump ...................................................... BC E/P positioner ................................................. 91 Elbow - buttweld type ............................................94 Electronic humidistat and controller ......................97 Empower ................................................................47 End cap ..................................................................94 EPC partner ...........................................................23 Ethanol ...................................................................67 Exhibition - Engineering Expo ..........................4; 77 Exhibition - Plastivision 2013 ................................10 Expansion bellow .....................................................5 FE ................................................................. 5 Fep/pfa/pvdf material .............................................53 Fitting.....................................................................53 Flange Facer .........................................................100 Flow verturi tube ..................................................101 Fluid bed dryer .......................................................91 Foot valve - non return valve ..................................94 Forged steel valve....................................................19 FRP battery stand...................................................79 FRP cable tray ........................................................79
Product
Pg. No.
FRP canopy ............................................................79 FRP grating ............................................................79 FRP handralls and fencing .....................................79 FRP ladder .............................................................79 FRP luminaries.......................................................79 FRP poles and mast ................................................79 FRP storage tank ....................................................79 FRP structural profile .............................................79 Fuel pump ..............................................................93 Gas plant ......................................................... 35 Gasket ....................................................................53 Gate valve ...............................................................19 Gear pump .............................................................63 Globe valve .............................................................19 Gmp and non-gmp .......................................... 59, 99 Hast alloy ........................................................ 19 Heat exchanger ..........................................59, 99, 101 Heat exchangers and condenser..............................98 Heat transfer equipment.........................................33 High pressure blower ..............................................33 High pressure triplex plunger pump .......................99 High speed mixer ............................................. 59, 99 Hope ball valve - flange end ...................................94 HPLC ....................................................................47 Industrial dryer ............................................. BIC Industrial evaporator ...........................................BIC Informatic...............................................................47 Infrastructure ..........................................................67 In-situ fermentor ..................................................100 Laboratory centrifuge....................................... 92 Large diameter welded pipe ...................................93 Level leaf filter ........................................................90 Limit switch ...........................................................91 Lined ball valve.........................................................5 Lined valve .............................................................19 Lined valve and pipe fitting ......................................6 Long neck pipe end ................................................94 Membrane holder............................................. 69 Minivac pump .................................................. 91, 93 Modular system pump ............................................51 Monel .....................................................................19 Monoblock pump ...................................................94 Motor protection relay............................................94 Multi stage cake washing........................................39 Network gas chromatograph ............................. 94 Nickle aluminium bronze .......................................19 Non metallic pump .................................................94 Non return valve .......................................................6 Nutshell filter..........................................................69 Oil burner controller ........................................ 98 Oil free air compressor ...........................................97 P/P positioner.................................................. 91 Paint spray room.....................................................91 PFA lined ball valve ..................................................5 PFA lined plug valve ................................................5 PFA lined product ....................................................5 Pipe ......................................................................53 Piping system from polypropylene ...........................8 Plastic masterbatch .................................................87 Plate heat exchanger ...............................................12 Plug valve ......................................................... 19, 53 Polypropylene process pump ..................................94 Portable shot blasting machine ...............................98 PP butterlly valve - flange end................................94 PP diaphragm valve flange end and screwed end ...94 Pressure and vacuum filtration ................................39 Pressure vessel............................................ 59, 99,101 Process gas blower ..................................................33 Ptfe ......................................................................53 Ptfe lined ball check valve.........................................5 Ptfe lined fitting .......................................................5
Product
Pg. No.
Ptfe lined pipe ..........................................................5 Ptfe lined product .....................................................5 Ptfe lined spool pipe .................................................5 Ptfe lined valve and pipe fitting ................................6 Pump .............................................63, 92,94, 97, BIC Pump for chemical equipment ...............................17 Pumping solution ...................................................91 Pvdf pump ..............................................................94 Reaction vessel................................................. 97 Reactor ............................................................. 59, 99 Ribbon blender .......................................................92 Rod ......................................................................53 Roots blower....................................................97, BC Rotary dry vacuum pump .......................................33 Rotary gear pump ............................................. 63, 94 Rotor unit ...............................................................94 Safety switchgear.............................................101 Sampling valve - teflon lined ....................................6 Scraped surface heat exchanger ..............................12 Seamless pipe..........................................................93 Self priming mud pump .........................................94 Self priming sewage pump .....................................94 Service provider ......................................................49 Sheet ......................................................................53 Silence flow package ...............................................33 Silicone fbd gasket ................................................103 Silicone rubber braided hose.................................103 Silicone rubber compound....................................103 Silicone rubber corona tester sleeve ......................103 Silicone rubber extruded gasket and profile ..........103 Silicone rubber moulding .....................................103 Silicone rubber sheet ............................................103 Silicone rubber sponge .........................................103 Silicone rubber tubing ..........................................103 Silicone transparent tubing .....................................92 Sintered filter ..........................................................69 Socket .....................................................................94 Spool pipe.................................................................5 Stailess steel pipe ....................................................93 Sterility test kit .......................................................69 Storage tank...............................................59, 99, 101 Strainer .....................................................................6 Suction blasting machine......................................101 Super duplex ...........................................................19 Swing check valve ...................................................53 Teflon lined valve and pipe fitting ....................... 6 Tefzel hhs isotactic p.p material ...............................8 Thermoplastic valve ..................................................8 Titanium ................................................................19 Trade show .............................................................64 Transmitter .............................................................25 Truck blower...........................................................33 Tube ................................................................ 53, 93 Twin lobe roots blower ...........................................97 Two stage vacuum pump ........................................97 Two wire temperature transmitter ........................101 ‘U’ tube ............................................................ 93 Uplc ......................................................................47 Vacuum booster pump .....................................BC Vacuum or hot gas drying .......................................39 Vacuum system ..................................................... BC Valve .................................................................. 5, 53 Valve positioner ......................................................91 Vent filter................................................................69 Vertical glandless pump ..........................................94 Vertical pressure leaf filter.......................................92 Water recycling plant .................................... BIC Water ring vacuum pump .......................................97 Welded pipe............................................................93 Wind turbine ..........................................................41 BC - Back Cover, BIC - Back Inside Cover, FIC - Front Inside Cover
102 | CHEMICAL & PROCESS WORLD | May 2013
List of Advertisers Advertiser’s Name & Contact Details
Pg No
Aeron Composite Pvt Ltd
79
Advertiser’s Name & Contact Details
Pg No Advertiser’s Name & Contact Details
BHS-Sonthofen (India) Pvt. Ltd.
39
Engineering Expo
T: +91-79-65258500
T: +91-40-23315341/45
T: +91-09819552270
W: www.aeroncomposite.com
W: www.bhs-sonthofen.in
W: www.engg-expo.com
E: info@aeroncomposite.com All India Plastics Mfrs Association
E: info@bhs-sonthofen.in 10
T: +91-22-28217324
Chemical & Process World
64
E: cpw@network18publishing.com
W: www.plastivision.org Ani Engineers
63
Dev Engineers
4; 77
E: engexpo@infomedia18.in
T: +91-22-30034650
E: pvi13@plastivision.org
Pg No
94
Everest Blower Systems
BC
T: +91-11-45457777
E: info@everestblowers.com
W: www.everestblowers.com Flucon Automation
91
T: +91-2752-241479
T: +91-79-26403839
T: +91-79-65722609
W: www.anivaryapumps.com
W: www.devpumps.com
W: www.fluconautomationinc.com
E: anivarya@sancharnet.in
E: sales@fluconautomationinc.com
E: info@devpumps.com
BASF India Ltd
41
Dip-Flon Engineering Co.
5
G M Engineering
T: +91-22-66618000
T: +91-79-25624003
T: +91-2827-287658
W: www.basf.com
W: www.dipflon.com
W: www.gmengg.com
E: contact-us-india@basf.com Bhavya Polymers
103
E: dipflon@satyam.net.in
E: valve@gmengg.com
Emerson Process Mgmt. (I) Pvt Ltd
25
Hi-Tech Applicator
T: +91-2762-224114
T: +91-22-66620417
T: +91-79-25833040
W: www.bhavyapolymers.com
W: www.emersonprocess.com
W: www.ptfeindia.com
E: bhavyapolymers@yahoo.co.in
19
E: Enquiry.Rosemount-IN@emerson.com
6
E: hitech@ptfeindia.com
May 2013 | CHEMICAL & PROCESS WORLD | 103
List of Advertisers Advertiser’s Name & Contact Details
Pg No
HRS Process Systems Ltd
12
Advertiser’s Name & Contact Details
Pg No Advertiser’s Name & Contact Details
Paharpur Cooling Towers Ltd
FIC
Pg No
Supremo Polymer Industries
53
T: +91-20-66047894/95
T: +91-33-24792050
T: +91-79-22205282
E: info@hrsasia.co.in
E: pctccu@paharpur.com
E: supremoproduct@gmail.com
W: www.hrsasia.co.in
W: www.paharpur.com
W: www.supremoproduct.com
Jyoti Ceramic Industries Pvt Ltd
3
Pentair Water India Pvt Ltd
17
Suraj Limited
93
T: +91-253-2350120
T: +91-120-4199444
T: +91-79-27540720
E: info@jyoticeramics.com
E: marketing.india@pentair.com
E: suraj@surajgroup.com
W: www.jyoticeramics.com
W: www.pentair.com
W: www.surajgroup.com
KPC Filtech Pvt Ltd
69
Prayag Polytech Pvt Ltd
87
Swam Pneumatics Pvt Ltd
T: +91-22-25669866
T: +91-11-47262000
T: +91-120-4696222
E: sales@kpcfilt.com
E: delhi@prayagmb.com
E: swamatic@airtelmail.com
W: www.kpcfilt.com
W: www.prayagmb.com
W: www.swamatics.com
Kwality Process Equipments Pvt Ltd
59
PSA Nitrogen Ltd
35
Tata Chemicals Ltd
T: +91-250-2453438
T: +91-09311021433/37
T: +91-22-6665828
E: pdmakwana@vsnl.net
E: works@psanitrogen.net
E: cjoshi@tatachemicals.com
W: www.chemicalequipments.com
W: www.psanitrogen.net
W: www.tatachemicals.com
LAN Marketing Pvt Ltd
51
Samarth Engineers
101
UHDE India Pvt Ltd
T: +91-09920780721
T: +91-20-66300305
T: +91-22-40478308
E: jai@lanengg.com
E: sanjayaut21@hotmail.com
E: uhdein@thyssenkrupp.com
W: www.maag.com
W: www.samartheneers.com
W: www.uhdeindia.com
Lester & Dynamiks (India)
99
Satjyot Enterprises
97
Uniphos Envirotronic Pvt Ltd
T: +91-250-2544735
T: +91-09810403546
T: +91-22-6123500
E: lester_n_dynamiks@yahoo.com
E: satjyotenterprises@yahoo.co.in
E: singhrv@uniphos.com
W: www.lesteranddynamiks.com
W: www.satjyot-enterprises.com
W: www.uniphos-she.com
Marvex Polytech Pvt Ltd
94
Shree Siddhivinayak Industries
93
UNP Polyvalves India Pvt Ltd
T: +91-79-22901027
T: +91-22-28457073
T: +91-265-2649248
E: info@marvex.co.in
E: minivac9@hotmail.com
E: mktg@polyvalve.com
W: www.marvex.co.in
W: www.minivacpumps.com
W: www.polyvalve.com
Mumbai Fabrics Pvt Ltd
67
Sri Vishnu Pumps
91
Waters (India) Pvt Limited
T: +91-22-40829511
T: +91-22-28457073
T: +91-80-28371900
E: visheshagarwal@royalenergylimited.com
E: vishnupump@rediffmail.com
E: waters_india@waters.com
W: www.minivacpumps.com
W: www.waters.com
P P I Pumps Pvt Ltd
97
SSP Pvt Limited
T: +91-79-25832273
T: +91-129-4183700
E: sales@ppipumps.com
E: info@ssp.co.in
W: www.ppipumps.com
W: www.sspindia.com
104 | CHEMICAL & PROCESS WORLD | May 2013
33
49
23
57
8
47
BIC BC - Back Cover, BIC - Back Inside Cover, FIC - Front Inside Cover
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