The analysis covers a portfolio of import-dependent chemical intermediates and downstream derivatives in India. The growth opportunities are categorized into three strategic buckets namely, scalable opportunities, conditional bets, and plausible MOAT. Each consists of chemical intermediates filtered based on import scale, balanced import source, India demand growth by volume, feedstock availability in India and announced capacity gap analysis. A total of 16 chemical intermediates are shortlisted from opportunity identification framework and the basis of the prioritization matrix, and then are categorized into strategic buckets. Of the 16 chemical intermediates, 12 attractive chemical intermediates have been separated into three strategic buckets.

Scalable opportunities are defined according to the following: “Feedstock is largely available in India, and a demand-supply gap exists post announced capacity additions. The opportunity follows standard project development path.” Conditional bets defined as “Attractive for demand and import size, but contingent on resolving a specific pre-condition such as feedstock gap, technology access, large capex or announced capacity plans get discontinued before investment is viable.” Lastly, Plausible MOATs are defined as “High barriers to entry—technology access, environment/safety constraints, and longer return on investment create lasting competitive advantage for the first mover.”

The unattractive chemical intermediates are categorized under the “challenging plays” bucket and described as “Multiple compounding challenges: proprietary technology unavailable for license, feedstock not available, economics unproven at scale, or global oligopoly makes entry unattractive.”

Author: Vidhika Awalla