What are the top Petrochemical companies in India?
What Are Petrochemical Stocks?
Petrochemical stocks are the ones that are made of chemical products that are made using petroleum. The importance
The Current Scenario Of Petrochemicals In India
The need for petrochemicals is still around even though India is vigorously searching for its alternatives to work with. It might not seem important to regular people, but in many ways, our lives depend on petrochemicals. From the carpet we put on our floors, to the plastic bottles we use to fill water in summer, to clothes that we wear along with fertilizers used by farmers for their crops and other general purpose products are made using petrochemicals in one way or the other.
Petrochemicals have hydrocarbons, which come to use downstream processing of crude oil and natural gas. These hydrocarbons are used in various industries like agriculture, automotive, packaging, personal care, construction, plastic, and more.
If we look at the petrochemical industry in India, we can see it is cyclical. This is because the petrochemical industry is the one that is harshly dependent on feedstock prices and sulky demand. On the other hand, in terms of per capita consumption of petrochemical products, India ranks among the lowest in the world.
The global average per capita consumption of polyester is 3.3 Kg for the whole world. At the same time, it is 1.4 kg per capita consumption in India, according to the reports presented in 2021. One more example of this situation of low per capita consumption can be seen with polymers. Here in India, the per capita consumption of polymers is only 4kg. But, the global per capita consumption of polymers is around 20kgs.
Top 3 Petrochemical Companies In India
Given below are the top three players in the market of petrochemical companies in India.
#1 Reliance Petroleum Ltd. RPL
Starting with the biggest name in the petrochemical industry in India, we have Reliance Petroleum. This company specializes in oil and energy, and it is owned by Mukesh Ambani, who is one of the wealthiest men on the earth. The parent company Reliance Industries Limited (RIL), is considered to be one of India's biggest private sector companies. The main work of Reliance petroleum is done on the ground in Ahmedabad, Gujarat, where the headquarters of the company is located. Right now, the company has more than 400,000 employees and has crossed a total profit of $5 billion. On 29th February 2009, Reliance Petroleum was successfully merged with RIL.
Reliance petroleum has long-term chartered two oil rings, DD KG-1 and DD KG-2, where DD stands for Dhirubhai Deepwater. Both of these drilling ships are registered in the Marshall Islands and have been owned by Deepwater Pacific Inc, which is a subsidiary of Transocean. With An annual crude capacity of 1,240,000 barrels each stream day, Reliance petroleum is said to be the biggest oil refinery in the world. Apart from this, a new refinery project is also being implemented, for which the capital cost of Rs 270,000 million is funded via multiple equities and debt.
- Market Cap: 58,928 Crores Cr.
- Book Value: 968
- Dividend Yield: 0.31%
- ROCE: 10.7%
- ROE: 10.3 %
#2 Haldia Petrochemicals Ltd. HPL
Haldia petrochemicals Ltd was formed in the 90s in the West Bengal region of India. It was the first ever integrated petrochemical complex opened in Haldia, which is just 125 km away from Kolkata, the capital of West Bengal. HPL started its production in 2000, and over the years, the company has reached a capacity of 700 KTA from 420 KTA in quite a short span of time. In 2016 the company opened HPL Global Pte Ltd in Singapore, which is the first of its kind overseas wholly-owned subsidiary of an Indian petrochemical company. Besides this, Haldia Petrochemicals also acquired a majority of stakes of 57% in the Lummus Technology business from McDermott International Inc in partnership with Rhone Capital.
The total value of Lummus Technology is $2.725 billion, which comes out to be Rs 20,590 crores. The main purpose of this deal is to make HPL progress in the field of material technology space. With the association with Lummus, technology HPL is also looking at upstreaming the investment in its oil to chemical sectors as well. In 2022 HPL was in the news as it proposed to acquire Coastal Oil & Gas Infrastructure Pvt Ltd. by just one crore above the liquidation value.
- Market Cap: 3.96 Cr.
- ROCE: -0.43 %
- ROE: -239 %
#3 Indian Oil Corporation IOC
Indian Oil Corporation is the country's highest-ranking energy PSU in the Fortune 500 (Rank-142). In the year 2021-2022, the company recorded revenue of Rs 7,28,460 crores. Along with this, the net profit of IOC in the fiscal year 2021-2022 was Rs 24,184 crores. It has the biggest customer interface in India, and the company is able to reach every nuke or corner of the Indian subcontinent. Right now, IOC has more than 56,000 customer touchpoints all across the country and in locations where it has to deal with surmounting challenges like tough terrain, high altitude, extreme climate conditions, and accessibility.
The marketing network of IOC is bolstered with 80.55 MMTPA of Group Refining Capacity. In addition to this, the company has also built 15,000 Kms of cross-country pipeline. According to the latest reports, IOC's research and development center in Faridabad is considered to be one of Asia's finest in R&D of downstream petroleum. Also, this R&D center provides a competitive advantage to this corporation via world-class technology and process solutions.
- Market Cap: 95,812 Cr.
- Book Value: 110
- Dividend Yield: 7.69%
- ROCE: 4.95%
- ROE: 8.74%
Top 10 Petrochemical Stocks In India
|Indian Oil Corporation (IOL)||95,812 Crores||21.94|
|Reliance Petroleum Ltd. (RPL)||58,928 Crores||298.90|
|Finolex Industries Ltd.||8,621 Crores||33.32|
|DCW Ltd.||1,713 Crores||12.17|
|NOCIL Ltd.||4,398 Crores||14.44|
|Dhunseri Ventures Ltd.||774 Crores||28.79|
|Savita Oil Technologies Ltd.||2,016 Crores||12.17|
|INEOS Styrolution India Ltd.||1,477 Crores||14.44|
|Supreme Petrochem Ltd.||6,684 Crores||14.44|
|Manali Petrochemicals Ltd.||1,575 Crores||14.44|
(Data as of 20th October 2022)
Disclaimer: The securities quoted are exemplary and not recommendatory. Past performance is not indicative of future returns
So this is what petrochemical stocks in the Indian stock market are all about. Right now, we are witnessing a global shift in the petrochemical industry. This results in changes in how base chemical capacities are added to the process and utilized.
India right now ranks 6th amongst the top 10 largest manufacturers of petrochemical-based products in the world. Around 30% of the raw material in the chemical industry is made from the petrochemical industry, and it is expected that by 2025 the petrochemical industry will reach new heights as in 2021, it has reached $ 100 billion with a CAGR of 14%.
The overall outlook for the petrochemical industry in India is positive for the coming years. As a result, investing in petrochemical stocks could be the right decision for you if you plan well and choose your stock investment carefully.
This is not an investment advisory. The blog is for information purposes only. Investments in the securities market are subject to market risks, read all the related documents carefully before investing. Past performance is not indicative of future returns. Please consider your specific investment requirements, risk tolerance, goal, time frame, risk and reward balance, and the cost associated with the investment before choosing a fund, or designing a portfolio that suits your needs. The performance and returns of any investment portfolio can neither be predicted nor guaranteed.
What are petrochemical stocks?
All the products which come under the belt of organic chemical products with the use of crude oil and natural gas are called petrochemicals. These organic chemicals are used in industries to perform certain processing and tasks. The final product of these companies are plastics, rubber, paints, detergents, fertilizers, and even insulating materials.
What are the six basic petrochemicals?
Ethylene, propylene, butylenes, benzene, toluene, and xylenes are considered to be the six main petrochemicals that are used in India for various purposes. Also, these chemicals are used with a combination of other chemicals in order to make better products.
Which is the largest petrochemical company in India?
As of October 2022, Reliance petrochemicals is considered to be the biggest name in the petrochemical market of India. Apart from this, this company also comes among the top 10 petrochemical companies in the world as well. Moreover, this company holds the biggest petrochemical industry center in Jamnagar, Gujarat, India.
Which are four petrochemical companies that are listed in National Stock Exchange (NSE) India?
Given below are the five petrochemical companies which are listed in NSE India.
- Reliance Industries Ltd.
- Indian Oil Corporation
- Gas Authority of India Limited.
- Bongaigaon Refinery and Petrochemicals Ltd.