DCW - DCW

📊 NSE: DCW 🏢 Petrochemicals 📅 Last Updated: 12/13/2025 21:24

💰 Financial Performance

Revenue Growth by Segment

Revenue grew 6.88% YoY to INR 2,000.34 Cr in FY25. Specialty chemicals (CPVC, SIOP) are the primary margin drivers, with CPVC achieving a 22% CAGR from FY21 to FY25. Q2 FY26 revenue reached INR 539.2 Cr, a 10.3% YoY increase.

Geographic Revenue Split

Not disclosed as specific percentages, but operations are concentrated in Sahupuram (Tamil Nadu) and Dhanghadra (Gujarat), with corporate headquarters in Mumbai.

Profitability Margins

Profit After Tax (PAT) surged 93.4% YoY to INR 30.28 Cr in FY25. PAT margin for Q2 FY26 stood at 2.56%, up 281 bps YoY. ROE and ROCE for FY25 were 2.94% and 6.69% respectively.

EBITDA Margin

EBITDA margin for FY25 was 9.67%, up 29 bps YoY. Q2 FY26 EBITDA margin improved significantly to 10.78%, a 354 bps YoY increase, driven by specialty chemical contributions and cost-control measures.

Capital Expenditure

DCW completed a CPVC capacity expansion from 20,000 MTPA to 40,000 MTPA in July 2025. Plans are underway to add another 10,000 MTPA by the end of FY26. 30% of capex is funded via internal accruals and 70% through debt.

Credit Rating & Borrowing

India Ratings reaffirmed an IND A/Stable rating for term loans (INR 397.7 Cr) and IND A1 for working capital limits (INR 339.2 Cr). Interest expense for FY25 was INR 67.2 Cr.

⚙️ Operational Drivers

Raw Materials

Key raw materials include PVC (partially captive), Salt, and Coal. Total expenses for FY25 were INR 1,806.9 Cr, representing approximately 90.3% of revenue.

Capacity Expansion

CPVC capacity was doubled from 20,000 MTPA to 40,000 MTPA in July 2025 (ahead of schedule). Target capacity is 50,000 MTPA by the end of FY26 to meet rising domestic infrastructure demand.

Raw Material Costs

Raw material costs are impacted by global commodity volatility. Procurement strategies include diversified sourcing, long-term contracts, and strategic backward integration projects.

Manufacturing Efficiency

CPVC plant achieved a robust capacity utilization rate of 106% in FY25. The new 40,000 MTPA capacity achieved full utilization immediately upon commissioning in Q2 FY26.

📈 Strategic Growth

Expected Growth Rate

25%

Growth Strategy

Growth will be achieved by shifting the product mix toward high-margin downstream chemistries like CPVC and SIOP. The company aims for an annualized revenue run rate of INR 2,500 Cr by leveraging its doubled CPVC capacity and further expansion to 50,000 MTPA.

Products & Services

Soda Ash, Caustic Soda, PVC, CPVC (Chlorinated Polyvinyl Chloride), and SIOP (Synthetic Iron Oxide Pigment).

Brand Portfolio

DCW Limited.

New Products/Services

Expanded CPVC capacity and value-added downstream chemistries are expected to be the core drivers of margin stability and growth.

Market Expansion

Targeting domestic import substitution in the CPVC market, where DCW is the sole domestic manufacturer.

Market Share & Ranking

DCW is the sole domestic manufacturer of CPVC in India.

Strategic Alliances

Kaze Renewables Private Limited (Associate Company).

🌍 External Factors

Industry Trends

The industry is shifting toward specialty chemicals and ESG compliance. India is positioning as a global chemical manufacturing hub for the next decade.

Competitive Landscape

Competition primarily from global importers of CPVC and PVC; commodity segments face pricing pressure from global supply-demand dynamics.

Competitive Moat

Durable moat as the sole domestic manufacturer of CPVC in India, providing a significant logistics and cost advantage over imported alternatives.

Macro Economic Sensitivity

Sensitive to global chemical sector cycles and pricing; India remains attractive due to consumption growth and import substitution opportunities.

Consumer Behavior

Rising demand for CPVC is driven by domestic infrastructure, industrial needs, and construction growth.

Geopolitical Risks

Global macroeconomic uncertainties and supply chain disruptions impact raw material pricing and global demand recovery.

⚖️ Regulatory & Governance

Industry Regulations

Compliance with Safety, Health, and Environmental (SH&E) regulations and SEBI Business Responsibility and Sustainability Reporting (BRSR).

Environmental Compliance

Investments in zero-liquid discharge and green chemistry to comply with SEBI BRSR mandates and evolving SH&E regulations.

Taxation Policy Impact

Effective tax rate was approximately 28.5% in FY25, with current tax of INR 8.62 Cr on PBT of INR 30.28 Cr.

Legal Contingencies

Pending reply to the Department of Geology and Mining, Thoothukudi District; management states there is no material impact on financials or operations.