In an interview with SmallCap Spotlight, Rakesh Dhalbisoi, VP – Marketing (Industrial Chemicals) at Deepak Fertilisers, highlighted the company’s evolution from a commodity-focused business to a speciality-led player across fertilisers, mining solutions and chemicals. He noted that capacity expansions, value-added products and a focus on high-purity chemicals are expected to support the company’s long-term growth ambitions through 2031.
Anjali Palod: Hello and welcome, you are watching SmallCap Spotlight. This is Anjali Pallod and joining us today on the show is Mr. Rakesh Talbishoi, the VP of Marketing for Industrial Chemicals at Deepak Fertiliser and Petrochemicals Corporation. Hi sir, welcome to the show.
Rakesh Dhalbisoi: Hello and thanks for inviting me to have a small chat with you.
Anjali Palod: So, let’s start talking about the company and go back to the roots. When was the company founded? What has been the journey for it so far?
Rakesh Dhalbisoi: So, it is little over 40 years old company, precisely four and a half decades company.
We started as a ammonia producer. Then over a period of a third, we have surplus of ammonia. So, we get into downstream of ammonia like nitric acid, ammonium nitrate, ammonium nitro phosphate and we have various chemicals like methanol, isopropyl alcohol and few other chemicals.
So, we have three verticals. One is our fertiliser. We have a brand name of Aadhan. Then we have technical ammonium nitrate that is our mining chemical business. Then I am part of the chemical business where we have methanol, nitric acid, isopropyl alcohol, ammonia. We are the largest nitric acid producer in Asia.
We are the largest IPA producer in India. We are the largest ammonium nitrate producer, second largest in the Asian and we are holding some position in the global as well. So, these are basically all into chemical sector we have.
So, we have a real estate mall which is in Pune. So, that is a diversified kind of thing. So, that is part of our fertiliser business.
Anjali Palod: Right. Sir, take us through what your business, you told us about the three verticals, but take us through who your clients are in all of these verticals, who are the buyers and what is shaping the demand for these products?
Rakesh Dhalbisoi: Okay, fine. So, it is like for our fertiliser business, obviously a farmer is our customer and for our mining business, all these explosive manufacturers.
So, for them, technical ammonium nitrate is a raw material for explosive manufacturers. Ultimately, the consumer is, ultimate customer is the coal mines and the real industry sector. I mean, we have our roads, buildings, lots of mining chemicals to explore, making roads, building and coming to chemicals, we have long edge of customer base.
I mean, you talk about anything. I mean, we touch your everyday life. Right.
So, it is like the mattress, everything you are using, I mean, for that nitric acid goes in some or other form. For nitric acid, it’s a building prop for certain chemicals from that this pew is made, from pew you are having those, your slippers, footwear, your mattress, car cushions and then whatever steel utensils you have been using and it is for pickling nitric acid is being used. Agrochemicals, lot of nitric acid is used, IPA is used.
Very, I mean, you know, for isopropyl alcohol, 75% of Indian pharmaceutical industries consume IPA. Oh. So, it’s like whatever medicines you are having, so our IPA, it goes there.
It’s being used. Methanol is also in that place. I mean, that’s why I’m saying, we have been some or other, we have been touching everybody’s day to day life.
Anjali Palod: That’s great to know. But you said it’s a four and a half decade old company, which means a lot must have happened through the years. Could you take us through what were the biggest milestones and turning points for the company in this journey? Some recent ones?
Rakesh Dhalbisoi: Like, as far as I remember, I mean, I have spent a good amount of years in this organisation.
I’ve seen from going from 600 odd crores to close to a little over a billion US dollar in so many years, of course. We have expanded, you know, it’s like across the Asia, we have various locations. We are present not only in Maharashtra, we are present in Gujarat, we are present in East, that is in South Andhra Pradesh.
Then we have in North, now we are coming up with an Eastern part in Odisha. So, we have expanded organically, you know, we have expanded our capacity, whether there’s ammonium nitrate or nitric acid, everything. Apart from that, we have shifted our focus from commodity to speciality.
So, in fertiliser, we are not a basic, we are into water soluble, a few other speciality fertilisers. In ammonium nitrate, we have gone ahead, it’s like one plus one, we are getting into, we are going into that, we are into the services of mining business. In chemicals, we have entered into value added, some speciality chemicals.
We have positioned our industrial grade IPA into pharmaceutical grade and we command a premium of $150 vis-a-vis the industrial grade. Then we have created some nitric acid solution for pickling industry, rather than doing, taking, you know, nitric acid using for pickling, we are providing some solution. So, that is saving the cost of pickling by 20%, giving better efficiency, gloss.
And in so many, I mean, there is a shift in, there’s not any chemicals, so there is a shift in commodity to speciality. So, that has been going for last three, four years. So, I mean, it is a continuous process that has been going on.
We are getting into speciality, we are getting into high purity of isopropyl alcohol, ammonia, all those things, considering or looking at the semiconductor ecosystem is coming to India, it’s a matter of two years. So, and our Prime Minister Modi, I mean, Mr. Modi has been, you know, promoting Make in India. So, it is like, we want to part of that Indian growth story.
So, we are focussing more on the commodity to speciality. So, that’s the journey that the company has been for the past three or four years, but it’s also a crowded space.
Anjali Palod: You talk about fertilisers or even speciality chemicals, for that matter, what’s giving your company a competitive edge across the industry?
Rakesh Dhalbisoi: We talk about fertiliser, again, we are talking about the speciality fertiliser, I’m not talking about, I’m not talking about urea, or so I’m talking about a water-soluble fertiliser, so we just give a maximum yield.
Anjali Palod: And so, these are industry-first solutions that you are bringing?
Rakesh Dhalbisoi: Yeah, so I’m talking about all industry-first. Then in ammonium nitrate, we are going with some solutions. So, it’s not that we are only providing ammonium nitrate to a customer, we are giving them some mining solution.
Because with that, we are going ahead with some, you know, to the end market. We ourselves will be making explosive, but here it’s not that the others are not making, we are getting into that space as well. Coming to chemicals, so what others are talking about pickling solutions, we have a brand that is somewhere, it is like Pickbrite, that’s the first ever in India, no one is making it back.
In pharmacopoeia solvent, we have a leadership position. In semiconductor, there’s a hybrid that we are coming, so IPA only, propylene-based IPA is, you know, qualified for semiconductor grade IPA. So, in India, there is no one propylene-based IPA producer there.
So, we are focussing, you are right, we are focussing on those where, so where our entry barriers are there, plus wherever you like, I mean, it’s like we want to be in first or second in globally. In fact, globally first or second, in whatever way, whatever chemical or whatever we have been doing, we want to be either one or two leadership position.
Anjali Palod: Got it, understood.
So, if we see five years from now, how do you see the company growing, what are the key milestones that the company has in mind to achieve?
Rakesh Dhalbisoi: So, it is like I was talking about, we have been expanding. One project is coming, I mean, this financial year in West Coast of India, that is Gujarat, one is coming in East Coast, that is coming in Odisha. So, this is not only adding it to your top line, it is adding to your bottom line.
So, I mean, in terms of valuation, if I see my business, chemical business is 2,500 crores, but we are looking at a valuation of 4x kind of thing. So, that way we have certain plans of which I can’t, you know, few things I can’t talk here. So, it is like we have a roadmap in place.
So, and we have…
Anjali Palod: What’s the timeline you have for this 4x
Rakesh Dhalbisoi: kind of… 2031. Okay. Yeah. So, it is like five years from now. So, everything is lined up, we are working in that direction. So, this is what we have been trying to take it to 4x kind of valuation.
Anjali Palod: That’s great to know. With that, thank you so much, Mr. Ravish, for joining us here on the conversation. That was this episode of Small Cap Spotlight.
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