Deepak Nitrite

Deepak Nitrite Limited (DNL)


Established leader:

Incorporated in 1970, DNL commands a market share of 75% each in Sodium Nitrite, Nitro-Toluene and fuel additives in the domestic market. It is also amongst the top three players globally in Xylidine, Cumidine and Oximes.


Deepak Nitrite is a multi-product company that manufactures a diversified product portfolio of Basic Chemicals (BC), Fine and Specialty Chemicals (FSC), Performance Products (PP) and Phenol and Acetone. DNL’s growth has been aided by strategic acquisitions of companies with complementary product lines, in the past periods. DNL is the market leader in almost all the products it manufactures. Even though DNL predominantly caters to the domestic markets, it has significant footprint offshore, especially into Europe, USA, Japan, Latin America, South East and Far East Asia. DNL exports its products to over 30 countries across 6 continents through 2 Subsidiaries.

Geographically, Domestic market contributed 78% of the business and rest 22% came from Exports for FY19.

Reputed and diversified clients:

DNL clients


Sector outlook:

Demand for chemicals is derived from several downstream industries such as textiles, papers, paints, soaps, detergents, pharmaceuticals, varnish etc. The global chemical industry has been expanding at a steady pace over the past couple of years.

India is expected to grow at a faster pace than other growing economies in the world, with structural reforms and higher investments driving economic activity. China’s growth seems to have slowed down due to the trade war with the U.S., global economic slowdown and decline in domestic consumption.

With nearly US$ 15 Trillion of Chinese exports in chemicals and plastics subject to US tariffs, India is set to gain market share in the global chemical industry, estimated to be around US$ 4.7 Trillion. Significant opportunities lie ahead for Indian chemical companies arising out of emerging possibilities in US-China trade war as well as shutting down of capacities in China. The domestic industry is also tapping the intermediates opportunity and exploiting meaningful demand. Given the mature market conditions of China, India is expected to be the next engine of growth rendering opportunities to players engaged in the chemical value chain – extending from agrochemicals, dyes, pigments, and specialty chemicals, which sees the strongest tailwinds along with petrochemicals at the same time.

A complete revamp of the current Petroleum, Chemicals & Petrochemicals Investment Regions (PCPIRs) policy will encourage effective and long-term investments in the sector and boost margins for Indian chemical players. Currently, roughly 50% of the country’s demand for Poly Vinyl Chloride (PVC) is being met by imports. The current per capita consumption of chemicals is very low at 1/10th of global average. This is expected to increase in the coming decade with India’s expanding middle class creating an unparalleled end-user market. Further, China’s excessive restrictions on its chemicals industry has already made MNCs start thinking about India as an alternate source, resulting in rapid flow of foreign direct Investment (FDI) into India.

DNL growth drivers:

Phenol and acetone project will be major growth driver for DNL. DNL expects revenues of $1bn (Rs. 65,000mn @ Rs. 65/USD) over the next 2 – 3 years, implying Revenue CaGR of 40-50%.

DNL is shifting shifting to value added from commodity products and it augurs well for the company as this is expected to improve the margins going forward.

Supply disruptions in China are expected to continue in the medium term, thus acting as tailwinds for the growth of Indian Chemical Industry. DNL manufactures a range of intermediates which finds application in several industries including Colorants, Petrochemicals, Agrochemicals, Rubber, Pharmaceuticals, Paper, Textile, Detergents, Fine & Specialty Chemicals etc. DNL has also developed expertise in multiple chemical processes including Nitration, Alkylation, Nitrogen Oxides Absorption, Hydrogenation, Sulphonation, Condensation, Diazotization and Oxidation. DNL is a preferred supplier to some of the leading chemical companies like BASF, CIBA, Monsanto, Bayer Crop Science etc. DNL is in a better position due to diversification as it mitigates risks in the event of downturn in one of the product lines.

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