KCK Industries Ltd Management Discussions

Industry Overview

OVERVIEW OF CHEMICAL INDUSTRY IN INDIA

The Indian chemical industry is one of the oldest industries in India and has made immense contribution to the industrial and agricultural development of India. It encompasses both large and small-scale units. The fiscal incentives granted to the small-scale units in the mid-1980s provided the thrust to the growth of MSMEs in the sector. The chemical industry serves the needs of sectors such as textiles, leather, plastics, paper, printing inks and food stuffs, among others.

The sector covers over 70,000 commercial products, and provides the feedstock to many downstream industries such as finished drugs, dyestuffs, paper, synthetic rubber, plastics, polyester, paints, pesticides, fertilizers and detergents. Over the years, the industry has been evolving with a shift towards product innovation, brand building and environmental friendliness. Besides, customer focus is gaining significance in the industry.

Leading Position Globally

Chemical industry in India is the third largest producer in Asia and sixth largest in the world.

The Indian chemical industry is expected to surge to USD 226 billion by 2020, up by nearly 35 percent from USD 147 billion in 2015.

Indian chemical industry is expected to double its share in global chemical industry to 5-6% by 2021 registering growth of 8-9% in the next decade.

High GDP Share

The chemical industry in India is a key constituent of Indian economy, accounting for about 2.11 per cent of the GDP

Global Dye Supplier

India accounts for approximately 11 per cent of the world production of dyestuff and dye intermediates, particularly for reactive acid and direct dyes

CHARACTERSTICS OF THE INDIAN CHEMICAL INDUSTRY

- The industry has changed over time to meet the dynamic needs of an emerging economy

- Strong economic growth and rise in per-capita income has meant a steady increase in demand for chemicals

- Expected to clock a growth of 14 per cent over the next decade

- The industry has left behind a low-growth and regulated environment to emerge more mature

- There is strong government support towards R&D; this would benefit the sector

Business Overview

Our Company was originally incorporated at Chandigarh as "Kck Sales Private Limited" on 19th March, 2013 under the provisions of the Companies Act, 1956 vide Certificate of Incorporation issued by the Registrar of Companies, Punjab and Chandigarh. Consequent upon the conversion of Company to public limited company, the name of the Company was changed to "Kck Sales Limited" vide fresh Certificate of Incorporation dated 19th October, 2020 issued by the Registrar of Companies, Chandigarh. Further, the name of Company has been changed to " Kck Industries Limited" on 11th November, 2020 vide Fresh Certificate of Incorporation issued by the Registrar of Companies, Chandigarh.

Our Company which was originally established by Mr. Jagdish Prasad Arya and Later on Mrs. Reena Sharma joined the business with Mr. Jagdish Prasad Arya. The business was started in the year 2013 in Chandigarh with a commitment to supply quality products meeting or exceeding customers expectation and achieving objective of being a preferred supplier.

Our Company is achieving a steady growth and has expanded its range of products from dyes to auxiliaries to speciality chemicals. We believe that our expertise in chemical trading has enabled us to expand into new value added products. With our wide range of products, we cater to various industries viz. Dyestuff and Dye intermediates, Textiles, Speciality Chemicals etc.

We offer a gamut of products in our chemicals and dyes product portfolio, which includes as below:

Combed yarn and Carded yarn

Auxiliaries: dyeing

Auxiliaries: Easy Care Finishing

Auxiliaries: Finishing

Auxiliaries Flame Retardant

Auxiliaries: optical Brightener

Auxiliaries: Pigment printing

Auxiliaries: Pre-treatment

Auxiliaries: Printing(other)

Auxiliaries Softener

Auxiliaries: Antifoaming/Deaerating

Auxiliaries: Detergent(pre-Treatment)

Basic chemicals

We are constantly striving to expand our line of products and we are always on the lookout for complementary products that will add to our solution bouquet. We would seek product lines which have better scope for value addition and therefore offer us higher than average margins.

With an addition in vertical line of business segment, Our Company acquired a Rice Shellar Plant of M/s. Shiv Shakti Rice Mills from Punjab National Bank situated at Sunam Lehra Road Village Khokhar, Distt Sangrur in the year 2020-21. The manufacturing plant is fully integrated and automatic and started its operations since April, 2021. The Capacity of plant is 12 Ton/ hour and current utilization is 7 Ton/ Hour.

At our processing plant, we processing the non-basmati and basmati rice. We process varieties of rice with the help of state of the art plant and machinery. We serve to our consumers healthy, hygienic, tasty and nutrient rice. We are backed by a strong infrastructural base, which is well equipped with latest technology, advance machines and equipments which assist us in maintaining the quality and quantity of the rice. We have a strong focus on processing process and have a quality testing laboratory and well qualified and experienced personnel.

Strengths

Diversified product portfolio

Strong managerial capability

Cordial relations with Customers

Adaptability of company in the fast changing environment

Sound structured facilities

Reputed suppliers

Efficient supply chain management

Weaknesses

Higher taxes

Dependence on suppliers for products availability

Working capital intensive due to payment delays from customers

Opportunities

Large Potential.

Increasing interest of foreign players in India

Increasing demand

Threats

Competition from other established competitors in India or Outside India

Rising prices of materials

Formation of cartels

Government & regulatory norms

Fluctuations in the material prices

Outlook

The long term objective of the Company is to remain strong player in the market with strong emphasis on product and market development. Your Company is also continuously improving its operational efficiency, and cost control which alone can improve the bottom line in future in highly competitive environment. Further, your Company is hopeful to get advantage of this overall boom likely to happen for the Indian markets and will do all out efforts to secure the bigger share of the increasing market in future.

Internal Control Systems and Their Adequacy

The Company has proper and adequate systems of internal controls. Regular internal audits and checks are carried out to ensure that the responsibilities are executed effectively and that adequate systems are in place.

CAPACITY AND CAPACITY UTILISATION:

Following are the Details of Installed Capacity, Capacity utilisation. The Capacity of plant is 12 Ton/ hour and current utilization is 7 Ton/ Hour. HUMAN RESOURCES:

We believe that our employees are key contributors to our business success. We focus on attracting and retaining the best possible talent. Our Company looks for specific skill-sets, interests and background that would be an asset for its kind of business.

Total numbers of employees as on 31^st marc 2024 is 40.