List of Best Chemical Stocks in India 2024

The chemical industry serves as the cornerstone of modern civilization. It manufactures many products that affect almost every aspect of our lives. From the plastics in our homes to the medicines we consume, the chemicals used in agriculture, and the fuels that power our transportation, the chemical industry plays an indispensable role in our lives. The industry is broadly classified into bulk chemicals, specialty chemicals, petrochemicals, and agrochemicals.

Today’s blog will explore some of the top chemical companies in India, the products they offer, factors that should be considered before investing in chemical stocks, and what the future holds for India’s chemical sector.

Overview of the Chemical Industry

India’s chemical industry is a major part of the economy. It is the 6^th largest chemical producer in the world and the 3^rd largest in Asia. It contributes 7% to India’s GDP. India’s growing economy and industrialization are increasing the need for chemicals. It includes a wide variety of products, such as bulk chemicals, agrochemicals, petrochemicals, polymers, and fertilizers. The country is a major exporter of chemical products, especially dyes and agrochemicals. India’s chemical sector was valued at $220 billion in 2023 and is expected to reach a valuation of $300 billion by 2025 and US$ 1 trillion by 2040.

Top Chemical Stocks in India Based on Market Capitalization 

The top chemical stocks in 2024 are:

The top chemical stocks have been listed in descending order based on their market capitalization in the table below:

Best Chemical Stocks in India 2024 Based on Market Capitalization – An Overview

The best chemical stocks in India are given below, along with a brief overview:

1. Pidilite Industries Ltd.

Pidilite Industries is a leading Indian company that specializes in adhesives. It is renowned for its flagship brand, Fevicol, a household name synonymous with adhesives. The company was founded in 1959 by Balvant Parekh.

The core business area revolves around

• Consumer Products – These products include adhesives, sealants, waterproofing solutions, art materials, stationary, and other consumer-oriented products.
• Industrial Products – It includes a wide range of specialty chemicals for several industries, such as construction, paints, coatings, and leather.
• Trade Products – It includes professional and trade segments with products like adhesives, construction chemicals, etc.

2. SRF Ltd.

SRF, formerly known as Shri Ram Fibres, was established in 1970 as a wholly-owned subsidiary of DCM Limited. It started as a manufacturer of tyre cord fabrics. Recognizing the potential of the chemical sector, SRF made its foray into the industry in 1989 by manufacturing refrigerants. This move marked a turning point for the company.

The company’s core strengths are producing technical textiles, fluorochemicals, refrigerants, and high-quality packaging films for various applications.

The company has successfully established a robust global presence, with operations in multiple countries around the world.

3. PI Industries Ltd.

PI Industries, previously known as Mewar Oil & General Mills Limited, was established in 1946. The company is a global leader in the agrochemical industry. The business segments of the company are as follows,

• Agrochemicals and specialty products
• R&D services
• Custom Synthesis and Manufacturing (CSM) includes process development, scale-up, and manufacturing complex organic intermediates and active ingredients.
• Formulation and Technical Services include formulation development, registration support, and manufacturing services for agrochemical products.

4. Deepak Nitrite Ltd.

Deepak Nitrite is a well-known chemical manufacturing company in India. Based in Baroda, Gujarat, this company makes various chemicals like agrochemicals, colorants, rubber, speciality, and fine chemicals. Established in 1970 as a small chemical manufacturer, it has grown into a multinational company focusing on research, quality, and sustainability.

Top Chemical Stocks Based on 1-year Returns

Best Chemical Stocks in India 2024 Based on 1-Year Return – An Overview

The best chemical stocks in India based on 1-year return are given below, along with a brief overview:

1. Gujchem Distillers India Ltd.

Gujchem Distillers India Ltd. is a chemical manufacturing company located in Ahmedabad, Gujarat, India. It manufactures and sells industrial alcohol, acetaldehyde, acetic acid, auxiliaries and chemicals, monochloroacetic acid, etc. The company was established in 1911. In 1939, the company became a private limited company named Sardesai Brothers Private Limited. The name was changed to Gujchem Distillers in 1974. The main source of revenue is the sale of its chemical products, which are also used as raw materials by other industries.

2. Himadri Speciality Chemical Ltd.

Himadri Specialty Chemical Limited, previously known as Himadri Casting Pvt. Ltd. and Industries, was established as a private company in July 1987. The company embarked on its journey as a manufacturer of carbon materials and chemicals. It was originally a coal tar pitch manufacturer, but now it focuses more on developing and innovating the raw materials of the lithium-ion battery value chain.

The core business revolves around producing and selling carbon materials and chemicals. The company product portfolio includes.

• Speciality carbon black is used in various industries like tyres, paints, plastics, and inks.
• Coal tar Pitch is important in producing aluminum, graphite electrodes, and carbon-based products.
• Refined Naphthalene is used to produce phthalic anhydride, dyes, and other chemicals.

3. Solar Industries India Ltd.

Solar Industries was founded in 1995 under the name Solar Explosives Limited. The company has always focused on supplying top-notch explosives and related products to the mining, construction, and infrastructure sectors.

Solar Industries invests in research and development of new products and improving existing ones. The main source of income comes from selling explosives, detonators, and ammunition to different industries.

4. Dhanuka Agritech Ltd.

Dhanuka Agritech is a top Indian agrochemical company that aims to improve agricultural productivity through innovative solutions. The company provides various crop protection products such as insecticides, fungicides, herbicides, and plant growth regulators. It was established in 1980 by Shri Chiranjilal Dhanuka. 

The company primarily operates as a product-focused, distribution-led business model in the agrochemical industry. The company’s main source of revenue is from the sale of various crop protection solutions to farmers.

Key Performance Indicators

Benefits of Investing in Chemical Stocks 

The benefits of investing in chemical stocks are:

• High Demand: India’s economy is growing, and the demand for chemicals as a raw material is also increasing. This will increase the profitability of chemical companies.
• Export opportunity: Due to the low cost of manufacturing and competitive pricing, India has emerged as a significant exporter of chemicals.
• Diversified Sector: Many companies involved in the chemical industry manufacture chemicals that serve as raw materials for other industries, which diversifies their revenue sources.

Factors to consider before investing in Chemical stocks

An investor must consider the following factors before investing in chemical stocks:

• Financial Health – Analyze the company’s balance sheet, profit and loss statement, and cash flow statement.
• Regulatory Environment – The chemical industry is heavily regulated, and it is important to understand the regulatory landscape.
• Demand-Supply Dynamics – Analyze the demand and supply trends of the company products.
• Product portfolio – A diversified product range can help reduce risks, while companies focusing on high-growth segments might offer better returns.

Future of Chemical Industry

The Indian chemical industry is expected to experience substantial growth in the coming years due to various factors such as increased government backing, a growing domestic market, and a strong emphasis on innovation. This growth will contribute to the overall development of India’s economy and position the sector as a key player in the country’s industrial landscape. Programs like the PLI scheme are strengthening the chemical sector.

The ‘China Plus One’ (C+1) strategy could also help India’s chemical industry. This strategy recommends that other countries diversify their supply chains and move manufacturing away from China to other countries like India.

Conclusion

The chemical industry must adapt and innovate to meet society’s changing needs. By adopting sustainable practices, investing in research, and promoting collaboration, the industry can positively impact the economy and the environment. The chemical industry has a bright future, especially in specialty chemicals. However, it is advised to consult a financial advisor before investing.

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