ALKYLAMINE - Alkyl Amines Chemicals Ltd. Share Price

Management Outlook:
Alkyl Amines expects FY25 to improve, driven by stable pharma demand, volume growth, and better margins due to raw material cost stabilization. The ethylamines plant (100 tons/day), now the world's largest, is fully operational, addressing long-term capacity needs. While FY24 saw mixed results (sub-10% volume growth, price pressures from Chinese competition), margins improved in Q4. Acetonitrile faces pricing challenges (55"“60% utilization), but cost advantages may sustain competitiveness. Anti-dumping filings for acetonitrile (potential 15"“20% injury relief by FY25 Q4) and stabilizing ethylamine/methylamine prices offer optimism.

Key Highlights:

1. Capacity Expansion: New ethylamines plant (Rs.375cr capex) commissioned; old plant to convert to methylamines.
2. Volume Growth: Target 10"“15% in FY25, supported by derivatives (diethylketone ramp-up) and agro/pharma demand.
3. Margins: Q4 margin recovery (ethylamines + methylamines); EBITDA target 20"“22% (vs. 25% peak).
4. Competition: Chinese pricing pressure persists (acetonitrile, MIPA); domestic methylamines capacity additions (Balaji) may impact prices.
5. Raw Materials: Ethanol, acetic acid, and ammonia prices softened, aiding margins.
6. New Products: Two non-amine specialty chemicals under development; decisions pending market stability.
7. Exports: ~20% of sales; focus on domestic growth amid global volatility.

Question 1 (Nilesh Ghuge, HDFC Securities):
"My first question is on capex. As you mentioned, that you commissioned this ethylamine plants during this fiscal. So can you just tell us how much total capex we incurred in FY '24? And then can you give us the project-wise breakup for that?"
Answer:
Total FY24 capex was ~Rs.120 crore, including routine maintenance, solar plants, and the ethylamine project. The ethylamine plant (100 tons/day) was capitalized at ~Rs.375 crore but incurred Rs.120 crore in FY24. Utilization of the acetonitrile plant was ~55% in H2FY24 due to Chinese competition, though pricing stabilized in Q4.

Question 2 (Nilesh Ghuge, HDFC Securities):
"And sir, just on the ethylamine side...what was the utilization of your ethylamine plant including new capacity?"
Answer:
The new ethylamine plant ran at ~60% utilization in H2FY24, with raw material (ethanol) prices softening. Margins improved due to price stabilization and lower input costs.

Question 3 (Neerav Gimudia, Anvil Research):
"Sir, I have two, three questions. One is on the volume growth for FY '24...if you can just let us know what was the volume growth for FY '24."
Answer:
FY24 volume growth was <10% (~97K tons). H2 was weaker than H1 due to Chinese competition in acetonitrile and monoisopropylamine (MIPA).

Question 4 (Neerav Gimudia, Anvil Research):
"Sir, if you can just walk us through the demand outlook for methylamines..."
Answer:
Methylamines derivatives (e.g., pharma/personal care) grow faster than base methylamines (low single-digit growth). 30% of methylamines are consumed internally; 70% sold externally.

Question 5 (Neerav Gimudia, Anvil Research):
"Any volume growth guidance which you can give for FY '25?"
Answer:
Expect 10"“15% volume growth in FY25, aided by derivatives like diethylketone (DEK), though DEK utilization was only ~20"“30% in FY24.

Question 6 (Jaiveer Shekhawat, Ambit Capital):
"First question is on the anti-dumping duty investigation...what kind of volume or margin benefit you expect?"
Answer:
Anti-dumping duty on acetonitrile (if approved by Q4FY25) may address 15"“20% injury margins. Current acetonitrile prices (Rs.150/kg) are stable but under Chinese pressure.

Question 7 (Jaiveer Shekhawat, Ambit Capital):
"When do you think you can reach back to the 25% EBITDA margin level?"
Answer:
EBITDA margins are unlikely to revisit FY21 highs (COVID-driven). Target 20"“22% margins through volume growth, as realizations stabilize post ~20% YoY decline in FY24.

Question 8 (Rajiv Rupani, Individual Investor):
"Our competitor has a 48,000 ton plant...what would be the impact on prices?"
Answer:
Balaji's methylamine expansion (40K tons) may pressure prices. Alkyl plans to convert its old ethylamine plant to methylamine to meet future demand.

Question 9 (Aman Choudhary, Motilal Oswal):
"What is the current prices of ammonia, acetic acid and methanol?"
Answer:
Ammonia: Rs.50"“52/kg; acetic acid: ~Rs.40/kg; methanol: <Rs.30/kg.

Question 10 (Dhruv, HDFC AM):
"What is the market size of Acetonitrile and how much is imported?"
Answer:
Acetonitrile market: 30K"“35K tons annually. ~50% imported (mostly from China). Domestic capacity utilization: ~55"“60% in FY24.