Phillips Carbon Black is attractive as it is pushing India to turn net exporter of the commodity

In a few ideas for profit from Moneycontrol Pro, Anubhav Sahu of Moneycontrol.com spoke about a stock that he is tracking closely--Phillips Carbon Black (PCBL).

PCBL is the largest carbon black producer in India. It benefits from the current geopolitical situation. Given the sanctions on Russia, there might be a shortfall in supply which Indian manufacturers can fill in.

India turned net exporter of carbon black in the financial year 2022, and this shift in trend was chiefly led by PCBL. PCBL accounted for more than 70 percent of carbon black exports from India in the financial year 2022.

While this trend will continue to benefit PCBL, the gain is likely to be more on the pricing side in the near future, according to Sahu.

Current capacity is optimally utilised. Having said that, capex projects for about 1,70,000 tonnes are on track which includes 20,000 tonnes for speciality applications, Sahu said. This will add about 30 percent to existing capacities and are likely to be available from the fourth quarter of the financial year 2023.

Margin pressure would remain due to elevated crude linked raw material prices in the near term.