Expect 20% revenue growth in FY22 & FY23: Vinati Organics

Vinati Organics is expecting a 20 percent revenue growth in FY22 and FY23 said Vinati Saraf Mutreja, MD & CEO of the company.

“This year in terms of revenue, in FY21 we will probably be down about 10-15 percent compared to FY20. Coming to FY22, given that ATBS has ramped up and Butyl Phenol has ramped up, maybe we will see some addition from Veeral Additives. I would expect a 20 percent growth in revenue and the same for FY23 compared to FY22. So one can expect FY23 to close somewhere around Rs 1,500-1,600 crore in revenue,” she said in an interview to CNBC-TV18.

On the company’s arrangement with antioxidants' manufacturer Veeral Additives, Mutreja said that Veeral Additives is owned by promoters of Vinati Organics and will be a forward integration for the company.

“Veeral Additives is a company that is in the manufacturing of antioxidants (AO) which is a forward integration for Vinati Organics. Vinati Organics will be the only manufacturer of Butyl Phenol in the country and half of these Butyl Phenol will be used in AO production which makes a lot of synergy and integration sense for the two companies to merge,” she said.

She expects the plant to ramp up in 6-8 months after merger approval. However, the approval would take around 8-10 months, she added.

“The timeline for the merge approval is about 8-10 months because it requires Sebi approval, shareholder approval, and then NCLT. Pursuant to that, once the merger is approved we expect another 6-8 months for the plant to fully ramp up. It is pretty much ready to produce; just a few minor changes in equipment’s and it will be in full production. The revenue potential of just this plant itself is Rs 500 crore. However, taking into account the Butyl Phenol which will be used in it, the incremental revenue will be Rs 300 crore,” she said.

She added that they will be the only integrated and the largest plant for these AOs in India. The demand for these AOs in India is about 10,000 tonne and the global demand is 3 lakh tonne and they will have a production capacity of 25,000 tonne, she said.