THE POLYAMIDE MARKET IN INDIA

A post-completion proposal for a new multi-client report from AWJ Consulting

Published: SEPTEMBER 2009

The Polyamide Market in India

TABLE OF CONTENTS
P3 P7 P9 P11 P12 P14 Introduction: Background and scope of the study Executive summary Table of contents of full report Cost of the study About AWJ Consulting Subscribing to the study

The Polyamide Market in India

INTRODUCTION: BACKGROUND and SCOPE OF THE STUDY

The Indian polyamide market grew strongly each year from 2000 to 2007 at growth rates which averaged 13% p.a., almost double the average GDP growth during the same period. India was not, however, immune to the emerging global financial crisis which started in September 2008, and its effects negated any PA demand growth earlier in that year to leave the overall 2008 PA market flat. Demand appears to be have recovered cautiously during Q1 2009, but is gaining momentum as 2009 moves into August. AWJ Consulting (AWJC) is forecasting that PA consumption growth should be sustained at an average 11% p.a. up until 2013. With the Indian polyamide market now characterised by an increasing number of suppliers, but a diverse and a relatively fragmented end use processing sector, a changing supply structure is likely to evolve over the next few years. The industry faces major questions relating to market drivers, application dynamics and competitive strategies. To assist companies in this area, AWJ Consulting (AWJC) has completed this major new study to address and answer these questions. The study is entitled: The polyamide market in INDIA Demand drivers and supplier strategies The research programme was undertaken between February and July 2009 and involved AWJC using a field-oriented approach to build the study detail. AWJC made multiple calls to develop its understanding of the market combined with analysis of publicly available data and information related to PA suppliers and processors in India. AWJC undertook over 140 interviews of which 25 were detailed personal interviews all conducted in India by AWJCs principal, Tony Jones, who has over 25 years experience in the PA market in both commercial and consulting capacities. The scope of the interview programme by type of company interviewed is shown below.

Type of company OEMs Tier One/Two Systems Suppliers, Moulders and Extruders PA compounders PA producers

Number of interviews 20 60 20 25

The Polyamide Market in India

Others ( inc compound machinery, additive and filler producers, polymer distributors, recyclers and traders ) TOTAL This report analyses and comments on:

15

140

The size and growth of the market, by PA polymer and compound product type, and by end use market application The supply of PA polymer and, in particular, the current high dependence on imports for the ETP market The product and application positioning of the major PA polymer producers and independent PA compounders The concentration of PA demand in certain provinces, regions and cities The supply of PA polymer/raw material feedstock to the independent compounding sector Specific questions answered include: Which types of PA are set to enjoy the strongest growth? Which PA polymer producers and compounders have been investing and in which market sectors are the investments targeted? How important is Distribution? What are the key individual application developments underpinning future growth in the PA market? What inter- polymer competition exists in the key applications? What scope remains for additional substitution of metal by PA, particularly in the automotive industry? Where does the power lie to influence change, i.e. OEM, first/second tier systems supplier (moulder), etc? Who are the major moulders /extruders of PA? How and where are the independent compounders effectively competing against the PA producers, gaining specification and becoming active suppliers? What level of commitment do the leading PA compounders have to the different applications, and is PA core to their overall business?

The Polyamide Market in India

The report will be an invaluable resource to companies who are attempting to ensure that their business in India maximises its profit and growth potential. As part of the subscription to this report, AWJC offers 1 day of follow up consultancy, to respond to queries and more closely interact with clients and their management, thereby ensuring they derive the maximum value from the report. The report analyses the Indian PA market downstream from the polymerisation level as shown in the following diagram.
POLYAMIDE RESIN (includes local production and imports)

RESIN SALE

TEXTILE/ FILM/ OTHERS

EXPORTS

INDEPENDENT COMPOUND RESIN COMPOUND

INTEGRATED COMPOUND RESIN COMPOUND

RECLAIM/ RECYCLE

DIRECT SALE

DISTRIBUTOR

EXPORT

IMPORTED COMPOUND

MOULDING / PROCESSING INDUSTRY

The Polyamide Market in India

Product Scope
The PA families covered at an application level are: PA6 PA66 PA4.6 and partially aromatic polyamides (inc PPA) Polyamide compound types appraised include: Glass fibre reinforced Flame retardant (UL V0) Others (includes unfilled, heat stabilised, mineral reinforced, impact modified and blends )

Data Points
Data is provided for 2003, 2007, 2008, with forecasts for 2013.

Units of Measurement
Data is reported in tonnes, or thousand metric tonnes, with values in Rs Lakhs, Rs Crore, or m as appropriate. NB tonnage volume is the weight of PA polymer or compound used by the processor and includes prime (virgin), secondary and reprocessed compounds.

Applications
Research focus concentrated on 20 individual applications (or associated application groups) currently perceived to be consuming the largest volumes of PA in the 3 end-use injection moulding markets, namely Automotive, Electrical /Electronic, and Other Industries. PA extrusion (film and non-film) applications are also included.

The Polyamide Market in India

EXECUTIVE SUMMARY Demand

The polyamide market in India saw growth in the last five years average 12% p.a., compared with average GDP growth of 6.5% during the same period. AWJC is forecasting that in the period up to 2013, growth in PA consumption will be sustained at an average 11% p.a. Demand for PA compounds or polymer at the processor level in 2008 reached 42,000 tonnes and is expected to grow to 72,000 tonnes in 2013.
HISTORIC AND FORECAST DEMAND BY PA PRODUCT TYPE DURING THE PERIOD 2003-2013

Units: 000 Tonnes PA6 PA66 HTN Total

2003

2007

2008

2013

18.8 5.2 0 24

32.2 8.9 0.15 41.25

32.5 9.1 0.2 41.8

56.1 15.2 1 72.3

Growth rate % p.a. 20082013 11.5 10.9 41 11.4

Injection Moulding accounted for 69% of PA demand in 2008, with the automotive sector the destination for 55% of the total PA volume tonnage processed. PA demand in automotive applications in India grew strongly up until 2007; largely on the back of unit production growth which itself averaged 18% p.a. during the period 2001-2007. Future long term growth for PA in the sector will, however , be particularly underpinned as the typical kgs per car content increases from its present 5 kgs which lags far behind the levels associated with cars made in the US, Europe and Japan . The Indian automotive market also includes production of 8 million two wheelers p.a. which also offer significant growth potential for PA. Havells, the largest and probably fastest growing electrical and power distribution equipment manufacturer in India, is the countrys largest processor of PA (mostly PA6), including significant volumes for exported PA products. The Indian electrical industry as a whole, is itself anticipating further stimulus from the Government to spur domestic demand and a faster implementation of the ongoing projects for augmenting power generation, transmission and distribution systems. The Indian Railway Infrastructure, a large user of PA66 for insulators, is likewise set to grow strongly in order to support the overall growth of the countrys economy as laid out in the 11th Five year plan published in 2008. The Polyamide Market in India

In the extrusion market, demand for PA6 polymer in the film packaging sector should also grow strongly at around 15% p.a., doubling the 2008 volume of 2,500 tonnes by 2013.

Supply
An estimated 101,000 tonnes of PA6 polymer was produced in India in 2008, of which approximately 20% or 19,800 tonnes were subsequently consumed in the plastics applications covered in the scope of this study. Of the 8 companies producing PA6 polymer in India , only 2, SRF and GSFC directly participate in the ETP business with JCT s involvement restricted to the occasional supply of textile grade PA6 polymer to independent compounders. At the PA6 compound supply level, SRF appear to enjoy market leadership along with DSM who have just started up production at its new 2025,000 tonne p.a. ETP compounding plant near Pune. Kuibyshevazot have significantly increased exports of PA6 polymer into the compounding sector during the first half of 2009. There is no existing polymerization of PA66 in India with the 9,000 tonne PA66 injection moulding market exclusively supplied by locally produced PA66 compound based on imported polymer, or imported PA66 compound. Dupont are the largest PA66 compound producer in India, and have developed market leadership in India through direct sales and an extensive network of distributors operating across the country. Other foreign PA producers with significant sales penetration in India include BASF and Radici. The former are currently (July 2009) opening a 9,000 tonne p.a. ETP compounding plant at an existing BASF facility in Thane. The 2.9million investment will primarily manufacture PA6, PA66 and PBT compounds to underpin and grow BASFs business in the Indian Automotive sector although Electrical and Electronics markets will also be served. Radici, having originally entered the Indian ETP market in early 2006 via the formation of a joint venture company, Radici Plastics Modi P .Ltd, are themselves likely to be considering various options for local manufacture. The combined PA production of 20 independent compounders was estimated at 15,000 tonnes in 2008, with Formulated Polymers the largest at 3,500 tonnes. AWJC estimate that in 2008, the total value of PA polymer or compound sales in India at the processor level was 750 Rs Crore or 108 million. In order to capture and retain value in it, AWJC expects PA polymer producers and compounders alike, to pay increasing attention to understanding their customers needs, to market segmentation, to branding, and, where required, introduce value chain re-engineering. The Polyamide Market in India

TABLE OF CONTENTS of THE FULL REPORT

P4 P8 P9 Introduction Background and Scope of the Study Abbreviations Executive Summary

P11 Section 1 - The Market for PA in India P17 Section 2 - Production and Supply of Polyamide polymer in India P25 Section 3 - PA compound production P31 Section 4 - High Temperature Nylons P32 Section 5 - The Market for Polyamide in Automotive Applications P57 Section 6 - The Market for Polyamide in the Electrical / Electronics Industry P70 Section 7 - The Market for Polyamide in other Injection Moulded Industrial Applications P78 Section 8 - The Market for Polyamide in Film P81 Section 9 - The Market for Polyamide in Non-Film Extrusion Markets P84 Section 10 -Demand for Polyamide in Blow Moulding P85 Section 11- Profiles and strategies of the major Polyamide manufacturers BASF Dupont DSM GSFC Radici SRF

The Polyamide Market in India

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P93

Section 12 - Market Position and Strategies of the Independent Indian Compounders

P96 Section 13 - Profiles of Independent Indian Compounders

APPL Axel Polymers Dilip Plastics Ester Industries Formulated Polymers Indore Composite Intercontinental Polymer Private Ltd Loxim Mahaveer Plast Modlon Polymers Next Polymers Rajivplastics Sundaram Polymers

P109 Section 14 Profiles of major PA processors

Adept Polymers AK Engineering ATC Components Ashok Minda Connectwell Consult Techniques Controls and Switchgear Elmex Ergocomp Essen Deinki Haryana Plastic Havells Injecto Plast Mann and Hummel Pheonix Contact Salzer Electronics Soynia Surelock Tata Visteon TVS group Techma Engineering Tyco Electronics Varroc

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COSTS
The total cost of the report is as follows:

Project title

Post completion subscribers By 30/10/2009 4,500

Post completion subscribers after 31/10/2009 5,500

The polyamide market in India.

AWJ Consulting will invoice the full amount on delivering the report with payment requested within 30 days. The fee includes two hard copies of the study report and a review meeting within the UK to discuss the reports contents. An electronic copy of the report will be supplied in a Microsoft PDF format.

Review meetings and discussions will normally be held in the UK; however, other locations, including India, will also be considered, although they are likely to incur travel costs (to be invoiced separately).

The Polyamide Market in India

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ABOUT AWJ CONSULTING

AWJ Consulting is a small, specialized consulting service dedicated to the Global Engineering Thermoplastics Industry. Founded and led by Tony Jones in October 2007, AWJ Consulting offers a broad portfolio of services to clients, both large and small, who can benefit from his commercial hands on and consulting experience built up since entering the Industry in 1983. In 2008 and 2009 to date, AWJ Consulting has successfully completed a range of single client assignments for companies in the ETP Industry, notably: Competitive distributor analysis in the UK ETP market ETP compound production in the Independent compounding sector an acquisition search and appraisal Supply chain analysis in selected global PA6 and PA66 markets In July, 2008, AWJC published a multi-client report of the 500,000 tonne Chinese PA market, which was well received by 8 PA polymer producers. Tony Jones commenced his career in technical sales of ETPs to the UK Injection Moulding sector with Whitfield Plastic Compounders. At the time, they were a leading ETP compounder in the UK, and a distributor of PC, PA, PBT and ABS for Bayer, as well as a toll compounder of POM for Celanese (now Ticona). His European Plastics Industry understanding and knowledge was then developed during a 4 year consultancy spell with CDC (Corporate Development Consultants), including successful project management and completion of the first pan European multi-client studies on both the PP and ETP compound markets. Following a business development role with leading UK Telectronics moulder , Plastic Engineers , in the early 1990s , Tony returned to Sales Management with the specialist PA compounder , Plastex , before joining Applied Market Information (AMI) in 1993. In an 11 year career at AMI, as Head of Client research, he pioneered the consulting companys early studies and research of the Central European Plastics Industry, as well as managing major market research projects in the late 1990s for polymer manufacturers seeking to enter the emerging, but fast growing markets in Asia (particularly China). The Polyamide Market in India

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More recently, Tony also spent 3 years as Commercial Manager at Chem Polymer, the UKs leading independent PA compounder who are now owned by the US diversified material science company, Teknor Apex. In 2007, when back at AMI, he researched and published a successful and well received multi-client study of the European PA market, in addition to managing a strategic review of the largest 50 technical compounders in Europe. Where required to fully meet client needs, Tony will be networking with associates around the world who have complementary skills and experience within the Global Engineering Thermoplastics Industry. AWJ Consulting offers assistance in the following areas: Market research and analysis Competitor analysis and benchmarking Strategic analysis and planning Defining new product opportunities Market and product diversification Merger and acquisition screening , selection and due diligence Global expansion AWJ Consulting has extensive market experience and knowledge in: Injection Moulding Thermoplastics Compounding Blow Moulding Extrusion Plastics Recycling Automotive plastic applications and component supply Engineering plastics in Electrical and Electronic markets

The Polyamide Market in India

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ACCEPTANCE
I wish to subscribe to THE POLYAMIDE MARKET in INDIA study at the following price (tick which applies): Post completion subscribers by 30/10/2009 at 4,500 Post completion subscribers after 31/10/2009 at 5,500 I agree that the circulation of the report will be restricted to this company and subsidiaries in which its holding is more than 51 percent. Company: Address:

Telephone: Fax: E-mail: Name: Title: Signature: Date:

For any questions or further information regarding this study, please contact Tony Jones, AWJ Consulting. Tel/fax: +44 (0)1454 269095, email: tony@awjconsulting.com If you accept this proposal, please sign one copy and return it to AWJ Consulting. This will serve as a binding agreement. The Polyamide Market in India