India Glycols : Transcript of results conference call for Q1FY22

"India Glycols Limited

Q1 FY2022 Earnings Conference Call"

August 12, 2021

ANALYST: MR. SANJESH JAIN - ICICI SECURITIES

MANAGEMENT: MR. SUDHIR AGARWAL - EXECUTIVE DIRECTOR MR. RUPARK SARSWAT - CHIEF EXECUTIVE OFFICER MR ANAND SINGHAL - CHIEF FINANCIAL OFFICER

MR SANJEEV GURWARA - PRESIDENT - MARKETING MR. S.K. SHUKLA - HEAD - LIQUOR BUSINESS

MR. ANKUR JAIN - HEAD (LEGAL) & COMPANY SECRETARY

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India Glycols Limited

August 12, 2021

Moderator:Ladies and gentlemen, good morning and welcome to the Q1 FY2022 Earnings Conference Call of India Glycols hosted by ICICI Securities. As a reminder, all participant lines will be in the listen-only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing '*' then '0' on your touchtone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Sanjesh Jain from ICICI Securities. Thank you and over to you Sir!

Sanjesh Jain:Thanks, Lizaan. Good afternoon everyone. Thank you for joining us on India Glycols' Q1 FY2022 Results Conference Call. Today we have with us Mr. Sudhir Agarwal - Executive Director, Mr. Rupark Sarswat - Chief Executive Officer, Mr Anand Singhal - Chief Financial Officer, Mr Sanjeev Gurwara - President - Marketing, Mr. SK Shukla - Head - Liquor Business, Prof. Dr. R.K. Khandal - President, R&D and Business Development, and Mr. Ankur Jain - Head (Legal) and Company Secretary at India Glycols Limited. I would like to invite Mr. Rupark Sarswat to initiate proceeding with his opening remark, post which we will have Q&A session. Over to you RuparkJi! Thank you.

Rupark Sarswat: Thank you Sanjesh. Thank you very much. Good afternoon everybody, welcome and thank you for joining us in this call. I hope all of you are doing well, we have had rather precarious year last year and uncertainty has been rather unthinkable and continues. On a much lighter note hopefully we will start spending our clothes budget on things other than mask and Alcohol budget on things other than gallons of sanitizers. What I plan to do is to take you through the 30 second introduction of my team members we have not done such a call for a long time and therefore it will be in order. After that I will take you through our company overview and then I will request our CFO to take you through financials very quickly and then we will have time for discussion. I will start off by introducing myself, I Rupark Sarswat, joined India Glycols roughly about six months ago in December 2020. I have worked in mainly two organizations before that, most of my career has been spent working for ICI and Croda and in my last role I was the Managing Director for Croda India with some responsibilities for Asia Pacific which included supply chain, technical quality and some sites like Singapore, Japan, Indonesia, etc. In between, I had a stint of about one year with another company called Transpek-Silox, which is a subsidiary of a Belgium company called Silox and now I am here at India Glycols. I will quickly ask my leadership team to introduce themselves starting with Mr. Anand Singhal, the CFO.

Anand Singhal: Good afternoon, I am Anand Singhal, I am the CFO of the company. I joined this company in 2008 ,I have already completed my 13 years with this company taking care of the finance and accounts. Before that I was working with a company called Trident Group in Ludhiana

.We will try to answer all questions asked by the investors. Thank you very much.

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India Glycols Limited

August 12, 2021

R.K. Khandal: My name is Prof. Dr. R.K. Khandal, I am President, R&D and Business Development in India Glycols and my association with India Glycols started in 1993, then in 2001 I left the company and went to become the Director Shriram Institute for almost about 12 years, then as a Vice Chancellor of UP Technical university, and since 2015 I am again with India Glycols. I am really proud to say that this is a company where any employee would like to work for. Our R&D focuses on innovation, unique products, noble products and focus is always on products, which are sustainable, which make the company sustainable, and as our Founder Mr. M. L. Bhartia had given the mandate and vision for the company we focus our energy on finding out alternatives to petroleum resources to make sure that not only India Glycols remain sustainable but all our stakeholders, all our partners also attain sustainability. Thank you very much.

Sanjeev Gurwara: Good afternoon ladies and gentlemen, I am Sanjeev Gurwara, President - Marketing. I have been with this company for the last 27 years, I joined India Glycols in 1994 and I have seen a wonderful growth over the years and we have been innovating on the way forward with collaborations, JV, and now our future endeavors to go into bio-based products and specialties and improve our profitability in the coming times.

SK Shukla:Good afternoon, my name is SK Shukla, I am heading the Liquor Division. I am with this company since 2004 this is my 17th year and in these17 years I have travel across all the plant of India Glycol right from Gorakhpur, Kashipur, and now I am in Head Office looking after the operation. I am ready to answer your questions regarding my subject. Thank you.

Ankur Jain:Good evening this is Ankur Jain, I look after the Compliance and Corporate governance part, heading as a Legal Head and Company Secretary. I have been with this company for the last five years, previously I had worked with different gamuts from real estate to construction companies. Delighted to welcome you all to this call and look forward for your questions. Thanks everyone.

Rupark Sarswat: Yes, last but not the least, Mr. Sudhir Agarwal, who has joined us from another location. SudhirJi very quickly can you give us an introduction.

Sudhir Agarwal: Thank you so much. Good afternoon everybody, I am Sudhir Agarwal, Chemical Engineer, having experience of almost 35 years. I joined IGL in 2014 as Vice President, Operation and now I am having the title as Executive Director of the Company. My focus area has been plant area, plant operations, energy optimization, project management and all day-today activities of the plant operations. Thank you.

Rupark Sarswat: Thank you. Without wasting much more time I will now take over to give an overview of India Glycols. India Glycols is essentially a company which has been and is into sustainable

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India Glycols Limited

August 12, 2021

bio-based ingredients and performance chemicals, which updates on green technologies. We are called India Glycols but it is possible that our name probably does not fully convey what all we represent. Though the journey started about 30 years ago by manufacturing Glycols and at that point in time India Glycols was the first company in the world to make ethylene oxide using bio-based feedstocks, converted it into various ingredients, which includes glycols, glycol ethers and subsequently ethoxylates derivates formulations and so on. So this innovative way in which the company started by being a pioneer in this technology, it is perhaps even more inspirational and relevant today for the journey that we look ahead. In terms of our portfolio, we have bio-based specialties, bio-polymers and a segment which has plant based APIs & Nutraceuticals, which you call Ennature Biopharma. Portable spirits is an important portfolio for now. Something that will become more important in future is bio fuels and something that you may have read about which is the Carbon Smart range

Since I have used the word Carbon Smart I would like to explain this to you Although this is a nascent business for us right now. The reason this has been in news is that there have been at least two public announcements, one of them have been by the Global CEO of Unilever and also a press release where they talked about a collaboration of LanzaTech, India Glycols and Unilever to make homecare products using Carbon Smart feedstocks. It has a very low carbon footprint and it is something which is an imperative worldwide, not only for nations but organizations to continue to reduce their carbon footprint so as to meet the UN SDGs or the UN sustainability development goals and therefore contribute towards reducing climate change and more and more bigger companies are taking it very seriously and setting targets for themselves. LanzaTech brings the technology very, very interestingly. Huge amounts of carbon or carbon dioxide which goes out from steel plants and other high energy consuming plants gets captured by this bio-technology and is converted into useful chemicals, which we in India Glycols, further derivatize to useful products which are known as carbon smart products. It is not a big part of our portfolio right now, but it is very promising

We are also the largest manufacturers of Bio-EO based ethylene oxide and its derivatives in the world. We are probably only the second significant player and also the largest. We have a customer base which includes big players from India as well as global players , like Coca- Cola, Unilever, Bacardi and many others. We have three state of art manufacturing facilities which we are currently running, one of them is in Dehradun, the other one is Kashipur and the third one is in Gorakhpur.

In terms of our portfolio, we divided into three broad edge,the way we would like to align our strategy going forward as well. Number one being bio-based chemicals and specialties, this includes bio-based specialties like glycols, glycol ethers and acetates, specialty and

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