Exploring the top three players in the soda ash industry in India; do you hold any?

Soda ash, scientifically termed sodium carbonate, is a white, odourless, and water-soluble powder with a slightly alkaline taste. Due to its distinctive chemical properties, soda ash finds extensive applications across various industries. Its primary uses include glass manufacturing, water treatment, detergent, and cleaning product production, among others.

Soda Ash price is rising consistently and even today some sources reported that soda ash prices may increase 5% next week amid the closure of major Chinese plants for another three months. Over the last two months, soda ash prices in China have surged by approximately 50%.

As per Polaris Market Research, the worldwide soda ash market was assessed at USD 19.79 billion in 2021 and is anticipated to climb to USD 33.10 billion by 2030, demonstrating a CAGR of 6.2%. This is attributed to the rising production of glass and ceramics. Recent years have seen a surge in automobile sales and increased construction endeavours, both of which have generated a heightened need for glass.

In this article, we will explore the three major players manufacturing Soda Ash.

Tata Chemicals:

Tata Chemicals Limited, a prominent chemical player of the Tata Group, is engaged in the manufacturing and export of both basic chemicals and speciality products. The company’s primary product line includes Soda Ash, Bircarb, Salt, and Marine chemicals. In FY23, the installed capacity for soda ash in India was reported at 10.91 lakh MTPA. Additionally, the company operates production facilities in the USA, Kenya, and the UK, which collectively contribute to a total capacity of 32.90 lakh MTPA. It is the third largest Soda Ash player in the world.

Today, the stock opened with a 2.7% gap up on the BSE, and as of the time of writing this article, it is trading at Rs 1,046.90 per share. The current market capitalization of the company is Rs 26,658 crore, and the stock has demonstrated a remarkable return of nearly 245% in the past three years.

GHCL Limited

GHCL Limited was incorporated on October 14, 1983, and holds the distinction of being the largest manufacturer of Soda Ash at a single location in the country. It manufactures Soda Ash (Anhydrous Sodium Carbonate), a significant raw material for the detergent, glass, and ceramics industries, as well as Sodium Bicarbonate (baking soda).

The company operates a Soda Ash manufacturing plant in Sutrapada, Gujarat, with an installed production capacity of 12 Lakh MTPA, and it is currently in the process of expanding it by another 5 Lakh MTPA by the end of 2025. The company holds a market share of almost 26% in India. The company reports that approximately 98% of its annual revenue is derived from the sale of soda ash, as disclosed in its latest annual report.

Today, the stock opened with a 4.5% gap on the BSE, and as of the time of writing this article, it is trading at Rs 634 per share. The current market capitalization is estimated at Rs 6,060 crore, and the stock has demonstrated a remarkable return of over 300% in the past three years.

DCW Limited

DCW Limited was established as Dhrangadhra Chemical Works in Dhrangadhra, Gujarat, marking India’s first Soda Ash plant. Since its inception, DCW has been a pioneer in and has established a robust presence in the Chlor-Alkali, Synthetic Rutile, and PVC business sectors. The company boasts a successful track record of innovation in both new products and processes. It was incorporated in 1939.

According to the company’s latest annual report, the total production capacity is reported to be 1.04 MTPA. In FY23, the revenue contribution from the soda ash segment amounts to 13.75%, and 16% of its total operating profit is derived from the soda ash segment.

Today, the stock opened with an 11.9% gap on the BSE, and as of the time of writing this article, it is trading at Rs 59.51 per share. The current market capitalization of the company is Rs 1,756 crore, and the stock has demonstrated a remarkable return of over 300% in the past three years.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions