India is the 6th largest chemical manufacturing country in the world. The world chemical industry was highly dominated by China. But due to their norms on pollution control many chemical industries are forced to stop their manufacturing activities.Also many chemical companies who were procuring from China stated the issue of disrupted supply chain.Then with Covid-19 the supply chain issues even became more worse.All of us would be aware of China's 'zero covid' policy,that is,even if one person in a village or a town is infected by Covid then the whole town or village will have the lock down. This is how the supply chain issues even got widened.So all those companies who were dependent on China for their supplies have moved or planning to move to some other country.This is famously called as 'China+1' strategy.
Many companies have targeted India by thinking the low cost labor,skilled man power,less cost of acquiring raw materials,etc.Even the government has also launched PLI Schemes and have already made many regulations in order to protect our environment.
India has a well diversified chemical industry that covers more than 80,000 products.To know more numbers on the Indian chemical sector you click here to read more.
This sector is expected to grow in next 3-5 years. It is said that mainly specialty chemicals would have a more demand compared to other types of chemicals.So investors prefer companies like Tata Chemicals,Sadhana Nitro Chemicals,etc.Currently some chemical stocks are at correct valuations.All these companies reported that they were facing a huge competition from China because, they sell chemicals at a very cheaper rate.Anyways this situation should normal in few months or years.Kindly not consider it as an investment advise but it is just said to know about it.
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