DCW Limited is the Biggest Beneficiary of the Recently Announced Anti-dumping Duty on Imported C-PVC

/ -- DCW Limited ("DCW"), India's sole manufacturer of Chlorinated Polyvinyl Chloride (C-PVC), stands out to be the biggest beneficiary of the Government of India's recently announced anti-dumping duty on cheap imports of C-PVC from countries such as China & South Korea.

The Union Ministry of Commerce and Industry announced, on 19 February, 2020, anti-dumping duty (ADD) on imported C-PVC resin/compound from China and South Korea. This move is followed by provisional anti-dumping duty announced on 26th August, 2019.

C-PVC is a thermoplastic produced by chlorination of polyvinyl chloride (PVC) resin, which is significantly more flexible and can withstand higher temperatures than standard PVC. The biggest customers of C-PVC in India are the pipe manufacturers, as the applications of C-PVC include making of hot and cold water delivery pipes and industrial liquid handling. C-PVC is considered to be safe for the transport and use of potable water used for drinking, cooking, and bathing.

C-PVC is a highly specialized product with only 4 players globally which have the requisite technology to manufacture C-PVC. DCW is the only Indian company to have signed the technology license agreement with Arkema (one of the 4 players globally having the technology patent). With this technology tie-up, DCW Limited, in the year 2017, set up the C-PVC manufacturing plant with an installed capacity of 12,000 MT/year at their integrated manufacturing complex located at Sahupuram, Tamil Nadu. DCW is a major supplier to India's all the leading pipe manufacturers.

The total imports of C-PVC (resins + compound) by India for FY 2018-19 stood at about 1,37,019 MT. Out of these imports, the combined share of cheap imports from China and South Korea was at about 50,000 MT or approximately 36% of the total imports. The share of imports from China & South Korea stood at about 33% of the total imports between April-August 2019 which was at about 25,100 MT.

Post the provisional ADD affected in August 2019, the share of imports from China and South Korea went down to 6% during September-December 2019. This had a positive impact on DCW as the company witnessed about 12% increase in the net realizations for C-PVC, compared to just 2% increase in the landed cost for imports from countries other than China & South Korea.

Commenting on the Government's decision, Mr. Vivek Jain, Managing Director - DCW Limited said, "We welcome the Government's step to impose ADD on cheap imports from China & South Korea. DCW Limited is the biggest beneficiary of anti-dumping duty on C-PVC as it is the sole manufacturer of C-PVC in India. With an installed capacity of 12,000 MT/year placed at Sahupuram, Tamil Nadu facility, DCW is well positioned to leverage this opportunity."
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