In conversation with K Ganesh Kamath, CFO, Galaxy Surfactants

Pandemic led elevated awareness of hygiene needs has given a leg up to the growth of surfactants, asserts K Ganesh Kamath, CFO, Galaxy Surfactants.  

What is your outlook on the Indian speciality chemicals sector?   

We are value chain integrators to personal and high-end home care needs. We are mostly participants in the oleochemical value chain. Our ingredients composition shall reflect the consumption pattern of the HPC industry and its growth drivers.   

In the surfactants market we see the following macro trends:   

1. Migration from crude based to oleo chemical-based surfactants. Hence a market that was not addressed by us earlier is becoming addressable. 

2. At the speciality end of affordable consumption, we are seeing a shift towards sulphate free mild surfactants.  

Both these drivers shall play out in our revenues, and we believe macro trends can enable continued secular growth.  

Pandemic led elevated awareness of hygiene needs has given a leg up to the growth of surfactants. Growth and increased affordability in the developing markets of India and AMET would provide impetus to increase consumer base and the per capita consumption. 

Can you shed some light on the company’s Q2FY22 results? 

Our underlying business strengths continue to remain the same as before. It is the pandemic driven supply chain factors that have affected the Q2 results. As informed nearly 65 per cent of our sales is cross border/international and an equivalent share of our feedstock is imported. The supply chain was elongated, timely deliveries disturbed, and there was an unforeseen spike in freight costs. Our focus was to address the supply security of our regular customers and we have gone that extra mile to ensure that even if it means that we had to source an intermediate. An intermediate was sourced as the rising covid cases in Southeast Asia adversely impacted the supply of our critical raw materials. Issues about the availability of Ethylene Oxide, a critical raw material used for manufacturing performance surfactants and few preservatives, further delayed production. A combination of these factors adversely impacted our performance in Q2 FY22.    

What are the challenges being faced by Galaxy Surfactants?   

The challenges are mainly on the supply side. The principal challenge being the prevailing scenario in international logistics given that a large part of our business is international.   

What are your top three strategic priorities?   

Our top three priorities right now are:  

1. Digitization of business and operations.   

2. Enhancing cybersecurity capabilities. 

3. Investing and developing technologies that enable safe and sustainable consumption.