Adani Group New PVC Plant in Mundra to Compete with Reliance by 2028

The Adani Group is building a polyvinyl chloride (PVC) plant at Mundra in Gujarat with an annual production capacity of 1 million tonnes. This is part of its entry into the petrochemicals sector, which is currently led by Reliance Industries, as per news reports.

Polyvinyl Chloride (PVC) is a versatile synthetic plastic polymer used in a vast range of products. You'll find it in everything from pipes and fittings to window and door frames, cable insulation, and vinyl flooring. It's also used for wall coverings, credit cards, and even toys.

India’s PVC Demand Outpaces Supply

India’s total PVC demand stands at around 4 million tonnes per year, while domestic production capacity is limited to approximately 1.59 million tonnes. Of this, Reliance accounts for nearly half. The demand is expected to grow at a CAGR of 8-10%, driven by sectors like agriculture, infrastructure, housing, pharmaceuticals, and packaging.

Project Scope

The facility is expected to be commissioned by FY2028 (April 2027-March 2028). It will be part of a larger petrochemical cluster being set up by Adani Enterprises. In addition to PVC, the project will include chlor-alkali, calcium carbide, and acetylene units.

Adani plans to use an acetylene and carbide-based production process for the plant. Environmental clearance and consent to establish have already been secured. The group aims to reduce the domestic supply gap and lower the dependence on imported PVC.

Competing with Reliance

Reliance currently operates PVC plants in Hazira, Dahej, and Vadodara with a total capacity of around 750,000 tonnes per annum. It also plans to double its capacity by 2027. Adani’s project could potentially be scaled up to 2 million tonnes based on future demand.

Read More: Adani Group to Invest $100 Billion, Targets 100 GW Power Capacity by 2030!

Financing and Execution

The project is backed by a State Bank of India-led consortium. Construction had been paused in early 2023 but resumed after Adani raised over $5 billion in equity and debt. The group has since repaid all share-backed loans.

The project will benefit from existing infrastructure at Mundra, including port access and land availability. This is to streamline the movement of raw materials and finished goods across domestic and export markets.

Conclusion

With this facility, Adani is entering a new segment and contributing to closing the gap between PVC demand and local supply in India.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions. 

Investments in the securities market are subject to market risks, read all the related documents carefully before investing.