IT is the largest producer of caustic soda in India, and also one of the biggest turnaround stories in the public sector. And, despite being in the chemicals industry, it is a company that carries its passion for protecting the environment o its sleeve.
Gujarat Alkalies and Chemicals Limited (GACL), a Gujarat government-promoted company, has shown the way to the highly polluting chemicals industry that it is a sector where money can be made and the environment spared the damage caused by pollution. Today, if one travels to the company's complex on the outskirts of Vadodara, one would not be blamed for thinking that it is a brand-new facility. The spanking-clean complex represents the style of functioning that has been adopted by the company in recent years. Not long ago, a heavy stench of chemicals used to hang around the complex and litter used to be strewn along the road. Today, the stench is gone and the campus is spotlessly clean. The large number of trees at the plant highlights the company's credo, "Ours is green attitude".
The same is true of the company's performance; Its fortunes took a nose-dive in the mid-1990s, and it slipped into the red in 1998-99. After bleeding for four years, GACL came back into the black in 2002-03, with a modest profit after tax of Rs.28 crores on a turnover exceeding Rs.1,000 crores. The next year, the company consolidated its position and the profit rose to Rs.63 crores. Aided by an increase in the demand for caustic soda, GACL has been growing and its balance sheet looks much healthier now.
But the management of GACL, led by its Managing Director P.K. Taneja, is not one to rest on the comfort of having the company running in the black. As a forward-looking company, GACL has chalked out modest expansion and product diversification plans to continue on the growth path with sufficient muscle to insulate it from future shocks. "The company was set up in 1973. Thirty years is a long time, long enough to test the character of any organisation. Be it recession, inflation, increased competition or changing governments, we have lived it all. And for sure, all the turbulence has made GACL a stronger and progressive company," said Taneja, an officer of the Indian Administrative Service.
From an initial capacity of 37,425 tonnes per annum (TPA) of caustic soda, GACL has grown to be the largest producer in India, with a capacity of 2,70,000 TPA. The company is spread over two complexes, at Vadodara and Dahej. Its turnover stood at Rs.1,075 crores in 2003-04 and it is likely to move up to Rs.1,200 crores in 2004-05.
Knowing that in the future there may be new hurdles to cross, GACL has started to diversify and expand its existing infrastructure to consolidate its supremacy in chlor-alkali and other integrated downstream products. "All our plans have been chalked out with the objective of becoming a fully integrated player in the chlor-alkali segment. Expanding capacities will enhance GACL in our chosen basket of products and give the company the capability to make speciality chemicals to insulate it from the vagaries of industry cycles," said Taneja.
The plans include an evaporation unit of 240 tonnes per day (TPD) at a cost of Rs.70 crores at Dahej, to increase the caustic soda production from the existing 240 TPD to 436 TPD. A 12,000 TPA hydrogen peroxide plant is also being set up at Dahej to utilise the surplus hydrogen generated during the production of caustic soda. This project involves an investment of Rs.100 crores and will go on stream by October 2006. The hydrogen peroxide plant is expected to start paying back to the company in five years.
The company's projects on hand include a 100 TPD caustic soda flaking capacity to convert liquid lye to solid flakes that can be easily transported, and poly aluminium chloride to insulate the company against market fluctuations with respect to chlorine and hydrochloric acid. The production of caustic soda lye at Vadodara will increase by 40 TPD and a new 200 TPD capacity will be added at Dahej. GACL is also exploring opportunities in the agro-chemical industry.
As GACL treads the growth path, technology upgradation and achieving greater efficiencies is a constant effort. While the capacity utilisation is about 70 per cent in the caustic soda industry, GACL's plants are working at almost 100 per cent capacity, thereby utilising their assets to the fullest extent.
GACL's commitment towards the environment is undying. The company feels that its credo of a green attitude is not a mere slogan. A dedicated senior executive heads the Safety and Environment Department to ensure high standards of safety and to maintain a harmonious relationship between the environment and technology. The company has planted more than 27,000 trees, which are taken care of regularly. Over 1,000 saplings are planted every year. Rainwater harvesting and collection is a part of routine activity at GACL. This water is used to maintain the green belts. GACL has been a pioneer in adopting environment-friendly and energy-efficient technologies. It converted to membrane cell technology from mercury cell technology way back in 1989, and since 1994 all the plants have been running on mercury-free membrane cell technology. For the disposal of solid waste, GACL has secured a dedicated landfill site conforming to the Hazardous Waste Management Act. Being a member of the Effluent Channel Project, it releases its liquid effluents in this channel only after ensuring that the necessary parameters specified by the Gujarat Pollution Control Board are met.