Balaji Amines Ltd Q1 FY2023 Concall Summary

Key Takeaways

• ESG disclosure, not earnings: This document is a Business Responsibility and Sustainability Report (BRSR) filing for FY22, not a quarterly earnings call. It contains no financial performance data, demand commentary, or forward guidance.
• Water intensity improved sharply: Water intensity per rupee of turnover improved from 0.000042 to 0.000026, driven by a 2.8% reduction in absolute water withdrawal at the Solapur site.
• Zero Liquid Discharge across all sites: All BAL manufacturing facilities are ZLD, meaning no industrial wastewater is discharged outside the plant boundary.
• One data breach reported: A single breach was identified outside the organization during FY22; users were notified, and 0% of breaches involved personally identifiable information.
• What to watch next quarter: Whether BAL begins pairing its BRSR filings with the customary earnings commentary investors expect, or whether this standalone ESG disclosure becomes the norm.

Environmental Performance

• Water withdrawal fell: Total water withdrawal in the water-stress area of Solapur decreased from 517,804 KL in FY21 to 503,150 KL in FY22, with surface water withdrawal decreasing and groundwater withdrawal increasing.
• Water intensity improved: Water intensity per rupee of turnover improved from 0.000042 to 0.000026, a meaningful efficiency gain.
• Energy mix stayed fully renewable: Total energy consumed from renewable sources increased from ~33.2 crore Joules/Annum to ~34.3 crore Joules/Annum, with zero energy consumed from non-renewable sources in either year. Fuel consumption rose while electricity consumption slightly decreased.
• Waste profile shifted: Total waste generated increased from 5,974 MT to 7,473 MT, driven entirely by a jump in non-hazardous waste (ash) from 5,275 MT to 7,191 MT. Hazardous waste decreased from 399 MT to 282 MT.
• Resource efficiency investments: Unit-4 Expansion installed 12 Air Cooled Condensers substituting conventional cooling towers, saving 15.49 M3/hr of water. 16 Dry Vacuum Pumps in Distillation Columns substituted steam ejectors and water ring vacuum pumps, cutting liquid effluent by 1,628 Kg/hr and reducing carbon footprint.

Governance & Compliance

• Environmental compliance confirmed: The company is meeting all applicable environmental laws in India (Water Act, Air Act, Environment Protection Act), as demonstrated in six-monthly MOEF compliance documents.
• ZLD status maintained: All BAL sites are confirmed as Zero Liquid Discharge Manufacturing Facilities, so water discharge criteria are not applicable.
• Cybersecurity framework in place: The entity has a framework and policy on cyber security and risks related to data privacy, with details available on the company website.
• No consumer complaints: Zero consumer complaints were received in respect of data privacy, advertising, cybersecurity, delivery of essential services, or restrictive and unfair trade practices.
• No product recalls: No instances of product recalls on account of safety issues were reported.

Reddy: "Balaji Amines, since inception, has built its organization pillared on Environmental, Social and Governance. Every strategic decision is taken after it's successfully clears these three aspects."

Social & Supply Chain

• CSR applicability: CSR is applicable as per Section 135 of the Companies Act, 2013.
• MSME sourcing rose: Direct sourcing from MSMEs and small producers increased from 16.83% in FY21 to 17.28% in FY22. Sourcing from within the district and neighboring districts decreased from 3.90% to 2.76%.
• Business continuity preparedness: BAL has an onsite emergency plan for all sites with trained teams (Operations, Engineering, Safety, Fire crew) and works in close coordination with local authorities including the Fire Department, MIDC, Collector office, and State Pollution Boards. Hazardous chemical storages are equipped with fire and safety infrastructure, tank farm areas comply with PESO regulations, and area classification guidelines follow IS, ATEX and NFPA standards.
• Industry affiliations: The entity is a member of 10 trade and industry chambers and associations, including CHEMEXCIL, FICCI, Indian Chemical Council, and BDMA.

Data Security

• One breach disclosed: One breach was identified during FY22, outside the organization, where users were notified. 0% of data breaches involved personally identifiable information of customers.
• No substantiated privacy complaints: In fiscal 2022, there were no substantiated complaints concerning breaches of customer privacy from outside parties and regulatory authorities.

Guidance & Commitments

Key Metrics