Indian Petrochemicals Corporation Limited (IPCL), the pioneering petrochemical company in India, was incorporated in 1969, It was converted into a public limited company in 1986. Till early 1992, the Government of India (GOI) held the entire equity capital of IPCL. Reliance Industries has acquired 26% of the equity stake in the company through the divestment made by GOI on June 4, 2002. With this disinvestment the GOI's stake in the company has come down to 34%. RPIL made an open offer to the shareholders of IPCL and acquired 4.96 crore shares at a price of Rs.231 per share,representing 20% of the total voting capital,thereby increasing the equity stake to 46% in the Company,
Today, IPCL is one of the leading petrochemical companies. It's business comprises of polymers, synthetic fiber, fiber intermediates, solvents, surfactants, industrial chemicals, catalysts and adsorbents. Backed by strong Research Center, Product Application Centers and Technology Management Centers, the company is continuously innovating its processes and products. The company owns and operates three petrochemical complexes, a naphtha based complex at Vadodara and gas based complexes at Nagothane near Mumbai and at Dahej on Narmada estuary in bay of Khambat. The company also owns a catalyst manufacturing facility at Rabale, Navi Mumbai.
IPCL is the main promoter of a joint venture (JV) under the auspices of Gujarat Chemical Port Terminal Company Ltd. (GCPTCL), incorporated in 1992. The objective of this JV is to construct and operate, a state of art liquid chemical handling port at Dahej. This project was promoted as a JV with six partners. The port has been commissioned and will open up opportunities for international trade in chemicals in a big way. In view of the strategic importance of the port the company has increased its stake from present 30% to 37% as part of its consolidation strategy.
More over IPCL and General Electric Plastics (GEP), BV, Netherlands have also jointly ventured to manufacture advanced engineering plastics in India. This was the first time a multinational company joined hands with an Indian Public Sector with equal equity participation. An agreement was signed between IPCL and GEP to form a 50:50 JV in 1991. A joint venture company, General Electric Plastics India Ltd. (GEPI) was incorporated during the same period. A key feature of the joint venture is that it will cover in its territories of operation, the neighboring countries and Middle East, which were earlier covered by GE Plastics, Netherlands. IPCL has decided to pullout from this business.
The GOI has directed IPCL to sell its Vadodara unit to the Indian Oil Corporation after a proper valuation of assets and at a mutually negotiated price. The two companies, however, has not reached a consensus on the price at which the plant should be sold and hence the same is still pending.
The company's main agenda for the current fiscal is consolidation whereby it will be reviewing its investments in the non-core sector and concentrating its activities only in chemicals and petrochemicals. In this regard the company will be offloading its stake in GEPI and pulling out of India Vaccines Corporation Ltd. which is in the business of oral vaccines since they have not contributed significant returns to the company and there is little business synergy.
The company has shelved any major capex for the next two years primarily because of two reasons. During 2002-03 the company has divested its equity in GE Plastics India Ltd. The company has made an major investment in Gujarat Chemical Port Terminal Company Ltd,equipped with an modern liquid cargo handling port facility.
The company together with Department of Biotechnology and Pasteur Merius Serums and Vaccines,France, promoted IVCOL to establish commercial production of injectible polio Vaccines in India.After RIL had acquired management control of the company,the IVCOL project was reviewed in depth. Since Reliance Life Sciences private ltd is engaged in the field of biotechnology research,it has been decided to utilize the expertise in setting up biotechnology based production facilities at IVCOL site. The discussions are underway with GOI for acquiring the management control of IVCOL.
In Feb 2004, Government of India has disinvested another 28.945% stake through offer for sale. Out of 29%, 5% is reserved for Reliance group. The mode of sale : Sold through Offer for Sale by Government of India. The shareholding of The Government of India after the sale is 1,24,11,282 shares amounting to 5% of the total share capital of the Company.
During 2004-05 the company has enhanced its installed capacity of Polymers, Ethylene Glycol, propylene and other chemicals by 170000 MT, 68380 MT, 10000 MT and 15735 MT respectively. With this expansion the total installed capacity of Polymers, Ethylene Glycol, propylene and other chemicals has increased to 1252690 MT, 264480 MT, 235460 MT and 1425915 MT respectively.