PRIVI SPECIALITY CHEMICALS LIMITED Annual Report 2020-21

42 PRIVI SPECIALITY CHEMICALS LIMITED (Formerly known as Fairchem Speciality Limited) Key Global Companies Leading manufacturers have been present in the industry for a very long time and have huge production capacities. However, owing to the augmented product demand, these players are focusing on acquisition, expansion, and investment strategies to enhance their product portfolio and meet the growing demand from the end-use markets. New market entrants are seeking greater opportunities in the global market. Companies attempting to establish themselves in the market have to compete with the existing multinationals. Consumers are increasingly becoming more aware of the product benefits, which has compelled the producers to develop high-quality, sustainable, and affordable products. In addition, these players observe high integration across the value chain and are involved from the raw material sourcing to the distribution of finished products. The uncertainty caused by the COVID-19 pandemic continues. There is also a change in lifestyle necessitating increased hand washing frequencies, better hygiene in general – including more cleaning of floors, more frequent washing of clothes etc. This change in lifestyle will lead to increased demand for hygiene chemicals. The increased demand for sanitizers, soaps, detergents, floor cleaners and other categories involving washing in the Fast Moving Consumer Goods (FMCG) segment will lead to increased demand for the raw materials for making these products, including the fragrances, and in turn aroma chemicals. In the short-term, the disruptions caused by pandemic is expected to result in slow demand logistical disruptions such as movement of goods to and from the port for exports and for domestic use. (Source: Grand view research) Global Perfume markets The global perfume market size was valued at USD 32 billion in 2018 and is expected to expand at a CAGR of 3.9% from 2019 to 2025. The rising importance of personal hygiene and grooming among both men and women is expected to remain one of the key driving factors. There is also increasing awareness regarding physical fitness among adults. Deodorants and perfumes have become essential daily personal care products, and play a significant role in personal grooming. This will promote the demand for body odor controlling products such as deodorants. Urbanization coupled with the improving living standards among middle-class income groups of developing countries including India, Thailand, China, Vietnam, Brazil and Argentina is anticipated to expand the market.. Moreover, rising demand for exotic and floral scents majorly from young adults teenage consumers will augur well for the industry. Rising disposable income of customers in developing countries such as India, Indonesia, Thailand, and China lead to a increased spending on personal care products for better health and hygiene. Furthermore, the rise in the percentage of working women with greater purchasing power coupled with awareness regarding cosmetic products encourages the demand for personal grooming products. Additionally, increased spending on attractive packaging, advertisement, and promotional activity by FMCG companies including P&G and Unilever have increased the market visibility of fragrance products. Application growth of fragrance products including sprays, candles, incense sticks, and gels in the household industry is anticipated to act as a key market driver. Furthermore, shifting consumer preference towards aromatherapy is expected to increase the size of the industry. (Source: Grand view research) Fine Fragrances Perfume is expected to remain the fastest-growing product segment, expanding at a CAGR of 3.9% from 2019 to 2025. These products are gaining popularity owing to the increasing demand for exotic products primarily from the youth Rising awareness regarding personal hygiene, along with the availability of a wide product portfolio in retail shops are some of the prominent factors driving the demand for perfumes. Deodorants are also gaining popularity owing to properties such as its ease of use and the long-lasting effects of the products. Manufacturers are launching new products to gain a competitive edge. (Source: Grand view research)