HDPE IMPORT DATA ANALYSIS

JULY 2013


INDEX
Particulars Page No.

Particulars Page No.
INTRODUCTION 01 FEEDSTOCK PRICE MOVEMENT 08

IMPORT SNAPSHOT 01 HDPE OFFERS TO INDIA 08
HDPE INDIA IMPORT SNAPSHOT 01
IMPORT DATA AVERAGE IN 2013 01 IMPORTANT GLOBAL PLANT NEWS 09
COUNTRY-WISE INDIA HDPE IMPORTS (BY VOLUME) 02
COUNTRY-WISE INDIA HDPE IMPORTS (BY VALUE) 02 DEMAND SUPPLY & NET AVAILABILITY SNAPSHOT 09
INDIA HDPE DEMAND SUPPLY 09
HDPE INDIA PRICING 03 INDIA ALL PE DEMAND SUPPLY 10
HDPE GRADES AVERAGE MONTHLY PRICING 03 INDIA POLYMER DEMAND SUPPLY 10
HDPE FILM MONTHLY PRICES (MAX/MIN) 03 INDIA ETHYLENE NET AVAILABILITY 10
M-O-M AVERAGE PRICES % CHANGE 04
MAJOR PRODUCTS PRICE TRENDS 04 HDPE INDIA IMPORT DUTY 11
HDPE GRADES JULY PRICE MOVEMENT 05
HDPE FILM 1 YEAR PRICE MOVEMENT 05 GOI 5 YEAR PLAN CAGR FIGURES 11
HDPE FILM 3 YEAR PRICE MOVEMENT 06
CRUDE PRICE MOVEMENT & INR V/S USD 12
MAJOR HDPE PRODUCERS CAPACITY PROJECTION 06
HDPE CAPACITY PROJECTION OF MAJOR PRODUCERS IN INDIA 06 INDIA ECONOMIC NEWS 13
ETHYLENE CAPACITY PROJECTION OF MAJOR PRODUCERS IN INDIA 07
DISCLAIMER 18
PORT PERFORMANCE 07

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POLYMERUPDATE
Analysis HDPE Import Data


Contact Details: 344, A to Z Indl. Estate, G. K. Marg, Lower Parel (w), Mumbai 400018, INDIA | Email: info@polymerupdate.com | Tel: +91-22-61772000 (25 lines) | Fax: +91-22-61772025 1

Introduction

HDPE stands for High-Density Polyethylene. It is sometimes also referred to as polyethylene high-density (PEHD) and sees high import volume
into India given its various applications. It takes 1.75 kilograms of petroleum (in terms of energy and raw materials) to make one kilogram of HDPE.
Known for its large strength to density ratio, HDPE finds applications in Raffia, Blow Moulding, Film, Pipes and Injection Moulding. HDPE is highly
preferred as a sheathing material where it provides high resistance to water penetration. It is very hard, has low coefficient of friction, and is abrasion
resistant. Hence, it is used in products and packaging such as milk jugs, detergent bottles, margarine tubs, garbage containers and water pipes.

HDPE is principally used for the manufacture of high-performance pipe, blow-molded household and industrial bottles, oil bottles, injection-molded food
containers, consumer durables and disposable goods and film goods such as grocery sacks and merchandise bags.

Import Snapshot

Exhibit: HDPE India Import Snapshot

HDPE Volume (MTS) M-o-M Change Value (Rs Crores) M-o-M Change
Jan'13 34253 -8.20% 270 -6.90%
Feb'13 28109 -17.94% 227 -15.93%
Mar'13 31391 11.68% 263 15.86%
Apr'13 29322 -6.59% 249 -5.32%
May'13 31949 8.96% 266 6.83%
Jun'13 33839 5.92% 285 7.14%
Jul'13 29801 -11.93% 266 -6.67%

Source: GoI 2013 Import Data

The above table gives a snapshot on HDPE India imports in terms of volume imported and monetary value of the imports that have taken place in 2013.
The volume for the month of July was recorded at 29801 MTS which is a 11.93% decrease over the import volume of June. The monetary value of the
imports was Rs. 266 crores which is a 6.67% decrease over the monetary value of HDPE imported in the preceding month.

Exhibit: Import Data Average in 2013

Volume (MTS) Volume % Value (Rs. Crores) Value %
31238 -2.59% 261 -0.71%
HDPE
Monthly
Averages

Source: GoI 2013 Import Data
The above table gives out the average figures for HDPE imported into India in 2013. As we can see, the average import per month stands at 31238 MTS,
the average import monetary value per month is Rs. 261 crores. HDPE imports in 2013 have seen an average volume decline of 2.59% and an average
monetary value decrease of 0.71% per month so far into the year.
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POLYMERUPDATE
Analysis HDPE Import Data


Contact Details: 344, A to Z Indl. Estate, G. K. Marg, Lower Parel (w), Mumbai 400018, INDIA | Email: info@polymerupdate.com | Tel: +91-22-61772000 (25 lines) | Fax: +91-22-61772025 2

Exhibit: Country-wise India HDPE imports (by Volume)









Source: GoI July 2013 Import Data

The table lists out the countries from which
HDPE was imported into India, along-with its
volume, in the month of July 2013.

Saudi Arabia, Qatar and UAE occupied the top
three positions.


Exhibit: Country-wise India HDPE imports (by Value)








Source: GoI July 2013 Import Data

The table lists out the countries from which
HDPE was imported into India, along-with its
monetary value, in the month of July 2013.

Saudi Arabia, Qatar and UAE occupied the top
three positions.
Country
Import Volume
(MTS)
% of India HDPE
July imports
Country
Import Volume
(MTS)
% of India HDPE
July imports
SAUDI ARABIA 11286 37.87% USA 144 0.48%
QATAR 8695 29.18% INDONESIA 140 0.47%
UAE 4126 13.85% TAIWAN 76 0.25%
KUWAIT 1934 6.49% OMAN 36 0.12%
IRAN 1152 3.86% CHINA 30 0.10%
SPAIN 446 1.49% SWEDEN 26 0.09%
THAILAND 404 1.36% AUSTRIA 22 0.07%
GERMANY 353 1.19% BELGIUM 22 0.07%
SINGAPORE 248 0.83% MALAYSIA 18 0.06%
CANADA 224 0.75% UK 9 0.03%
KOREA 210 0.71% FRANCE 4 0.01%
JAPAN 197 0.66%
Country
Import Value
(Rs. crores)
% of India HDPE
July imports
Country
Import Value
(Rs. crores)
% of India HDPE
July imports
SAUDI ARABIA 98 36.84% USA 1.8 0.68%
QATAR 75 28.20% INDONESIA 1 0.38%
UAE 39 14.66% TAIWAN 0.7 0.26%
KUWAIT 17 6.39% CHINA 0.4 0.15%
IRAN 10 3.76% SWEDEN 0.3 0.11%
GERMANY 4.5 1.69% BELGIUM 0.3 0.11%
THAILAND 4 1.50% AUSTRIA 0.3 0.11%
SPAIN 3.6 1.35% OMAN 0.17 0.06%
CANADA 2.7 1.02% MALAYSIA 0.16 0.06%
SINGAPORE 2.3 0.86% UK 0.13 0.05%
JAPAN 2.2 0.83% FRANCE 0.5 0.19%
KOREA 2 0.75%
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POLYMERUPDATE
Analysis HDPE Import Data


Contact Details: 344, A to Z Indl. Estate, G. K. Marg, Lower Parel (w), Mumbai 400018, INDIA | Email: info@polymerupdate.com | Tel: +91-22-61772000 (25 lines) | Fax: +91-22-61772025 3

HDPE India Pricing

Exhibit: HDPE Grades Average Monthly Pricing

HDPE Film Blow moulding Injection Pipe Raffia
Jul'13 Avg 95.46 96.32 99.47 99.98 101.44
Jun'13 Avg 90.71 91.51 94.61 94.99 96.61
May'13 Avg 85.99 86.79 89.89 89.97 91.39
Apr'13 Avg 85.80 86.60 89.70 90.05 91.20
Mar'13 Avg 87.80 88.60 91.70 92.27 93.20
Feb'13 Avg 87.96 88.76 91.86 92.43 93.36
Jan'13 Avg 85.64 86.44 89.54 90.11 92.80
3 Month Avg 90.72 91.54 94.66 94.98 96.48
6 Month Avg 88.95 89.76 92.87 93.28 94.53

Source: PolymerUpdate Price Archives (Reliance Ex-Hazira Rs/Kg Basic)

The above table lists out the average monthly prices observed for the respective HDPE grades for 2013. Three month average (May13 Jul13) and six
month average (Feb13 - Jul13) are also provided. As we can see, HDPE grades have seen a heavy price increase in the month of July.

Exhibit: HDPE Film Monthly Prices (Max/Min)

HDPE Film Minimum Maximum
Jul'13 94.46 95.96
Jun'13 89.46 91.46
May'13 84.96 86.96
Apr'13 84.96 86.46
Mar'13 86.46 88.96
Feb'13
Jan'13 83.96 86.96
2013 Overall 83.96 95.96
87.96

Source: PolymerUpdate Price Archives (Reliance Ex-Hazira Rs/Kg Basic)

The above table lists out the maximum and minimum prices that were observed for HDPE Film in 2013. The overall maximum and minimum prices for the
year 2013 are also provided. As we can see, the maximum price recorded in the month of July was Rs. 95.96 while the minimum price was Rs. 94.46.

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POLYMERUPDATE
Analysis HDPE Import Data


Contact Details: 344, A to Z Indl. Estate, G. K. Marg, Lower Parel (w), Mumbai 400018, INDIA | Email: info@polymerupdate.com | Tel: +91-22-61772000 (25 lines) | Fax: +91-22-61772025 4

Exhibit: M-o-M Average Prices % Change







Source: PolymerUpdate Price Archives Reliance Ex-
Hazira Rs/Kg Basic)


The above table lists out the M-o-M changes for the respective HDPE grades considering average monthly prices. The month of July saw a big jump in
prices considering monthly averages in 2013. All the five grades witnessed an increase of between 5% and 6%. The increase in Blow Moulding was the
highest at 5.26% while the Raffia grade was the lowest at 5.00%. HDPE grades have seen a healthy overall price increases so far this year.

Exhibit: Major Products Price Trends





Source: PolymerUpdate Price Archives [HDPE (Reliance Ex-Hazira Rs/Kg Basic),
LDPE (Reliance Ex-Mumbai Panvel Depot Rs/Kg Inclusive of excise duty), LLDPE
(Reliance Ex-Hazira Rs/Kg Basic), PVC (Reliance Ex-Hazira Rs/Kg Basic), PP
(Reliance Ex-Hazira Rs/Kg Basic), PS (Ex-Works Rs/Kg Basic), PET (Reliance Ex-
Hazira Rs/Kg Basic), EVA (Reliance Ex-Works Rs/Kg Basic)]

The above table has been formulated by comparing the average price for the particular month as compared to the average price of the preceding month.
If the value is Up, the average price for the particular month was observed to be higher as compared to the average price for the preceding month. If
the value is Down, the average price for the particular month was observed to be lower as compared to the average price of the preceding month. If the
value is Neutral, no change was observed in the average price of the particular month and the preceding month. We have considered the India price
movements of the following grades: HDPE Film, Blow Moulding, Injection, Pipe, Raffia; LDPE General, Heavy Duty, Injection, Lamination, Milk Pouch;
LLDPE Extrusion Coating, Film, Injection, Rotomoulding; PP Block Copolymer, BOPP Homopolymer, Injection, Raffia, Random Copolymer, TQ Film;
PVC - Suspension; PET Bottle; PS GPPS, HIPS; EVA.

HDPE Film Blow moulding Injection Pipe Raffia
Jul'13 5.24% 5.26% 5.14% 5.25% 5.00%
Jun'13 5.49% 5.44% 5.25% 5.58% 5.71%
May'13 0.22% 0.22% 0.21% -0.09% 0.21%
Apr'13 -2.28% -2.26% -2.18% -2.41% -2.15%
Mar'13 -0.18% -0.18% -0.17% -0.17% -0.17%
Feb'13 2.71% 2.68% 2.59% 2.57% 0.60%
Jan'13 3.32% 3.26% 3.13% 3.11% 2.75%
2013 Overall 14.51% 14.42% 13.97% 13.85% 11.95%
Product Jan'13 Feb'13 Mar'13 Apr'13 May'13 Jun'13 Jul'13
HDPE Up Up Down Down Up Up Up
LDPE Up Up Up Down Up Up Up
LLDPE Up Up Up Down Up Up Up
PP Up Up Down Down Up Up Up
PVC Up Up Up Down Down Up Up
PET Up Up Down Down Neutral Up Up
PS Up Up Up Neutral Down Up Up
EVA Up Up Up Down Down Up Up
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POLYMERUPDATE
Analysis HDPE Import Data


Contact Details: 344, A to Z Indl. Estate, G. K. Marg, Lower Parel (w), Mumbai 400018, INDIA | Email: info@polymerupdate.com | Tel: +91-22-61772000 (25 lines) | Fax: +91-22-61772025 5

Exhibit: HDPE Grades India July Price Movement


Source: PolymerUpdate Price Archives (Reliance Ex-Hazira Rs/Kg Basic)

The above chart gives out the price movement for the respective HDPE grades for the month of July.

Exhibit: HDPE Film 1 Year Price Movement


Source: PolymerUpdate Price Archives (Reliance Ex-Hazira Rs/Kg Basic)

The above chart shows the price movement for HDPE Film over a one year time frame.
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POLYMERUPDATE
Analysis HDPE Import Data


Contact Details: 344, A to Z Indl. Estate, G. K. Marg, Lower Parel (w), Mumbai 400018, INDIA | Email: info@polymerupdate.com | Tel: +91-22-61772000 (25 lines) | Fax: +91-22-61772025 6

Exhibit: HDPE Film 3 Year Price Movement















Source: PolymerUpdate Price Archives (Reliance Ex-Hazira Rs/Kg Basic)

The above chart shows the price movement for HDPE Film over a three year time frame.

Major Producers Capacity Projection

Exhibit: HDPE Capacity Projections of the major producers in India


HDPE Capacity (Kt) 2013-14 2014-15 2015-16 2016-17
RIL 490 490 490 490
GAIL 700 700 700 700
HPL 550 550 550 550
IOCL 475 475 475 475
OPAL --- 720 720 720
BPCL 155 155 155 155


Source: Chemicals & Petrochemicals Manufacturer's Association of India (RIL- Reliance Industries Limited; GAIL- Gas Authority of India Limited; HPL-
Haldia Petrochemicals Limited; IOCL- Indian Oil Corporation Limited; OPAL- ONGC Petro Additions Limited; BPCL- Bharat Petroleum Corporation Limited)

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POLYMERUPDATE
Analysis HDPE Import Data


Contact Details: 344, A to Z Indl. Estate, G. K. Marg, Lower Parel (w), Mumbai 400018, INDIA | Email: info@polymerupdate.com | Tel: +91-22-61772000 (25 lines) | Fax: +91-22-61772025 7

Exhibit: Ethylene Capacity Projections of the major producers in India


Ethylene Capacity (Kt) 2013-14 2014-15 2015-16 2016-17
RIL 1840 1840 3240 3240
GAIL 1000 1000 1000 1000
HPL 670 670 670 670
IOCL 857 857 857 857
BPCL - Assam GC 220 220 220 220
OPAL 0 1100 1100 1100


Source: Chemicals & Petrochemicals Manufacturer's Association of India (RIL- Reliance Industries Limited; GAIL- Gas Authority of India Limited; HPL-
Haldia Petrochemicals Limited; IOCL- Indian Oil Corporation Limited; OPAL- ONGC Petro Additions Limited; BPCL-Assam GC - Bharat Petroleum
Corporation Limited Assam Gas Cracker)

Port Performance

Exhibit: HDPE Import volume at Indian ports and its monetary value

JNPT handled the maximum HDPE imports among the seaports while Tughlakabad ICD handled the maximum HDPE imports among the dryports.
Port Type
Import
Volume
handled
(MTS)
% of India HDPE
import volume
handled
HDPE
Import
Value (Rs.
Crores)
Port Type
Import
Volume
handled
(MTS)
% of India
HDPE import
volume
handled
HDPE Import
Value (Rs.
Crores)
JNPT SEA SEA 16309 54.73% 144.00 TUTICORIN ICD DRY 596 2.00% 5.00
MUNDRA SEA SEA 2363 7.93% 24.00 HARASARU GARI ICD DRY 246 0.83% 2.80
CHENNAI SEA SEA 2274 7.63% 20.00 VAPI ICD DRY 149 0.50% 1.30
TUTICORIN SEA SEA 2237 7.51% 19.00 LUDHIANA ICD DRY 96 0.32% 0.80
KOLKATA SEA SEA 1743 5.85% 14.80 HYDERABAD ICD DRY 66 0.22% 0.60
COCHIN SEA SEA 780 2.62% 6.70 BANGALORE ICD DRY 35 0.12% 0.30
MANGALORE SEA SEA 82 0.28% 0.79 NAGPUR ICD DRY 33 0.11% 0.30
GOA SEA SEA 17 0.06% 0.14 REWARI ICD DRY 25 0.08% 0.24
TUGHLAKABAD ICD DRY 1155 3.87% 11.00 NASHIK ICD DRY 5 0.02% 0.40
BHUSAWAL ICD DRY 883 2.96% 7.80 PATPARGANJ ICD DRY 3 0.01% 0.40
AHMEDABAD ICD DRY 705 2.37% 6.00 MUMBAI AIR AIR 1 0.004% 0.01

Source: GoI 2013 July Import Data
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Analysis HDPE Import Data


Contact Details: 344, A to Z Indl. Estate, G. K. Marg, Lower Parel (w), Mumbai 400018, INDIA | Email: info@polymerupdate.com | Tel: +91-22-61772000 (25 lines) | Fax: +91-22-61772025 8

Feedstock Price Movement

Exhibit: Ethylene July India Price Movement


Source: PolymerUpdate Price Archives (India CFR USD/MT)

HDPE Offers to India

Exhibit: Some of the HDPE Offers made to India in the month of July

Offered
Product
Offerred on
Basis
Offer Price
Offer
Unit
Offer from
Country
Offer to
Country
Expected
Shipment
Offer Date
Film CIF 1510 USD Thailand India Aug-13 16-Jul-13
Film CIF 1500-1510 USD Saudi Arabia India Aug-13 24-Jul-13
Film CIF 1460-1470 USD Middle East India Aug-13 25-Jul-13

Source: PolymerUpdate Market Intelligence




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POLYMERUPDATE
Analysis HDPE Import Data


Contact Details: 344, A to Z Indl. Estate, G. K. Marg, Lower Parel (w), Mumbai 400018, INDIA | Email: info@polymerupdate.com | Tel: +91-22-61772000 (25 lines) | Fax: +91-22-61772025 9

Important Global News

1) Borealis is in plans to halt production of HDPE at its plant in Germany. A Polymerupdate source in Germany informed that the production of HDPE
is planned to be halted completely by end-2014. The step is being taken owing to weak demand fundamentals for HDPE. Following the
mothballing of HDPE, the company will maximize production of polypropylene (PP) at the site. The company operates one HDPE plant with a
production capacity of 175,000 mt/year and two PP plants with combined capacity of 580,000 mt/year in Burghausen, Germany.

2) INEOS Olefins & Polymers USA (INEOS) and Sasol announced in July the signing of a Memorandum of Understanding (MOU) with the intent to
form a joint venture to manufacture high-density polyethylene (HDPE). The envisioned facility would produce 470 kilotons per annum of bimodal
HDPE using Innovene S process technology licensed from INEOS Technologies. The intention is to produce a limited number of grades allowing
high grade efficiencies. Final investment decision is expected to be made in the first half of 2014 with start-up of the plant expected at the end of
2015.
Source: PolymerUpdate Market Intelligence


Demand Supply Snapshot

Exhibit: India HDPE Demand Supply


HDPE (Kt) 2010 A 2011 A 2012 A 2013 E 2014 E
HDPE Capacity 1513 1740 1740 1740 1900
LLD/HD Capacity 847 1007 1007 1007 1175
Total Capacity 2360 2747 2747 2747 3075
Production 1108 1462 1414 1464 1588
Imports 449 332 449 536 646
Exports 88 242 171 100 61
Apparent Demand 1469 1552 1692 1901 2173
Demand Growth (%) 9.50% 5.70% 9.00% 12% 14%

Source: Asia Petrochemical Industry Conference 2013 India Country Report (A:Actual, E:Estimate)


The above table provides the India HDPE Demand Supply Snapshot. HDPE registered a 9% growth in 2012, this is likely to increase to 12% and 14% in
2013 and 2014 respectively.


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POLYMERUPDATE
Analysis HDPE Import Data


Contact Details: 344, A to Z Indl. Estate, G. K. Marg, Lower Parel (w), Mumbai 400018, INDIA | Email: info@polymerupdate.com | Tel: +91-22-61772000 (25 lines) | Fax: +91-22-61772025 10


Exhibit: India All PE Demand Supply

Source: Asia Petrochemical Industry Conference 2013
India Country Report (A:Actual, E:Estimate)

The table lists out the PE Demand Snapshot for India.
As we can see, PE recorded a growth of 12% in 2012
and likely to maintain the momentum in 2013 and
2014.


Exhibit: India Polymer Demand Supply


Source: Asia Petrochemical Industry Conference 2013
India Country Report (A:Actual, E:Estimate)


The table lists out the India Polymer Demand Supply
scenario. Operating rate is expected to increase from
83% in 2012 to 86% in 2013 and expected to touch
90% in 2014.



Exhibit: India Ethylene Net Availability



Source: Asia Petrochemical Industry Conference 2013 India
Country Report (A:Actual, E:Estimate)

All ethylene produced in India is used for local consumption
and is not exported to any other country.

ALL PE (Kt) 2010 A 2011 A 2012 A 2013 E 2014 E
Capacity 2578 2965 2965 2965 3293
Production 1992 2399 2332 2548 2746
Imports 1087 972 1323 1455 1707
Exports 95 265 176 121 86
Apparent Demand 2984 3106 3479 3881 4366
Demand Growth (%) 9.40% 4.10% 12% 12% 12%
Polymers (Kt) 2010 A 2011 A 2012 A 2013 E 2014 E
Capacity 7905 8467 8907 9447 9875
Production 6358 7102 7434 8116 8867
Operating Rate 80% 84% 83% 86% 90%
Imports 2104 2099 2552 2793 3136
Exports 792 1089 1027 996 965
Net Trade -1313 -1010 -1525 -1797 -2171
Apparent Demand 7670 8113 8959 9913 11037
Demand Growth% 12% 5.80% 10% 11% 11%
Ethylene (Kt) 2010 A 2011 A 2012 A 2013 E 2014 E
Capacity 3826 4080 4080 4080 5180
Production 2827 3355 3744 3735 4421
Imports 109 36 23 50 25
Exports 0 0 0 0 0
Net Availability 2936 3391 3767 3785 4446
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POLYMERUPDATE
Analysis HDPE Import Data


Contact Details: 344, A to Z Indl. Estate, G. K. Marg, Lower Parel (w), Mumbai 400018, INDIA | Email: info@polymerupdate.com | Tel: +91-22-61772000 (25 lines) | Fax: +91-22-61772025 11

HDPE India Import Duty

Exhibit: HDPE Import Duty applicable in India







Source: GoI

GoI 5 Year Plan CAGR Figures

Exhibit: GoI 11th/12th/13th 5 Year Plans CAGR Figures








Source: GoI 12th 5 Year Plan on Petrochemicals

The table gives the Actual CAGR achieved in the 11th 5 Year Plan (2005/06 2011/12) and the projected CAGR for the 12th 5 year Plan (2011/12
2016/17) and 13th 5 year Plan (2016/17 2021/22) for HDPE and Ethylene. As per government projections, HDPE is likely to enjoy above GDP growth
rates in the 12th and 13th 5 Year plan periods.








13th 5 Year Plan Growth
2016/17 - 2021/22
Capacity Demand Capacity Demand Demand
HDPE 9.20% 10.90% 11.10% 9.20% 9.00%
Ethylene 9.00% 7.00% 12.90% 12.40% 0.80%
Products
Projected CAGR
11th 5 Year Plan Growth
2005/06 - 2011/12 2011/12 - 2016/17
12th 5 Year Plan Growth
Actual CAGR
Custom Duty
%
Countervailing
Duty (CVD) %
Educational
Cess on CVD %
Special
Additional
Duty %
Total Duty %
7.5 12 3 4 25.852
HDPE
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POLYMERUPDATE
Analysis HDPE Import Data


Contact Details: 344, A to Z Indl. Estate, G. K. Marg, Lower Parel (w), Mumbai 400018, INDIA | Email: info@polymerupdate.com | Tel: +91-22-61772000 (25 lines) | Fax: +91-22-61772025 12

Crude Price Movement V/s INR performance against the USD

The graph shows the movement of Dated Brent, Nymex crude and the INR performance against the USD. The Y-axis on the left is USD/barrel rate while
the Y-axis on the right represents the conversion rate.


















Source: PolymerUpdate Market Intelligence, RBI currency reference rates













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POLYMERUPDATE
Analysis HDPE Import Data


Contact Details: 344, A to Z Indl. Estate, G. K. Marg, Lower Parel (w), Mumbai 400018, INDIA | Email: info@polymerupdate.com | Tel: +91-22-61772000 (25 lines) | Fax: +91-22-61772025 13

India Economic News

HSBC India Purchasing Managers Index

Indian manufacturing sector stagnates in July as output and new orders continue to fall
Julys seasonally adjusted HSBC India Manufacturing Purchasing Managers Index posted only fractionally above the 50.0 no-change threshold. Down from
50.3 in June to 50.1, the latest reading was indicative of a broad stagnation of manufacturing operating conditions in India.
Output fell for the third consecutive month in July, amid evidence of falling new orders, tough economic conditions and raw material shortages. The rate
of decline, however, was fractional and eased since June. Lackluster demand conditions had resulted in a further contraction of incoming new work, with
sector data highlighting declines in the intermediate and investment goods sectors. Conversely, consumer goods producers signaled higher levels of new
orders, but the rate of expansion was modest.
Manufacturers indicated slower supplier delivery times in July, suggesting that the depreciation of the rupee meant vendors were reluctant to import raw
materials. Subsequently, stocks of purchases fell for the first time since April 2012.
Key Points

Operating conditions broadly unchanged since June
Third consecutive decline in production volumes
New orders decrease, but exports rise for eleventh month running

Historical Overview



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POLYMERUPDATE
Analysis HDPE Import Data


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ZyFin Business Cycle Indicator
Business climate improves in July
Lifted by increase in foreign direct investment (FDI) and greater revenue receipts by the Government, India witnessed an improvement in its business
climate. The ZyFin Business Cycle Indicator (BCI), which reflects various macroeconomic trends on a monthly basis, stood at 165.3 points in July 2013,
5.3 per cent higher compared to the same month last year.
The key factors with a positive impact on BCI in July include domestic and international air traffic, suggesting improving consumer sentiment, increased
FDI inflows and greater revenue receipts for Government, according to the report.
On the basis of current trends, India is expected to witness an economic growth of 5.3 per cent in the first quarter of 2013-14, which is likely to go up to
5.8 per cent by December 2013, the report said.
The index is based on components in four broad categories: capital markets, foreign trade, policy and the real economy.
ZyFin Consumer Confidence Index (CCI)
ZyFin consumer confidence index dips marginally in July
The ZyFin consumer confidence index of India, which measures consumer confidence among urban consumers across 18 major Indian cities, registered a
score of 40.8 for the month of July 2013, a dip of 1.1 points from the previous month. The data collected from the monthly survey of 4,000 respondents
indicated that, despite the current economic slowdown, Indian consumers across tier 1 and tier 2 cities are showing an inclination to spend.

According to the survey, consumers are intending to purchase homes as well as two-wheeler and four-wheeler vehicles within the next six to twelve
months. This optimism has manifested in a 0.4 point increase in the spending sentiment index. The index stood at 30.9 in July, rising by over 2.6 points in
the last six months.

India Credit Rating
Agency India Rating
S&P Rating BBB-
S&P Outlook Negative
Moody's Rating Baa3
Moody's Outlook Stable
Fitch Rating BBB-
Fitch Outlook Stable

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POLYMERUPDATE
Analysis HDPE Import Data


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Index of Industrial Production Growth
Index of industrial production (IIP) fell by 2.2 per cent in June compared to a year ago. For the first
Quarter (April-June) of 2013-14, industrial output was 1.1 per cent lower than the corresponding period of the previous year. These figures suggest that
even if construction maintained its growth rate of past few quarters (an optimistic scenario given the high base of 7 per cent growth Q1, 2012-13),
industrial GDP is likely to have grown at less than 0.5 per cent in the first quarter of this fiscal. Even if one accounts for a normal monsoon and relatively
resilient service sector, first quarter GDP growth is almost certain to be below 5.0 per cent in 2013-14.

Weak domestic demand, supply-side bottlenecks and policy uncertainty, especially those related to fuel availability, land acquisition and environmental
clearances have hurt private sector investments and dampened industrial activity. The adverse impact of the weak rupee on corporate balance sheets -
according to a study by CRISIL Research, Nifty companies have around 40 per cent of their debt in foreign currency and according to RBI around half of
corporate

Indias forex exposures are unhedged - and caution on the upcoming elections can further delay investment decisions by the private corporate sector.
With weak investment sentiments and rising concerns on external sector vulnerabilities, it is incumbent upon the government to kick-start recovery by
speeding up clearances of stalled projects and resolving issues plaguing the mining sector.

Capital goods output contracted for the third month in a row and stood at 6.6 per cent in June, reflecting subdued investment climate. Consumer
goods output in June fell by 2.3 per cent compared to a year ago, reflecting a sharp slowdown in private consumption, weighed down by slower
income growth, high interest rates and high retail inflation.

The growth of the eight core infrastructure industries, having nearly 38 per cent weight in IIP, fell sharply to 0.1 per cent in June as compared to
7.9 per cent in the same month last year. Electricity, coal and natural gas output, all of which are critical inputs for the industrial sector, also
declined. Policy focus on resolving issues pertaining to fuel availability is absolutely critical for a turnaround of the industrial sector.


Source: Crisil
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POLYMERUPDATE
Analysis HDPE Import Data


Contact Details: 344, A to Z Indl. Estate, G. K. Marg, Lower Parel (w), Mumbai 400018, INDIA | Email: info@polymerupdate.com | Tel: +91-22-61772000 (25 lines) | Fax: +91-22-61772025 16

All India General, Group and Sub-group wise Consumer Price Indices



















Source: Central Statistics Office, GoI
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POLYMERUPDATE
Analysis HDPE Import Data


Contact Details: 344, A to Z Indl. Estate, G. K. Marg, Lower Parel (w), Mumbai 400018, INDIA | Email: info@polymerupdate.com | Tel: +91-22-61772000 (25 lines) | Fax: +91-22-61772025 17

Provisional annual inflation rate based on all India general CPI (Combined) for July 2013 on point to point basis (July 2013 over July 2012) is 9.64% as
compared to 9.87% (final) for the previous month of June 2013. The corresponding provisional inflation rates for rural and urban areas for July 2013 are
9.14% and 10.26% respectively. Inflation rates (final) for rural and urban areas for June 2013 are 9.63% and 10.13% respectively.
Indian car sales down 7.4% in July
According to data provided by industry body SIAM (Society of Indian Automobile Manufacturers), car sales in India fell an annual 7.4 percent in July which
makes it the ninth straight month of fall, as rising fuel costs and high interest rates continued to keep demand subdued.
Automakers sold 131,163 cars in India in July while sales of motorcycles fell 1.5 percent to 809,312 vehicles, while truck and bus sales were down 14.9
percent at 55,301 vehicles.
INR V/s USD in 2013




Source: RBI reference rates
Considering monthly averages, the Indian rupee has depreciated about
10% until July 2013.

India GDP Growth Projection

Exhibit: India GDP Growth Projection 2013-14





Data collected from various sources
Agencies GDP Growth
Reserve Bank of India - July
2013
5.5%
IMF WEO - July 2013 5.6%
World Bank - June 2013 5.7%
ADB - July 2013 5.8%
CRISIL - July 2013 5.5%
HSBC - June 2013 5.5%
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POLYMERUPDATE
Analysis HDPE Import Data


Contact Details: 344, A to Z Indl. Estate, G. K. Marg, Lower Parel (w), Mumbai 400018, INDIA | Email: info@polymerupdate.com | Tel: +91-22-61772000 (25 lines) | Fax: +91-22-61772025 18

We will be happy to receive any feedback/suggestions on this analysis.

Also, if there are any queries, then please do not hesitate to get in touch with us at info@polymerupdate.com.

Disclaimer: This analysis makes use of Import data procured from the Indian Customs and is being made available on an as is basis. We have
attempted to refine the raw database by removing records with sweep/reprocessed/off-grade material shipments and records with non-standard units. We
have undertaken our best efforts in refining the database while formulating our statistics; however, customs data is known to include repetitions which are
difficult to verify independently and may have inadvertently got included in this analysis. The figures have been rounded off during some calculations;
hence the totals and subtotals may not match exactly. No representation or warranty, express or implied, is made as to the fairness, accuracy,
completeness or correctness of the information/opinions contained herein. It is advisable that all figures be considered as approximate.







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