SH Kelkar and Company is in the business of fragrance and it has been hitting new lows almost every single day since the covid-19 fear started spreading. Today it went down 11%, hitting another new low at Rs.81.35.
The company gave an update over its situation on account of the virus.
The company directly sources 20% of its raw material requirements from China and another 10% is indirectly dependent on China. The company said that it is actively in discussion with all its suppliers to continuously assess and be prepared for any change in the supply situation.
Currently, it said it holds adequate inventories to support uninterrupted production till April 2020.
In mid-January 2020, following the Chinese New Year celebrations, SHK had carried out a maintenance shutdown of its manufacturing facility in China which was extended until February end 2020 in-line with the Chinese Government's directives over COVID-19. The manufacturing facility has become operational from 1st week of March 2020.
The government of Italy has recently adopted emergency measures in response to the outbreak of COVID-19. Amidst this situation, the operations of Creative Flavors and Fragrances in Italy currently remain unaffected. The company is hopeful that the situation stabilizes in the medium term.
Though the company assured that its business will be largely unaffected by any supply chain disruptions, the market is obviously not convinced.