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    Chetan Udeshi

    Research Analyst at JPMorgan Chase & Co.

    Chetan Udeshi is an Equity Research Analyst at JPMorgan Securities, specializing in coverage of the European chemicals and industrials sectors, including companies such as BASF SE, Linde, Covestro, Yara International, Koninklijke DSM, Air Liquide, and Dialog Semiconductor. With coverage of over 30 stocks, Udeshi has delivered notable recommendations such as an 81.3% one-year return for Brenntag, though his overall stock call success rate is approximately 52%, with a price target met ratio of 25% and an average potential upside of 93% for his recommended stocks. He began his career at JPMorgan India before joining JPMorgan Securities Plc in London in September 2010, where he continues to build his track record in European chemical equities research. While specific securities licenses or FINRA registrations are not publicly listed, his position requires compliance with all required credentials for equity research within the UK and European banking regulations.

    Chetan Udeshi's questions to SOLVAY S A /ADR/ (SLVYY) leadership

    Chetan Udeshi's questions to SOLVAY S A /ADR/ (SLVYY) leadership • Q1 2025

    Question

    Chetan Udeshi of JPMorgan Chase & Co. asked for an explanation of the volatile corporate cost line, the size of the rare earth business and its sensitivity to pricing, and why soda ash volumes are weak when container glass customers report growth.

    Answer

    CFO Alexandre Blum clarified the corporate line's volatility is due to one-offs, with a normalized annual run rate of €70-€90 million. CEO Philippe Kehren noted the Special Chem business is about 12% of sales, with the new rare earth project being marginal. Kehren addressed soda ash volumes by explaining there's a lag before customer recovery impacts Solvay's order book and denied market share loss, attributing the year-over-year decline to the absence of opportunistic sales that occurred in Q1 2024.

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    Chetan Udeshi's questions to SOLVAY S A /ADR/ (SLVYY) leadership • Q1 2025

    Question

    Chetan Udeshi of JPMorgan Chase & Co. sought an explanation for the volatility in the corporate cost line, asked for the current size of the rare earths business and its sensitivity to metal prices, and questioned why soda ash volumes were weak when container glass customers were seeing positive trends.

    Answer

    CEO Philippe Kehren clarified that there was no soda ash market share loss, attributing the weak volume comparison to opportunistic sales in Q1 2024 when China was importing. CFO Alexandre Blum explained the corporate line's volatility is due to one-off items and guided to a normalized annual run rate of €70-€90 million. Mr. Kehren added that the Special Chem business is about 12% of revenue, but the new rare earth project is currently marginal.

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    Chetan Udeshi's questions to SOLVAY S A /ADR/ (SLVYY) leadership • Q1 2025

    Question

    Asked for an explanation of the volatility in the corporate cost line, the current size and pricing impact of the rare earths business, and the reason for soda ash volume weakness despite positive signs from container glass customers.

    Answer

    The corporate line is volatile due to one-off events, with a normalized annual run rate of EUR 70-90 million. The rare earth business for magnets is currently marginal. The perceived soda ash weakness is due to a lag in customer recovery reaching Solvay's order book and a comparison to an unusually strong Q1 last year when China was importing; no market share has been lost.

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    Chetan Udeshi's questions to SOLVAY S A /ADR/ (SLVYY) leadership • Q2 2024

    Question

    Chetan Udeshi inquired about the expected EBITDA trend from Q2 to Q3, the typical seasonality for the new Solvay, and the details behind the large provision for the Dombasle energy project cost overrun.

    Answer

    CEO Philippe Kehren stated that Q3 volumes are expected to be stable and in line with Q2, with cost savings balanced by transformation spending. CFO Alexandre Blum clarified the Dombasle provision totals EUR 78 million and is considered final after a full reassessment, attributing the overrun to project complexity and external headwinds. Kehren added that other energy transition projects are on track.

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    Chetan Udeshi's questions to SOLVAY S A /ADR/ (SLVYY) leadership • Q2 2024

    Question

    Chetan Udeshi asked about the expected EBITDA trend from Q2 to Q3, the typical seasonality for the new Solvay in Q4, and the nature of the large cost overrun provisions for the Dombasle energy transition project.

    Answer

    CEO Philippe Kehren stated that Q3 is expected to be very much in line with Q2, with stabilizing volumes and cost savings balancing increased transformation spending. He noted the company tightened its full-year guidance due to derisking H1 but acknowledged uncertainty remains for H2. CFO Alexandre Blum clarified the Dombasle provision totals €78 million and is considered final after a full reassessment of the complex project. He assured that other energy transition projects in the U.S. and Germany are on time and on budget.

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    Chetan Udeshi's questions to SOLVAY S A /ADR/ (SLVYY) leadership • Q1 2024

    Question

    Chetan Udeshi of JPMorgan Chase & Co. asked for an update on pending separation cost cash flows and questioned why the Basic Chemicals segment maintains a high 28% margin at a perceived trough, while Performance Chemicals is much lower.

    Answer

    CFO Alexandre Blum clarified that less than EUR 50 million in separation costs remain to be paid in 2024. CEO Philippe Kehren explained that the Basic Chemicals segment is far more capital-intensive, thus requiring higher EBITDA margins to justify investments. He added that the Performance Chemicals margin is currently weighed down by the Coatis business, which is operating at a trough.

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    Chetan Udeshi's questions to SOLVAY S A /ADR/ (SLVYY) leadership • Q4 2023

    Question

    Asked for Q1 guidance and the expected EBITDA phasing throughout 2024, questioning if a low Q1 implies a strong recovery. Also inquired about demand trends in early-cycle businesses like silica and hydrogen peroxide.

    Answer

    Q4 is a good reference for Q1. The negative impact from soda ash pricing might be offset by slightly stronger volumes from restocking, so Q1 EBITDA is not expected to be massively different from Q4. The €100 million EBITDA impact from phased-out businesses was mostly in Q1-Q3 2023, not Q4. For other markets, they see some positive signals and higher volumes, but it's too early to confirm a sustained trend beyond restocking. Pricing in other businesses is resilient.

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    Chetan Udeshi's questions to NOVOZYMES AS/FI (NVZMY) leadership

    Chetan Udeshi's questions to NOVOZYMES AS/FI (NVZMY) leadership • Q2 2023

    Question

    Chetan Udeshi of JPMorgan Chase & Co. asked for confirmation of improving trends in Food & Beverages in early Q3, questioned the significant Q2 inventory increase, and inquired about potential cash leakage related to the Chr. Hansen merger.

    Answer

    President and CEO, Ester Baiget, confirmed early Q3 trends align with expectations. EVP and CFO, Lars Green, explained the inventory increase was driven by the delayed P&L effect of higher input costs, not excess volume, and expressed confidence in managing it down. Regarding the merger, both executives firmly stated they do not expect cash leakage beyond the guided one-time transaction and integration costs.

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    Chetan Udeshi's questions to NOVOZYMES AS/FI (NVZMY) leadership • Q1 2023

    Question

    Chetan Udeshi from JPMorgan asked about the structural shift in the Bioenergy business, seeking its current exposure to the U.S. ethanol market. He also challenged the company's claim of progress on commercial pricing, given the year-over-year decline in margins.

    Answer

    EVP, Agriculture & Industrial Biosolutions, Tina Fanø, stated that the Bioenergy business's link to U.S. ethanol production is now roughly 50%, down from 100% a decade ago. CEO Ester Baiget defended the pricing progress by highlighting the sequential gross margin expansion from Q4 2022 and reiterated that the company prices on value, not cost, with the impact materializing over time as contracts renew, which supports the goal of a flat gross margin for the year.

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    Chetan Udeshi's questions to NOVOZYMES AS/FI (NVZMY) leadership • Q1 2023

    Question

    Chetan Udeshi from JPMorgan Chase & Co. asked about the structural diversification of the Bioenergy business away from U.S. ethanol. He also challenged the commentary on pricing progress, pointing out that gross and EBIT margins were still down year-over-year in Q1.

    Answer

    EVP, Agriculture & Industrial Biosolutions Tina Fanoe stated that the Bioenergy business is now only roughly 50% linked to U.S. ethanol production, a significant diversification over the last decade. President & CEO Ester Baiget addressed the margin question by highlighting the sequential gross margin expansion from Q4 2022 as proof of progress. She reiterated that pricing is based on value, not cost, and its impact is gradual, with the full-year goal remaining a flat gross margin.

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    Chetan Udeshi's questions to NOVOZYMES AS/FI (NVZMY) leadership • Q4 2022

    Question

    Chetan Udeshi asked for clarification on the Q4 gross margin, which saw no leverage despite strong pricing and volume, and inquired about the margin trajectory for 2023. He also sought to understand if the soft Q1 guidance could imply negative organic sales growth.

    Answer

    CFO Lars Green explained the Q4 gross margin was impacted by higher freight costs from fulfilling strong Bioenergy demand and some product mix effects. For 2023, he expects a gross margin similar to 2022, as secured price increases will offset input costs that remain higher than the 2022 average. Regarding Q1, Green stated that while it will be a softer start due to a tough comparator, he would not expect it to be negative.

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    Chetan Udeshi's questions to L AIR LIQUIDE SA /FI (AIQUY) leadership

    Chetan Udeshi's questions to L AIR LIQUIDE SA /FI (AIQUY) leadership • Q2 2022

    Question

    Chetan Udeshi of JPMorgan Chase & Co. sought clarification on the robustness of take-or-pay contracts, asking if they hold during supplier or customer force majeure events, and questioned why European Large Industries sales fell 10% despite these protections.

    Answer

    Francois Jackow, Executive VP, clarified the 10% sales decline was due to lower variable volumes from customer turnarounds and a specific contract conversion, not a failure of the model. Pascal Vinet, SVP, detailed two protective mechanisms: a standard 'take-or-pay' and a 'fixed monthly fee' that is invoiced even if a customer claims force majeure. Francois Jackow concluded that the group's total sales impact from a major European gas curtailment would be limited to 1-2%.

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    Chetan Udeshi's questions to L AIR LIQUIDE SA /FI (AIQUY) leadership • Q3 2021

    Question

    Chetan Udeshi questioned the benchmark for merchant pricing, noting that the 2.2% increase in Europe appeared low compared to the manufacturing producer price index, which was running over 10%. He also asked why the Large Industries base business, excluding start-ups, showed zero growth despite easier prior-year comparisons.

    Answer

    Executive VP Francois Jackow responded that merchant pricing is benchmarked against Air Liquide's specific cost stack, not general PPI, to ensure cost recovery while maintaining customer relationships. CFO Jérôme Pelletan clarified that the Large Industries base business was slightly positive, but growth was masked by temporary factors including China's dual energy policy, the impact of Hurricane Ida, and customer turnarounds.

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    Chetan Udeshi's questions to L AIR LIQUIDE SA /FI (AIQUY) leadership • Q1 2021

    Question

    Chetan Udeshi from JPMorgan Chase & Co. asked about Air Liquide's competitive positioning in the electronics market in Asia versus the West and how its offering differs from peers. He also asked how to interpret the benefit of CapEx dedicated to efficiency improvements.

    Answer

    CFO & Executive VP Fabienne Lecorvaisier explained that efficiency CapEx, around 15% of industrial decisions, directly supports the company's €400M+ annual efficiency targets. Michael J. Graff, Executive VP, highlighted that Air Liquide's comprehensive offering, particularly its Advanced Materials business, is a key differentiator not offered by traditional industrial gas peers, helping it maintain a leading market share in its focus areas.

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    Chetan Udeshi's questions to L AIR LIQUIDE SA /FI (AIQUY) leadership • Q3 2020

    Question

    Chetan Udeshi asked about the potential for incremental CapEx on the acquired Sasol assets over the coming years. He also inquired about the expected year-on-year progression of Gas & Services margin in the second half compared to the first half.

    Answer

    Executive VP François Jackow confirmed there is a roadmap for further investment in the Sasol assets to modernize equipment, improve efficiency, and reduce CO2 emissions. CFO & Executive VP Fabienne Lecorvaisier stated that while temporary cost savings may soften in H2, recurring efficiency plans are ramping up, so she sees no reason for margin improvement to be lower in H2 than in H1.

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