Manufacturers of specialty chemicals Neogen Chemicals (Neogen) said that they had reached an agreement with the Japanese company MU Ionic Solutions Corporation to obtain a production technology licence for electrolytes in India.
A subsidiary of the Japanese corporation The Mitsubishi Chemical Group, MU Ionic Solutions (MUIS) is a joint venture between Mitsubishi Chemical Corporation (MCC) and UBE Corporation.
According to the terms of the contract, Neogen will get a licence from MUIS to use its patented and confidential manufacturing technology to produce its electrolyte solutions at a plant in India with an installed capacity of up to 30,000 tonne per year.
Neogen will concentrate on these electrolytes to satisfy the rising demand of Indian makers of lithium-ion cells.
"Initially we had evaluated a capex of Rs 450 crore with our own technology for an installed capacity of 10,000 tonne per annum. With this agreement, we now have the capability to go up to 30,000 tonne per annum,'' Neogen Chemicals Managing Director Harin Kanani told reporters.
As per him, the company must now determine how many stages it will take to reach this 30,000 tonne capacity annually and examine the technological differences between the two companies to determine the capex that would be needed.
By 2025–2026, the business anticipates opening a commercial electrolytes factory in Gujarat using the technical licence, according to Kanani.
The company currently runs out of three manufacturing facilities, one each in Mahape, Gujarat; Dahej SEZ, Bharuch; and Karakhadi, Vadodara.
The projected revenue for Neogen in 2022–2023 is between Rs. 650–700 crore.
"With our technology, we have estimated 10,000 tonne of business and Rs 1,000-1,200 crore revenue by FY26-FY27. Now with this announcement, we will again have to revisit capex and also have to revise our revenue guidance along with it,'' he noted.