Chennai-based Manali Petrochemicals will invest ₹100 crore to increase its polyol production capacity from the current 50,000 tonnes per annum (tpa) to 1,50,000 tpa.
The brownfield investment would be staggered over four to five years.
Increase capacity
The first phase, expected to be completed by March 2016, will take the company’s production from 50,000 tpa to 75,000 tpa.
The subsequent phases, each with a 25,000-tonne capacity addition, would be commissioned every 12 months.
Incremental turnover would be about ₹280-300 crore with every additional phase, according to the company.
Polyol demand in India is estimated to be roughly 5 lakh tonnes in a market dominated by multinational petrochemical companies such as Dow, Shell, Bayer, BASF and Huntsman.
New additions
The company expects the new additions to produce cost-effective propylene oxide (PO) in manufacturing products like Polyurethane Foams (PU), which is extensively used in the automotive, construction, refrigeration and other industrial products.
The key raw material for the production of PU and Propylene Glycol is PO.
Chairman Ashwin C Muthiah said, “This move will give Manali Petrochemicals significant scale and ability to further penetrate the market. The latest technology will ensure efficient and global manufacturing best practices.”
Manali’s stock fell nearly six per cent to close at ₹15.70 on the BSE on Wednesday.
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