Aarti Industries collaborates with Global Chemical Conglomerate to develop and supply High Value Specialty Chemical Intermediate worth $125 million for a 10 year supply period
Deepthi | Myequity news | Date : 20-02-2019 09:50:00 IST
Aarti Industries Ltd (AIL) today announced that they have signed a $125 million (INR 900 Cr at current Exchange Rate) supply contract with a leading global chemical conglomerate. The contract entails supply of a high value specialty chemical intermediate for a period of 10 years. The plant is expected to commission in Q4 FY 2021, with average annual revenue of $ 12.5 million. The end use of the product is one of the major new growth initiatives for the customer. The supply quantities of the contract will be used to seed the market and increase the potential market size of the product.
AIL estimates a capital investment of approx $15 million to setup a commercial scale manufacturing facility for the production of this speciality chemical intermediate. The upcoming facility will be located in the state of Gujarat. The product is not part of AIL's existing product range. The process had been optimized and scaled up jointly by the technical teams of both the companies over last 4 years within the boundaries of stringent quality requirements. This particular deal not only augments AIL's product portfolio, but also testifies the elevated brand equity the company has among its targeted customers. In line with AIL's vision to be a "Global Partner of Choice", AIL collaborates with its global customers to develop niche chemical intermediates involving complex chemistries.
Commenting on this contract Mr. Rajendra Gogri, Chairman & Managing Director, Aarti Industries Limited
said, "This contract demonstrates Aarti Industries' technological capabilities to scale up from R&D to commercial quantities while meeting stringent process parameters". He further added, "Aarti's technology team has meticulously collaborated with the customer for 4 years to develop this commercially viable multi-step process."