Himadri Chemicals to Invest Rs 4,800 Crore in Lithium-Ion Facility
By siliconindia | Thursday, 07 December 2023, 09:55 IST
Himadri Specialty Chemicals is preparing for a substantial investment of Rs 4,800 crore to enter the production of components for Lithium-ion batteries. The upcoming facility in Odisha will be dedicated to manufacturing Lithium Iron Phosphate (LFP) Cathode Active Material, an essential element for electric vehicle (EV) batteries. This strategic initiative positions Himadri as a trailblazer in India's venture into this particular sector.
Funding for the initiative will predominantly arise from internal earnings, as affirmed by the top leadership of the company. Anurag Choudhary, CMD & CEO of Himadri Specialty Chemicals Ltd, indicated, "We expect to achieve a debt-free and positive cash position by March", underscoring their intent to utilize internal resources. Choudhary also credited their 150-member R&D team's extensive efforts spanning nearly 15 years for the development of this product.
The project will unfold in stages, with the initial phase estimated at Rs 1,125 crore for a 40,000 MTPA capacity, projected to commence operations within 27 to 36 months. Over the subsequent five to six years, Himadri aims to expand production to 200,000 MTPA of LFP Cathode Active Material, meeting the demand for 100 GWh of Li-ion Battery, demonstrating their ambitious growth plan. Recognizing the crucial role of cathode materials in Lithium-ion cell production, which significantly influences cell costs, Himadri seeks to capitalize on the growing demand. Anticipating a surge in global demand for Cathode Material, expected to reach 9.4 million tonnes annually by 2030, Himadri aims to carve a niche in this expanding market currently dominated by Chinese firms.
Nonetheless, Himadri's primary focus remains on supplying these materials to original equipment manufacturers (OEMs) and battery cell manufacturers, steering clear of direct involvement in Lithium-ion battery manufacturing. The company also intends to explore international markets, planning to export their new product beyond India, foreseeing substantial demand. Lithium Iron Phosphate (LFP) batteries, preferred for their higher thermal runaway temperature and enhanced safety compared to other battery types, provide a strategic advantage in diverse climatic conditions, such as those prevalent in India. Their cost-effectiveness and extended lifespan further enhance their appeal, diverging from the higher production costs associated with other battery compositions.
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