Neogen Inks Pact With Japan's MUIS To Buy Manufacturing Tech License For Electrolytes In India

Specialty chemicals manufacturers Neogen Chemicals (Neogen) on Monday said it has signed an agreement with MU Ionic Solutions Corporation, Japan, to acquire manufacturing technology license for electrolytes in India. MU Ionic Solutions (MUIS) is a joint venture between Mitsubishi Chemical Corporation (MCC) and UBE Corporation, and is a group company of The Mitsubishi Chemical Group, a Japanese conglomerate.

As per the terms of the agreement, Neogen will obtain the license from MUIS for proprietary and confidential manufacturing technology for making Neogen's electrolyte solutions at its manufacturing facility in India with a maximum installed capacity of up to 30,000 tonne per annum. These electrolytes will be targeted by Neogen to meet the growing demand of lithium-ion cell manufacturers in India.

"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. Now the company has to evaluate in how many phases it will reach this 30,000 tonne capacity per annum and look into the difference between the technology of both the companies and then see what will be the capex required, he stated.

The company expects to set up a commercial plant with this technology license for electrolytes in Gujarat by 2025-26, Kanani said. Currently, the company operates out of its three manufacturing facilities located in Mahape in Maharashtra and Dahej SEZ, Bharuch as well as Karakhadi, Vadodara in Gujarat. Neogen's revenue for 2022-23 is estimated at 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.