Mumbai: American specialty chemicals maker Lubrizol will invest $200 million (about ₹1,674 crore) in India over four years to set up a greenfield manufacturing facility in Aurangabad.
The company is a leading manufacturer of additives used to make lubricants for vehicles and industrial machinery, among other things. It is betting on the growing demand for new vehicles in India to support the added manufacturing capacity from the new plant, which will be Lubrizol’s second-largest in the world.
“The automotive market in India is almost the third-largest in the world. As an economy, we aspire to become the third-largest economy with the kind of growth rates that we are experiencing here,” Bhavana Bindra, managing director, Lubrizol IMEA (India, Middle East and Africa), told Mint in an interview.
The company sees India's fast-expanding economy as an opportunity, she said.
The specialty chemicals market represents 22% of India's overall chemicals and petrochemicals market and is valued at $32 billion, per a recent KPMG report. The market is expected to grow at a compounded rate of 12% between 2020 and 2025.
Among additives manufacturers, Lubrizol's competitors include global players like Evonik Industries and Infineum as well as several smaller domestic players.
This is the second big investment announcement the American company has made in India in just over a year. In June 2023, it announced an investment of over $150 million in the country. The funds were to be used to set up the world’s largest cholrinated polivinyl chloride (CPVC) resin plant in Vilayat, Gujarat, double the capacity at its site in Dahej, Gujarat, and to open a grease lab in Navi Mumbai.
In April, the company announced that it will set up a new Global Capability Centre (GCC) in Pune.
The fresh investment will partly be funded through accruals at Lubrizol’s India unit and the company is still finalizing the means to raise the remainder sum, said Flavio Kliger, president of Lubrizol Additives.
The new plant will primarily cater to domestic demand and handle some exports for the company, Kliger said.
“Our mission is to double the size of our market in India in the next five years,” he said. “India has the right talent, local demand and meets all the requirements that qualifies it to be a global hub for Lubrizol.”
