Aarti Industries signs Rs 900 cr supply contract for specialty chemical intermediate

Aarti lndustries Ltd (AIL), which is into pharma and chemical businesses, Wednesday said it has bagged a Rs 900 crore contract to supply specialty chemical intermediate to a global firm.

The Mumbai-based company has "signed a USD 125 million (Rs 900 crore at current exchange rate) supply contract with a leading global chemical conglomerate," it said in a filing to the BSE.

The contract entails supply of a high value specialty chemical intermediate for a period of 10 years, it added.

AIL estimates a capital investment of about USD 15 million to set up a commercial scale manufacturing facility for the production of the specialty chemical intermediate which is not a part of the existing product range.

The facility will be located in Gujarat and the plant is expected to be commissioned in Q4 of FY'2021, with an average annual revenue of USD 12.5 million.

"The end use of the product is one of the major new growth initiative 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," the statement said.

"This contract demonstrates Aarti lndustries' technological capabilities to scale up from R&D to commercial quantities while meeting stringent process parameters," AIL's CMD Rajendra Gogri said.