The Mumbai-based Vinati Organics Ltd (VOL), a specialty chemical company producing organic intermediates, monomers and polymers, is all set to expand its business with an investment of around Rs 120 crore for capacity building.
VOL, claimed as the world’s largest manufacturer of isobutylbenzene (IBB), the basic raw material in manufacture of ibuprofen and also the world’s second largest manufacturer of 2-acrylamido-2-methyl propane sulfonic acid (ATBS), has already finished establishment of a new plant as backward integration, to manufacture isobutyl (IB), with an investment of Rs 40 crore. The new plant with a capacity of 12,000 tonne per annum is expected to start operation in May, 2010, according to Vinati Saraf Murteja, executive director, VOL.
Further, the company will induct around Rs 40 crore to expand its manufacturing capacity of N-tertiary butyl acrylamide (TBA) and ATBS along with entering into manufacturing of other monomers including N-tertiary octyl acrylamide (TOA ) and diacetone acrylamide (DAAM). Including this, the company will make an investment of Rs 80 crore in the next two years out of which Rs 40 crore will be to expand its manufacturing of acrylamide, with expectations to finish the project before March 2012.
“The capacity expansion plans will be carried out in our Lotte plant. The IB plant will have a capacity of 12,000 tonne per annum in which 4000 tonne will be for our in-house usage while the rest will be marketed out,” said Vinati. She added that the manufacturing of ATBS will be increased from the current 10,000 tonne per annum to 12,000 tonne per annum with the plans materialized.
VOL has around 65 per cent market share in IBB and almost 25 per cent share in ATBS market globally. “Ibuprofen is a fairly mature drug and presently grows at 4-5 per cent annually. ATBS on the other hand is very young and versatile product having uses in varied industries. We expect ATBS to grow at 15 per cent,” said Vinati. Almost 50 per cent of the current revenue of VOL is from IBB, which will be reduced to 40 per cent in future providing more space to other monomers to occupy the centrestage of company’s growth, she added.
The company is expected to close its revenue at Rs 240 crore turnover in the current financial year and has plans to grow to Rs 300 crore revenue in 2011. With the expansion plans on the board, the company expects to reach Rs 1000 crore turnover in next five years, she averred. VOL, at present, exports its products to almost 20 countries including US and Europe.