BASF evaluates MDI investment in India; stock climbs

BASF India Ltd on Monday said it is evaluating a potential investment in India to establish an MDI (methylene diphenyl diisocyanate) production complex.

The company said it is in the advanced stages of a feasibility study for the proposed facility and has secured an industrial land parcel in Dahej, Gujarat, through its Indian subsidiary, BASF India Polyurethanes Pvt Ltd.

MDI is a key building block for polyurethane products, which are used in applications including building insulation, refrigeration, automotive components, furniture and consumer goods.

"India is among the most attractive growth markets globally, with strong demand expected across a wide range of industries," said Stephan Kothrade, member of the Board of Executive Directors and Chief Technology Officer of BASF SE.

Kothrade said a potential investment in India would expand BASF’s manufacturing footprint in the country and support its local-for-local approach by enabling the company to serve customers in India and neighbouring markets with locally produced MDI.

The company said the final investment decision will depend on the outcome of the feasibility study and will be subject to all necessary approvals.

"BASF continues to invest in its global MDI production network to support customer growth and ensure reliable supply across key markets," said Ramkumar Dhruva, President of BASF’s Monomers division.

BASF said its $1 billion MDI expansion project in Geismar, United States, is entering its final phase. The company also operates MDI production facilities in Antwerp, Belgium; Chongqing and Caojing (Shanghai), China; and Yeosu, South Korea.

In India, BASF operates multiple production sites and has an integrated chemical complex in Dahej, where it already operates an MDI splitter and polyurethane production facilities.

Following the announcement, shares of BASF India were last seen trading 1.06 per cent higher at Rs 3,645.70.