Balaji Amines is setting up a chemical plant to produce dimethylformamide (DMF) and di-methyl amine hydrochloride (DMA HCL) at an investment of Rs 30 crore in Maharashtra.
The first phase of the DMF plant with a capacity of 7,500 tonnes is set to come on stream by September this year, while the second phase would double the output by December this year.
The project assumes significance due to short supply of these amines in global market. Used as raw materials for manufacturing anti-diabetic and antibiotic, these amines always remain in supply deficit due to rapid expansion in production capacity of pharmaceutical companies.
Balaji’s products, specially chemicals, aliphatic amines and its derivatives, cater mainly to active pharmaceutical ingredients (APIs), agrochemicals, rubber chemicals, water treatment chemicals, refineries and other industries in the domestic and global markets.
India’s total consumption of DMF stands at 30,000 tonnes per annum of which Rashtriya Chemical and Fertiliser (RCF) produces between 3,000 – 4,000 tonnes per annum. Balaji has currently one plant up and running at an annual capacity of 22,000 tonnes. Indian pharmaceutical companies also import huge quantity of DMF to meet its requirement.
“Total import of DMF was recorded at 17,000 tonnes. Therefore, we proposed to set up a unit with an annual production capacity of 30,000 tonnes,” said D Ram Reddy, director of Balaji Amines.
The only substitute to this product is dicyandiamide (DCDA) which is largely produced in China. But, being the highest polluting industry, DCDA manufacturing unit can’t be set up anywhere and everywhere.
Accumulating the two plants, the total DMF production capacity of Balaji Amines would go up to 52,000 tonnes making it the world’s largest producer of DMF.
With the rising demand from pharma companies, the price of DMF has surged to $4-5 a kg now from $2.5- 3 a kg about a month ago. Reddy hopes the price spurt to continue in the future.
The additional capacity of all its products is set to add 25-30 per cent in the company’s annual turnover which was reported at Rs 486 crore in the financial year 2011- 12, a rise of 26 per cent from the previous year.
The company operates from three manufacturing complexes, with two facilities in Solapur (Maharashtra) and one in Hyderabad (Andhra Pradesh). Balaji has a dedicated research and development center which is continuously engaged in reduction of manufacturing costs through process improvements. The company has been instrumental in introducing new products and expanding existing facilities every year.
During the June quarter, the company posted a net profit at Rs 9.4 crore at a turnover of Rs 136.6 crore.
