Tata Chemicals has no EV plant plan, lines up Rs 5,000-crore capex

Tata Chemicals' consolidated turnover for financial year 2021-22 (FY22) grew 24 per cent to Rs 12,622 crore over the previous year

tata chemicals
Photo: Bloomberg
Viveat Susan Pinto Mumbai
3 min read Last Updated : Jul 07 2022 | 12:17 AM IST
Tata Chemicals will not set up a battery plant for electric vehicles (EVs), Tata group Chairman N Chandrasekaran said at the company’s eighty-third annual general meeting held virtually on Wednesday.

Instead, the emphasis would be on expanding its current businesses for which the company, the world’s third-largest soda-ash maker, would invest Rs 5,000 crore in capital expenditure (capex) in the next few years, said Chandrasekaran, who is also the chairman of Tata Chemicals. The 59-year-old executive was responding to shareholders.

Tata Chemicals’ consolidated turnover for financial year 2021-22 (FY22) grew 24 per cent to Rs 12,622 crore over the previous year. The company reported an over threefold growth in profit after tax in FY22 to Rs 1,400 crore, its annual report shows.

Chandrasekaran said Tata Chemicals, part of the $103-billion Tata group, would continue to provide its expertise to group companies, including Tata Motors, as far as lithium carbonate, an important component in EV batteries, was concerned.

Soda ash is one of the principal raw materials used in the production of lithium carbonate. Though shareholders alluded to the shift towards green energy and mobility to drive home the point for an EV battery unit at Tata Chemicals, Chandrasekaran said the focus would remain on existing categories of the company.

“The EV ecosystem under Tata Motors has a number of companies from the Tata group as a part of it. This includes Tata Chemicals, Tata Power, Tata Autocomp, and Tata Motors Finance, among others. We will continue to leverage group companies as part of the initiative. Some of them will have a significant role to play, while some will not have a big role to play,” Chandrasekaran told shareholders.

Apart from soda ash, Tata Chemicals manufactures products such as sodium bicarbonate, salt and silica, which have a wide range of industrial applications. The company was also the distributor of the country's largest salt brand, Tata Salt, till two years ago, when the firm offloaded the business to Tata Consumer Products, along with branded pulses and cereals under the Tata Sampann label.

Chandrasekaran was the chief architect of this shift as he sought to consolidate consumer operations under his ‘3S philosophy’, which included simplification, synergy, and scale. In recent months, he has added a fourth ‘S’, which is sustainability to the list.

When addressing shareholders, he said Tata Chemicals would bring a sharper focus on sustainability by reducing 30 per cent of its carbon emissions by 2030 and ensuring circularity of feedstock, low-energy intensity, and zero effluents.

As part of this initiative, Tata Chemicals last week commissioned UK’s first “at scale” carbon capture and utilisation facility, which not only reduces carbon intensity, but also provides a sustainable source of critical inputs in house, Chandrasekaran said.

Tata Chemicals is also expanding its soda ash capacity at its Mithapur plant in Gujarat, while new salt capacities will commence in the second half of FY23, he said.

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Topics :Electric VehicleTata ChemicalsElectric VehiclesTata group

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