Meghmani Organics Limited will set up a manufacturing facility for White Pigment Titanium Dioxide (TiO2) in Dahej, Gujarat for a total capex of ₹400 crore.

The plant will have the capacity of 33,000 tonnes per annum, the company said in a regulatory filing.

Titanium Dioxide (TiO2) has application as a bright white pigment in various industries including paint, coating, plastic, ink, dyes, paper and cosmetics among others, it said.

The company expects to commission the project by the first quarter of the fiscal 2023-24.

The new project will add ₹700 crore to Meghmani Organics’ topline on a full-financial year basis, the company stated.

Meghmani Organics had reported ₹ 55 crore revenues from operations for the quarter ended September 30, 2021.

The company eyes an EBITDA margin of 25 per cent with robust return ratios i.e ROCE and ROE of over 20 per cent each.

The new project will be funded by an appropriate mix of internal accruals and debt, it added.

India’s annual demand for Titanium Dioxide (TiO2) is pegged at 2,50,000 mtpa and is growing at the rate of 4.2 per cent CAGR.

Currently, India imports about 80 per cent of its TiO2 requirements. The domestic production capacities for TiO2 currently stand at 81,000 mtpa.

Ankit Patel, Chief Executive Officer, said, “The company has strengthened its value added proposition of its Pigments Division with its entry into White Pigment Titanium Dioxide. Meghmani Organics’ foray into TiO2 is in line with the company’s endeavour of creating sustainable growth in Pigment Division beyond Phthalocyanine Pigment Blue and Green.”

Meghmani Organics shares ended positive with nearly 2 per cent gain on the BSE at ₹93.65 on Tuesday.

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