Chart of the week: Increased EV adoption starts the Giga factory race in India

26 Mar 2024 , 03:17 PM

India battery manufacturing and supply chain summit shed light on the evolving battery ecosystem in India as well as globally. With the giga factory race picking up in India, chemical companies have started exploring supply chain opportunities with some already committing large capex. Though battery manufacturing is complex and involves various components that may vary with evolving chemistry, India’s ambitious goal of EV adoption, renewables and local sourcing equips the space with guaranteed demand offtake. However, complexities around the rigorous qualification processes will warrant a cautious approach, as the strike rate will be low in the near future as companies undergo the learning curve.

Upcoming battery capacities in India*

Chemical companies targeting battery supply chain

Company	Target segment
Neogen Chemicals	Getting into electrolytes and electrolyte salts
Gujarat Fluorochemicals	Getting into electrolytes and electrolyte salts. Will also focus on additives, CAM and binders
PCBL Ltd	Exploring nano-silicon technology for EV
Himadri Specialty chemicals	Getting into CAM
Aether Industries	Tied up for electrolyte additives
Ami Organics	Getting into electrolytes, also focussing on additives
Tatva Chintan	Getting into electrolyte salts
Pondy Oxides	Focussing on recycling of Li-ion batteries

Source: Company, IIFL Research

Favourable policies driving investments across the globe

Country	Regulation/Act	Key points
USA	Inflation Reduction Act	IRA aims to strengthen the battery supply chain and established a production tax credit for manufacturing
Australia	Promotion of battery & critical minerals	Facilitates global investment in pre-cursor/cathode active materials manufacturing
European Union	Critical raw minerals act	To strengthen EU’s critical raw materials capacities across the value chain to reduce dependency
India	ACC PLI	Mandates minimum 60% domestic value addition
China	Domestic battery manufacturing	Improving domestic battery market that includes cell manufacturing, supply chain development

Source: : CES, IESA, IIFL Research

Upcoming battery capacities in India