Deepak Nitrite’s subsidiary Deepak Chem Tech (DCTL) has announced a major investment of ₹3,500 crore, aimed at setting up a large phenol and solvent manufacturing complex in India. This strategic move is set to significantly reduce the country's dependence on chemical imports, especially for phenol, acetone, and isopropyl alcohol (IPA), which are essential raw materials for numerous industries.

Import Substitution and Atmanirbhar Bharat Focus

The planned facility will include manufacturing units for phenol, acetone, and IPA, with proposed annual production capacities of:

• 300 KTA (kilotonnes per annum) of phenol

• 185 KTA of acetone

• 100 KTA of isopropyl alcohol (IPA)

These chemicals are currently being imported in significant volumes, especially acetone, for which India is not self-reliant. The company aims to bridge this gap and align with the government’s vision of Atmanirbhar Bharat (self-reliant India).

In addition, the existing capacity for phenol and acetone at Deepak Chem has been running at 100% utilisation, showcasing the demand for expanding domestic production.

Rs 220 Crore for Speciality Fluorochemicals Plant

In another key development, the board of Deepak Chem Tech approved an additional investment of ₹220 crore to set up a multi-purpose manufacturing facility dedicated to the production of specialty fluorochemicals. These chemicals are used across pharmaceuticals, agrochemicals, and other high-performance industries.

Polycarbonate Resin (PC) Manufacturing on the Horizon

The company has ambitious plans to integrate the new phenol and acetone capacities into the manufacturing of polycarbonate resins (PC). India is currently entirely dependent on imports for PC resins, which are widely used in automotive, electronics, medical devices, and construction industries.

To accelerate this, Deepak Tech has signed agreements to acquire and relocate a polycarbonate plant from Germany to India, signalling a leap towards vertical integration and global competitiveness.

Phased Expansion Over the Next Three Years

The new facilities for acetone, phenol, and IPA are expected to be commissioned in phased manner over a span of three years. According to the company, this would not only strengthen their existing value chain but also help serve growing domestic and international demand.

Chairman and CEO Comments on Strategic Vision

Deepak Mehta, Chairman and Managing Director of Deepak Nitrite, emphasized the significance of this investment:

“Deepak Group is committed to creating one of the most integrated capacities in the world. These import-substitute products will enhance our Group’s role in **India’s path to self-reliance and development (Vikshit Bharat).”

In a previous statement, CEO Maulik Mehta added that

“All major polymer projects are expected to be commissioned by December 2027, and the company is ensuring that European demand for resins will also be catered to through this asset.”

Strategic Industry Impact

• India’s demand for phenol, acetone, and IPA is growing rapidly, driven by their diverse applications in the pharma, paints, adhesives, and plastics sectors.

• By increasing domestic supply, Deepak Chem Tech aims to stabilize prices, improve supply chains, and increase India’s competitiveness in the global chemicals market.

• This expansion also enables import substitution and supports the Make in India initiative in the chemicals space.

Stock Market Reaction and Future Outlook

Despite the strategic scale of this announcement, shares of Deepak Nitrite have seen a decline of 28% in 2025 so far. This may reflect broader market pressures, investor caution in capex-heavy announcements, or lagging sentiment awaiting execution.

However, the long-term outlook remains positive as the company is betting big on integrated and sustainable growth, with a focus on high-demand sectors such as polymers, solvents, and specialty chemicals.

Conclusion

Deepak Chem Tech’s latest announcement of a ₹3,500 crore investment is not just an expansion plan—it’s a strategic blueprint for chemical self-reliance in India. With added investment in specialty chemicals, polymer resins, and global technology transfers, the Deepak Group is well-positioned to emerge as a leader in India’s speciality chemicals value chain. The company’s vision aligns perfectly with the national goals of reducing import dependence, boosting domestic manufacturing, and enhancing India’s global competitiveness in the chemicals industry.

The Upcoming IPOs in this week and coming weeks are Aten Papers & Foam.

Start your Stock Market Journey and Apply in IPO by Opening Free Demat Account in Choice Broking FinX

Join our Trading with CA Abhay Telegram Channel for regular Stock Market Trading and Investment Calls by CA Abhay Varn - SEBI Registered Research Analyst.