Neogen Chemicals Ltd witnessed a 4% decline in its stock price following a fire incident at its Dahej SEZ plant in Gujarat. The fire, reported at 12:30 am on March 5, led to an immediate suspension of production, as the company detailed in its stock exchange filing. The incident has raised concerns among investors and stakeholders about its potential impact on the company’s financials and supply chain.

Fire Breaks Out at Neogen Chemicals’ Dahej SEZ Plant

The Dahej SEZ plant is a crucial unit for Neogen Chemicals, primarily involved in the production of organic chemicals. According to the company, prompt action by supervisory staff prevented the fire from spreading to neighboring facilities. Thankfully, there were no casualties or injuries reported. The cause of the fire is still under investigation, and authorities have been informed about the incident.

Production Halt and Insurance Assessment Underway

Following the fire, Neogen Chemicals has temporarily suspended production at the Dahej SEZ plant until a thorough damage assessment is completed by the insurance surveyor. The company has already initiated an insurance claim and is working closely with assessors to determine the extent of the financial impact.

Despite this setback, Neogen Chemicals assured stakeholders that its other plant, Neogen Ionics Limited, remains fully operational. The fire did not impact any other divisions or plants in the region, ensuring that a portion of the company’s operations remains unaffected.

Financial and Market Impact

The stock of Neogen Chemicals Ltd responded negatively to the fire news, declining 2.06% to ₹1,681.5 apiece on the BSE at around 9:45 am. Investors are awaiting further clarity on the extent of damage and the timeline for resuming operations at the Dahej facility.

While the exact financial impact is yet to be determined, Neogen Chemicals has confirmed that the damages will be covered under its insurance policy. This provides some relief to shareholders, though the final loss quantum will be assessed after a detailed investigation.

Next Steps and Road to Recovery

Neogen Chemicals has assured stakeholders that its primary focus is to restore operations at the Dahej plant as soon as possible. The company is coordinating with authorities, insurers, and safety experts to conduct a comprehensive assessment and implement necessary repairs and safety measures.

Further updates regarding the estimated financial impact and the reopening timeline are expected after the insurance surveyor completes the damage evaluation.

Investors and market analysts will closely monitor any developments related to Neogen Chemicals as the company works toward restoring normalcy at the Dahej SEZ plant.

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