Andhra Petrochemicals Limited has announced the immediate suspension of plant operations at its Visakhapatnam facility effective March 17, 2026. The suspension is directly attributed to the disruption in supply of propylene, a critical raw material for the company's manufacturing processes.

Supply Chain Disruption Details

The company has cited geopolitical tensions as the root cause of the operational halt. According to the official communication, Hindustan Petroleum Corporation Ltd (HPCL) has stopped the supply of propylene due to the ongoing war between Iran and USA & Israel. This development has forced the petrochemical manufacturer to cease production activities at the Visakhapatnam plant.

Regulatory Compliance

The company has fulfilled its disclosure obligations under Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The intimation was formally communicated to The Bombay Stock Exchange Ltd on March 17, 2026, ensuring transparency with stakeholders and regulatory authorities.

Operational Outlook

Andhra Petrochemicals Limited has indicated that plant operations will resume once HPCL restores the supply of propylene. The company has committed to providing immediate updates to the stock exchange once operations are restored, maintaining transparency regarding the operational status of the facility.

The suspension highlights the vulnerability of petrochemical operations to supply chain disruptions, particularly when dependent on specific suppliers for critical raw materials. The company's proactive communication demonstrates adherence to regulatory requirements while keeping stakeholders informed of material developments affecting operations.

Andhra Petrochemicals has announced a revision in its credit ratings assigned by ICRA, with downgrades affecting the majority of its credit facilities. The company communicated this development to The Bombay Stock Exchange through regulatory disclosures dated 7 February 2026 and 11 February 2026.

Credit Rating Revisions

The rating agency has made significant changes to the company's credit profile, affecting both long-term facilities while maintaining stability in short-term ratings. The revisions reflect ICRA's updated assessment of the company's creditworthiness across different facility categories.

ICRA's Rationale for Downgrade

ICRA provided detailed reasoning for the rating downgrade, citing multiple performance-related factors. The rating downgrade factors in subdued performance during 9 months FY 2026 and weaker-than-expected performance anticipated for FY 2026, driven by weak realizations resulting in compressed margins.

The operating margins declined in FY 2025 and 9 months FY 2026 as the spread between oxo-alcohols and feedstock narrowed owing to a decline in product prices. The pressure on margins is expected to continue in the near term. The performance was further impacted by the shutdown of the company's sole manufacturing facility from October 29, 2025 to February 03, 2026.

Manufacturing Facility Challenges

While the plant was initially shut for planned maintenance, the shutdown was subsequently prolonged owing to un-remunerative realizations for oxo-alcohols amid a surge in low-priced imports. The ratings remain constrained by the exposure of the company's profitability to fluctuation in the spread between oxo-alcohols and feedstock.

ICRA noted that the company is exposed to force majeure risk because of its dependence on a single supplier (HPCL) for the key raw material, propylene. However, the rating agency acknowledged that in the last three years, during times of requirement and healthy margins, the company procured raw material from BPCL-Kochi and Gas Authority of India Limited (GAIL)-Pata, though at higher cost, providing some diversification.

Company's Financial Position

In response to the downgrade, Andhra Petrochemicals clarified its strong financial position in its communication dated 11 February 2026. The company emphasized that it is debt-free, having fully paid its Project Term Loan of Rs.5.18 crores, and is not currently utilizing its Working Capital Limits.

The Working Capital limits are fully securitized by hypothecating Plant & Machinery, Stocks & Stores, and Book Debts worth Rs.300.00 crores, along with a lien on Fixed Deposits for the working capital limit of Rs.35.00 crores.

Regulatory Compliance

Both disclosures were made in compliance with regulatory requirements, with the company informing the stock exchange through its Chief Financial Officer and Company Secretary, G. Adinarayana. The communications referenced the company's equity code 500012 and were addressed to the Department of Corporate Services at The Bombay Stock Exchange.