Indian Chemical Companies Diversify Into Battery Materials and Semiconductor Supply Chains

Indian chemical companies are strategically repositioning themselves to capitalize on the country's accelerating transition toward clean energy and electrification. The shift is being driven by government policies including Production Linked Incentive programmes, the PM e-Drive scheme, and a reduced GST rate of 5% for electric vehicles, which have significantly improved EV affordability and adoption rates.

Battery Materials Drive New Growth Opportunities

The government's ambitious target of achieving 30% EV penetration in passenger vehicle sales by FY30 has created substantial market opportunities for chemical companies. CareEdge Ratings projects that lithium-ion battery demand in India could surge to 54 GWh by FY27 and further expand to 127 GWh by FY30, creating significant demand for upstream battery materials.

PCBL Chemicals is exemplifying this transition by extending its carbon black expertise into advanced battery materials. The company is developing superconducting carbon, nano silicon, and acetylene black through its joint venture Nanovace Technologies with Australia's Kindia Pty. Notably, PCBL will be the first company globally to develop these three advanced technologies simultaneously.

Nano silicon represents a particularly significant advancement, offering 10 times the energy density of graphite's theoretical capacity and potentially increasing battery range by 25-100% while improving charging speeds by up to 4X.

Electrolyte Manufacturing Scales Up

Neogen Chemicals is building an integrated battery chemicals platform centered on lithium-ion battery electrolytes and related salts. The company is establishing what is expected to become one of India's largest electrolyte manufacturing bases in Gujarat, leveraging its existing expertise in bromine and lithium-based chemistry.

Neogen has secured technology access through an exclusive partnership with Japan's MU Ionic, a global leader in lithium electrolyte technology. This collaboration provides proven chemistries and manufacturing processes as domestic battery manufacturing scales up. A smaller electrolytes capacity has already been commissioned and is currently undergoing testing.

Balaji Amines is addressing the specialty solvents segment by upgrading its dimethyl carbonate (DMC) capacity. The company commissioned a new facility in May 2025 to produce electronic-grade DMC specifically for EV battery manufacturers, making it the only domestic producer of electronic-grade DMC in India.

Semiconductor Chemical Opportunities Emerge

Acutaas Chemicals is pioneering India's entry into semiconductor-grade chemicals while simultaneously expanding into battery electrolyte additives. The company is developing vinylene carbonate and fluoroethylene carbonate, becoming the first company outside China to develop electrolyte additives at global scale.

In semiconductors, Acutaas has become the only Indian manufacturer of semiconductor-grade photoresist chemicals through its 55% acquisition of Baba Fine Chemicals in FY23. The company has also formed a joint venture (75:25) with South Korea's J & Materials, targeting Korean and global semiconductor markets with revenue contributions expected from H2 FY27.

Integrated Semiconductor Fabrication

Archean Chemicals is undertaking the most capital-intensive expansion by moving into compound semiconductors through a silicon carbide fabrication facility. The project, formally launched in November 2025, represents a significant shift from the company's traditional focus on bromine and industrial salt.

Stallion India Fluorochemicals is positioning itself in the ultra-high-purity gases segment, expanding capabilities in helium processing and high-purity gas handling for semiconductor, solar cell, and fiber optic applications. The company is targeting 6N purity levels required for semiconductor manufacturing, which creates significant entry barriers and competitive advantages.

Strategic Market Positioning

These diversification efforts align with India's goal of meeting 50% of energy needs from renewable sources by 2030. As domestic battery and semiconductor demand grows, the need for localized supply chains becomes increasingly critical. Chemical companies are leveraging their existing expertise in specialty chemicals, process control, and purity standards to capture value in these high-growth segments.

The success of these initiatives will depend on execution capabilities, customer qualification processes, and capital discipline as companies transition from traditional chemical manufacturing to serving mission-critical applications in batteries and semiconductors. The convergence of government policy support, growing domestic demand, and established chemical industry expertise creates a favorable environment for this strategic transformation.