Laxmi Organic Industries Limited's Lote facility in Maharashtra is under political and regulatory scrutiny for using machinery acquired from Miteni S.p.A, a banned Italian chemical plant. The controversy centers around allegations of PFAS production and environmental concerns.

Machinery Origins and Acquisition

The equipment at Laxmi Organic's Lote facility was acquired through a strategic acquisition of Miteni's assets. After Miteni's bankruptcy, its assets including machinery, patents and technical know-how were auctioned in 2019, with Viva Lifesciences, a subsidiary of Laxmi Organic, emerging as the sole bidder.

Political Allegations and Regulatory Response

Maharashtra state legislator Rohit Pawar has alleged that the plant is emitting PFAS (polyfluoroalkyl substances) using machinery procured from the banned Italian facility. Pawar questioned why regulatory permissions were granted, particularly when India does not yet have specific laws governing PFAS.

Maharashtra industries minister Uday Samant has sought a report from the Maharashtra Pollution Control Board (MPCB). The MPCB informed that PFAS have not been manufactured at the plant so far and issued a notice to the company. Authorities are verifying whether the imported machinery had necessary clearances.

Miteni's Toxic Legacy in Italy

Miteni operated in Vicenza, Italy, producing fluorochemicals that contaminated soil and water over decades. High concentrations of PFAS were detected in the plant's wastewater, with contamination spreading through groundwater and exposing an estimated 350,000 people to the chemicals via drinking water.

Company's Environmental Compliance Claims

Laxmi Organic Industries has issued a comprehensive clarification addressing the scrutiny, stating that its Lote facility operates in complete compliance with applicable Indian environmental, safety, and regulatory requirements. The company emphasized that all statutory approvals have been received since the facility's inception.

Facility Operations and Product Portfolio

The Lote facility operates as a multi-technology and multi-product site encompassing both fluorinated and non-fluorinated products. These products serve industries including semiconductors, defence, power grids, electric vehicles, medical devices, electronics, agrochemicals, and pharmaceuticals. The company maintains that fluorinated products are produced responsibly, adhering to established safety and environmental standards.

Laxmi Organic Industries, promoted by Harshvardhan Goenka who also sits on the board of Laxmi Organic Italy, continues to engage with stakeholders and government authorities while serving over 750 clients across key industries in more than 55 countries.

Laxmi Organic Industries Ltd has announced a significant update to its credit rating following communication from India Ratings and Research Private Limited dated December 23, 2025. The rating agency has revised its outlook on the company's bank loan facilities while maintaining its overall rating structure.

Rating Update Details

Key Changes and Implications

India Ratings has revised its outlook on the bank loan facilities of Laxmi Organic Industries to 'Negative' from 'Stable' while reaffirming the rating at IND AA/Negative/IND A1. The revision of the outlook to 'Negative' suggests that India Ratings perceives an increased risk in the company's credit profile, which could potentially impact future borrowing costs and financial flexibility.

Despite the outlook revision, the reaffirmation of the 'IND AA' rating indicates that the company maintains a high degree of safety regarding timely servicing of financial obligations with very low credit risk. Additionally, India Ratings has reaffirmed its IND A1 rating on the commercial paper of the company, demonstrating continued confidence in the company's short-term creditworthiness.

Regulatory Compliance and Disclosure

In compliance with Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, Laxmi Organic Industries promptly disclosed this rating update to both BSE Limited and National Stock Exchange of India Limited on December 24, 2025. The company has provided stakeholders with access to the detailed rationale behind the rating action through India Ratings' press release.

The communication was signed by Aniket Hirpara, Company Secretary and Compliance Officer, ensuring proper authorization and transparency in the disclosure process. Investors and stakeholders can access the complete rationale for the rating revision through the provided link to India Ratings' official communication.