With over 100 products supplied to more than 1,100 customers in 60 countries, Aarti Industries has earned trust by consistently delivering value-added, cost-effective solutions. Suyog Kotecha, CEO, Aarti Industries talks about the overall growth strategy of the company…  

What were the primary contributors to Aarti Industries Limited (AIL's) revenue in FY 2024-25, and how did different segments perform relative to expectations? 

FY25 remained a year where we reaped the benefits of staying the course on our core philosophy: chemistry-led value creation.  AIL achieved a consolidated revenue of Rs. 8,046 crore in FY24-25, marking a 15 per cent year-over-year growth.  Our performance was underpinned by volume-led growth across our diversified product segments, despite the volatility in global pricing.

Agrochemical intermediates remained under pressure, but the real traction came from performance chemicals and polymer additives, where our backward integration and customer stickiness helped us outperform market expectations.

We witnessed early signs of recovery in demand for dyes, pigments, and pharma intermediates, but the pricing remained subdued. Another major contributor to our growth was the increase in the volumes of Energy applications, which are still in the market development phase. AIL’s Energy Business achieved strong volume growth, driven by expanded market reach across the US, Europe, and India. Thus, the diversified product mix across end-markets is a testimony to the resilience we’ve built into our portfolio, which supports our growth.   

AIL reported a 15 per cent increase in revenue in FY25, totalling Rs 8,046 crore. What were the primary drivers behind this growth? 

The 15 per cent revenue growth in FY25 was primarily driven by volume and wasn't incidental but intentional. We placed a sharp focus on capacity utilisation, commercialising key projects and working closely with customers to deliver at scale. The commissioning of new capacities in our Nitrotoluene and Ethylation chains, coupled with consistent execution and scaling up of volumes across various value chains, including specific products such as MMA, enabled us to tap into latent demand.  Additionally, the commissioning of new projects and a focus on high-value specialty chemicals contributed to the top-line growth. The fact that we achieved revenue growth amid global disruptions shows the strength of our integrated, future-ready model. 

Despite economic headwinds, AIL maintained its capital expenditure plans of investing a total of Rs. 3,000 crores in new chemical value chains and high-potential products. What areas received the most investment, and what returns are anticipated? 

Capex at AIL is not just a number, but a roadmap to the future. A large part of Rs. 3,000 crore has already been invested over the last few years, directed towards developing new chemical value chains in Nitrotoluene, Chlorotoluene, and newer Ethylation platforms, aligned with growth trends. Our capital expenditure (Capex) for FY26 is expected to be below Rs. 1,000 crore. A pilot plant at Jhagadia (the new greenfield site) has already begun operations, while the multipurpose and calcium chloride plants are expected to be commissioned by Q3 FY26. However, significant volume contributions from these assets are anticipated from FY27 onward, post-stabilisation and ramp-up. These strategic investments aim to enhance our product portfolio and cater to the growing demand for specialty chemicals. The anticipated returns include increased market share, improved margins, and strengthened global partnerships. 

AIL earmarked about Rs. 1,800 crore for capital expenditures in FY25. What are the key projects or areas receiving these investments? How do these capital investments align with AIL's long-term growth objectives and market expansion plans? 

The Capex in FY25 was approximately Rs. 1,372 crores. This capital expenditure was channelled into key projects that bridge current capabilities with future aspirations, from piloting high-value products at Jhagadia (the new green field site) to strengthening our Chlorotoluene value and advanced intermediates platforms. These investments align with our vision to be a “Global Partner of Choice” with a differentiated portfolio. These investments future-proof our manufacturing backbone and reinforce our position in the global supply chain.  

AIL planned to complete several projects by 2024, including the third long-term contract unit at Jhagadia and the NCB capacity expansion at Vapi. What is the current status of these projects, and how will they impact AIL's production capabilities? 

Both the third long-term contract unit at Jhagadia and the NCB capacity expansion at Vapi have been successfully commissioned. The Jhagadia unit enhances AIL’s ability to fulfil long-term supply agreements, while the NCB expansion increases production capacity from 75 KTPA to 108 KTPA, supporting growth in downstream products. 

What specific upgrades were made to the acid unit at Vapi, and how do they contribute to operational efficiency and sustainability? 

The acid unit at Vapi underwent a significant upgrade, focusing on energy recovery, emission control, and process intensification. With Phase I complete, we have already seen marked improvements in emergency efficiency and a reduction in emissions that contribute to AIL’s sustainability goals. On the one hand, this reflects our principles that operational efficiency and sustainability are not mutually exclusive, but rather interlinked. Our recognition on the CDP A list for both climate and water security reflects the measurable progress we have made in this direction. The outcome is not just lower cost but a future-proof operation aligned with the global expectations.   

Exports showed sequential growth in 2024. Which international markets or products significantly contributed to this trend? 

Export revenue in FY25 increased by approximately 21 per cent to Rs. 4,425 crore, with a sequential rise led by robust demand in the US and Europe especially for specialty chemicals and advanced intermediates. Customers worldwide are increasingly seeking resilient, compliant, and agile partners, and our integrated model is the ideal fit. We have also expanded commercial presence in newer regions to build pipeline diversity.  

AIL's near-term emission reduction targets have been validated by the Science-Based Targets initiative (SBTi). What specific strategies are in place to achieve these targets?  

SBTi validations are not the finish line for AIL; it's actually a starting point. Our multi-pronged strategy targets emissions reduction through increased renewable energy use, investments in low-emission processes, and circularity initiatives. This includes optimising energy efficiency, expanding renewable energy in operations, and implementing waste-to-energy solutions. 

Certified under ISO 50001, AIL uses an IT-based Energy Management System to track and drive progress. Key projects—such as Variable Frequency Drives (VFDs), waste heat recovery, steam compressors, and biomass substitution—have already reduced energy use and emissions. In FY24, energy-saving measures resulted in over 6.3 million kWh of savings. Investments in hybrid renewable power and cleaner fuels have also been significantly scaled up. With renewable power expected to account for over 75 per cent of our purchased energy mix by FY27, we're on track to reduce our carbon footprint significantly. Further sustainability measures include advanced distillation, NOx abatement, zero liquid discharge, and hazardous waste recycling. Every plant upgrade, every molecule redesign, now considers carbon impact. At AIL, emissions control should be integrated into the design, rather than being treated as an afterthought.  

AIL increased its investments in renewable energy sources during fiscal year 2024. What percentage of the company's energy mix is now derived from renewables, and what are the future targets? 

As of FY24, AIL commissioned a 13.2 MW hybrid renewable power plant, reinforcing our push towards energy transition. We are progressively tilting our energy mix towards renewables, and our next milestone is to reach a point where more than 75 per cent of our purchased power requirements going forward will be met through renewable sources.  

Over the next three years, this will be further accelerated through a mix of captive green projects and green power procurement.  

Aarti Circularity, a wholly owned subsidiary of AIL, has formed a joint venture with Re Sustainability to establish a plastic recycling facility in Hyderabad, at an outlay of Rs. 100 crore. What is the current status of the project and long-term targets? 

Aarti Circularity’s joint venture with Re Sustainability is a bold step toward material circularity. The Rs. 100 crore Hyderabad project, currently in the pre-construction stage, is designed to process hard-to-recycle multilayer plastics using advanced recycling technology. Over time, we aim to recover value from waste at scale, reduce our dependency on landfills, and offer recycled raw materials as feedstock back into the petrochemical supply chain. It’s about closing the loop. The project is progressing as planned, with long-term targets focused on promoting circular economy practices and enhancing operational sustainability. 

AIL ranks between 1st and 4th globally for 75 per cent of its product portfolio. What strategies have contributed to achieving and maintaining this market position? 

AIL’s strong global ranking is a result of its commitment to quality, innovation, and customer-centric approaches. Our global leadership is rooted in deep strengths, including an integrated operating model, a de-risked and diversified portfolio, and long-term customer relationships. With over 100 products supplied to more than 1,100 customers in 60 countries, we have earned trust by consistently delivering value-added, cost-effective solutions. Our R&D-driven innovation, with 250+ scientists and 40+ new products under development, ensures we stay ahead of market needs. Strategic capital expenditures in high-margin value chains and emerging chemistries, such as electronic chemicals, membranes and polymer additives, further reinforce our edge. At AIL, we build enduring leadership through science, scale, and sustainability. 

What programs has AIL implemented to promote employee well-being, gender equality, and community development in 2024? 

People are the cornerstone of our success. We firmly believe a thriving organisation is built on the well-being of its employees. This belief is reflected in our comprehensive approach to employee welfare, encompassing five key dimensions: career, financial, social community, health, and well-being. These pillars of well-being are integral to our organisational culture, driving engagement, productivity and satisfaction.  

We conduct regular employee surveys on well-being through renowned external agencies. Our scores on the dimensions of well-being have crossed 90th percentile globally. 72 per cent of our workforce have a thriving and positive view of life against a global average of 35 per cent. 

By investing in our people and communities, we not only enhance individual fulfilment but also strengthen our collective capacity to achieve excellence. AIL has implemented various programs focusing on employee health and safety, learning and development, diversity and inclusion, and community engagement. 

Aarti Industries Limited (AIL) and UPL Limited (UPL) formed a 50-50 joint venture (JV) Augene Chemical Private Limited, to manufacture and market specialty chemicals. What is the latest development on this front? 

The joint venture, Augene Chemical Private Limited, established by AIL and UPL, is progressing with plans to manufacture and market specialty chemicals. We are working on finalising the product lines that can create mutual advantage, technology and market reach.  The synergy lies in leveraging the strengths of the two partners to build a platform for differentiated specialty chemicals catering to global demand. This arrangement will enable India to demonstrate its ability to collaborate and partner in creating world-class chemical manufacturing assets that deliver innovative specialty chemicals to the world.