INOX Air Products announces Rs 2,000 cr investment in industrial gases

INOX Air Products

India’s largest manufacturer of industrial and medical gases, INOX Air Products (INOXAP) plans to invest Rs 2,000 crore to build 8 new air separation units across the country. This will be India’s largest greenfield investment plan in the industrial gases sector. This follows a manifold increase in demand for medical oxygen because of the Covid-19 pandemic though the company says it is looking ahead at the government’s push for the manufacturing and infrastructure sector.

With a combined capacity to make more than 1500 tonne a day (TPD) of liquid gases, the expansion will take INOXAP’s total liquid gases production to 4800 TPD by 2024. The investment would be funded by a mix of debt and internal cash accruals. “The debt portion is yet to be worked out but it could be 40 per cent of the investment,” Siddharth Jain, director – INOX Air Products, told Business Standard.

INOXAP’s new plants will be strategically located in proximity of high demand growth areas in Gujarat, Maharashtra, Tamil Nadu, Madhya Pradesh, Uttar Pradesh, Andhra Pradesh and West Bengal. The plants will produce liquid oxygen, liquid nitrogen and liquid argon and will be commissioned during the course of FY22-24. The bulk availability of industrial and medical gases will ensure constant supplies for the electronic manufacturing, pharmaceutical sector, besides helping iron, steel and automobile industries to ramp up their production capacities. The projects will generate more than 1000 direct and indirect employment opportunities in their respective regions.

“The 8 plants would be set up on a sequential basis over the next 12 to 36 months. There is a demand for the gases both as feedstock and raw material,” said Jain.

Complementing the critical boost provided in Budget 2021 to the healthcare sector, INOXAP’s expansion would also augment its liquid medical oxygen production capacity by 50 per cent, said the company. “With an objective of rejuvenating the country’s economic landscape, Budget 2021 pronounced major investments and initiatives around manufacturing, infrastructure and healthcare. As we welcome the enhanced capex in these critical areas, we want to be prepared to service the country’s future-oriented and accelerated growth drive by ensuring capacity creation of industrial and medical gases across the growth corridors of the country. The expanded capacity will enable us to serve the core sectors,” said Jain.

INOX AP currently manufactures 3300 TPD of liquid gases across 44 locations in the country. During COVID, INOXAP has been catering to more than 60 per cent of the total medical oxygen demand in the country. All INOXAP units have been running 24×7 to ensure a continuous production and supply of medical oxygen to more than 800 hospitals nationwide through a dedicated fleet of 550 transport tanks.