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Lubrizol to invest $150 mn in India expanding manufacturing, R&D

2023-06-20

Lubrizol, a subsidiary of Berkshire Hathaway, has announced a significant investment of $150 million in India, as the company recognises the country's potential as a leading manufacturing hub in the future. Lubrizol CEO Rebecca Liebert expressed her optimism about the investment, stating that the company currently manufactures products in India for the local market, but envisions the possibility of expanding production for the export market as well. Liebert emphasised the strong capabilities of India in various areas such as IT, finance, HR, engineering, and capital, and mentioned that Lubrizol is actively seeking centres of excellence in these functions to leverage the potential of India for both the domestic and global markets.

Liebert further elaborated on the opportunities that India offers beyond Lubrizol's current sectors of operation. The company is focused on expanding its presence in areas such as electric vehicles, future mobility, health beauty, and home space. As part of its operations in India, Lubrizol already has a joint venture with Indian Oil Corp. to produce chemical additives for lubricants. While the company acquired an additional 26 per cent stake in the joint venture in 2017, Liebert clarified that Lubrizol does not have plans to further increase its ownership.

The forthcoming investment represents Lubrizol's largest commitment to India since its entry into the country in 1966. The funds will be utilised to initiate the construction of a chlorinated polyvinyl chloride (CPVC) resin plant in Vilayat, Gujarat, and to double the capacity of its existing unit in Dahej. Additionally, Lubrizol plans to establish a grease laboratory in Navi Mumbai. The company is collaborating with Grasim Industries, a flagship company of the Aditya Birla Group, to establish a state-of-the-art CPVC resin plant in Vilayat with a capacity of 100,000 metric tonnes. This facility will become the world's largest single-site CPVC resin production capacity. Furthermore, Lubrizol intends to expand its CPVC capacity at the Dahej unit to reach 140,000 metric tonnes.

In order to support its growth plans and foster innovation, Lubrizol also intends to establish a research and development centre in India. This centre is expected to be the company's second-largest global R&D facility, following its North American counterpart. Liebert mentioned that while Lubrizol will be investing $150 million, its Indian partners will provide the necessary land and other assets for the facility.

When asked about any specific demands that Lubrizol might present to the Indian delegation led by Prime Minister Narendra Modi during their visit to the US, Liebert expressed her gratitude for the infrastructure development in India and commended the efforts to attract more investments. Prime Minister Modi is scheduled to embark on a state visit to the US, where he will engage in meetings with US government officials and industry representatives, starting on June 21, following an invitation from President Joe Biden.