Shares of Neogen Chemicals have more than doubled in the past one-year period after the Centre announced production-linked incentives (PLIs) for specialty chemical manufacturers.
The 30-year-old company, founded by Haridas T. Kanani, specialises in bromine based compounds, grignard reagents and inorganic lithium salts.
Neogen operates out of three manufacturing facilities located at Navi Mumbai, Vadodara and Dahej SEZ (Special Economic Zones) in Gujarat.
In the past one-year period, the shares of the firm rose 131 per cent to Rs 1,639 per share.
In 2021, the Centre had announced PLIs worth Rs 1.97 lakh crore for 13 key sectors, including for advanced chemistry cell (ACC) needed for manufacturing batteries.
The total outlay of the scheme for manufacturing of ACC battery was reportedly Rs 18,100 crore for a period of five years.
Ramp-up in the capacity utilisation of the recently-tripled organic chemicals facility at Dahej will fuel near-term growth, brokerage house HDFC Securities said in a report.
“Neogen Chemicals Ltd (NCL) has announced the establishment of a 250- MT electrolyte formulation capacity. The company will initially invest Rs 350 million (Rs 35 crore) to set up an electrolyte formulation capacity and produce advanced lithium-based salts required in electrolyte manufacturing,” the brokerage said.
It has given a ‘buy’ call with a target price of Rs 2,150 per share.