Lithium Hydroxide Manufacturing Plant Setup Begins in India

India is initiating the setup of lithium hydroxide manufacturing plants to bolster its domestic battery supply chain. The country currently imports nearly all its lithium chemicals, despite plans for battery cell and cathode plants nationwide. The establishment of these new facilities is supported by the National Critical Mineral Mission.

The investment required varies significantly based on the feedstock source and plant scale. Smaller plants converting imported lithium carbonate to hydroxide could require an investment of around INR 250 crore. Larger, integrated facilities refining spodumene concentrate may necessitate investments ranging from INR 2,500 to INR 4,000 crore, with capacities between 20,000 to 25,000 tonnes per year.

Lithium hydroxide is a critical chemical for high-nickel cathodes used in electric vehicle batteries. Technical grades find applications in lubricating greases, ceramics, and specialty chemicals. Profitability hinges on global lithium prices and operational efficiency, with well-managed plants potentially achieving gross margins of 35-45% and net margins of 15-25%.

Potential locations for these plants are being considered across states including Gujarat, Odisha, Andhra Pradesh, Tamil Nadu, Maharashtra, and Karnataka. Key approvals involve environmental clearances and state pollution control board consents. Successful operation necessitates secure feedstock supply and proven purification technology.