### **Executive Summary** BASF India Ltd continues to demonstrate strategic momentum in 2025 with significant corporate developments, capacity expansions, innovation initiatives, and structural reorganizations. The year marks a transformative phase for the company, highlighted by the announcement of a joint venture with Carlyle and Qatar Investment Authority to create a **standalone global coatings business**, and the **de-merger of its Agricultural Solutions business** into a new listed entity. Supported by robust investments in local manufacturing, R&D, and sustainability, BASF India is positioning itself for long-term, agile growth across high-potential sectors including agriculture, automotive, materials, health, and energy. --- ### **Key Strategic Developments (2025)** #### **1. Global Coatings Joint Venture (October 2025)** - BASF has entered a **binding agreement with investment firm Carlyle and Qatar Investment Authority** to form a **standalone global coatings company**. - The transaction includes BASF’s **automotive OEM coatings, refinish coatings, and surface treatment businesses**, valued at **€7.7 billion enterprise value**. - BASF will retain a **40% equity stake** in the new entity and receive **~€5.8 billion in pre-tax cash proceeds**. - **Expected closure in Q2 2026**, enabling capital redeployment and sharpened strategic focus. #### **2. De-Merger of Agricultural Solutions (August–October 2025)** - BASF India is demerging its **Agricultural Solutions business** into a separately listed entity: **BASF Agricultural Solutions India Limited (BASIL)**. - **Completion expected in FY 2026–27**. - Shareholders will receive **one share in BASIL for every one share in BASF India** (1:1 ratio). - **Strategic Rationale**: Improve capital allocation, enable strategic agility, and allow the Agri business to operate as a pure-play entity to better compete in a dynamic market. --- ### **Operations & Capacity Expansion** #### **Dahej & Panoli Projects** - **Alkaline Surfactant Polymer (ASP) Blending Plant** at Dahej became operational in **February 2025**, supporting **Enhanced Oil Recovery (EOR)** applications under the **Aspiro™** brand. - The plant services both domestic and export markets, enhancing crude oil recovery from mature fields. - **Polyamide compounding capacity expansion** at the **Panoli plant** completed in **May 2025**, boosting capacity for automotive, electronics, and consumer goods sectors. - A **new Cellasto® microcellular polyurethane (MCU) plant** broke ground in **January 2025**, with **commercial operations expected in H2 2026**. #### **Mangalore Site Enhancements** - **E-coat production capacity doubled** in 2024 to meet rising demand for cathodic electrodeposition (CED) materials. - **Coatings Technology Center**, operational since 2011, continues to drive R&D in electrocoat, primer, basecoat, and clearcoat layers globally. - **Signed 25-year PPA** to source **80% of Mangalore’s energy from renewable sources**—up from 60% in 2024. --- ### **Business Segment Updates** #### **Agricultural Solutions** - Launched **two new crop protection products for rice**: - **Valexio (Insecticide)** – May 2025 - **Mibelya (Fungicide)** – June 2025 - Strengthened portfolio with new **IRAC Group 36 insecticides** (e.g., **Efficon®**) and market share gains in **soybean, cotton, and rice**. - Despite wet monsoon disruptions (2024), new product innovation and diversification across insecticides, herbicides, and fungicides enabled **modest revenue growth**. #### **Materials & Performance Chemicals** - **MDI (Methylene Diphenyl Diisocyanate)** demand rose in flexible packaging, construction, and footwear. - **TDI (Toluene Diisocyanate)** sales stable due to rigid PU foam applications. - **Polyamides**: Stable demand in barrier films and monofilaments; margin expansion in FY 2024–25. - **Plastic Additives** business grew in tandem with polymer sector expansion, driven by packaging, automotive, and electronics. #### **Nutrition & Health** - Segment driven by strong performance in **Aroma Ingredients** (via bio-based **Isobionics®**) and **Pharma Solutions**. - **Kolliphor® Urea** and **Kolliphor® P 188 cc** launched in **FY 2024–25** for biopharma formulations. - Nutrition ingredients faced price pressure, offset by innovation and supply diversification. #### **Industrial Solutions** - **Dispersions & Resins**: Overcame weak paint and paper demand via customer-centric innovation and new launches (e.g., **Acronal EDGE 7686** for efflorescence resistance). - **Process Catalysts**: Won new orders due to refining catalyst innovation; growth driven by domestic petrochemical capacity addition. - **Minerals (Kaolin) business divested** in 2022; **Mining Solutions** now focuses on solid-liquid separation, hydrometallurgy, and lithium battery binders (**Licity®**). #### **Coatings & Surface Technologies** - Automotive Coatings business now operates through **BASF India Coatings Pvt Ltd**, a standalone subsidiary established in **January 2025**. - Focus on **‘Beyond Paints’** portfolio, sustainability, and digitalization: - Launched **NEW ARRAY color collection**, emphasizing eco-friendly pigments. - **SAP S/4HANA ERP** implemented — enhancing digital integration. - **Coatings Technology Center in Mangalore** develops coatings for autonomous vehicles and lightweight materials. #### **Care & Personal Care** - **Care Chemicals** grew strongly in home care and personal care, aided by rising disposable incomes and premiumization. - Labs developed bio-based, biodegradable formulations for home, personal, and industrial use. - Innovation in sulfate-free surfactants in response to shifting consumer trends. #### **Fuel & Lubricant Solutions** - Steady growth driven by automotive production and industrial activity. - Components include **Polyisobutylene (PIB)**, additives, and synthetic base fluids. - Formulations such as **coolants (Dynago™) and brake fluids** serve automotive OEMs and oil companies. --- ### **Sustainability & Innovation** #### **Environmental Initiatives** - **80–90% renewable energy** targeted across Dahej and Mangalore sites. - **Sovermol®**, a bio-based polyol, in commercial production at Mangalore — used in NEVs, windmills, and industrial coatings. - **Lupranat® ZERO**: Net-zero isocyanate produced with renewable energy for sustainable insulation. #### **R&D and Digital Transformation** - **Polyurethane Technical Development Center (PTDCI)** launched in **Thane (May 2024)** and **Mumbai (May 2024)**. - Labs support localized innovation in polyurethanes, pharmaceuticals, and care chemicals. - **Agricultural Research Station in Pune**: Conducts drone-based spraying trials, UV tunnel studies, and field efficacy testing. - **AgGenie app** and **xarvio digital platform** used to engage farmers and promote safe farming practices. #### **Corporate Responsibility** - Crèche inaugurated at **Dahej** to support working parents. - Partnerships with **Somaiya University** and **Indian Chemical Council** to train female science graduates. - Collaboration with **Mahindra** to promote women in automotive refinishing.