Soaring Demand For Specialty Chemicals Produces India’s Newest Billionaire

Ashwin Desai’s listing of his Surat, India-based specialty chemicals maker Aether Industries this month has made him India’s newest billionaire in a city better known for its diamond industry.

Desai, the founder and managing director of Aether, controls 87% of the company. Aether listed at a 10% premium to the IPO price of 672 rupees ($8.51), raising a total of 10.4 billion rupees ($134 million), including pre-placements.

The 70-year-old chemical engineer started Aether in 2013 and runs it with his wife, Purnima, and sons, Rohan and Aman. While Purnima handles finance, Rohan oversees business operations spanning sales, sourcing and human resources. Younger son, Aman, who has a Ph.D. in organic chemistry from Michigan State University, heads R&D and new projects.

With two factories in Surat, Aether has a portfolio of 25 speciality chemical products, which it supplies to a range of industries such as pharmaceuticals, agrochemicals, and oil and gas.

The company’s revenue rose 31% to 5.9 billion rupees ($75 million) in the fiscal year ended March 2022, while net profit was up 53% to 1.1 billion rupees ($14 million). This comes on the back of compounded annual revenue growth of 49.5% from fiscal 2019 to fiscal 2021 and compounded net profit growth of 75% for the same period.

After studying chemical engineering at the premier Institute of Chemical Technology in Mumbai, Desai started his entrepreneurial journey in 1976 when he cofounded specialty chemicals maker Anupam Rasayan along with his brother-in-law (sister’s husband). After more than three decades, Desai, who was the chairman and managing director at Anupam, broke away to start Aether in 2013, a name which means “pure” in Greek and “infinite” in Sanskrit.

Anupam Rasayan, which went public in March 2021 now has a market cap of $824 million with revenue of 8.4 billion rupees ($110 million)as of March 31, 2022.

Apart from speciality chemicals, Aether offers contract research and manufacturing services and customized manufacturing. The company is benefiting from an uptick in the specialty chemicals sector as global customers, seeking an alternative supply source to China, turn to India. China will continue to grow–albeit at a slower pace. The Indian speciality chemicals market is expected to grow at a 11% compounded growth rate from 2020 to 2025, while the Chinese market is expected to grow at 7%.

Demand in the domestic market is robust as well. The Indian speciality chemicals sector grew to $87 billion from $53 billion from 2015 to 2020. It has been projected to grow to $148 billion in 2025. Demand for speciality chemicals from the fertilizer and agrochemicals industries is projected to grow to $53.3 billion from $33 billion from 2020 to 2025 while chemicals for the pharmaceutical sector is expected to rise to $29 billion from $17 billion in that same period.

Other specialty chemicals billionaires include Deepak Mehta of Deepak Nitrite; Ashok Boob of Clean Science and Technology; Yogesh Kothari of Alkyl Amines and Vinod Saraf of Vinati Organics.