1. Company Overview & Business Model

GFCL EV Products Limited, a wholly-owned subsidiary of Gujarat Fluorochemicals Limited (GFL), is a strategic supplier of battery materials, positioned to capitalise on the global shift toward electric mobility and energy storage. It operates a fully integrated battery materials complex, positioning itself as a battery-agnostic materials player catering to both LFP and NMC chemistries.

Its integrated business model spans over 50% of the lithium-ion battery value chain. Product portfolio:

• Electrolyte salt (LiPF6)

• Additives (FEC, VC)

• Electrolyte formulations (salt + additives + solvents)

• Cathode Active Material — LFP (CAM)

• Binders (PTFE, PVDF)

• Anode Active Material — Natural Graphite (NGAAM)

This basket covers ~70% of the value of an LFP cell, making GFCL EV possibly the only company ex-China offering multiple battery chemicals under one roof — versus 1–2 product suppliers typically found across South Korea, Japan and the EU.

Problem Being Solved: GFCL EV reduces global (particularly Western) EV/battery makers' dependence on China-dominated battery chemical supply chains by offering a one-stop, ex-China source for multiple battery chemicals — addressing supply-chain security and geographic diversification needs, reinforced by US policy (OBBB, see Section 5).

Revenue Model:

• RoCE-based pricing: pricing is set on an underlying Return on Capital Employed (tied to overall investment), which limits earnings volatility and passes raw-material inflation through to customers

• Revenue backed by client contracts/approvals rather than speculative capacity — reduces ramp-up risk

• LiPF6 uses a generic spec supplied across customers; LFP CAM and binders are customer-tailored products

2. Value Chain & Product Integration

• CAM: Lithium Carbonate, Phosphoric Acid, Iron Sulphate → Carbon Precursor + Phosphates of Lithium/Iron → CAM

• Electrolyte/LiPF6: LiF, Phosphorous Pentachloride, HF → LiPF6

• Electrolyte formulations: Electrolyte salt + Additives + Solvents

• Binders (PVDF/PTFE): HF, Chloromethanes → monomer intermediates → polymerised into Fluoropolymers

• Anode (NGAAM): Natural Flake Graphite → grinding, shaping, chemical purification, HF-based purification, coating

Backward integration: sources lithium carbonate from China but is backward integrated into AHF (currently from parent GFL; dedicated capacity being added in GFCL EV), solvents and additives — de-risking its supply chain.

Product-wise Status:

• LiPF6 constitutes 10–15% by weight of electrolyte formulation but 50–60% of electrolyte cost; purity requirements exceed pharma-grade in certain respects (impurities <1ppm)

• Key entry barrier: new entrants need 2–3 years to qualify; any change in Man/Material/Machine/Method triggers full requalification

3. Cost Structure of an LFP Cell

~70% of LFP cell cost (Cathode + Anode + Electrolyte, adjusted) is addressable by GFCL EV's current/planned product basket.

4. Manufacturing Unit, Capacity & Capex (₹ Cr)

Greenfield integrated battery materials complex located at Jolva, Gujarat. Management indicates the business has crossed the hurdle of plant stabilisation, product validation and customer audits for most products. All Phase I capacity is commissioned and contracted with anchor clients.

• Target: 2x asset turnover and 25%+ EBITDA margin, with full potential realised only post FY29/30E

• FY27E capex largely earmarked for growth capex, including NGAAM

• Existing land bank to be fully utilised with the ₹6,000 Cr capex programme

• Current capacity across products is fully/completely contracted

FY26 Funding Raised / Tied Up (₹ Cr):

Source (360 ONE) prints "Rs 37.3–10.0 bn" for Indian investors — an internally inconsistent range in the original document; shown here at the lower bound (Rs 37.3bn = ₹3,730 Cr would be the upper reading). Treat this line with caution and refer to primary filings.

• Additional events: ₹92.47 Cr raised via private placement (Nov'25); ₹430 Cr CCPS issue approved via EGM (Jan'26)

5. Competitive Positioning, Demand Outlook & Policy Tailwind

• Setting up HF capacity is difficult in the US, Europe, Korea and Japan — reinforces GFCL EV's backward-integrated HF cost advantage

• Global electrolyte salt manufacturers: Korea (4), Japan (2), Europe (2) — GFCL EV is the notable ex-China entrant with a full basket

• US "One Big Beautiful Bill" (OBBB) mandates batteries contain ~60% non-Chinese-origin components, rising to 85% over the next few years — a structural tailwind for non-Chinese suppliers such as GFCL EV

Ex-China Li-ion battery cell demand is projected to grow from ~500 GWh (CY26) to ~1.8 TWh (CY30E) — an addressable-market tailwind directly relevant to GFCL EV's product basket.

Demand Drivers:

• Global shift towards LFP chemistry on cost advantage across mass-market EV and ESS segments

• Pick-up in Battery Energy Storage System (BESS) demand, driven by AI-led power/storage-server growth and BESS-plus-renewables grid stabilisation

• Global push to de-risk battery supply chains away from China

Client Geography:

• Product approvals span multiple customers and geographies

• Biggest end-markets: US (largest), followed by India; local demand in Japan and Taiwan comparatively smaller

6. Financial Performance — Actuals (₹ Cr)

GFCL EV is currently in a heavy investment/ramp-up phase; losses have been widening as capex and operating costs scale ahead of revenue commercialisation.

Source: UnlistedZone (company filings). Figures reflect a subsidiary still in scale-up phase — not yet EBITDA/PAT positive.

7. Revenue & Profitability Guidance / Estimates

Management Guidance (per 360 ONE visit):

• Battery chemicals segment to reach sizeable triple-digit revenues (₹ Cr) by 4QFY27E

• LiPF6 commercial scale-up to continue into FY27E and beyond

• LFP CAM commercial sales from 2HFY27E; PVDF binder commercial business from 1HFY27E

Management Guidance (per Axis Capital visit):

• FY27E revenue guidance: ₹500–700 Cr, with peak revenue/margin targeted by FY30E

• Peak revenue target: ~₹12,000 Cr; EBITDA margin ~25% by FY30E

• Phase I LiPF6 salt expansion fully commissioned by Dec'26; binders and LFP CAM ramping with customer approvals expected by Dec'26

8. Shareholding Pattern

9. Key Risks

• Execution/ramp-up risk in the battery chemicals business — the central swing factor per both broker visit notes

• Delays in product approvals/customer qualifications (LFP CAM, binders, NGAAM) could push back revenue ramp-up and commercialisation

• Anode supply chain is nascent for GFCL EV — ~90% of natural graphite anode material manufacturing is currently based in China

• Heavy capex programme (₹6,000 Cr by FY28–29E) funded via a mix of equity, debt and internal accruals — funding/execution risk; inability to raise further funds would pressure the balance sheet

• Currently loss-making with widening EBITDA/PAT losses (FY26: EBITDA ₹(80.5) Cr) as capex outpaces revenue ramp

• Policy risk: US OBBB non-Chinese content mandate is a tailwind today but subject to change

• Inability to sell R32 capacity given constrained consumption vs production quota (parent-level risk with read-through)

• Guarantees extended by parent group on other Inox group entities (Inox Wind, Inox Wind Infrastructure, etc.) — indirect balance-sheet risk