Joint Venture / Investment
RHI Magnesita Forms Joint Venture with Khemka Refractories to Build Greenfield Recycling Facility
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RHI Magnesita India Limited (RHIM) has approved the formation of a joint venture with Khemka Refractories Private Limited to establish a greenfield refractory recycling facility in Odisha. The new company will initially be incorporated as a wholly owned subsidiary of RHIM, with Khemka subsequently acquiring a 49% stake, resulting in a 51:49 joint venture.
PRICE-SENSITIVE TRIGGER
Event: Board approval for formation of a Joint Venture Company with Khemka Refractories Private Limited
Type: Joint Venture / Investment
Impact: Positive
Immediate Effect: The proposed joint venture strengthens RHIM’s circular economy strategy by expanding refractory recycling capabilities and establishing a dedicated recycling facility in eastern India, subject to regulatory approvals.
Key Metrics:
- RHIM Consolidated Turnover (FY26): ₹4,01,994.50 lakh
- Khemka Refractories Consolidated Turnover (FY26): ₹48,725.77 lakh
- Initial Equity Subscription: 10,000 equity shares of ₹1 each (₹10,000 cash investment)
- Initial Shareholding: RHIM – 100%
- Post Incorporation Shareholding: RHIM – 51%; Khemka – 49%
Highlight:
- Strategic Ownership Structure:Â The JV will initially be incorporated as a wholly owned subsidiary of RHIM before Khemka acquires a 49% equity stake.
What Happened ?
RHI Magnesita India Limited’s Board has approved entering into a Joint Venture Agreement with Khemka Refractories Private Limited for establishing a new company that will develop a greenfield refractory recycling facility in Odisha.
The JV aims to accelerate circular business models by combining RHIM’s global expertise in refractory recycling with Khemka’s regional sourcing network and raw material capabilities. The company will initially be incorporated as RHIM’s wholly owned subsidiary, after which Khemka will subscribe to a 49% equity stake.
The incorporation remains subject to approval from the Ministry of Corporate Affairs and the Registrar of Companies.
Key Details
Key Features of the Joint Venture:
- Joint Venture partner: Khemka Refractories Private Limited.
- Objective is to establish a greenfield refractory recycling facility in Odisha.
- Business will focus on industrial minerals and refractory recycling activities.
- Shareholding after completion:
- RHIM – 51%
- Khemka – 49%
- RHIM will initially incorporate the JV as a wholly owned subsidiary before allotting 49% shares to Khemka.
- Each shareholder will have the right to appoint and replace its nominee director.
- Changes in capital structure will require shareholder approval.
- Any future issuance of securities will first be offered to existing shareholders.
- No consideration has been paid between the parties under the Joint Venture Agreement.
- The transaction is domestic and does not qualify as a related party transaction at the time of execution.
- The JV company will become a subsidiary of RHIM after incorporation.
Note:
- The proposed incorporation is subject to approvals from the Ministry of Corporate Affairs and other applicable regulatory authorities before operations commence.
Risk Analysis
Summary:
- The transaction is at the incorporation stage and remains subject to statutory approvals and successful execution of the proposed recycling facility.
Key Risks:
- Incorporation of the JV requires regulatory approvals.
- Commercial operations will commence only after establishment of the recycling facility.
- Project execution and commissioning timelines have not been disclosed.
- Benefits from the circular business model will depend on successful operational implementation.
Worst Case:
- Delays in regulatory approvals or project execution could postpone commissioning of the recycling facility and defer realization of expected operational and sustainability benefits.
Risk Level: Medium
Company Commentary
- The JV is intended to accelerate circular business models through refractory recycling.
- RHIM stated that the facility will combine its global recycling expertise with Khemka’s regional presence and supplier network.
- Management expects the project to strengthen supply-chain resilience, support sustainable industrial growth and accelerate India’s transition toward a circular economy.
- The company confirmed that the JV will initially be incorporated as a wholly owned subsidiary before Khemka acquires its agreed 49% stake.
Official Exchange Filing: RHI Magnesita India Limited
