Archean Chemical Industries Limited has entered into a major loan agreement with its Wholly Owned Subsidiary (WOS), Neun Infra Private Limited. The total sanctioned loan amount is ₹560 Crore, intended to fund capital expenditure for a compound semiconductor manufacturing facility via SiCSem Private Limited. The unsecured loan carries an interest rate of 9.00% p.a., is repayable over 5 years, and the transaction was conducted at arm’s length.
Intimation of Loan Agreement with Subsidiary
Archean Chemical Industries Limited announced on March 26, 2026, that it has executed a loan agreement with its Wholly Owned Subsidiary (WOS), Neun Infra Private Limited. This disclosure is made pursuant to mandatory listing regulations.
Purpose and Project Context
The primary purpose of this significant funding is to support the subsidiary in advancing its semiconductor business. Specifically, the loan will finance the procurement of long-lead machinery, equipment, and related project expenditures necessary for the compound semiconductor manufacturing facility of SiCSem Private Limited. SiCSem Private Limited has already secured approval from the Government of India’s India Semiconductor Mission (ISM) for setting up the facility in India.
Key Financial Terms of the Loan
The details provided in Annexure-A outline the specific terms of the financing:
- Lender: Archean Chemical Industries Limited
- Borrower: Neun Infra Private Limited
- Nature of Loan: Unsecured Loan
- Total Amount Granted: Rs. 560 Crs
- Total Amount Outstanding: Rs. 217 Crs
- Interest Rate: 9.00% p.a.
- Repayment Period: Repayable over a period of 5 years.
- Repayment Start Date: Repayment commences from the FY 2031-32 onwards.
- Date of Execution: 26.03.2026
Related Party Status and Arm’s Length Compliance
The parties are intrinsically related, as Neun Infra Private Limited is the Holding and Wholly Owned Subsidiary Company of Archean Chemical Industries Limited. Furthermore, the entire 100% equity of the subsidiary is held by the Company. The transaction confirms that the loan agreement falls within the definition of related party transactions but was conducted strictly at arm’s length.
No security has been provided by the borrowers for this loan, as the cumulative outstanding loans lent to or borrowed from the party do not become material on a cumulative basis based on the equity holdings.
Source: BSE
