Hyderabad-based Nexon Geochem has signed an agreement with Andhra Pradesh to build a ₹1,250 crore plant making 600 tonnes a year of rare earth magnets, as India tries to cut its reliance on imported magnets.
At a glance
- The plant will be in Thondangi, Kakinada district, under an MoU with the Andhra Pradesh Economic Development Board.
- Investment is split into ₹750 crore for the first phase and ₹500 crore for the second.
- It will make sintered NdFeB magnets for EVs, wind turbines, automation and defence.
Background
Neodymium-iron-boron (NdFeB) magnets are the strongest permanent magnets in common use. They power electric vehicle motors, wind turbine generators, factory automation and defence systems. India imports the rare earth magnets it uses and is trying to build a domestic supply chain for critical minerals.
What happened
Nexon Geochem said on Wednesday it signed a memorandum of understanding (MoU) with the Andhra Pradesh Economic Development Board. The agreement covers an integrated sintered NdFeB magnet plant at Thondangi in Kakinada district. The company will invest ₹1,250 crore in two phases: ₹750 crore in the first and ₹500 crore in the second.
The facility is planned to produce 600 tonnes of high-grade permanent magnets a year, the company said in a statement reported by Moneycontrol and Business Standard.
Why it matters
Rare earth magnets are critical for electric vehicles, wind turbines, industrial automation and defence equipment, and India depends on imports for them. The project is part of a wider push to build a domestic critical minerals ecosystem.
"Our vision is to establish an integrated NdFeB magnet manufacturing ecosystem that strengthens supply-chain security, reduces import dependence," director Praveen Kumar Choudhary said. The Hyderabad-headquartered company focuses on replacing imported components for the defence, green energy and automotive sectors.
What comes next
An MoU is an early step. The company has not given a construction or production timeline, so the plant's effect on India's magnet supply will depend on how quickly it is built.
Our read
Outlook: neutral. A 600-tonne plant is small next to global magnet output, so it is unlikely to move neodymium prices on its own.
What to watch
- A construction timeline and start date for the first phase.
- Where the plant will source its rare earth raw materials.
For information only, not investment advice.
Neodymium price in India
metalscost.com India reference price as of 2026-10-16.
Detailed analysis
Demand Drivers
Electric vehicles, wind turbines, automation and defence drive demand for NdFeB magnets.
Government Policies
The plant fits India's push to build a domestic critical minerals and magnet supply chain.
What could lift prices
- Growing EV and wind demand in India needs more rare earth magnets.
- New magnet plants add demand for neodymium-praseodymium feedstock.
What could weigh on prices
- The plant is at the MoU stage with no production date.
- Its 600-tonne capacity is small relative to India's import needs.
Country impact
| Country | Impact | Reason |
|---|---|---|
| India | High | The plant would reduce reliance on imported rare earth magnets. |
Industry impact
| Industry | Effect | Reason |
|---|---|---|
| Electric Vehicle Manufacturing | Positive | Local magnet supply could secure a key EV motor component. |
| Wind Energy | Positive | Turbine makers would gain a domestic magnet source. |
Who gains, who loses
- Indian EV and wind manufacturers: A local magnet source could cut supply risk.
- Magnet exporters to India: Domestic output would replace some imports.
Other ways this could play out
- If the first phase is built quickly, India could start replacing some imported magnets within a few years.
- If feedstock proves hard to secure, the project could be delayed.
Price risks
- The project may face delays between MoU and construction.
- Securing rare earth raw materials could be difficult.
Technical view
Price is mixed relative to its 20-period and 50-period moving averages, showing no clear trend alignment.
Computed from metalscost.com's own stored price history.
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