India's battery chemicals ecosystem set for rapid expansion as ACC demand surges: Nuvama

New Delhi: India is transitioning from being primarily an importer of battery materials to developing a domestic battery chemicals ecosystem, with demand for advanced chemistry cells (ACC) expected to grow sharply in the coming years, brokerage firm Nuvama said in a research report.

Nuvama expects India's ACC demand to grow at a compound annual growth rate (CAGR) of 39 per cent between 2025 and 2030, reaching around 700 GWh by 2030 from 40 GWh in 2025. Demand is expected to remain strong thereafter, growing at a CAGR of 27 per cent between 2030 and 2035.

The brokerage expects electric vehicle (EV) battery demand to grow at around 35 per cent annually during 2025-30, while battery energy storage systems (BESS) are projected to be the fastest-growing application, with demand rising at a CAGR of 78 per cent over the same period.


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Globally, advanced chemistry cell demand is expected to grow at around 20 per cent CAGR during 2025-30, before moderating to approximately 8 per cent during 2030-35. Nuvama expects global demand growth to eventually outpace supply growth, with utilisation rates rising as excess manufacturing capacity is absorbed.

India's battery manufacturing ecosystem is also expanding. The government's Rs 18,100 crore Production Linked Incentive (PLI) scheme for ACC batteries aims to establish 50 GWh of domestic cell manufacturing capacity. In addition, more than 10 manufacturers have announced around 178 GWh of battery manufacturing capacity, creating significant downstream demand for battery chemicals and materials.

Nuvama said the National Critical Mineral Mission is expected to support domestic exploration, processing and recycling of key minerals including lithium, nickel, cobalt and graphite.

The brokerage expects lithium iron phosphate (LFP) to remain the dominant battery chemistry globally due to its lower cost, improved safety and longer cycle life. The shift towards LFP is expected to support demand for iron phosphate, graphite, conductive carbon black, carbon nanotubes and electrolyte materials, while moderating long-term growth in cobalt demand.

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India's battery-materials value chain is at different stages of development. Critical minerals remain largely imported, while cathode and anode materials, electrolytes and conductive additives are seeing increasing domestic capacity. Battery cell manufacturing is also expanding rapidly, while technologies such as silicon-carbon anodes, LMFP, sodium-ion and solid-state batteries are emerging as potential future growth areas.

Nuvama said India's energy transition, rising EV adoption and the expansion of renewable energy and storage infrastructure could create a long-term opportunity for domestic battery chemicals and materials manufacturers.