Standard Engineering Technology announces equity investment in GL Hakko, Japan

Standard Engineering Technology (SETL) today announced an equity investment in GL Hakko Co., (GL Hakko) Japan, a manufacturer of glass-lined process equipment. GL Hakko is a member of the AGI Group, which is SETL's technology partner and, as a group, its second-largest shareholder after the promoters.

Under the agreement, SETL will make a primary capital infusion of Rs 70 crore (Japanese Yen 1,174 Million) into GL Hakko for an initial 19.19% equity stake, funded from internal accruals, without external debt. SETL also has the right to increase its shareholding by a further 31.88% for Rs 116.7 crore (Japanese Yen 1,978 Million), taking its aggregate holding to 51.07%, over the three years at the same per-share valuation, subject to definitive agreements and applicable regulatory approvals.

The investment forms part of SETL's stated objective of becoming India's largest glass-lined equipment manufacturer in FY27, on a manufacturing base of 1.2 million sq ft and more than 400 engineers and thereafter building the leading position in Southeast Asia.

GL Hakko will deploy the proceeds towards capital expenditure in the following areas:

- Additional capacity for glass-lined shell and tube heat exchangers, a technology GL Hakko has developed over several decades and for which it received Japan's Ichimura Prize in 1987. A new heat exchanger plant at its Nakatsu works is scheduled to begin operations in 2026. SETL and the AGI Group have already introduced this product category to India, with the first glass-lined shell and tube heat exchangers manufactured in the country. The companies estimate the addressable market at roughly Rs 2,000 crore in India and US$2 billion globally.

- Equipment for semiconductor-grade chemical processes, including reactors built on GL Hakko's MISS/electro-magnetic stirred systems and its low-leaching, high-corrosion-resistance glass developed for semiconductor-grade wet chemicals. The companies cite projections for this market of US$3.6 to 4.8 billion today, growing to US$6 to 7 billion by the early 2030s.

- A clean room for glass-lined equipment assembly, intended to improve contamination control and quality standards, together with broader investment in manufacturing capacity.