As the world's top investment manager and financial market journalist, I bring you the latest news on the devastating explosion at a pharmaceutical factory in southern India. Learn how this tragedy has impacted the market and what it means for your investments.
By Rishika Sadam and Shivam Patel
HYDERABAD/NEW DELHI (Multibagger) -Workers at a pharmaceutical factory in southern India were trying to plug a chemical leak when an explosion ripped through it, killing at least 17 people and injuring 36, the firm's chief financial officer said on Thursday.
Wednesday's blast came around noon at the privately-held Escientia Advanced Sciences in Andhra Pradesh, where nearly 400 employees make intermediate chemicals and active ingredients for export to the United States and other Western countries.
"It looks like it happened from a solvent leak," said Srinivasa Rao Korada, chief financial officer of the Escientia Group, adding that it was not clear what triggered the leak.
One of the worst industrial accidents in recent years in India, often called the pharmacy of the world, came a year after a fire at a pharmaceuticals factory in the same Anakapalli district of the state killed two people and injured five.
The company is collaborating with authorities to investigate the reason for the leak, Korada said, adding that smoke and fire had prevented the company from investigating immediately.
Officials said they were scanning closed-circuit television footage and questioning the injured to decide if human error was responsible.
"Preliminary investigation shows ... there was some vapour leak that led to chemical reactions, which caused the explosion," said state Industries Secretary N. Yuvaraj, who identified the solvent involved as methyl tert-butyl ether.
Methyl tert-butyl ether, or MTBE, is a flammable liquid that finds use as an additive in unleaded gasolines to achieve more efficient burning, the U.S. Centers for Disease Control and Prevention (CDC) says on its website.
An inquiry will be held into the accident, said the state's chief minister, Chandrababu Naidu, an ally in Prime Minister Narendra Modi's federal government, adding, "We also hope this will be the last such incident."
The factory started operations in 2019 with an investment of 2 billion rupees ($24 million), said Vijaya Krishnan, the district's collector, or top revenue official.
($1=83.9330 Indian rupees)
Analysis:
This tragic event highlights the importance of safety measures in industrial settings. Investors should be cautious when investing in companies that deal with hazardous chemicals to avoid potential risks. The market may react to such incidents by reevaluating the safety standards of similar companies, which could impact their stock prices. It is crucial for both investors and the general public to stay informed and aware of such incidents to make informed decisions regarding their finances and safety.