Shares in Orica, a noted mining and infrastructure solution provider, fell significantly by as much as 1.8% to reach A$15.150.

The dip can be attributed to the impending shutdown of the company’s key Kooragang Island facility.

For analysts at Citi, this closure arrives at a rather untimely phase when they forecasted a rise in demand for explosives and their prices.

They noted that during an 8-9 weeks turnaround period, the company’s ammonia plant, a major part of its operations, will not be functional.

Citi claims that this could necessitate the import of ammonium nitrate by Kooragang to sustain market demands for FY24.

The resulting diminished manufacturing margin is projected around A$15 million.

Following evaluation of the scenario, Citi reduced its FY24 underlying EBIT estimate by 4%.

Regardless, the majority of analysts remain optimistic about Orica’s performance with eleven of thirteen analysts designating a ‘buy’ or higher rating.

One analyst maintains a ‘hold’ while one suggests a ‘sell’, endorsing a median price target of A$17.80.

As of its last traded session, the stock recorded a 1.1% gain this year.

Orica (ASX:ORI) is primarily engaged in manufacturing commercial explosives and blasting systems for the mining, quarrying, and construction sectors.