Gravita India Limited: Scaling New Heights in Global Recycling and Sustainability by 2027
Introduction
Recycling and waste management are playing a pivotal role in promoting sustainability, with more people recognizing the importance of reducing, reusing, and recycling. Companies are transforming waste into valuable resources, and Gravita India Limited is one of the leading forces in this space. In this article, we will examine Gravita’s future outlook, focusing on its financial performance, capacity expansion, and business segments.
Growth of Recycling and Waste Management in India
Industry Growth and Trends
India’s recycling and waste management sector is experiencing rapid growth. The industry is expected to grow at a Compound Annual Growth Rate (CAGR) of 11.9%, from $1.29 billion in FY22 to $2.26 billion in FY27. The global lead recycling market is also growing steadily, rising from $16.95 billion in FY23 to $17.39 billion in FY24, and projected to reach $19.55 billion by 2028, growing at a CAGR of 3%.
In India, the aluminium recycling market grew at a CAGR of 9-11% from FY15 to FY24, while the lead recycling market stands at 2.5 MMT, accounting for 2.5% of the global reserves. Meanwhile, the global plastics recycling market is expected to grow from $42.4 billion in FY24 to $57.9 billion by FY29, with a CAGR of 6.4%.
Overview of Gravita India Limited
Gravita India Limited was established in 1992 by Mr. Rajat Agrawal. Over the years, it has grown into a leading multinational company specializing in lead, aluminium, plastic recycling, and metal fabrication. With operations in over 70 countries and a workforce of more than 3,350 employees as of FY24, the company has become a key player in the recycling industry.
- 50% of Gravita’s revenue is generated from overseas markets.
- The company serves customers across 38 countries, including Europe, America, Asia, and Africa.
- Gravita’s vision is to be among the top 5 global recycling companies by 2026.
The company is committed to sustainability and eco-friendly technologies, utilizing innovative processes to ensure environmental responsibility.
Key Business Segments of Gravita India
Gravita India Limited has diversified into four major recycling verticals, each contributing to the company’s overall success:
Lead Processing
Gravita’s lead processing segment is one of the largest contributors to its business. The company produces 148,500 MT of lead from recycled materials, supplying to various industries globally.
Aluminium Processing
The company also focuses on aluminium processing, producing 10,800 MT of aluminium from recycled materials. This segment continues to grow as aluminium demand rises in various industries, including automotive and construction.
Plastic Manufacturing
Gravita India is active in the plastic recycling sector, producing 8,500 MT of recycled plastic products. The company’s plastic recycling efforts align with the growing demand for eco-friendly packaging and materials.
Turnkey Solutions
Gravita offers turnkey solutions, setting up recycling plants globally for clients. With 11 recycling plants across the world and over 1,700 global touchpoints, the company has made significant strides in helping other organizations manage their waste efficiently.
In total, the company has produced over 1.69 lakh MT of products from more than 2.5 lakh MT of scrap, focusing on lead, aluminium, and plastic recycling.
Financial Performance of Gravita India Limited
Steady Financial Growth
Gravita India Limited’s financial performance has shown impressive growth over the last five years. The company’s revenue has steadily increased, rising from ₹2,800.60 crore in FY23 to ₹3,160.75 crore in FY24, representing a growth of 12.86%.
| Financial Metric | FY23 | FY24 | Growth |
|---|---|---|---|
| Revenue | ₹2,800.60 crore | ₹3,160.75 crore | 12.86% |
| Net Profit | ₹204.09 crore | ₹242.28 crore | 18.71% |
| Operating Profit Margin | 10.05% | 11.16% | |
| Net Profit Margin | 7.05% | 7.48% | |
| ROCE | 27.74% | ||
| ROE | 33.97% | ||
| Debt-to-Equity Ratio | 0.58x | 0.65x |
The net profit of Gravita India surged from ₹36.58 crore in FY20 to ₹242.28 crore in FY24, with a CAGR of 59.92%. The company’s operating profit margin also improved from 10.05% in FY23 to 11.16% in FY24, while the net profit margin increased from 7.05% to 7.48%.
Gravita’s Return on Capital Employed (ROCE) was 27.74%, and its Return on Equity (ROE) was 33.97% in FY24, highlighting the company’s profitability. To fund its expansion plans, Gravita raised its borrowing to ₹548 crore, which increased the debt-to-equity ratio slightly from 0.58x to 0.65x.
Capacity Expansion and Capex Plans
Gravita India is focused on expanding its manufacturing capacity to drive future growth. In FY24, the company increased its capacity by 29.37%, from 2,33,919 MT in FY23 to 3,02,859 MT. This capacity expansion includes:
- 236,559 MT for lead
- 30,000 MT for aluminium
- 24,300 MT for plastic
The company plans to further expand its capacity to over 500,000 MT by FY27, ensuring it can meet growing demand in the recycling industry.
Capex Investments
Gravita has been making significant capital expenditures (capex) to support its growth initiatives:
- ₹110 crore in FY23
- ₹98 crore in FY24
- Plans to invest ₹40 crore in FY25, ₹70 crore in FY26, and ₹100 crore in FY27
These investments will allow Gravita to expand into new recycling segments, including lithium-ion battery recycling and the establishment of paper and steel recycling plants by FY27.
Future Outlook of Gravita India Limited
Gravita India has a well-defined roadmap for future growth. The company is targeting 25% volume growth and 35% profitability growth (CAGR) over the next 3-4 years. Key future initiatives include:
- A self-funded capex plan exceeding ₹600 crore through FY27.
- Launching a pilot project for lithium-ion battery recycling in FY26, with an investment of ₹70-100 crore.
- Establishing a tyre recycling plant in Mundra, with a capacity of 9,000 tons per annum, expected to be operational by FY26.
- Expanding R&D capabilities to develop in-house technologies for lithium-ion battery refining.
- Increasing the share of non-lead business to 30% of total revenue.
- Increasing the use of renewable energy and reducing energy consumption by over 10% as part of their sustainability goals.
Conclusion
With a solid track record of financial growth, ongoing capacity expansion, and a clear focus on sustainability, Gravita India Limited is well-positioned to become a global leader in the recycling industry. The company’s commitment to expanding into new recycling segments, such as lithium-ion batteries and tyre recycling, and its investments in sustainability-driven operations, highlight a future full of opportunities.
Gravita’s roadmap for the future is aligned with global sustainability trends, making the company a key player in the evolving recycling and waste management industry. The future looks promising for Gravita as it continues to play a vital role in shaping a sustainable future.FOR MORE FINANCIAL UPDATE CLICK HERE
