### **Overview** Gravita India Limited (GIL) is a leading integrated recycler of non-ferrous metals and plastics, operating globally for over three decades. Established in 1992 and headquartered in Jaipur, India, the company has evolved from a lead-focused recycler into a diversified, multi-continental recycling conglomerate with a strong emphasis on sustainability, vertical integration, and technological innovation. With a presence in over **70 countries**, Gravita operates **12+ state-of-the-art, eco-friendly manufacturing facilities** across India, Asia, Africa, and Central America, supported by a vast procurement network of more than **33 owned scrap yards and 1,900 collection touchpoints** globally. The company processes over **300,000 metric tons (MT)** of scrap annually and serves **350+ global customers**, including major OEMs like Amara Raja Batteries, Exide, Schneider Electric, and Glencore. --- ### **Core Business Verticals** Gravita operates across **five key verticals**: 1. **Lead Recycling** – Flagship segment, contributing ~80–85% of EBITDA. 2. **Aluminium Recycling** – Strategic growth area with rising capacity and margin expansion. 3. **Plastic Recycling** – Focused on value-added products like food-grade PET flakes. 4. **Rubber Recycling** – Recently launched, used internally for energy recovery and cost savings. 5. **Turnkey Recycling Solutions** – Proprietary technology and consultancy services. --- ### **Product Portfolio & Revenue Mix** Gravita specializes in converting scrap—primarily from used lead-acid batteries (ULAB), e-waste, and end-of-life vehicles (ELVs)—into high-quality secondary raw materials, including: - **Lead-based**: Pure lead (>99.98% purity), lead alloys, lead sheets, lead oxide, red lead, lead bricks - **Aluminium-based**: Customized aluminium alloys, ingots - **Plastic-based**: PP granules, food-grade PET flakes - **Rubber-based**: Crumb rubber, pyrolysis oil #### **Value-Added Products (VAPs)** - Constitute **49–51% of total revenue (as of FY24–FY25)**, though the share has gradually declined from **55% in FY20 to ~47–49% in FY24**, reflecting product mix shift. - VAPs are higher-margin offerings that strengthen customer relationships and capture larger shares of client procurement spends. - Key VAPs: Custom lead alloys, red lead, lead sheets, food-grade PET flakes. #### **Revenue by Segment (FY24)** - **Lead Recycling**: ₹2,780.77 crore (~88% of total segment revenue) - **Aluminium & Plastics**: Growing contributors - **Turnkey Projects**: ~8% of EBITDA, high-margin (~40% gross margin), with a robust order book of **60,000 MT** --- ### **Global Expansion & Strategic Diversification** Gravita follows a replication strategy, expanding successful business models across geographies: - **Overseas Milestones**: - First unit: **Sri Lanka (2006/2007)** - Africa entry: **Ghana (2007/2019)** - Mundra, India: New integrated facility (2021) - **Togo, Senegal, Tanzania, Mozambique, Nicaragua, Dominican Republic** – active or under development - **Europe Entry**: Acquiring a **17,000 MTPA waste tyre recycling plant in Romania** via Gravita Netherlands BV (₹40 crore investment), marking strategic expansion into EU markets. --- ### **Capacity & Utilization** - **Total Recycling Capacity**: ~**290,000–310,000 MTPA** (as of Jan–Mar 2025) - **Target by FY28**: **700,000 MTPA** - **Current Capacity Expansion Projects**: - **Mundra, India**: Lead capacity boosted to **100,000 MTPA**, plastic and red lead units added - **Chittoor, India**: Lead capacity expanded to **64,640 MTPA** - **Tanzania, Togo, Senegal**: Capacity additions in lead, plastic, and rubber - **Capacity Utilization**: Increased to **~58–67% (FY23)** from ~37% in earlier years --- ### **Procurement & Supply Chain** - **Deep Global Network**: Scarp sourced from Asia, Africa, Middle East, Europe, and the Americas. - **80% imported**, 20% domestic scrap (India). - **Procurement Advantage**: Strategic plant locations near **ports** (Mundra, Chennai) and **customers** (e.g., Amara Raja), reducing logistics costs and shortening working capital cycles. - **ELV Policy (India, April 2025)**: Poised to benefit from structured battery scrap inflow via Registered Vehicle Scrappage Facilities (RVSFs). --- ### **Financial & Risk Management** - **Hedging Policy**: 100% hedged on lead prices through **back-to-back contracts or LME/MCX futures**. - **MCX Empanelment**: GIL’s lead from Jaipur and Chittoor plants is an approved deliverable for MCX futures (since 2022), enhancing price transparency and inventory management. - **Aluminium Hedging**: Awaiting **MCX listing for ADC12 alloy** (expected Q4 FY25), which will unlock better risk control and higher capacity utilization (~45–50% targeted). - **Tax Rate**: Stable at **11–12%** - **Other Income**: Hedging gains in FY23 contributed ₹88 crore (included in EBITDA) --- ### **Turnkey Solutions Segment** - A high-margin, scalable business line with **70+ projects executed globally** (Qatar, UAE, Saudi Arabia, Poland, Chile). - Services include **end-to-end turnkey solutions** — planning, design, fabrication, testing, installation, operation, and annual maintenance. - Proprietary in-house developed technology, including PLC-based control systems. - **Order Book**: Over **60,000 MT**, demonstrating strong client trust and demand. --- ### **Sustainability & ESG Focus** - **13 eco-friendly manufacturing units** with strict environmental compliance. - **EPR-driven growth**: Regulatory tailwinds in India for **plastic, tyre, and battery waste** (BWR Rules, GST RCM extension) favor formal recyclers. - Investing in: - **Pyrolysis for rubber** (used as low-cost fuel) - **PET recycling expansion** (targeting 70% capacity increase in India) - **Renewable energy adoption** across facilities --- ### **Challenges & Mitigations** - **EV Disruption Risk**: Long-term threat from declining lead-acid battery demand, but transition expected to be slow in India and Africa due to dominance of unorganized sector. - **Scrap Price Volatility**: Fully mitigated via daily hedging and back-to-back sales. - **CapEx Intensity**: Manages via internal accruals, lean investments (e.g., leased facilities), and rolling CAPEX of **₹150 crore/year**, with ₹100 crore annually allocated for new verticals. --- ### **Financial Highlights (FY24)** - **Total Segment Revenue**: ₹3,160.75 crore (up from ₹2,800.60 crore in FY23) - **Lead Revenue**: ~88% of total (₹2,780+ crore) - **EBITDA Growth**: **22% YoY** despite only **12% volume growth**, highlighting focus on **profitability over volume** - **Volume Growth Guidance (FY25)**: **20–25%**, driven by capacity additions and better utilization - **Overseas Revenue**: ~**42% of total**, but contributes **~76% of profits**—reflecting higher margins internationally