This small-cap recycling company announces start of commercial production of recycled polypropylene granules from its new plant!

The stock jumped more than 100 per cent in the last three years. As a result of this, it turned out to be a multi-bagger while in the last one year

Gravita India’s business is organised across four specialised verticals namely, lead recycling (flagship), aluminium recycling, plastic recycling, and turnkey projects. The company also has expertise in the recycling of used batteries, cable scrap/other lead scraps, aluminium scrap, plastic scrap, etc.  

In a recent development, the company announced that its step-down subsidiary situated in Ghana (West Africa) has started commercial production of recycled polypropylene granules from its new recycling plant, having an annual capacity of around 1,200 MTPA in phase 1. Further, the company also has plans to increase this capacity to 2,700 MTPA in the next phase.  

The company is already having similar plastic recycling facilities in Senegal, Mozambique, and India. Further, this is in line with the company's vision of replicating the recycling business in different geographies. The group has made an investment of approx. Rs 1.90 crore for the procurement & commissioning of this new recycling plant, which is invested from internal accruals of the company.  

The company, which will be procuring domestic plastic scrap for the purpose of production from this plant, would cater to the needs of plastic manufacturing industries situated in North America, Europe & Asia. This plant will help the company to change its sales mix by increasing the contribution from the plastic business.  

Interestingly, the company delivered good profit growth of 36.9 CAGR over the last five years and has a good return on equity (RoE); the track record of a 3-year RoE stood at 33.1 per cent.   

The stock jumped more than 100 per cent in the last three years. As a result of this, it turned out to be a multi-bagger while in the last one year, the stock has delivered stunning returns of over 80 per cent.