Recycling Stock Jumps 5% After It Acquires Rashtriya Metal Industries for ₹565 Cr

Synopsis: A company where the stock has given a return of more than 2000 percent in the last 5 years, has now seen the stock jump by 5 percent after a Rs 565 crore acquisition, in order to enter the copper recycling industry.

A small cap company in the business of recycling and producing different kinds of metals has seen its stock surge soon after the company announced its 100 percent acquisition of a copper and copper alloy manufacturer. The company currently sees the  highest volume in its lead business and also happens to be the largest lead producer in India.

With a market cap of more than Rs 12,600 Cr, Gravita India Ltd saw its stock hit an intraday high of Rs 1763 which is more than 5 percent higher than the previous close of Rs 1673. The company stock has given a compounded return of 48 percent in the last three years, while the regular stock return in the last 5 years stood at 2000 percent.

What’s the News?

Gravita India Limited has approved a binding term sheet to acquire up to 100 percent stake in Rashtriya Metal Industries Limited (RMIL) for a consideration of up to Rs 565 crore. 

RMIL was incorporated in 1946, the company manufactures copper and copper alloy products and has reported Rs 910 crore turnover in FY25, and has a net worth of Rs 300 Crore. This company exports to UAE, USA, Thailand, Sri Lanka, Oman, Saudi Arabia, Kenya and Indonesia etc. 

The acquisition aligns with Gravita India’s strategic expansion plans and will make RMIL its subsidiary upon completion, targeted by March 31, 2026. The deal involves cash consideration and is not a related-party transaction. Gravita also announced its entry into the copper recycling business, strengthening its long-term metals portfolio strategy.

Current Volume Mix

As of Q3FY25, Gravita recorded the majority of its volume in lead, aluminium and plastic, where 43,900 MT is in lead, 6,264 MT in aluminium, and 3,279 MT in plastic. These figures formed a strong base, especially for lead, which remained the company’s dominant segment by volume contribution during the quarter.

By Q3FY26, lead volumes increased to 46,269 MT, marking a healthy 5.4 percent year-on-year growth. Aluminium volumes declined sharply to 3,550 MT, down 43.3 percent, while plastic volumes slipped marginally to 3,162 MT, reflecting a 3.6 percent YoY decline.

Business & Financial Overview

Gravita India Limited, incorporated in 1992 and headquartered in Jaipur, Rajasthan, is a leading recycling and manufacturing company. It operates across four recycling verticals with 13 manufacturing plants and over 1,900 global touchpoints, serving diverse industries through strong domestic and international partnerships, with clients including Amara Raja, Tata Group, TVS, Exide, Asian Paints and Philips.

The company has a production capacity of 3.40 lakh MT with 65 percent capacity utilisation and collects 2.87 lakh MT of scrap annually. Around 46 percent of revenues are derived from customised, value-added products. Gravita also has 40 percent overseas capacity, ILA-accredited plants and a healthy order book exceeding 60,000 MT.

In the latest quarter the company saw a YoY revenue growth of 2 percent, going from Rs 996 Cr in Q3FY25 to Rs 1,017 Cr in Q3FY26, while the QoQ went down by 2 percent from Rs 1,036 Cr in Q2FY26. The YoY Net Profits growth is at 24 percent, going from Rs 78 Cr in Q3FY25 to Rs 97 Cr in Q3FY26, while the QoQ growth stood at 1 percent from Rs 96 Cr in Q2FY26.

The company has a 3 year sales CAGR of 20 percent, while the TTM is at 12 percent. The company’s 3 year profit CAGR is at 30 percent, while the TTM number is at 33 percent. The company also has its ROCE and ROE at 21 percent.

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