The shares of this market leader are in focus after ICICI Securities has initiated a strong BUY call on this. In this article, we will try to understand the rationale behind this investment.
With a market capitalization of Rs 13,936 crores, the shares of Gravita India Ltd are currently trading at Rs 1,895 per share, down by 30 percent from its 52-week high of Rs 2,700 per share. Over the last five years, the stock has delivered a multibagger return of 5,463.40 percent.
Investment Rationale
ICICI Securities, in its research report dated 6 May 2025, stated that Gravita India’s performance was in line with what the brokerage had expected and has assigned a target of Rs 2,670 with an upside of 45 percent.
The company’s Q4 FY25 EBITDA and PAT came in 1 percent and 3 percent ahead of expectations, respectively. Lead and aluminium volumes increased by 12.3 percent and 62 percent YoY respectively.
While international business contributed 32 percent to revenue and 25 percent to PAT, inter-company sourcing and Mozambique plant issues hampered margins. In FY25, the company registered 46 percent value-added product sales and a 60 percent YoY increase in local scrap sourcing. Capacity increased by 93,000 tonnes with Rs 107 crores of capex.
For the future, the company mentioned that it aims for over 25 percent volume CAGR, over 35 percent PAT growth, over 25 percent RoIC, with 50 percent of revenue coming from value-added products and over 30 percent from non-lead segments. Due to management’s bullish comments, the brokerage expects its capacity to increase by 2.06 times through to FY28E at a capex of Rs 1500 crores.
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Financial Highlights
Gravita India Ltd reported a consolidated revenue of Rs 3,869 crores in FY25, up by 22.4 percent from Rs 3,161 crores in FY24. On a year-on-year (YoY) basis, revenue rose by 20.16 percent to Rs 1,037 crores in Q4 FY25 from Rs 863 crores in Q4 FY24. On a quarter-on-quarter (QoQ) basis, it increased by 4.12 percent to Rs 1,037 crores in Q4 FY25 from Rs 996 crores in Q3 FY25.
It posted a net profit of Rs 313 crores in FY25, up by 29.34 percent from Rs 242 crores in FY24. Net profit grew by 37.68 percent YoY to Rs 95 crores in Q4 FY25 from Rs 69 crores in Q4 FY24. On a QoQ basis, it increased by 21.79 percent to Rs 95 crores in Q4 FY25 from Rs 78 crores in Q3 FY25.
About the company
Gravita India Limited is a recycling and manufacturing firm that deals in lead, aluminium, and plastic recycling and manufacturing. The firm produces products such as pure lead, lead alloys, aluminium alloys, and plastic recycled granules. It also deals in turnkey recycling solutions and consultancy services, and trading in scrap material in the form of batteries, aluminium, plastic, and rubber.
Written by Satyajeet Mukherjee
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