Gravita India Limited Reports 38% Q2 Revenue Growth to ₹1,427 Crore

Gravita India Limited reported consolidated Q2 FY27 revenue of ₹1,427.35 crore, up 38% year-on-year, supported by diversified businesses, higher utilisation and value-added products. Adjusted EBITDA rose 28% to ₹143.37 crore, while profit after tax increased 6% to ₹102.03 crore despite raw-material constraints affecting lead volumes.

What did Gravita report in Q2 FY27?

Gravita reported revenue growth ahead of volume growth in the September quarter, with total volumes rising 3% year-on-year to 52,199 metric tonnes. The company said its expanded manufacturing base, higher capacity utilisation in key segments, product mix and operational efficiencies supported the financial performance.

Consolidated adjusted EBITDA was ₹143.37 crore, compared with the prior-year quarter, and the EBITDA margin was 10.04%. Consolidated profit before tax rose to ₹124.21 crore from ₹111.28 crore, while PAT reached ₹102.03 crore against ₹95.97 crore a year earlier. The PAT margin stood at 7.15%.

Value-added products accounted for 64% of consolidated revenue in Q2 FY27. This was also the share of total sales reported for the first half of FY27. The company has identified a contribution of more than 60% from value-added offerings as part of its Vision 2030 direction.

For H1 FY27, revenue was ₹2,902.41 crore against ₹2,075.44 crore in the year-earlier period. EBITDA was ₹288 crore and PAT was ₹208.40 crore. Management said H1 revenue, EBITDA and PAT increased 40%, 29% and 10%, respectively.

Why did lead volumes face pressure during the quarter?

Gravita said lead volumes were affected by raw-material availability rather than demand. Chief Executive Officer and Whole-Time Director Yogesh Malhotra attributed the constraint to sudden geopolitical and logistics disruptions that affected sourcing conditions.

Management said it had made bookings in new sourcing geographies and expected material to begin arriving from Q3 FY27. However, it also noted that the working-capital cycle for this material is around 80 to 90 days, which can delay the effect of new procurement arrangements on operations.

The company is building new scrap-sourcing yards in the United States and Africa to strengthen raw-material availability and reduce procurement costs. It expects these initiatives, together with domestic sourcing, to support long-term volume growth.

Gravita expects lead volumes to grow at an 18% to 20% compound annual growth rate over the next three years. This guidance follows the short-term supply challenge reported in Q2 and is based on the company’s planned sourcing expansion and recycling capacity additions.

How are copper operations and margins developing?

Gravita reported Q2 FY27 EBITDA per tonne of ₹22,620 for lead, ₹22,664 for aluminium, ₹10,334 for plastics and ₹84,671 for copper. Management said EBITDA per tonne in lead, aluminium and plastics is expected to remain stable, while copper margins have a separate integration-led improvement plan.

For copper, management guided to a sustainable margin of about ₹65 to ₹70 per kg over the next few quarters. It expects this to increase to roughly ₹80 to ₹90 per kg in two to three years, when the Mandvi recycling facility provides backward integration to RMIL.

RMIL contributed ₹419.83 crore to consolidated Q2 revenue and recorded an EBITDA margin of 8.5%. Management said RMIL requires de-bottlenecking, with plant and machinery ordered to lift utilisation to about 65% to 70% over the next two to three quarters.

The company also said copper is fully hedged and lead is hedged. Aluminium cannot be hedged because it is not exchange traded, according to management. These distinctions are relevant to how commodity-price movements may affect individual business segments.

What is Gravita’s capacity expansion and capital expenditure plan?

Gravita has earmarked ₹1,680 crore of capital expenditure through FY29 and said the plan remains on track. About ₹600 crore had already been spent as of the earnings call, with the programme intended to raise capacity from about 480,000 tonnes to 800,000 tonnes by FY29.

Of the planned capital expenditure, ₹815 crore is allocated to existing businesses, while the balance is intended for new verticals including lithium-ion battery recycling and copper. Management said it would slow capital expenditure only if scrap availability dried up, but it sees sufficient availability in India and overseas for the next three to four years.

Domestic sourcing is another part of the operating plan. In the previous quarter, about 26% of lead scrap was sourced from domestic battery scrap and 74% was imported. Gravita expects domestic sourcing to rise to 40% to 50%, while overseas supply accounts for 50% to 60%.

Management expects the domestic reverse-charge mechanism on battery scrap to help shift supply from the unorganised market to organised recyclers. It also expects Battery Waste Management Rules compliance demand to accelerate after FY29, when the stated seven-year regulatory window ends.

What does the Q2 performance mean for investors and the recycling sector?

The quarter showed that revenue and EBITDA grew faster than volumes, reflecting the contribution of value-added products, RMIL and overseas subsidiaries. At the same time, the 6% increase in PAT was lower than the growth in revenue and EBITDA, keeping attention on costs, sourcing conditions and capital allocation as expansion continues.

For the recycling sector, the company’s sourcing strategy highlights the importance of access to battery scrap and international procurement. The expected increase in domestic scrap collection could alter the procurement mix, although management has not provided a quantified financial impact from this shift.

Lithium-ion battery recycling is not included in Gravita’s current Vision 2030 targets. Management said volumes from this segment are expected to emerge conservatively in four to five years, indicating that the near-term financial plan remains centred on lead, aluminium, plastics and copper operations.

Conclusion

Gravita delivered 38% revenue growth and 28% adjusted EBITDA growth in Q2 FY27, while lead volume growth remained constrained by raw-material availability. The higher share of value-added products, RMIL’s contribution and stable segment-level profitability were central to the quarter’s performance.

Investors will watch the arrival of material from new sourcing geographies from Q3 FY27, RMIL utilisation improvement over the next two to three quarters, and execution of the ₹1,680 crore capital-expenditure programme through FY29. The pace of domestic scrap sourcing and progress towards 800,000 tonnes of capacity will remain key disclosed operating markers.