BAHETI - Baheti Recycling

📊 NSE: BAHETI 🏢 Aluminium and Aluminium Products 📅 Last Updated: 12/13/2025 18:52

💰 Financial Performance

Revenue Growth by Segment

Total revenue from operations reached INR 534.31 Cr in FY25, representing a 22.2% YoY growth. H1FY26 revenue stood at INR 315.14 Cr, up 22.53% from INR 257.19 Cr in H1FY25. The company achieved a 5-year CAGR of 42.52%, driven by expansion into the South India market and modernization of plants.

Geographic Revenue Split

While specific regional percentages are not disclosed, the company recently entered the South India market in 2025. It sources raw materials globally from the UK, USA, and New Zealand to ensure quality and competitive pricing for its domestic manufacturing base.

Profitability Margins

Gross margins are influenced by raw material costs which were INR 416.98 Cr (78% of revenue) in FY25. Net profit (PAT) for FY25 was INR 18.00 Cr (3.43% margin), improving to INR 9.26 Cr in H1FY26 (2.94% margin). Management targets a sustainable PAT margin of 3.5% to 4% as they scale operations.

EBITDA Margin

EBITDA margin expanded to 7.75% in FY25 (INR 40.63 Cr) from 3.28% in FY21. H1FY26 EBITDA was INR 21.23 Cr (6.74% margin). The expansion is attributed to operating leverage and systematic asset productivity improvements across production facilities.

Capital Expenditure

Planned capex of INR 30 Cr for a new wire rod facility with an initial capacity of 12,500 tons, expandable to 25,000 tons with an additional INR 6 Cr. Also invested in a 1.2MW DC Solar PV Plant to reduce energy costs.

Credit Rating & Borrowing

Total borrowings increased to INR 158 Cr in March 2025 from INR 102 Cr in March 2024. Finance costs for H1FY26 were INR 8.39 Cr, up from INR 6.41 Cr in H1FY25, reflecting increased debt to fund working capital and expansion.

⚙️ Operational Drivers

Raw Materials

Aluminium scrap (used for recycling into alloys and deox) represents approximately 78% of total revenue costs (INR 416.98 Cr in FY25).

Import Sources

Sourced internationally from the UK, USA, and New Zealand to ensure optimal quality and ample quantity for production.

Key Suppliers

Not specifically named in the documents, but described as a diversified global sourcing strategy to reduce dependency risks.

Capacity Expansion

Current production is 18,160 MT (11,576 MT Aluminium Alloy Ingots and 7,034 MT Aluminium Deox) at 63.8% utilization. Planned expansion includes a 12,500 MT wire rod facility by H2 FY27, with infrastructure built for 25,000 MT.

Raw Material Costs

Raw material consumption was INR 416.98 Cr in FY25. Procurement strategies involve diversified sourcing and strategic inventory management to mitigate supply chain disruptions.

Manufacturing Efficiency

Capacity utilization stands at 63.8%, providing significant room for volume expansion without immediate massive greenfield capex. Systematic asset productivity programs drive operational leverage.

Logistics & Distribution

Not disclosed as a specific percentage, but the company serves marquee automotive clients like Maruti and Motherson, requiring efficient just-in-time distribution.

📈 Strategic Growth

Expected Growth Rate

30%

Growth Strategy

Vision 2028 targets INR 1,200+ Cr revenue (approx. 30% CAGR from FY25). Strategy includes: 1) Expanding the automotive sector market share; 2) Launching a new wire rod vertical (INR 250 Cr potential); 3) Leveraging the IATF certification to onboard OEMs like Ola, TVS, and Hero; 4) Increasing capacity utilization from 63.8% to 80%+.

Products & Services

Aluminium Alloy Ingots, Aluminium Deox, and upcoming Aluminium Wire Rods.

Brand Portfolio

Baheti Recycling Industries.

New Products/Services

Aluminium Wire Rods expected to contribute INR 200-250 Cr to the topline at 80% utilization with better margins than traditional ingots.

Market Expansion

Targeting direct OEM relationships with major players like Ola, TVS, Yamaha, Hero, and Bajaj following the receipt of the IATF certificate in June 2025.

Market Share & Ranking

Not disclosed, but positions itself as a 'global champion of sustainable metal recycling' transitioning from a regional player.

Strategic Alliances

Partnerships with marquee clients including Ashley Alteams, Uno Minda, Spark Minda, Motherson, Caparo Maruti, and Alubee.

🌍 External Factors

Industry Trends

Secondary aluminium market is growing at 9-11% CAGR, significantly outperforming primary aluminium (1-2%). Growth is driven by 'green demand' and regulatory shifts toward recycling.

Competitive Landscape

Competes in the secondary aluminium recycling space; market dynamics are shifting toward organized players with global certifications.

Competitive Moat

Moat built on: 1) IATF certification (entry barrier for automotive supply); 2) Established global sourcing network for scrap; 3) Operational scale allowing for 7.75% EBITDA margins in a fragmented industry.

Macro Economic Sensitivity

Highly sensitive to the Indian automotive sector growth and global aluminium price cycles.

Consumer Behavior

Increasing demand for 'green' and recycled aluminium from automotive OEMs to meet sustainability targets.

Geopolitical Risks

Trade barriers or export restrictions in the UK/USA could impact raw material sourcing.

⚖️ Regulatory & Governance

Industry Regulations

Government mandates for recycled aluminium content are set to increase: 5% in FY28-29, rising to 10% by FY31-32, creating a guaranteed demand stream.

Environmental Compliance

Investing in a 1.2MW Solar plant and focusing on carbon neutrality; specific compliance costs in INR not disclosed.

Taxation Policy Impact

Tax expense for FY25 was INR 6.10 Cr on a PBT of INR 24.12 Cr (effective rate ~25.3%).

⚠️ Risk Analysis

Key Uncertainties

Raw material price volatility and supply chain security are primary risks. A 10% increase in scrap costs without a corresponding price hike could impact EBITDA by roughly 7-8%.