GRPLTD - GRP

📊 NSE: GRPLTD 🏢 Miscellaneous 📅 Last Updated: 12/13/2025 22:37

💰 Financial Performance

Revenue Growth by Segment

Reclaim Rubber (RR) revenue grew 1% YoY to INR 225.2 Cr in H1FY26, while Non-Reclaim Rubber revenue declined 8% YoY to INR 24.7 Cr. In FY24, Reclaim Rubber generated INR 424.7 Cr and 'Others' (Polymer Composite, Engineered Plastics) generated INR 62.11 Cr.

Geographic Revenue Split

In H1FY26, Exports contributed 52% (INR 129.6 Cr, down 6% YoY) and Domestic sales contributed 48% (INR 120.2 Cr, up 8% YoY). The company exports to 55+ countries.

Profitability Margins

Gross margins for H1FY26 were 50.6% (down 123 bps YoY). PAT margins declined significantly to 1.4% in H1FY26 from 2.7% in H1FY25, a drop of 122 bps, primarily due to higher interest costs and forex losses.

EBITDA Margin

EBITDA margin stood at 8.6% in H1FY26, down 38 bps from 9.0% in H1FY25. FY24 EBITDA margin was 10.8%, up from 6.6% in FY23, driven by EPR credit sales and cost efficiencies.

Capital Expenditure

Planned capex of INR 200-220 Cr over the next 3 years (FY26-FY28). Historical capex in FY24 was INR 67.39 Cr, including INR 37.04 Cr for Plant and Machinery and INR 22.85 Cr for Civil Infrastructure.

Credit Rating & Borrowing

CRISIL Ratings maintains a 'Stable' outlook. Total debt as of Sep-25 was ~INR 205 Cr, with interest coverage ratio weakening but remaining adequate. Bank limit utilization was 89% for the 12 months ended May 2025.

⚙️ Operational Drivers

Raw Materials

End-of-life tires (ELT) and Butyl rubber. Raw material costs account for approximately 50% of operating income.

Import Sources

Sourced from an extensive chain of 350+ vendors across 150+ cities domestically; specific import countries for Butyl rubber are not disclosed but are subject to global price fluctuations.

Key Suppliers

Not disclosed by specific company names; however, the company maintains a base of 350+ vendors.

Capacity Expansion

Current capacity is 1,220,000+ MTPA (including crumb rubber capacity added in Q4FY25). Planned expansion includes a facility for rubber crumbs and downstream products with an annual capex of INR 50-60 Cr.

Raw Material Costs

Raw material costs as a percentage of revenue fluctuated; Q2FY26 saw a INR 3.8 Cr gross margin reduction due to elevated Butyl rubber prices and export margin contraction of 15% YoY.

Manufacturing Efficiency

Operating efficiency improved in FY24 through debottlenecking; however, subsidiary GCSL is currently operating below optimal capacity due to supply chain bottlenecks.

Logistics & Distribution

Distribution costs impacted by increased ocean freight rates; company is leveraging inland customer networks to maintain service levels.

📈 Strategic Growth

Expected Growth Rate

9-11%

Growth Strategy

Growth will be driven by capacity enhancement in the reclaim rubber segment, maturing of the EPR credit regime (providing high-margin income), and scaling the Repurposed Polyolefins and Engineering Plastics businesses. The company is also investing INR 200-220 Cr in capex for downstream products.

Products & Services

Reclaimed rubber, rubber crumbs, engineered plastics, polymer composites, and repurposed polyolefins.

Brand Portfolio

GRP (Global Reclaim Partner).

New Products/Services

Rubber crumbs and downstream products; Engineering Plastics division registered 23% growth recently.

Market Expansion

Targeting 55+ countries with a focus on balancing regional supply chains to offset North American tariff risks.

Market Share & Ranking

Holds a 20% share in the domestic market and ~35% share in the export market for reclaimed rubber.

Strategic Alliances

Subsidiaries include Gripsurya Recycling LLP and GRP Circular Solutions Ltd (GCSL).

🌍 External Factors

Industry Trends

The EPR (Extended Producer Responsibility) market is maturing with floor/ceiling prices set at INR 2.525–INR 8/kg, providing a structured sustainability incentive for recyclers.

Competitive Landscape

GRP is a market leader in reclaimed rubber; competition includes other global recyclers and virgin rubber producers.

Competitive Moat

Moat is built on 5 decades of experience, established relationships with 8/10 top global tire firms, and ISCC+/GRS certifications which are difficult for new entrants to replicate.

Macro Economic Sensitivity

Highly sensitive to global tire demand and automotive industry cycles.

Consumer Behavior

Increasing global push for sustainability and circular economy regulations (like EPR) is driving demand for recycled rubber and plastic solutions.

Geopolitical Risks

Proposed tariff barriers in North America have reduced container availability and increased ocean freight rates, directly impacting export volumes.

⚖️ Regulatory & Governance

Industry Regulations

CPCB (Central Pollution Control Board) EPR norms require tire companies to purchase credits from recyclers. Formulae for awarding credits may undergo regulatory changes.