Gravita India Q1 FY27 Earnings Call — Analysis (NSE: GRAVITA)

Gravita delivers 42% revenue growth in Q1FY27 despite lead supply disruptions, driven by copper segment and value-added mix; management confident of long-term 25-30% PAT CAGR

30 Jul 2026 · Analysis by Alpha Inflection

The take

Q1FY27 Revenue ₹1,475 Cr ( +42% YoY ) . New guidance — FY29 overall installed capacity expa… over 8 lakh metric tons per annum . New story: Copper diversification as growth engine .

Results

Revenue ₹1,475 Cr (+42% YoY); EBITDA ₹145 Cr (+29% YoY); PAT ₹106.39 Cr (+14% YoY); total volumes of 55,455 MT (+4% YoY); lead volumes declined due to Middle East war disrupting scrap imports, partly offset by copper revenue of ₹376 Cr at 50% utilization

Financial highlights

Guidance

Management reiterates 25-30% PAT CAGR for FY27 and next 4-5 years; copper EBITDA/ton to reach ₹60,000 by FY27 end and ₹65,000-70,000 in 2-2.5 years; copper capacity to double to 60,000 MT in 3 years; overall capacity to 8 lakh MT by FY29

What management committed to

• Total installed capacity will be scaled to over 8 lakh metric tons per annum by FY29 — over 8 lakh metric tons per annum, FY29
• Gujarat copper recycling facility of 29,400 MTPA will be commissioned within the next 12 months [by July 2027] — Q2FY28
• Company has earmarked total capex of ₹1,680 crores through FY29, with ₹850 Cr for existing businesses and balance for new recycling verticals — ₹1,680 crores, FY29
• Copper segment EBITDA per ton will reach around ₹60,000 by end of FY27 — around ₹60,000, FY27
• Copper segment EBITDA per ton will reach ₹65,000 to ₹70,000 in 2 to 2.5 years [by FY29-FY30] — ₹65,000 to ₹70,000, FY29-FY30
• Copper capacity will be doubled to around 60,000 metric tons per annum in the next 3 years [by FY30] — around 60,000 metric ton per annum, FY30
• PAT CAGR will be in the range of 25% to 30% for FY27 and the next 4-5 years [through FY31] — 25% to 30%, FY27-FY31
• Copper capacity utilization will increase to over 60% by end of FY27 — 60% plus, FY27
• Lead EBITDA margins in Q2FY27 will be similar to Q1FY27 — Q2FY27
• Procurement network in developed nations (U.S.) will be set up by end of FY27, more than taking care of Gulf supply disruption — FY27
• Plastic EBITDA per kg on a sustainable basis will be ₹10 to ₹12 — ₹10 to ₹12 per kg, FY27-FY28
• Aluminium EBITDA per kg on a sustainable basis (overseas operations) will be ₹15 to ₹17 — ₹15 to ₹17 per kg, FY27-FY28

Key themes

Diversification and margin resilience amid supply disruptions

How the narrative shifted

• Middle East supply disruption: Management attributes lead volume decline to Gulf war disrupting import of 15-20% scrap, with Q2 also impacted, but expects normalization by year-end through alternate sourcing
• Copper diversification as growth engine: Copper contributed ₹376 Cr, offsetting lead weakness; management fast-tracking copper expansion, targeting 60%+ utilization by FY27-end and doubling capacity in 3 years
• Margin focus over volume: Amid scrap shortage, company prioritized profitability through better realisations and value-added mix, driving value-added share to 63%
• Network expansion into developed markets: Setting up own procurement yards in U.S. and other developed economies to de-risk supply chain and improve scrap availability for copper and lead
• Long-term growth intact: Management reiterated 25-30% PAT CAGR for FY27 and beyond, Vision 2030 capacity targets, and long-term volume growth despite near-term disruptions
• Working capital temporary increase: Working capital days rose to 95 due to higher copper inventory and goods in transit; management views it as transient

Operational commentary

• LME brand listing obtained for lead metal produced at Mundra (brand GRAVITA M), enabling delivery to all LME-approved warehouses and improving OEM acceptance
• Phagi, Jaipur lead facility expanded by 40,500 MTPA (investment ₹30 Cr, internal accruals), taking total lead capacity at Phagi to 75,819 MTPA
• Consolidation of Kathua unit into Jaipur facility for operational efficiency and cost savings
• Copper recycling facility of 29,400 MTPA at Gujarat on track for commissioning within 12 months; funded through internal accruals, capex ~₹160 Cr
• Integration of Rashtriya Metal Industries (copper acquisition) progressing, with operational synergies realised; debottlenecking to boost copper utilization to 60%+ by FY27-end
• Overall installed capacity reached 4.97 lakh MTPA; target of 8 lakh MTPA by FY29 reiterated
• New procurement yards being set up in developed economies (U.S.) to diversify scrap sourcing for copper and other metals, reducing dependence on Gulf region
• Rubber capacity put on hold; capex redirected to fast-track copper expansion
• MCX listing for aluminium ADC12 alloy pending at exchange level; management expects inclusion within this year
• Lithium-ion battery recycling plan: company targets full refining (beyond black mass) once sufficient black mass availability; R&D underway

Analyst Q&A

• Q. Volume guidance for FY27 across divisions and expectations for copper margins as volumes ramp up

  Extremely difficult to talk division-wise volume growth in short-term due to Middle East disruption; long-term growth story remains as per Vision 2030. Copper EBITDA/ton will remain around ₹55,000 with slight increase, eventually reaching ₹65,000-70,000 in 2-2.5 years.

• Q. When will copper capacity utilization reach 100%?

  Currently at 50%, we are debottlenecking; it will take until end of this financial year to reach 60%+; full ramp-up later. Margins will improve gradually.

• Q. When will the supply disruptions be behind and growth rates normalise?

  We are setting up yards in US and expect procurement network in developed nations by year-end, which should more than compensate; we are confident of returning to normal and increasing overall procurement by year-end.

• Q. What is the inventory value as on 30th June 2026?

  Inventory value is close to ₹1,040 crores, similar to March 2026 level.

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