B&K Sec bullish on recycling; initiates 'Buy' on Gravita, Ganesha Ecosphere

B&K Securities has initiated coverage on Gravita India, Pondy Oxides & Chemicals, Jain Resource Recycling and Ganesha Ecosphere; here's why

B&K Securities has turned bullish on the recycling space as it sees structural tailwinds across lead and copper recycling. It has initiated coverage on Gravita India with a ‘Buy’, and on Pondy Oxides & Chemicals and Jain Resource Recycling with a ‘Hold’ rating, while in the plastics recycling segment, the brokerage has assumed coverage on Ganesha Ecosphere with a ‘Buy’ rating.

Unorganised share shrinking as regulations tighten

India’s recycling ecosystem is undergoing a structural shift from the unorganised to the organised sector, aided by tighter environmental regulations and changing customer preferences, according to B&K Securities. The unorganised segment, which accounted for 80 per cent of non-ferrous metal recycling in FY16, has seen its share decline to 60 per cent currently, while organised players have expanded to 40 per cent on the back of compliance requirements and greater demand for reliable, scalable recycling partners from large original equipment manufacturers (OEMs) and global brands.

 

Organised market share rising 

The report expects the formalisation cycle to accelerate from FY26 onwards, with plastic waste management rules (PWMR) likely to come into effect from FY26 (even if with a short-term delay), alongside continued regulatory tightening and a sustained capex cycle across metals and plastics recycling. It projects organised players’ market share to rise to 65 per cent by FY30, supported by growing preference for recyclers with backward integration, own scrap yards, last-mile sourcing, strong collection networks, higher value-added product mix and investments in next-generation technologies, including Li-ion recycling. 

Scale, compliance and supply-chain depth emerge as key differentiators

The global lead recycling volume is expected to grow at a compound annual growth rate (CAGR) of 3.7 per cent, while India’s lead recycling volumes are projected to expand at a CAGR of 6.4 per cent over FY25-28. In comparison, the brokerage believes  Gravita India, Pondy Oxides & Chemicals, and Jain Resource Recycling, is positioned for materially stronger growth, with expected volume CAGRs of 19.8 per cent/18 per cent/13.0 per cent, respectively. 

 

This outperformance will be driven by the ongoing shift from the unorganised to the organised sector, supported by Extended Producer Responsibility (EPR) and Battery Waste Management Rules (BWMR) regulations, improved availability of domestic scrap and end-of-life batteries, and increasing customer preference for recyclers with scale, capacity reliability and value-added/customised product offerings.

Copper recycling: Volumes rising

India’s copper demand is estimated to grow at 7.2 per cent, while copper recycling volumes are expected to expand at a 13.2 per cent CAGR over FY25-30. B&K Securities projects copper-recycling volume CAGR of 14.5 per cent for Jain Resource Recycling and 170.2 per cent for Pondy Oxides & Chemicals over FY25-28, driven by rising domestic consumption, product upgrades (cathodes, wire rods, busbars), forward integration and onboarding of new customers as organised capacity scales up. 

Plastics: EPR mandate to drive rPET; supply constrained by approvals

In plastics, growth is expected to be led by Polyethylene Terephthalate (PET). PET demand is projected to grow at a 12.4 per cent CAGR and PET recycling volumes at 22.7 per cent CAGR over FY25-28. 

 

The report highlighted that EPR rules under plastic waste management will require 30 per cent recycled content from FY26, and only FSSAI-approved recyclers can manufacture food-grade rPET granules—creating a selective, supply-constrained market. It expects Ganesha Ecosphere’s subsidiary to grow faster than the industry, with a projected volume CAGR of 38.3 per cent over FY25-28E, and notes that Ganesha Ecosphere is the largest and among the oldest approved rPET-granule manufacturers in India.

 

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