GRP Limited Reports 27% Income Growth in Q1 FY 2025

GRP Limited has announced its financial results for Q1 FY 2025, showing a 27% increase in total income. For the quarter ending June 30, 2024, total income reached ₹1,267 million, up from ₹999 million during the same period last year.

The company also reported a significant 122% increase in profit after tax (PAT), rising to ₹43.7 million from ₹19.7 million in the previous year.

This growth in standalone profit is attributed to a 19% rise in volume, a 5% reduction in energy costs, an optimal product mix, and earnings from Extended Producer Responsibility (EPR) credits. Notably, the company sold additional EPR credits from FY23 in Q1 FY25, generating ₹6 crore.

GRP Limited also made a strategic capex announcement by stating that the company is set to invest up to ₹250 crore in future growth and operational excellence. This investment will be executed in two phases over three years. Phase 1 will see ₹150 crore deployed by December 2025, while the remaining amount will be utilised in Phase 2. The CAPEX will focus on:

• Implementing new technology to produce reclaimed rubber with reduced CO2 emissions
• Expanding capabilities in crumb rubber and other categories under Tyre EPR
• Growing the plastic recycling business

Speaking of the Q1FY25 performance, the Managing Director for GRP Limited, Mr Harsh Gandhi, said, “We are pleased to announce that our revenue stood at Rs 1,267 Mn in Q1FY25, representing a 27% year-on-year (Y-o-Y) growth. Our EBITDA for the quarter witnessed an 88% Y-o-Y growth, with EBITDA margins at 10.5% for Q1FY25.”

He further stated that the global tyre demand saw a 3% increase in the passenger car/light truck (PC/LT) tyre markets during H1 CY 2024, while demand in the truck tyre segment (excluding China) rose by 2%, despite a downturn in the European market. Against this backdrop, the company achieved a 13% year-over-year increase in reclaim export revenue. Domestic rubber consumption grew by 5% in Q4 FY24 compared to the previous year, and the company’s domestic reclaim revenue surged by 43%, driven by higher volumes and EPR income.

He noted that virgin natural rubber prices have increased year-over-year due to a demand-supply mismatch, while synthetic rubber prices remain high, driven by elevated crude oil and shipping costs stemming from political tensions in the Middle East.

Despite these factors, the company’s realisations have slightly declined by 2%, attributed to a reduced share of exports. However, volumes in the Non-Reclaim Rubber segment have increased, in line with a 10% year-over-year growth in the auto industry during the quarter. As the company diversified into other raw material sources such as textile and fishnet waste, overall realisations in Engineering Plastics have decreased due to the incorporation of these bought-out materials.

He added, “Our reclaim rubber business grew by 24% Y-o-Y with double-digit EBITDA margins on the back of volume growth, energy cost savings and EPR income, while our non-reclaim rubber business also saw significant traction with 25% growth and double-digit EBITDA margins, attributed to revenue growth over previous year Q1. The Board has approved up to ₹250 crore for a 3-year, 2-phase capacity expansion, focusing on new technology for reclaiming rubber, expansion into crumb rubber and other categories identified under EPR, and expansion of plastic recycling. This investment will enhance our capabilities and provide the required impetus to our growth aspirations.”

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