August 30, 2024: Lead recycling conglomerate Gravita India has posted increased net profit for the past year of Rs239 crore ($28.5 million) and has revealed work is underway on innovative new emissions reduction processes.
Reporting annual figures in a regulatory filing on August 24, Gravita chairman Mahavir Prasad Agarwal also forecast that demand for lead in the battery sector will increase “by leaps and bounds” in the next few years.
According to the annual report, net profit was up from Rs201 crore in the previous year. EBITDA for 2023-24 was Rs331 crore (up from Rs286 crore in the past year).
Increases in profit and earnings were in part driven by net sales of Rs3,161 crore for the year, compared to Rs2,801 crore in the previous financial year, said Agarwal, who was reappointed as chairman and a director for the next three years last April.
“The growth underscored the effectiveness of our market strategies and the strong demand for our recycled products.”
More than 60% of total sales were made in the domestic market, while overseas markets accounted for much of the remainder.
“We have also embarked on a groundbreaking pilot project to integrate an electric refining furnace into our metal recycling operations. This initiative aims to revolutionize the refining process by significantly enhancing efficiency and reducing environmental impact.”
Agarwal said the furnace is designed to optimize energy consumption, reduce greenhouse gas emissions and minimize other pollutants associated with traditional refining methods.
“We are also conducting oxygen trials during smelting processes to enhance energy efficiency through the introduction of higher oxygen concentrations into the combustion system.”
Agarwal did not elaborate, but said the trials aim to demonstrate that the process can raise the combustion temperature and promote faster and more thorough fuel burning.
This in turn will lead to lower fuel consumption and a reduction of emissions while enhancing the overall efficiency of smelting.
He cited data from US-based analyst TechSci Research indicating that India’s lead acid battery market was worth nearly $4.5 billion in 2023 and has an expected CAGR of nearly 7% up to 2028.
Demand will be driven by the automotive, telecoms, EVs and electronic two-wheeler sectors, according to TechSci.
Agarwal said datacentres in India, where lead batteries are “widely used”, will also need more batteries to support critical systems as that sector too is expected to expand over the next four years.
“The trend is a clear indication that the country needs to start preparing to meet the increasing demand for lead in the coming years.”
However, Agarwal said the lead recycling industry in India continues to face significant challenges as a result of informal operations that do not adhere to environmental and related regulations.
Informal recyclers can offer higher prices for used lead acid batteries because they have lower operating costs.
Agarwal urged the government to further strengthen a national crackdown on the informal sector and called for the introduction of lower taxes for formal recyclers processing end-of-life batteries.
According to Agarwal, there are some 800 authorized recyclers of lead wastes in India, with a combined processing capacity of more than 2 million tonnes per year.
This equates to a maximum production of about 1.25 million tonnes (60%-65% of the recycling capacity) of secondary lead annually at full capacity, he said.
India’s total lead consumption is an estimated 1 million tonnes annually, including primary and secondary production and imports.
Globally, the metal scrap recycling industry is valued at $500 billion with India’s share around 2.2% of that figure, Agarwal said. Recycled lead accounts for 50% of the world’s total lead production and India’s production capacity is in excess of 2 million tonnes annually.
Lead demand to feed the lead battery production will increase by leaps and bounds because of increased vehicle production, e-bikes and infrastructure, Agarwal said.
