Gravita India gains on commencement of aluminum recycling plant
Gravita India informed the bourses that its subsidiary, Gravita Tanzania Limited has started commercial production of aluminum cast alloys at its new plant situated at Tanzania, Africa.
The plant has a capacity of around 6,000 MTPA. Gravita India has invested around Rs. 6 crore from internal accruals for setting up the plant. In April 2019, the company had started commercial production of lead at the Tanzania plant with an annual capacity of around 3,000 MTPA. With the addition of this aluminum recycling plant, Gravita Tanzania Limited is able to diversify its product portfolio which would result in better profitability and will cater the needs of aluminum die-casting industries located in Europe and the Asian continent.
The company expects to generate around revenue of Rs. 20 crore and gross margin of ~15 per cent from this aluminum recycling plant in FY20. In FY19, the company's revenue jumped by 22 per cent to Rs. 1,241.73 crore, while EBITDA fell by 34 per cent to 58.71 crore. Net profit stood at Rs. 19.4 crore, down 59 per cent yoy.
The stock reacted positively to this development and jumped by ~2 per cent to make an intraday high of Rs. 58.15 on the BSE.