Gravita cuts PAT guidance to 25-30%, net debt jumps to ₹550 cr
Copper expansion drives debt surge from ₹118 cr. Lead volumes hit by Gulf shipping disruptions. Management prioritises copper over rubber recycling.
— 7 earlier stories on Gravita India Ltd. →What's new
- PAT growth guidance trimmed to 25-30% from 30-35% for FY27 and next five years.
- Net debt surged to ~₹550 cr from ₹118 cr at FY26 end, driven by copper working capital.
- Lead volumes fell YoY due to Gulf scrap supply disruptions; higher domestic realisations partly offset.
Why this matters
The debt surge is the biggest red flag. The copper transition is consuming cash faster than expected. The guidance cut reinforces that the ramp is more costly and slower than initially planned. Meanwhile, lead, the traditional core, faces supply headwinds.
What we're watching
- Lead volume recovery as Gulf shipping normalises.
- Copper utilisation ramp from 50% to over 60% by FY27-end.
- Net debt trajectory in coming quarters.
The full read
Gravita India's copper expansion is costing more than anticipated. Net debt ballooned to ~₹550 crore from ₹118 crore at the end of FY26, driven by the working-capital intensity of the new copper business. Management trimmed its PAT growth guidance to 25-30% from the earlier 30-35%, a clear signal that the transition will take longer and consume more cash than initial plans assumed. Lead volumes, the traditional revenue backbone, fell year-on-year as Gulf shipping disruptions hit scrap supply, though higher domestic realisations provided some cushion. Copper contributed ₹376 crore in revenue at an EBITDA of ₹55,151 per ton, but utilisation is only 50%. The target of 60% by FY27-end is still ahead. Rubber-recycling expansion has been shelved to focus on copper. Revenue grew 42% to ₹1,475 crore, and PAT was ₹106 crore. The debt trajectory is the key risk to watch.
Questions answered
- Why did Gravita cut its PAT growth guidance?
- Management revised the long-term PAT growth target from 30-35% to 25-30%, citing the higher working capital needs of the new copper business and disruptions in lead scrap supply.
- What caused the sharp increase in net debt to ₹550 crore?
- The jump from ₹118 crore was primarily due to the longer working-capital cycle of the copper business, which requires higher inventory and receivables.
- How did the lead business perform in Q1 FY27?
- Lead volumes declined year-on-year because of scrap-supply disruptions along Gulf shipping routes, though higher domestic realisations partly offset the revenue impact.
- What are the early results from the copper business?
- Copper contributed ₹376 crore in revenue with an EBITDA of ₹55,151 per ton during Q1. Utilisation is currently at 50%, and management expects it to exceed 60% by end of FY27.
- Why has Gravita put its rubber-recycling expansion on hold?
- The company decided to prioritise copper capacity expansion over rubber recycling due to the strategic importance and higher growth potential of the copper segment.
- What were Gravita's consolidated Q1 FY27 results?
- Revenue was ₹1,475 crore, up 42% year-on-year, and PAT was ₹106 crore. The revenue growth was driven largely by the copper business.
Gravita India Ltd.
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All notes on GRAVITA →- 28 Jul 2026 · 1:17 PM IST Gravita cuts PAT guidance to 25-30%, net debt jumps to ₹550 cr
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