Analysis: Baheti Recycling Industries Ltd.

What does Baheti Recycling Industries Ltd. do?

• Baheti Recycling Industries Ltd is a 7-decade-old aluminum recycling business, headquartered in Gujarat, India.
• Founded in 1956 as a metal trading company, evolved into a recycling powerhouse under the Shah family.
• Listed on NSE in 2022, with a mission to drive circular economy through aluminum recycling and sustainable practices.

• Produces aluminum alloys (ingots) and de-oxidizing products (cubes, ingots, shots, notch bars) for steel and automotive industries.
• Expanding into aluminum wire rod production (12,500 MT/year Phase 1, 25,000 MT/year Phase 2) to target higher-margin markets.

Growth thesis

Baheti Recycling Industries is a 7-decade-old aluminum recycling company transitioning to higher-margin wire rod production, with 500 crores revenue potential from its phased 38,000-ton capacity plant by FY28. The business derives 64% revenue from aluminum alloy ingots and 36% from deoxidant, while the new wire rod segment (launched in H2 FY27) targets 10% EBITDA margins by FY28 through 70-80% utilization. Growth hinges on OEM automotive contracts (Bajaj, TVS, Royal Enfield) scaling to 250-500 tons monthly and EPR mandates driving 5% recycled aluminum use in FY28. Capacity utilization will reach 80% by FY27, supported by 5 new electrical furnaces and solar plant efficiency gains. Key execution risk: delayed wire rod plant commissioning or EPR implementation.

Why is Baheti Recycling Industries Ltd. stock rising?

• Commencing 5 new electrical furnaces in FY27, increasing total installed capacity to 38,000 tons annually
• Solar plant to be commissioned by end of May 2026
• Entering aluminum wire rod segment with Phase 1 (12,500 TPA) by early November 2026, targeting 70% utilization in FY28 with revenue potential of ₹250 crores per phase
• Phase 2 wire rod expansion to 25,000 TPA planned after Phase 1 reaches 75-80% utilization
• Wire rod EBITDA margins expected to be 1-2% higher than current business, targeting sustainable 8-10% EBITDA margins

Research report

companyname: Baheti Recycling Industries Limited ticker: BAHETI sector: Aluminium Recycling / Secondary Aluminium Baheti Recycling Industries Limited is an aluminium recycling company that transforms imported aluminium scrap into high-grade aluminium alloys and de-oxidising products. The business has operated for seven decades, beginning in 1956 as a metal trading firm and incorporating in 1994 as a manufacturer. It is headquartered in Ahmedabad, Gujarat, and operates a single 5-acre facility i...

Catalysts

capex, margin expansion, regulatory approval, new product segment

Growth guidance

FY28 revenue growth guided at 500 crores from aluminum wire rod plant driven by Phase 1 and Phase 2 capacity expansion; EBITDA margin improvement to 10% by FY28