About the Company:
Divyadhan Recycling Industries Ltd is into the business of manufacturing of Recycled Polyester Staple Fibre (R-PSF) and Recycled Pellets.
The recycled fibre and pellets are produced from post-consumer PET bottles also known as Polyethylene Terephthalate bottles. Company started its operations in the financial year 2018-19, by manufacturing Recycled Polyester Staple Fibre (R-PSF) at their manufacturing facility based in Baddi, Himachal Pradesh with a capacity of 8030 Metric tons per annum.
Company is also involved in the producing of Recycled Pellets, which has various applications across various industries like automative, packaging, fiber etc. However, company is into the trail stage of production of Recycled pellets.
Company source raw material (post-consumer PET bottles) from various junk collectors and recycle them to produce Recycled Polyester Staple Fibre and Recycled Pellets at our factory.
Uses of Recycled Polyester Staple Fibre:
Company produce Hollow and Solid Recycled Polyester Staple Fibre, which gives good resilience properties and is used to make premium pillows, cushions and quilts. The recycled fibre is supplied to various industries such as Packaging, home furnishing and Textiles.
Its hollow structure adds to its insulating properties, making it suitable for use in a wide range of products including clothing, home furnishings, automotive components, non-woven fabrics, and insulation materials.
The recycled pellets are used to manufacture food grade and non-food grade bottles. FSSAI has issued latest instructions dated June 15, 2022, for acceptance criteria for recycled PET for food packaging. Further, we are currently catering to non-food industries requiring recycled bottles for their packaging.
Company’s Manufacturing Facility:
Company has its own manufacturing facility registered in its own name at in Kalyanpur Tehsil Baddi, District Solan, Himachal Pradesh. This manufacturing facility was purchased from Axis bank Limited as a distressed asset.
The Company has an owned land spreading to around 10,000 square meters and the manufacturing facility is built on an area of 5,000 square meters where all the manufacturing process pertaining to recycled polyester staple fibre and recycled pellets is carried out. Our facility has total capacity of 8030 metric tons per annum for fiber and 4320 metric tons per annum for pellets.
Company’s Business Verticals:
- Recycled Fiber.
- Recycled Pellets/chips.
Recycled Fiber:
Company manufacture synthetic fiber called as Recycled Polyester Staple Fiber (R-PSF) from PET bottles (Polyethylene Terephthalate bottles) of coke, soda, water or other post-consumer PET bottles or post -industrial waste.
The PET bottles are the most commonly used plastic in packaging, carrying, storing. The process of creating recycled PET fiber involves collecting PET plastic bottles, sorting and cleaning them, then melting it down to form pellets or chips.
These pellets are then extruded into thin filaments, which can be spun into yarns or fibers. These fibers can be further processed and woven into fabrics or used as filling material in various products like pillows, mattresses, and insulation.
Recycled Pellets/chips:
Company also manufactures pellets called as Recycled Pellets which are sourced from the same raw material as is recycled polyester staple fiber. The manufacturing process is also same as that of Recycled fibres for manufacturing pellets. These pellets are used to manufacture bottles or new plastic products such as storing and packaging bottles.
Company’s Installed Capacity and Capacity Utilization:
Competition in the Business:
Given the current scenario of sustainability and environmental impact of business activities, the recycling is an emerging industry. Company faces competition from domestic companies and from international organisations, whether private or public, small scale or large scale.
Company also competes with larger and financially stronger Companies who may have greater brand recognition and reputation.
Even though investment in plant and machinery is quite exorbitant but the source of raw material is easily available, thus people with no capital constrains can easily enter this market. Company’s ompetition depends on various factors, such as the quality of our product, demand for recycled products, government regulations and consumer preferences and fashion.
Some of the competitors are Ganesha Ecosphere Ltd, Rungta Greentech Ltd
Customer Acquisition:
The company initially faced challenges in attracting buyers due to intense competition in the industry, So company took a proactive approach by gathering customer reviews and using that feedback we started improving the quality of their products. Besides this we were also analyzing and studying the market dynamics.
After some time, the company successfully gained more buyers and established a good reputation in the industry. Offering competitive pricing strategies to attract price-sensitive customers in the competitive industry is one of our strategies followed for customer acquisition.
Management Team:
- Mr. Varun Gupta (Designation: Managing Director)
- Mr. Pratik Gupta (Designation: Director)
Objectives of the Issue:
Fresh Issue: (Rs.24.16 cr)
- To meet out the Capital Expenditure.
- To meet out the General Corporate Purposes; and
- To meet out the Issue Expenses.
Fund Utilization:
| Particulars | Amount (Rs. in Crores) |
|---|---|
| Purchase of Plant and Machinery | 17.03 cr |
Positives for the Company:
Company Plans to increase the manufacturing capacity by purchase of plant and machineries.
- Company is engaged in the manufacturing of Recycled Polyester Fiber and Recycled Pellets and intend to expand the operations by setting up a new manufacturing facility in Baddi, Himachal Pradesh, through the purchase of new wash line machinery.
Company plans to Capitalize the opportunity in the Recycled polyester Fiber and Pellets Industry.
- Company believes that the recycled fiber and pellets sector will grow rapidly in the upcoming years, due to changing lifestyle, government schemes for the environment protection, and consumer demand. Company intends to capitalise such opportunities by supplying required products and services and believes that it is well positioned to cater the growing demand with the offerings.
Financials of the Company:
| (in Crores) | FY 22 | FY 23 | FY 24 |
|---|---|---|---|
| Revenue | 59.81 | 58.15 | 59.12 |
| Net Profit | 0.52 | 2.16 | 2.37 |
Valuation of Peer Group Companies:
| Company Name | Face Value | EPS | PE Ratio | RoNW | NAV |
|---|---|---|---|---|---|
| Divyadhan Recycling Industries Ltd | 10 | 2.41 | 26.55 | 18.42% | 13.06 |
| Ganesha Ecosphere Ltd | 10 | 27.90 | 68.36 | 5.74 | N.A |
IPO Details:
| Details | Info |
|---|---|
| Issue Opens on | 26th September 2024 |
| Issue Closes on | 30th September 2024 |
| Issue Price | Rs.60-64 |
| Face Value | Rs.10 |
| Minimum Lot | 2000 Shares |
| Minimum Investment | Rs.1,28,000 |
| Issue Constitutes | 26.39 % |
| Issue Size | Rs.24.16 cr |
| Market Cap | Rs.91.56 cr |
| Listing at | NSE SME |
| Equity Shares Offered (Fresh) | 37,76,000 (Rs.24.16 cr) |
| Equity Shares Prior to the Issue | 1,05,30,714 |
| Equity Shares after the Issue | 1,43,06,714 |
IPO Valuation Parameters:
| Earnings Per Share (EPS) | Price To Earnings ratio (PE) | Return on Net Worth (RoNW) | Net Asset Value (NAV) |
|---|---|---|---|
| 2.41 | 26.55 | 18.42% | 13.06 |
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| Should You Subscribe or Not ? (Markets Guruji’s View) |
|---|
| Divyadhan Recycling Industries Ltd is engaged in the business of manufacturing Recycled Polyester Staple Fibre (R-PSF) and Recycled Pellets. These products are made from post-consumer PET (Polyethylene Terephthalate) bottles, which are collected from various junk collectors and then recycled at their facility in Baddi, Himachal Pradesh. The company began operations in the financial year 2018-19 with an annual production capacity of 8030 metric tons of R-PSF.
In addition to producing recycled fibre, Divyadhan is currently in the trial stage of manufacturing Recycled Pellets, which have diverse applications across industries such as automotive, packaging, and textiles. To further enhance its capabilities, the company plans to expand production by investing in additional plant and machinery. Divyadhan Recycling Industries Ltd aims to capitalize on the growing opportunities in the recycled polyester fiber and pellets industry. Its focus on sustainability and recycling aligns with global trends toward environmentally responsible manufacturing, making it a potentially attractive investment for those seeking long-term growth. |
Important Dates:
| Finalization of Basis of Allotment | on or Before 1st October 2024 |
| Initiation of Refunds | on or Before 3rd October 2024 |
| Credit of Equity Shares: | on or Before 3rd October 2024 |
| Listing Date: | on or Before 4th October 2024 |
| Company Contact Info: |
|---|
| Divyadhan Recycling Industries Ltd 1803, Lodha Supremus, Saki Vihar Road, Opp. Telephone Exchange, Powai, Mumbai City, Maharashtra – 400072, India. Telephone: + 91- 8928434702 Email: cs@divyadhan.in Website: www.divydhan.in |
| Registrar to the Issue: |
|---|
| SKYLINE FINANCIAL SERVICES PRIVATE LIMITED Address: D-153 A, 1st Floor, Okhla Industrial Area, Phase – I, New Delhi-110020 Telephone: +91-11-40450193-97 Email: compliances@skylinerta.com Website: www.skylinerta.com |
| Check IPO Allotment Status: |
|---|
SkylineWebsite: http://Skyline/IPO/Allotment_Status |
