CLSA, a global investment banking firm, has launched coverage of Gravita India Ltd., a metal producer, with an "outperform" rating in a note released on October 12. The stock responded with a 4% increase. CLSA set a price target of ₹1,980 for Gravita India, suggesting a 35% upside from last Friday's closing price. This target is slightly above the company's 52-week high of ₹1,913.6, despite the stock being down 20% from that peak.
The firm highlights Gravita India as a major beneficiary of India's shift towards recycling-led metal supply. CLSA notes that the company's deep scrap sourcing network, formalising industry backdrop, and scalable multi-metal platform drive strong earnings growth. The upcoming Copper expansion by Rashtriya Metal Industries Ltd. is expected to open new growth opportunities.
CLSA identifies multiple competitive advantages for Gravita India, including diversified sourcing, strong OEM relationships, and engineering capabilities. Copper is anticipated to be the next growth driver, with revenue and EBITDA mix projected to rise to 44% and 41% by fiscal year 2030. The firm forecasts a 41% CAGR in revenue, 36% in EBITDA, and 32% in profit after tax from fiscal year 2026 to 2030.
Key risks include higher working capital needs, potential scrap-export restrictions, faster adoption of alternatives, and OEM backward integration. All 11 analysts covering Gravita India have a "buy" rating, with a consensus price target implying a 33% upside from current levels. As of Monday, shares of Gravita India are trading 3% higher at ₹1,511.3, though the stock is down 19% year-to-date.