At a Glance
Eco Recycling Ltd (Ecoreco), India’s e-waste warrior, posted Q1 FY26 revenue of ₹9.24 Cr (-18.9% YoY) and PAT of ₹8.09 Cr (-2.4% YoY). With a P/E of 55×, ROE of 30.4%, and ROCE of 38.2%, this “green” stock is hotter than a lithium battery under stress. But zero dividends and stretched working capital (222 days!) make it a risky love affair.
Introduction
Picture this: a company that literally thrives on your junk gadgets, yet trades like it’s the next Tesla. That’s Ecoreco, India’s first e-waste recycler. Despite stellar profit growth (73% CAGR in five years), its stock is priced like a Gucci bag in a flea market—ridiculously expensive.
Business Model (WTF Do They Even Do?)
Ecoreco is the cleaner of the tech world, offering:
- Reverse Logistics: Collecting your dead devices.
- Data Destruction & ITAD: Securely erasing corporate skeletons.
- E-waste Recycling & Precious Metal Recovery: Turning trash into cash.
- Lamp Recycling & SmartER Vans: Mobile recycling on wheels.
- EPR/CSR Initiatives: Compliance heroes for corporates.
Essentially, they turn old iPhones into gold dust—literally.
Financials Overview
- Revenue (Q1 FY26): ₹9.24 Cr (-18.9% YoY)
- PAT: ₹8.09 Cr (-2.4% YoY)
- Operating Margin: 54.8% (insane!)
- ROE: 30.4%
- ROCE: 38.2%
Verdict: High margins, high growth history, but Q1 shows demand slowdown.
Valuation
- P/E: 55× (priced for perfection)
- EV/EBITDA: ~40×
- Fair Value Range: ₹400–₹700
DCF whispers caution, while market screams “ESG darling”.
What’s Cooking – News, Triggers, Drama
- Capacity Boost: Added 18,000 MTPA e-waste + 6,000 MTPA Li-ion recycling.
- Zero Debt: Balance sheet cleaner than a freshly scrubbed motherboard.
- Fundraising: Approved equity issuance for future expansions.
- Awards: 2024 HURUN Industry Achievement Award.
- Government Push: ₹1,500 Cr e-waste recycling proposal.
Drama: Auditor exits, CS resignations, and rising working capital days—red flags?
Balance Sheet
| (₹ Cr) | FY23 | FY24 | FY25 |
|---|---|---|---|
| Assets | 63 | 81 | 111 |
| Liabilities | 36 | 34 | 42 |
| Net Worth | 30 | 47 | 69 |
| Borrowings | 1 | 5 | 7 |
Commentary: Debt negligible, reserves rising, but liquidity stretched.
Cash Flow – Sab Number Game Hai
| (₹ Cr) | FY23 | FY24 | FY25 |
|---|---|---|---|
| Operating | 16 | -3 | 17 |
| Investing | -24 | 3 | -14 |
| Financing | -1 | 0 | -1 |
Punchline: Cash flows behave like an old printer—works, jams, then works again.
Ratios – Sexy or Stressy?
| Ratio | FY23 | FY24 | FY25 |
|---|---|---|---|
| ROE % | 24% | 30% | 30.4% |
| ROCE % | 33% | 38% | 38.2% |
| P/E | 45× | 50× | 55× |
| PAT Margin % | 22% | 70% | 67% |
| D/E | 0.02 | 0.05 | 0.1 |
Verdict: Ratios sexy, valuation stressy.
P&L Breakdown – Show Me the Money
| (₹ Cr) | FY23 | FY24 | FY25 |
|---|---|---|---|
| Revenue | 18 | 28 | 44 |
| EBITDA | 4 | 16 | 31 |
| PAT | 6 | 18 | 23 |
Commentary: Revenue growth impressive, but FY25 shows plateauing.
Peer Comparison
| Company | Revenue (₹ Cr) | PAT (₹ Cr) | P/E |
|---|---|---|---|
| EMS | 966 | 184 | 18× |
| Antony Waste | 934 | 70 | 24× |
| Concord Enviro | 594 | 58 | 22× |
| Ecoreco | 67 | 23 | 55× |
Humour: Ecoreco trades like a tech startup, not a recycler.
Miscellaneous – Shareholding, Promoters
- Promoters: 73.35% (solid control)
- FIIs: 0.93% (vanishing)
- DIIs: 0.17%
- Public: 25.55%
Retail-heavy float—perfect recipe for volatility.
EduInvesting Verdict™
Ecoreco is a green gold story with insane margins, zero debt, and a killer ROE. But its P/E screams “priced for perfection”, and working capital is a ticking time bomb.
Final Word: Great company, risky stock—don’t hold it like an old Nokia battery.
Written by EduInvesting Team | 28 July 2025
SEO Tags: Eco Recycling, E-waste, ESG Stocks, Green Investing, Reverse Logistics
