GRP Ltd Q2FY26 – The Tyre Recycling King’s ₹1,331 Mn Quarter, 8MW Solar Bet, and Pyrolysis Dreams on Fire (Hopefully Not Literally)

1. At a Glance

Let’s start with the basics: GRP Ltd, the Gandhis of Gujarat Rubber Politics (pun intended), just delivered Q2FY26 results withRevenue of ₹1,331 millionandEBITDA of ₹114 million, while PAT slipped to₹19.6 million. TheOperating Margin stands at 8.02%, a far cry from the juicy 20.49% they once flashed in Q4FY25 – proving once again that margin expansion in rubber is as slippery as a bald tyre on Mumbai’s Western Express Highway.

At₹1,896 per share, GRP looks like that distant cousin of MRF – respected but often ignored at weddings (read: investor portfolios). The stock has fallen-17% in 3 monthsand-40% in 1 year, turning it from a compounding darling to a “rubber duck” in a bear pond.

Still, withROE at 17.4%,ROCE at 17.5%, andDebt-to-Equity at 1.12, this ₹1,009 crore smallcap is not exactly melting like old tyres in the sun. Add to thata dividend yield of 0.76%, and it looks like the company still believes in sharing pocket change with shareholders.

Oh, and let’s not forget: GRP just announced acapex plan of ₹250 croreto build pyrolysis and recycling units. Because nothing says “India’s green future” like burning old tyres in a high-tech furnace for carbon black.

2. Introduction

Recycling is not glamorous. But in a world obsessed with sustainability hashtags and Greta Thunberg memes, GRP Ltd has been quietly turning waste into wealth since 1974. If you’ve ever driven a car, there’s a non-zero chance that your tyres rolled on a bit of GRP’s reclaimed rubber.

The company’s business model is a fascinating paradox: it deals inused tyresyet promisesfresh profits. GRP’s claim to fame?Recycling end-of-life tyres, tubes, and industrial rubber into usable materials. While the world complains about landfill waste, GRP cashes in – proving that even trash has a P/E multiple if you brand it as “sustainability.”

What’s particularly commendable (and slightly unbelievable) is that GRPsupplies reclaimed rubber to 8 of the world’s top 10 tyre manufacturers. Think Michelin, Goodyear, Bridgestone – yes, those same guys who spend billions on R&D end up buying rubber made from our old scooter tyres in Solapur.

But before you start clapping, remember – the company’ssales growth over five years is only 9.56%, and PAT growth, while flashy at61% CAGR, has come with heavy reliance on operational discipline and selective cost-cutting. In short, it’s a hustler business – sweaty, gritty, and utterly fascinating.

3. Business Model – WTF Do They Even Do?

GRP Ltd runs acircular economy on steroids. It’s like the Swachh Bharat of the tyre world – cleaning up old rubber and selling it back to the same people who made it. The company hasfive main divisions, each with its own flavour of recycling entrepreneurship:

1. Reclaim Rubber (89% of revenue):The backbone and the cash cow. GRP converts end-of-life tyres into reclaimed rubber used by tyre giants and industrial product makers. Imagine shredding old tyres, cooking them up in secret chemical soup, and shipping the outcome to Bridgestone.
2. Polymer Composite:Converts plastic waste into industrial goods like bumpers, fenders, and pallets. Think of it as “waste-to-Walmart-shelf.” The segment’s growth comes from sustainability regulations that basically force companies to use more recycled content.
3. Engineering Plastics:Makes recycled high-performance plastics for automotive and electronics. Because apparently, even your car’s battery housing deserves a second life.
4. Custom Die Forms:This is GRP’s “niche side hustle.” They make precision components for heavy industries. Vibration pads, bumpers, and snow plow blades (because apparently, someone in Solapur is thinking about Norway).
5. Repurposed Polyolefins:The newest kid on the block. GRP turns polypropylene and elastomers into plastic compounds for automotive interiors and packaging. Basically, recycling meets jugaad engineering.

Overall, GRP’s business model is simple but smart:take the world’s waste, rebrand it, and resell it with a “green” tag.

4. Financials Overview