From Waste to Wealth: India’s Plastic Recycling Success Story
Published by Sharekhan Education | July 6, 2023
Introduction :
In a world grappling with the adverse effects of plastic waste, a beacon of hope shines brightly in the form of plastic recycling. This transformative process breathes new life into discarded plastics, creating functional products while championing sustainability. India, in particular, is witnessing a remarkable surge in the plastic recycling industry, presenting a world of emerging opportunities.
Imagine a world where plastic waste no longer burdens landfills, where virgin polymers aren’t the sole option, and where greenhouse gas emissions are significantly reduced. This is precisely what the plastic recycling industry aims to achieve. Through meticulous sorting, washing, shredding, and compounding procedures, we give plastic products a second chance. We transform them into innovative materials for packaging, garment fibers, and carpet fibers.
Growth Prospects :
As the world becomes increasingly conscious of environmental concerns, Indian consumers are leading the charge, seeking out sustainable products. The demand for eco-friendly packaging, crafted from durable, non-toxic, and recycled materials, is on the rise. Even renowned apparel and lifestyle brands are embracing the trend, actively seeking quality recycled products. It’s part of a larger movement towards a circular economy, where waste becomes a valuable resource.
The Indian government has recognized the importance of plastic recycling and has taken significant steps to promote its adoption. A recycling policy has been announced, mandating the blending of recycled products with virgin materials. Brand owners and manufacturers are now required to incorporate 30% recycled content in their plastic packaging by FY26, with this limit increasing by 10% annually until FY29. This regulatory push aligns with the sustainability targets set by major FMCG companies like HUL, P&G, and Nestlé. These companies aim to reduce their use of virgin plastic in packaging by 50% before 2025.
Government Initiatives :
The government has implemented regulations such as the Plastic Waste Management Rules and the Extended Producer Responsibility (EPR) framework to further bolster the recycling industry. These initiatives encourage the establishment of collection centers, recycling facilities, and research and development in recycling technologies. The Swachh Bharat Mission raises awareness among gram panchayats about effective plastic waste management.
About Ganesha Ecosphere :
Amidst this flourishing landscape, one standout company capturing attention is Ganesha Ecosphere. Specializing in manufacturing recycled fiber and yarn from waste PET bottles, Ganesha Ecosphere mobilizes approximately 350 tons of PET waste daily from vendors and scrap dealers across India. With an impressive operational profile, the company boasts a track record of repeat business from a diverse client base and a robust supplier network. Its products are primarily sold to textile players and key OEMs, contributing to a circular economy in the textile industry.
Ganesha Ecosphere is introducing the “Go Rewise” brand for its non-commoditized, value-added products as part of its commitment to wise recycling. This brand embodies the ethos of intelligent recycling, symbolizing the company’s dedication to sustainability. Financial analysts at HDFC Securities predict a bright future for Ganesha Ecosphere, with an expected 20% and 22% revenue and profit after tax (PAT) compound annual growth rate (CAGR) respectively from FY22 to FY25E. Furthermore, the company’s diligent cost rationalization efforts could result in a return on equity (RoE) of around 15% by FY25E.
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