Lead recycler Ardee Industries Ltd. plans to sweat its existing capacity of 156,950 tonnes per annum to 75-80% utilisation before committing to fresh brownfield or greenfield investment, even as its Rs 426 crore initial public offering, including a Rs 320 crore fresh issue aimed largely at funding working capital, opens for subscription on Aug. 5.
The company, which operates a recycling facility in Andhra Pradesh's Tirupati district, produced about 70,000 tonnes of finished output in FY26, translating to roughly 67% utilisation of the capacity then in place, Chairman and Managing Director Sandeep Aggarwal told Autocar Professional in an interview. Installed capacity was scaled up to its current level by May 2026.
"We feel around 75 to 80% is the utilisation optimum," management said, adding that the company would first undertake debottlenecking at that threshold before evaluating new capacity. Ardee has also acquired about six acres of land adjacent to its existing plant for future growth.
Fresh Issue Skews Toward Working Capital
Of the Rs 320 crore fresh issue, Rs 220 crore; translating into nearly 70%, is earmarked for incremental working capital, with Rs 20 crore for repayment of long-term debt and the balance for general corporate purposes.
The working-capital weighting reflects the intensity of the scrap-to-metal business: Ardee runs a roughly 70-day cycle, holding about 30 days of inventory and 40 days of receivables. The company hedges its lead price exposure on a back-to-back basis, shorting derivatives against physical scrap purchases and unwinding positions once finished-goods prices are fixed.
Ahead of the IPO, shares worth about Rs 115 crore changed hands in secondary transactions at Rs 53 apiece, with buyers including institutional investors and family offices. Management attributed the move to banker advice and investor demand for early entry.
Why the Automotive Industry is Watching
The expansion math matters to battery makers and, by extension, vehicle manufacturers. Automotive applications; both original-equipment fitment and replacement demand, account for about 85% of India's lead demand, according to the company, with the recycled lead market growing 6-8% annually. Battery manufacturers already source more than 70% of their lead from recyclers, management said, and electrification has not dented demand: electric vehicles continue to carry a 12-volt lead-acid battery for auxiliary functions including cranking, power windows and onboard electronics.
Ardee supplies recycled pure lead and lead alloys, with the battery industry contributing about 35% of FY26 revenue and the wider metals industry about 50%. Value-added alloys, which require lengthy OEM R&D approvals, contribute 28% of business. The company holds LME brand registration for its pure lead, secured after a two-and-a-half-year process, is listed on the MCX, and exports to markets including Japan, South Korea, Singapore, the U.S. and the UAE.
A Fragmented Field
The build-out comes in an industry where consolidation has barely begun. The informal sector still accounts for an estimated 40% of India's recycled lead output, and Ardee, despite ranking among the top six formal players, holds a 2.09 percent market share; a gap management believes stricter enforcement of the Battery Waste Management Rules, 2022 and the EPR regime could help close in favour of organised recyclers. Beyond lead, the company is evaluating diversification into copper, tin and plastics recycling, though these remain exploratory.