About Ganesha Ecosphere Ltd

Ganesha Ecosphere Ltd is a leading PET Waste recycling company in India and is engaged in the manufacturing of Recycled Polyester Staple Fibre (RPSF), Spun Yarn and Dyed Texturised Yarn. The Company has three units located at Kanpur (U.P.), Rudrapur (Uttarakhand) and Bilaspur (Uttar Pradesh) with a cumulative manufacturing capacity of 1,18,800 TPA of RPSF and Yarn. Ganesha Ecosphere Ltd was incorporated on October 30, 1987 with the name Ganesh Polytex Ltd. In the year 1988, the company commenced commercial production to produce Dyed & Doubled Yarn at Raipur (Rania), Kalpi Road, Kanpur Dehat (U.P.) with an installed capacity of the plant at 391 tpa and 360 tpa respectively. During 1995 it diversified into the business of manufacturing Recycled Polyester staple Fibre (Green Fibre) through recycling of post-consumer pet bottle waste. The plant and technology was imported from Korea and the initial capacity was of 6000 tpa, which was increased to 10800 tpa through expansion and debottlenecking. During 2006 company undertook expansion plan of Recycled PSF through setting up a new unit at Rudrapur (Uttrakhand). The expansion plan was completed in two phases - first phase of 7200 tpa was started during February, 2007 and second phase of 14400 tpa has been started during September, 2008. The company also expanded capacity of its Kanpur unit from 10800 tpa to 18000 tpa during 2008-09. The company further expanded its capacity of Rudrapur Unit by 18000 tpa, which has been commissioned during March, 2010. The name of the Company has been changed from Ganesh Polytex Ltd to Ganesha Ecosphere Ltd with effect from October 7, 2011. The Company's green field project for manufacturing of spun yarn from Recycled Polyester Staple Fibre (RPSF) with an installed capacity of 25,920 spindles at Temra, Bilaspur, Distt. Rampur (U.P.) and expansion project to increase the existing recycling capacity at Kanpur unit by 9,000 TPA, had commenced commercial production w.e.f. 01.11.2013. The Company commissioned its Bilaspur facility in 2013-14. It commissioned Temra Unit in increasing the existing Recycled Polyester Staple Fibre (RPSF) capacity by 21,000 TPA effective from 1st February, 2018. In July, 2021, the Company acquired an under construction PET washing plant at Nepal by acquiring the entire shareholding of 'Ganesha Overseas Private Limited' (Formerly known as Essel Industries Nepal Private Limited). Accordingly, Ganesha Overseas Private Limited became a wholly-owned subsidiary of the Company.

Ganesha Ecosphere Ltd Chairman Speech

Overview

If there is a singular priority coming out of global businesses, it is ‘How sustainable is your business model?' This priority has emerged as the single most important discussion in Board rooms today around the growing conviction that companies with relatively unsustainable businesses are unlikely to survive into the long-term. The Company showcased its business sustainability even before the term had become prevalent or popular. At Ganesha Ecosphere, we have a few over-riding messages to send out. One, your company underlined its responsibility from the time it went into business with the objective to transform PET bottle waste into polyester staple fibre.

Two, your company resolved that it would not just manufacture a recycled product but would do so in a clean and environmentally responsible way. Three, your company resolved to progressively add more value to PET bottle scrap by introducing newer and more value-added products.

Fourth, your company will deploy cutting -edge technology to make superior quality products, fulfilling the aspirations of the end consumers. I am pleased to state that our focus on premiumisation, and innovative and value-added products translated into robust tangible outcomes. By the close of the last financial year, your Company achieved a total income of _1,149.29 Cr. registering an increase of 11.17%, and Operating Profit (EBITDA) stood at _128.94 Cr., with an increase of 9.86% over the previous financial year. During the year under review, your Company reported a PAT of H73.32 Cr. as against _69.55 Cr. in the preceding financial year. Your company has always been profitable during last two decades due to its resilient business model in surmounting all kinds of odds.

Platform

At Ganesha Ecosphere, we could have sustained our business in the conventional way; however, we chose to make a decisive leap. I am pleased to communicate that your company has moved with speed to address the growing needs of the future. Your company has aggregated the experience of almost three decades in the collection of PET waste, working with varied supply chain teams across the country, creating a network that can generate a larger quantum of raw material and strengthened its manufacturing processes to the point that its process e_iciency and consistency are among the best in this part of the world. Your company recognises that merely growing capacity in a linear manner within the existing business would not do so much for the Company. The time has come to treat the PET waste management and conversion capability into a platform that supports the creation of multiple recycled products that accelerates business sustainability and also makes the world cleaner - faster. During the year under review, your company embarked on a decisive extension of its business model. The bottle-to-bottle PET recycling capacity of 12,000 TPA and a bottle-to-filament recycling capacity of 12,000 TPA has been commissioned during the first quarter of the current financial year. Washing plants in Warangal and Nepal have also been operationalised in February, 2023. Moving ahead, the RPSF project is expected to be commissioned during the current year could extend the lead over competition and maintain the Company's leadership within the recycled polyester staple fibre space in India.

By broad basing our product portfolio, we will be strengthening our business model: towards more recycled products, reducing our excessive dependence on any one product and strengthening our recall as a recycled products supermarket.

Opportune

At Ganesha Ecosphere, we believe that the time has come for this broad-based platform for some good reasons. Until now, recycling was a recommended business approach because it was good for the world; the time has come when an increasing number of governments are incentivising recycling through a recommended products mix. The result is that the increased production is no longer just a good thing to do; it is being mandated, making the recycled proportion an integral part in the production of a range of products. By FY 2025-26, India is expected to increase its rPET resin consumption by 30%. By FY 2028-29, it is expected to increase by 60%. We expect rPET resin demand to reach to 0.9-1.0 Million tonne by 2030. To address this demand, the Company intends to enhance its rPET resin capacity on a continued basis. There is also a growing consumer resistance to the word ‘plastic.' An increasing number of consumers are turning products to check whether they have been made from virgin polymer or recycled material. I am happy to state there is a preference for products that are recycled, which is now becoming the consumer's way of engaging with cleaning up the world – by buying products that are a part of the circular economy.

Interestingly, industrial consumers are not merely interested in buying resources manufactured from recycled resources, they are going one step further: they are seeking to ensure that the products they manufacture are recycled and that the resource coming out of that are reinserted into the recycling chain and made available to recyclers like us. The result is the emergence of ‘closing the loop' concept that is intended to ensure that it is not just a recycled resource that goes into product manufacture but also the end product is recycled, making product manufacture holistically sustainable.

Sustainable

We believe that our Balance Sheet is sustainable enough to address our sustainable business: prior to committing a large amount of capital expenditure, the Company possessed a debt-equity ratio of 0.24 against a net worth of H518.82 Cr., indicating an extensive borrowing room available within.

In view of this, your company invested H450 Cr. by March, 23 – the highest

single capital expenditure programme undertaken by your company - through a gearing of 2.0 that will ensure that the overall corporate gearing does not exceed 1.0. This financing structure for the expansion is expected to prove shareholder value-accretive once the project achieves its desired capacity utilisation, generates a surplus and begins to repay debt. These projects are being carried out in wholly owned subsidiaries that enhance focus and accountability.

Value-addition

Your company is not only broad basing its product portfolio and increasing capacities, but is also focusing on value-addition. The objective is to strengthen realisations and capital e_iciency. At Ganesha Ecosphere, this will be achieved through the manufacture of new fibres addressing value-added non-textile applications that serve as a hedge against textile sector volatility. The Company's products will enable it to broad base its presence away from an excessive dependence on one market, empowering it to address profitable realities in specific geographies.

Outlook

The complement of these initiatives is expected to generate a significant turnover by the time the plant achieves full capacity utilisation. This will ensure that the Company doubles its turnover in the next three years, replicating an achievement that had taken three decades to achieve. I am grateful to our employees, Board members and shareholders for their continued support.

Shyam Sunder Sharmma