Ardee Industries Ltd IPO Date, Price, GMP, Review, Details

Introduction

Ardee Industries Limited is a lead recycler that converts end-of-life lead-acid batteries and non-ferrous scrap into pure lead and lead alloys, with purity levels ranging from 99.97% to 99.985%. Its product portfolio spans pure lead and lead calcium, lead antimony, lead tin, lead silver and lead cadmium alloys, which are consumed by the energy storage, e-mobility, automotive and chemical industries. The company was incorporated in 1993 and is registered at Village Sultanpur, Mehrauli, Gadaipur, New Delhi. The present promoters, Sandeep Aggarwal, Nikunj Aggarwal and Esha Gupta, acquired the company in 2021.

The defining feature of the last three fiscals has been capacity build-out and a shift towards exports. Installed capacity rose from 54,750 MTPA in Fiscal 2024 to 104,025 MTPA in Fiscal 2026 and stood at 156,950 MTPA as on the date of the Red Herring Prospectus, funded by capital expenditure of ₹20.54 crore, ₹25.30 crore and ₹12.44 crore in Fiscals 2024, 2025 and 2026 respectively. Export revenue grew at a CAGR of 138.69% from ₹81.63 crore in Fiscal 2024 to ₹465.05 crore in Fiscal 2026, taking exports from 17.63% to 39.83% of revenue from operations, with the customer footprint expanding from four countries to eight. The brand ‘ARDEE LEAD 9997’ is listed on the London Metal Exchange and the ‘Ardee’ brand is listed on MCX.

Operations are run from a single manufacturing facility spread across approximately 7.61 acres at Naidupet, Tirupati district, Andhra Pradesh, with an NABL-accredited in-house testing laboratory. The plant sits 130–150 kilometres from the Chennai, Kattupalli and Ennore ports and in proximity to Amara Raja Energy & Mobility Limited, its largest customer. Revenue from operations grew 57.21% to ₹1,167.65 crore in Fiscal 2026 with profit after tax of ₹84.68 crore. As of June 30, 2026, the company had 222 permanent and 326 contractual employees, and it served 52 customers during Fiscal 2026.

IPO Details

Objects of the Offer

• Working Capital Support
  The company will use ₹220 crore from the fresh issue to meet its incremental working capital needs. The funds will help finance higher inventory levels, make advance payments to suppliers and support expanding operations as the business scales across existing and new markets.

• Debt Reduction
  Around ₹20 crore has been earmarked to repay or prepay certain borrowings. Lower debt will improve the company’s balance sheet, reduce interest costs, strengthen its debt-to-equity ratio and provide greater financial flexibility to support future business growth.

• General Corporate Purposes and Offer for Sale
  The remaining fresh issue proceeds will be used for general corporate purposes, including growth initiatives and brand building.

Key Strengths and Opportunities

• Capacity Nearly Tripled with Meaningful Utilisation Headroom Left
  Installed capacity rose from 54,750 MTPA in Fiscal 2024 to 104,025 MTPA in Fiscal 2026 and to 156,950 MTPA as on the date of the Red Herring Prospectus, against cumulative manufacturing capital expenditure of ₹58.28 crore across the three fiscals. Actual production rose from 32,567 MT in Fiscal 2024 to 69,855 MT in Fiscal 2026, taking capacity utilisation from 59.48% to 67.15% after dipping to 45.16% in Fiscal 2025 when the expanded capacity came on stream on November 7, 2024. The company has also acquired 5.56 acres at Menakur, Naidupet, to diversify into plastic granules and tin and copper recycling. Because the incremental capacity is already commissioned and paid for, the next leg of revenue growth requires working capital rather than fresh capital expenditure. Fixed asset turnover of 16.54 times in Fiscal 2026 against Gravita India’s 5.55 times indicates that the asset base is being utilised efficiently.

• Export-Led Mix Shift Has Been the Principal Margin Lever
  Export revenue grew from ₹81.63 crore in Fiscal 2024 to ₹275.06 crore in Fiscal 2025 and ₹465.05 crore in Fiscal 2026, a CAGR of 138.69%, lifting the export share of revenue from operations from 17.63% to 39.83%. The destination mix has broadened from four countries to eight, with Switzerland scaling from nil in Fiscal 2024 to ₹188.32 crore in Fiscal 2026 and Singapore remaining the largest at ₹197.56 crore. Management attributes the Fiscal 2026 profit increase of 154.52% partly to higher export realisations in markets offering better pricing. The company holds Three Star Export House status from the Directorate General of Foreign Trade, upgraded from the One Star status awarded in 2022. Exports also carry longer receivable cycles, which is the reason ₹220 crore of the fresh issue is directed towards working capital.

• Regulatory Entry Barriers and a Wide Sourcing Network
  Lead scrap imports into India require licensing and compliance clearance from the Ministry of Environment, Forest and Climate Change, which raises the entry barrier for new recyclers. Ardee’s import purchases rose from 61.34% of total purchases in Fiscal 2024 to 86.94% in Fiscal 2026, evidencing an uninterrupted flow of approvals, and it sourced raw material from 58 countries across the three fiscals, with the United Arab Emirates at 25.23% and Singapore at 16.53% of Fiscal 2026 imports. The facility carries ISO 9001:2015, ISO 14001:2015 and ISO 45001:2018 accreditations alongside an NABL-accredited in-house laboratory, and the company’s brand is listed on both the MCX and the London Metal Exchange, which supports price benchmarking and customer acceptance. Repeat customers contributed ₹1,002.56 crore, or 85.86% of revenue from operations, in Fiscal 2026. The company uses oxygen enrichment and green fuel derived from end-of-life tyres in place of coal and furnace oil, which lowers both emissions and fuel costs.

Key Risks

• Revenue Is Concentrated in a Very Small Number of Customers and One End-Industry
  Ardee served 52 customers in Fiscal 2026, down from 54 in each of the two preceding fiscals. Its single largest customer contributed ₹474.56 crore, or 40.64% of revenue from operations, in Fiscal 2026, following 51.22% in Fiscal 2025 and 72.42% in Fiscal 2024. The top five customers accounted for 81.98% and the top ten for 91.61% of Fiscal 2026 revenue. Separately, 84.79% of Fiscal 2026 revenue was attributable to the battery and metal industries, with Amara Raja Energy & Mobility Limited the dominant name within it. The company has no long-term agreements with its customers and operates on a purchase-order basis. The concentration is falling but remains severe, and the loss or scaling back of a single relationship could materially affect the earnings base.

• Growth Is Working-Capital-Hungry and Cash Conversion Is Weak
  Net working capital rose from ₹104.63 crore in Fiscal 2024 to ₹148.18 crore in Fiscal 2025 and ₹226.19 crore in Fiscal 2026, and is projected at ₹474.89 crore for Fiscal 2027, more than double the Fiscal 2026 level. Cash flow from operations was ₹29.83 crore in Fiscal 2026 against profit after tax of ₹84.68 crore, a conversion of 35.22%, and was negative at ₹25.26 crore in Fiscal 2024. Trade receivable days fell sharply from 32 in Fiscal 2024 to 8 in Fiscal 2026, with trade receivables declining from ₹59.95 crore to ₹24.79 crore even as revenue grew 57.21%, while advance-to-supplier days are projected to rise from 34 to 53 as procurement shifts from a cash-against-documents model to FOB. The receivable position is the single largest swing factor in the Fiscal 2026 cash flow and its durability is untested. Of the ₹320 crore fresh issue, ₹220 crore funds working capital rather than capacity, so the proceeds finance the balance sheet rather than adding earning assets.

• Single-Site Operations with Heavy Import Dependence and Unused Capacity
  All manufacturing is carried out at one facility at Naidupet in Tirupati district, Andhra Pradesh, so any disruption at that site, whether regulatory, environmental, labour-related or utility-related, could halt the entire business. Import purchases were 86.94% of total procurement in Fiscal 2026 at ₹805.98 crore, leaving the raw material line exposed to shipping disruption, tariff changes, currency movement and MoEFCC licensing outcomes. Foreign exchange fluctuation on borrowings alone added ₹4.51 crore to finance costs in Fiscal 2026. Capacity utilisation was only 67.15% in Fiscal 2026 against installed capacity of 104,025 MTPA, and installed capacity has since risen to 156,950 MTPA, which means utilisation on the current asset base is materially lower. Fuel and gas costs of ₹23.64 crore and water and electricity costs of ₹5.11 crore together represented 2.72% of total expenses. Contract labour charges rose 121.94% to ₹12.76 crore in Fiscal 2026, and the company relies on 326 contractual workers against 222 permanent employees.

Financial Snapshot

Peer Comparison

Valuation