Delta Investment Advisors

CMR Green Technologies Ltd

The company was founded in 2005 by Mohan Agarwal and it is India's largest non-ferrous metal recycler by installed capacity. It processes Aluminium scrap (~78% of business) and converts it into recycled aluminium alloys - sold in ingot form, liquid (molten) form, or as aluminium billets, primarily to the automotive industry (OEMs and Tier 1 auto component manufacturers). It now operates 13 manufacturing facilities across India with combined capacity.

DRHP filed: 10th Sept 2025

BRLM: Equirus Capital, ICICI Securities, Motilal Oswal Investment Advisors

Auditor: ASA & Associates LLP

Disclaimer - Delta Partners (public market division under Dexter Capital) is not a SEBI registered Investment Advisor and this report does not constitute a recommendation but is only prepared for educational purposes. We (our team members including our directors) may or may not apply to IPO.

This note is not reviewed by our CIO - Devendra Agrawal, CFA. It is prepared by our team of Investment Analysts, and is reviewed by our senior team members. Any questions related to the IPO can be directed to shubham@deltainvest.in and we will come back.

We at Delta Partners continue to analyze many business and IPOs. Investors interested to be part of this network are requested to fill the form & our team will reach out with more details. [Click Here]

Delta’s View : May Subscribe for Listing Gains

CMR Green Technologies is a dominant aluminium recycler in a thin-margin commodity business (EBITDA margin ~4.5%) and moderate growth (11-12%). Its working capital needs are increasing amid deteriorating operating cash flow, which has raised the debt burden. The IPO is a pure OFS with the PE investor exiting after 12 years; at 13.7x EV/EBITDA and 20.9x P/E, it does not build much conviction in the overall business and governance.

However, One can expect good listing gains as per current GMP ~36% (5th June 26), provided if it sustains

CMR Green Technologies is India's largest aluminium recycler (~42-45% domestic cast alloy market share). However, the business is fundamentally a commodity processor - EBITDA margins at 4.5% (FY25) lag peers Gravita India (8.4%) and Jain Resource Recycling (5.7%), with pricing power structurally limited by LME-linked selling prices and ~73-80% imported raw materials. The working capital has stretched from 53 to 76+ days in two years, increasingly being financed by short-term debt (grew 3x to 1,174 cr (Dec 2025)). Its operating cash flow deteriorated over this period in 9M FY26 to -388 cr (it was -92 cr in FY25). The 2021 merger of six related-party entities created 1,240 cr of goodwill that was entirely written off in FY24, and the promoter personally carries an active ED matter and a stayed criminal complaint on merged entities (Although amount involved is 30-35 cr but raises governance concerns). The IPO is a pure OFS of ~631 cr with zero fresh capital entering the business; the sole PE investor (Global Scrap Processors, in since 2013) is exiting near-entirely. At ~13.7x EV/EBITDA and ~20.9x P/E (TTM), the valuation does not provide enough comfort at this point.

The business is fundamentally a commodity processor with thin margins (Gross Margins 10-12%) (~4.5% EBITDA). Its margins are inferior to other recycling sector peers like Gravita India (8.38%) and even Jain Resource Recycling (5.68%).

It operates in a price-taker environment where raw material (scrap) is priced on international markets and aluminium alloy selling prices are indexed to LME. Historically, ~73-80% of raw materials are imported. There is limited pricing power independent of commodity cycles.

The company’s short term debt had surged sharply to 1,174 cr (Dec 2025) from 362 cr (FY24). The working capital cycle has increased from 53 to 76 days in two years, which is being financed almost entirely by short-term borrowings, creating a refinancing risk. The company’s operating cash flow has been substantially negative (-92 cr in FY25 to -388 cr in 9M FY26).

In 2021, the company merged its 6 entities (GMRPL + SFSL + SNFTPL + RPPL + FMPL + Century Metal) into Grand Metal Industries Limited and renamed to CMR Green Technologies Limited. The merger was between related parties at valuations that resulted in significant goodwill (1,240 cr) being recorded on the consolidated books. It impaired entire goodwill (in exceptional items) in FY24. The creation of inflated goodwill from a related-party merger and its subsequent near-total write-off in a single year raises governance and accounting quality questions.

Two of the promoter’s (Mohan Agarwal) merged entities - SNFTPL & Century Metal had litigations against them in the past. SNFTPL (a trading company that used to import scrap) has been alleged by ED for violating forex rules. The amount is ~15 cr and the case is still pending. Century Metal was alleged by the Central Excise department that it had fraudulently claimed tax credits on aluminium scrap purchases. The amount is ~16 cr, but Mohan Agarwal personally was named in this case (penalties were imposed against him originally).

The issue is entirely Offer For Sale for ~631 cr, diluting 15% stake of the company. Its promoters hold ~87% in the company. The only PE investor, Global Scrap Processors Limited, which holds ~13% stake is selling majority of its stake in OFS alongside promoters.

The company’s revenue is concentrated in the automotive sector (~81%) and there is only limited near-term diversification into non-automotive channels beyond the nascent Tirupati (construction/packaging) and Odisha (Hindalco) plants.

The company’s IPO ask valuation seems decent at ~13.7x EV/EBITDA or ~20.9x P/E on a TTM basis, but the commoditized nature of the business, high debt and moderate growth does not provide sufficient comfort.

Business

CMR greentech recycles non-ferrous metal scrap of Aluminium (~78%) and other metals (zinc, stainless steel, copper, brass) (~22%) and converts it into recycled aluminium alloys, furnace-ready scrap or zinc alloys.

Scrap aluminium comes in mixed, impure form (called Zorba, Taint Tabor, Tense, etc.). CMR sorts, separates, melts, and reconstitutes it to exact chemical specifications demanded by automotive customers. Output is either - Aluminium Alloy ingots or Liquid Aluminium.

It had 112 customers as of FY25, which includes OEMs like Maruti Suzuki, Honda cars, Bajaj Auto, Hero Motocorp, etc and Tier 1 customers such as Rockman Industries, Sunbeam Lightweighting, Endurance Technologies, Craftsman Automation, etc. Its top 10 customers contribute 53% of revenue.

It sources aluminium-based metal scrap in various forms - Zorba, Zurik, Taint Tabor, Tense, Troma, Tally. It has 198 global suppliers across 73 countries with top import sources as USA (47.5%), UK (9.3%), Belgium (7.7%). Only ~27% of its raw materials are sourced domestically.

It has 13 plants with a capacity of 615,150 MTPA total (470,300 MT aluminium + 8,400 MT zinc + 136,450 MT other metals). Its installed capacity is almost 4x of nearest domestic competitor.

The scrap is first mechanically sorted in CMR’s refining facilities and melted through regenerative furnaces, and finally alloyed, degassed, undergone dross removal to form the final product.

Issue Details

Offer For Sale size - Amount → 631 cr ; Shares → 32.8 mil shares

Promoters and Leadership

Mohan Agarwal is the founder & CMD of the company and has experience of 31 years in the industry.

Second-generation sons - Akshay (34, son, Mechanical Engineering from BITS Pilani) and Raghav (31, son) are both Whole-time directors.

Shareholding Pattern

Financials