Management

• Kamlesh Jain (Chairman & Managing Director)
• Mayank Pareek (Joint Managing Director)
• Dr. Kandaswamy Paramasivan (Independent Director)
• Jayaramakrishnan Kannan (Independent Director)
• Rajendra Kumar Prasan (Independent Director)
• Revathi Raghunathan (Independent Director)
• Hemant Shantilal Jain (Executive Director and Chief Financial Officer)

Use of Proceeds

The total issue size is Rs. 1250 cr, which comprises a fresh issue of Rs 500 cr and offer for sale (OFS) of Rs 750 cr. The company intends to utilize a portion of the net proceeds towards Pre-payment or scheduled re-payment of a portion of certain outstanding borrowings availed by the company. (Rs 375 cr), and rest for general corporate purposes.

Competitive Strengths

Track Record of Profitability and Growth The Jain Metal Group has a strong record of profitability and consistent financial performance in an industry with significant entry barriers. Its lead ingot is registered as a brand by the London Metal Exchange, and the “JAIN 9998” brand is accepted on MCX for settlement of lead contracts. In Fiscal 2025, revenue grew 60.91% year-on-year, EBITDA rose 62.22% to Rs 3,685.82 mn, and PAT increased 36.29% to Rs 2,232.87 mn. Between Fiscal 2023 and 2025, revenue rose from Rs 30,640.71 mn to Rs 71,257.68 mn, while gross profit margins expanded from 5.34% to 6.24%.

Financial Stability and Strategic Facilities The strong financial position reflects operational growth, prudent capital allocation, and effective working capital management. Financial stability and cash flows have supported capacity expansion and customer servicing. The industry has high entry barriers, including large capital costs, regulatory approvals, and long-term customer relationships. Recycling operations are carried out at three facilities in Chennai, spread across 26.94 acres in SIPCOT Industrial Estate. These facilities enable cross-facility utilization of by-products worth Rs 439.27 mn in Fiscal 2025. Specialization in lead, copper, and aluminium recycling, supported by advanced furnaces, casting lines, and automation, ensures efficient processes and broad customer coverage.

Strategic Location and Diversified Portfolio The facilities are located near Chennai’s major ports, offering connectivity for imports and exports across China and Southeast Asia. Export sales were Rs 43,033.25 mn in Fiscal 2025, contributing 60.39% of revenue. Freight costs and seal charges are lower than market averages, providing logistical advantages. A diversified product portfolio across lead, copper, and aluminium enables participation across multiple industries and cycles. Recycling operations follow strict quality, safety, and compliance standards. Accredited laboratories and certifications enhance credibility, while uniform operational controls support efficiency. Exports consistently contribute over 50% of revenues, reflecting global demand and a strong international footprint.

Global Customer Base and Sourcing Strength The customer network spans more than 20 countries, including China, Singapore, South Korea, Taiwan, and Japan. Export revenue grew at a CAGR of 64.93% between Fiscal 2023 and 2025. Long-term relationships provide visibility and goodwill, while sourcing strength is built on raw material procurement from over 120 countries. A global team of four traders in the US and South America supports procurement efficiency. Direct sourcing from scrapyards reduces costs and ensures steady supply of quality scrap. Strong supplier relationships secure competitive pricing and timely deliveries, further strengthening business operations and supporting sustainable growth across international and domestic markets.

Risk Management and Experienced Leadership Commodity price fluctuations are managed through hedging strategies on the London Metal Exchange. Futures contracts covering ninety-day delivery periods offset risks in raw material purchases and sales, with flexibility to pre-sell products. Foreign currency exposure from imports and exports is managed by natural hedging, daily monitoring, and forward contracts. This ensures stability in financial performance. Leadership is provided by Kamlesh Jain with over three decades of industry experience, supported by Mayank Pareek and Hemant Jain, both Chartered Accountants. A skilled management team across operations, finance, supply chain, and business development ensures growth, customer retention, and future market opportunities.

Peer Comparison

Key Risks & Concerns

• The company’s products are manufactured based on detailed technical specifications. Any failure to meet these requirements, or non-compliance, with applicable quality standards, may result in rejection of the goods supplied, cancellation of current and future orders, and customer claims, all of which could adversely affect its revenue and profitability.
• The company has a significant share of export revenue from China. Consequently, any civil unrest, regional conflicts, political instability within China, or hostilities involving China, could adversely impact the company’s business operations, financial condition, cash flows, and overall results of operations.
• The company’s operations involve activities and materials that are inherently hazardous and could result in accidents, injuries, or fatalities, which may disrupt operations and adversely affect its business, results of operations, financial condition, and ability to meet customer demands.

Outlook and Valuation

The company’s operations are vertically integrated with end-to-end recycling processes supported by sourcing raw materials from over 120 countries. Accredited laboratories and certifications such as ISO 9001:2015, ISO 14001:2015, ISO 45001:2018, NABL, and BIS provide quality and compliance advantages. The facilities are strategically located to enable cross-utilization of by-products, improving efficiency and reducing wastage. Diversified product lines in lead, copper, and aluminium allow participation across business cycles. Market trends point to secondary copper’s share increasing to 55% by 2030 and secondary aluminium’s share to 45%, driven by lower costs, recyclability, energy savings, and environmental benefits.

Future growth is expected from forward integration into copper cathode, wire rod, and busbar manufacturing. The new project will use recycled copper as feedstock, enhancing the value chain and supporting demand in the wire industry. Capital expenditure will be funded through internal accruals, with land secured at SIPCOT and environmental consents received in August 2025. Plans include producing green copper cathodes without fossil fuels, aligning with sustainability goals and positioning the company as a preferred supplier for environmentally conscious industries. Operational synergies with existing facilities are expected to improve logistics, cost efficiency, and production competitiveness.

Expansion into new recycling domains such as solar panel recycling, automotive tire recycling, copper-aluminium radiator scrap, brass recycling, and e-waste processing is targeted to capture emerging opportunities. The company has begun extracting tin as a by-product of lead recycling and producing crude tin ingots and alloys, catering to battery, plating, and electronics industries. Plastic recovered from recycling is being converted into PVC and PPCP granules for use in automotive components, footwear, pipes, and battery cases. These initiatives will boost revenue growth. Furthermore, recycling metals sector is set for significant expansion, bolstered by governmental regulations and a rising consumer inclination towards sustainable metals. Jain Resource is valued at a P/E multiple of 35.7x FY25 earnings. We believe the issue is reasonably priced. We recommend a SUBSCRIBE rating for the issue for the long term.