Leading fast-moving consumer goods (FMCG) conglomerate Hindustan Unilever Ltd (HUL) is set to acquire a 14.3 percent stake in Lucro Plastecycle Pvt Ltd, a manufacturer of recycled and engineered plastics. This stake acquisition is expected to streamline the procurement of recycled plastic packaging materials for HUL, aiding the company in meeting its mandatory Extended Producers’ Responsibility (EPR) requirements alongside its Corporate Social Responsibility (CSR) objectives.
HUL’s investment marks a significant step toward its sustainability goals, aiming to scale up the use of recycled flexible plastic content in packaging. This aligns with the Government’s vision of achieving a zero plastic waste future. The investment seeks to enhance plastic circularity by increasing the availability of recycled content for flexible plastics, providing a roadmap for businesses to transition toward sustainable plastic packaging and address the challenges posed by hard-to-recycle flexible plastics.
Board approvalThe Board of Directors of Hindustan Unilever Ltd (HUL) at its meeting held Thursday approved the investment for acquiring 14.3 percent stake in Lucro Plastecycle Pvt Ltd (Lucro), a leading player in recycled flexible plastics, the company said in a statement. Lucro is a well-integrated waste management, recycling and product manufacturing company, working to create a circular plastics economy for a better tomorrow.
Hindustan Unilever’s board has approved the acquisition of a 14.3 percent stake in Lucro Plastecycle, a privately-held plastic recycling company. “The investment aims to strengthen plastic circularity by increasing the availability of recycled content for flexibles, providing a roadmap for businesses to move towards sustainable plastic packaging and address the challenge of hard-to-recycle flexible plastic,” the company stated in a stock exchange filing.
However, Hindustan Unilever has not disclosed the cost of the stake acquisition, any further investment plans, or the enterprise value of Lucro Plastecycle. The decision to acquire a stake in Lucro Plastecycle is viewed as a strategic move, reinforcing HUL’s commitment to a circular economy by enhancing plastic recycling capabilities and increasing the availability of recycled plastic materials for packaging.
Hindustan Unilever Managing Director and Chief Executive Officer Rohit Jawa said, “This investment is a significant step in building capabilities in recycling and developing a circular economy model for plastic, which aligns with our firm belief that what is good for India is good for HUL.”
HUL’s investment in Lucro Plastecycle is expected to support the company in achieving its environmental goals while driving business growth. Creating a circular economy for plastic is not just a business imperative but also a responsibility.
What is Lucro Plastecycle?Mumbai-based Lucro Plastecycle Pvt Ltd is a leading waste management and recycling company, transforming post-consumer plastic waste into high-value products. By championing the circular economy, the company is revolutionizing how plastic is perceived, produced, and consumed to build a more sustainable future for the planet. Its trademarked Plast-E-Cycle process efficiently closes the loop on plastic waste. Lucro Plastecycle is backed by investment firm Circulate Capital.
Founded in 2012 by Saumil Dinesh Desai and Ujwal Desai, the company specializes in producing flexible packaging materials such as films, shrink wraps, automotive covers, and retail bags using recycled granules derived from flexible plastic waste.
Reports estimate Lucro Plastecycle’s net sales rose by 57 percent year-on-year (YoY) in the financial year 2023-24 (April-March) to ₹84.8 crore, while net profit tripled from the previous year to ₹6.6 crore. The partnership with Hindustan Unilever Ltd (HUL) is expected to enhance the company's recycling capacity and encourage greater adoption of post-consumer resin across industries.
Welcoming HUL’s investment, Ujwal Desai, Managing Director of Lucro Plastecycle, stated, “At Lucro, we turn the challenge of recycling post-consumer flexible plastics into an opportunity to create high-quality recycled plastics while driving the circular economy. This investment by HUL paves the way for increasing our recycling capacity, driving large-scale commercial adoption of post-consumer resin, and setting a new benchmark for sustainable plastics."
Lucro Plastecycle sources plastic waste from waste pickers, non-governmental organizations (NGOs), aggregators, and brands, recycling it into high-quality, sustainable granules that give waste a new life as responsible packaging and products. By collaborating directly with waste pickers, the company helps maximize their earning potential while driving a more sustainable future. Through information, education, and communication (IEC) initiatives, Lucro also promotes plastic collection and builds a more environmentally conscious community.
The company’s proprietary de-inking, dry wash, and de-odorizing solutions remove ink, absorb oils and contaminants, and eliminate odours from granules, making it easier for brands to adopt Lucro’s post-consumer resin (PCR) and upcycle waste. Additionally, Lucro works closely with brands to ensure that end products are 100 percent recyclable while offering custom design and personalization to meet client needs.
Fund investmentsSingapore-headquartered, environment-focused investment firm Circulate Capital invested US$ 4.79 million (approximately ₹37.5 crore) in Lucro Plastecycle in 2020 through its Circulate Capital Ocean Fund. The Ocean Fund followed up with a second round of funding in Lucro Plastecycle for an undisclosed amount in 2022.
In December 2023, Circulate Capital marked the final close of the Circulate Capital Ocean Fund I-B at US$ 76 million, bringing its total assets under management to US$ 255 million. The Ocean Fund invests in startups addressing the ocean plastic crisis in South and Southeast Asia.
The Circulate Capital Ocean Fund has a total corpus of US$ 106 million, with PepsiCo as one of its first Limited Partners (LPs). Other LPs include major global companies such as The Coca-Cola Company, Procter & Gamble, Dow, Danone, and Chanel.
DILIP KUMAR JHA
Editor
dilip.jha@polymerupdate.com
