The dynamism and size of the Indian market present a huge opportunity for investment, says Kaplan
Singapore-based impact investment company Circulate Capital has committed half of their US$112 million investment to Circulate Capital Ocean Fund in India, with the latest being in further growing its portfolio by investing in Deluxe Recycling, a leading Indian plastic recycling company from Mumbai.
Deluxe supplies 90% of the recycled seat board market, which means nearly every rickshaw driver sits on a Deluxe-recycled seat made from hard-to-rechcle multi-layer plastics (MLP) such as sachets and used-beverage-cartons into valuable products like pallets and recycled chipboards.
Over the past two years, Circulate Capital has invested in six Indian companies, transforming the plastic recycling value chain and advancing the circular economy by creating innovative, scalable solutions that address systemic gaps and pain points.
By creating a market for MLP waste, Circulate Capital’s 7th investment venture in India is capturing the value of this plastic waste and expects to divert 34,000 tons from incineration or landfills by 2025.
The Fund is the world’s first investment fund focused on ocean plastics in South and Southeast Asia, created in partnership with leading global corporations, PepsiCo, Procter & Gamble, Dow, Danone, Chanel, Unilever, The Coca-Cola Company, Chevron Phillips Chemical Company LLC and Mondēlez International.
Rob Kaplan, Founder and CEO of Circulate Capital, said on 5 Apr 2022, “Difficult-to-recycle plastics like sachets, food packing and plastic wrap have remained a global challenge in the waste management and recycling sector.
“Deluxe’s game-changing technology and entrepreneurial know-how has enabled the company to transform these multilayer plastics into valuable products at a scale not seen before in India.
“The dynamism and size of the Indian market present a huge opportunity for investment in the transition to a circular economy for plastics. Deluxe is firmly positioned at the forefront of this transformation and we’re proud to be supporting their growth.”
The problem of plastic waste, especially MLP, is increasing in India, with the country generating 9.4 million tons of plastic waste annually. Only 60% of plastic waste is being collected, with 3.8 million tons leaking into the environment every year.
According to the Ellen MacArthur Foundation, the circular economy development path in India could create an annual value of Rs.14 lakh crore (US$218 billion) in 2030 and Rs.40 lakh crore (US$624 billion) in 2050 in comparison to the current development scenario. This makes India a hotbed for innovation in waste management and recycling and could reduce greenhouse gas emissions by 44% along with significant reduction in air pollution, thus contributing to health and economic benefits for society.
Deluxe co-founder Jignesh Shah underlined, “Our ultimate mission is to create value from waste, diverting it from incineration and landfill. We are proud to partner with Circulate Capital to scale our operations and our impact. At Deluxe, we see the potential to transform India’s MLP waste into a valuable mainstream raw material, incentivizing its collection and replacing the need to use virgin plastics.”
Since establishment, Deluxe has worked with external vendors and aggregators to provide training and development in effective waste segregation as well as offtake agreements, price premiums and better standard of living for formal and informal waste pickers.
Deluxe currently employs 150 full-time employees and up to 140 contract laborers, ensuring appropriate employment arrangements and contributions to pension funds. Expansion is expected to provide employment opportunities for over 100 new recycling and waste management workers. fiinews.com
