Loop to supply recycled DMT to Taro Plast for automotive applications

MONTREAL - Loop Industries, Inc. (NASDAQ:LOOP), whose stock has surged over 62% in the past six months and currently maintains a market capitalization of $89 million, announced Tuesday it has signed an offtake agreement with Italian compounder Taro Plast S.p.A. to supply recycled dimethyl terephthalate (DMT) from its planned manufacturing facility in India.

The DMT will be produced at Loop’s Infinite Loop India facility, which is scheduled to begin operations in early 2028 through a joint venture with Ester Industries. The plant is designed to produce 70,000 tonnes of PET resin annually, along with DMT for specialty polymer applications. According to InvestingPro data, Loop maintains a healthy financial position with a current ratio of 2.81, indicating strong short-term liquidity to support its expansion plans.

Under the agreement, Taro Plast will use Loop’s 100% recycled DMT in automotive and specialty polymer applications. The Italian company has conducted independent testing confirming that Loop’s recycled DMT meets high purity and performance standards.

"This partnership with Loop Industries is a significant milestone in our journey towards a circular economy," said Andrea Squeri, Managing Director of Taro Plast, according to the press release. He noted the agreement would help reduce greenhouse gas emissions by replacing fossil feedstock in plastic manufacturing.

Giovanni Catino, Chief Revenue Officer of Loop Industries, stated the partnership "sets a new benchmark for integrating recycled content and reducing the carbon footprint of specialty polymers without compromising on performance or quality."

The agreement represents Loop’s expansion beyond bottle-grade and fiber-grade PET resin into the specialty polymers market, diversifying its revenue streams. Taro Plast becomes the first company to integrate Loop’s DMT into its product portfolio.

Taro Plast operates five production plants across Europe and the USA, with annual turnover of approximately €200 million. Loop Industries’ technology depolymerizes waste PET plastic and polyester fiber into building block monomers that can be purified and repolymerized into virgin-quality PET. While the company is not yet profitable, InvestingPro analysts have set a high target price of $5.80, suggesting significant upside potential. For detailed financial analysis and additional insights, investors can access the comprehensive Pro Research Report available on InvestingPro, covering over 1,400 US stocks including LOOP.

In other recent news, Loop Industries reported its financial results for the first quarter of fiscal year 2025. The company announced a 46% reduction in cash operating expenses compared to the same period last year. Despite this improvement, Loop Industries acknowledged ongoing financial challenges and discussed strategic plans for future expansion. There were no updates regarding mergers or acquisitions in the recent developments. Analyst firms have not provided any recent upgrades or downgrades for the company. The focus remains on Loop Industries’ fiscal strategies and efforts to address financial hurdles while pursuing growth. Investors are closely watching these developments to gauge the company’s future direction.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.