Capital investments decisions are a part of the most significant decisions a company makes. At present, economic success goes hand in hand with environmental decisions and cannot be based on environmental devastation. The diploma thesis is focusing on compiling a concept of an investment plan for expanding of production of a new product based on the use of recycled raw material (wood plastic) for the company RECY WOOD Ltd., that operates in the wood production market and focuses on production and sale of timber products. By analysis of the theoretical basis of circular economy and of its investment process, as well as by identifying the starting points and reasons for the investment plan, was created a prerequisite for the creation of its concept. The sensitivity analysis determined the most sensitive parameter affecting the economic result and the size of its sensitivity when changing the input parameters by 10%. The effectiveness of the investment plan and its profitability for the company were evaluated by elaborating a financial – economic analysis and by using dynamic methods of evaluating the efficiency of the investment - net present value, profitability index, internal rate of return and discounted payback period. By evaluating the obtained results, we came to an investment recommendation and to a draft measure proposal.