Mold Tek Packaging – Q1FY24 Con-Call Key Outcomes
Flat Quarter:
- The FMCG segment experienced lower-than-expected growth, primarily due to reduced consumption of ice cream and dairy products caused by intermittent rains across the country.
- As a result, there was a 20% decline in volume growth for ice cream and dairy products, leading to a moderate 13% growth instead of the expected 36-37% growth.
- The operating capacity of the Khandala plant in Q1 FY24 was only 46%, lower than expected. However, from July onwards, the capacity has increased to 65-70% due to ongoing expansion and maintenance projects undertaken by major clients.
- The decrease in profit can be attributed to the recent increase in depreciation over the past few months.
- The future outlook appears very promising, primarily because of the upcoming introduction of Pharma packaging products, scheduled to be launched by December 2023.
- The Pharma facility will start getting audited by the client from October 2023.
- Iodex production is expected to commence by October 2023.
- Revenue expectations from the Pharma segment cannot be disclosed at this time.
- The QR coding issue has been resolved for Shell, and a further launch is underway for Shell.
- EBITDA per Kg stands at 38.8, compared to 40.14 in Q1, for Ice cream and Dairy products.
- In Q3, integrated printing facilities from Sultanpur are set to begin operations in October 2023, which is expected to improve the EBITDA.
- The Pharma segment is expected to start contributing to EBITDA from November to December this year.
- The Pharma Business is projected to achieve an EBITDA of 150 per Kg.
- Next year, the Pharma Business is estimated to generate revenue of 30-40 Cr, with a worst-case scenario of 25 Cr.
- Volume Growth reached 9200 tonnes, with volume contributions from Paints at 40%, Lube at 28%, and Food at 24.2%.
- Grasim’s volume growth is expected to reach 5000 tonnes, and the total capacity for the paints industry is 19000 tonnes, including Grasim.
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