Huhtamaki PPL Ltd Research Report By HDFC Sec

We expect HPPL’s consolidated net sales to grow by 41.8% on CAGR basis over CY13-16, which is likely to be driven by consolidation of PPIL, capacity expansion & improving demand for flexible packaging (due to revival in FMCG industry). Capacity Expansion, NASP initiatives would enable HPPL to improve its volume growth and boost its revenues & profits.

The acquisition of PPIL (Positive Packaging) would almost double HPPL’s turnover and is likely to be EPS accretive. It would enable HPPL gain further bargaining power with its customers, to extend its customer network and would also help synergies in sourcing of inputs and up-gradation in technology. In our view, the structure of the deal seems to be positive for the minority shareholders of HPPL. The acquisition reflects parent company’s increasing interest in Indian operations.

Download Huhtamaki PPL HDFC Sec Research Report