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Nirmal Bang Report
Key Points
Mold-Tek Packaging Ltd.'s Q1 FY24 Ebitda came 10% below our estimate mainly on lower volumes of ice-creams and under-utilisation at Satara plant for Asian Paints Ltd.
The management maintained its Ebitda/kg guidance of Rs 40 for FY24 and expects gradual improvement as pharma injection blow moulding project scales up.
We believe timely commissioning of new projects in paints and fmcg and food will determine the growth trajectory from FY25.
Outlook and valuation:
Mold-Tek Packaging has demonstrated its strength by consistently improving Ebitda/kg through innovation and expansion of the product basket, improvement in the value chain and backward integration.
All future projects are margin and return ratio accretive with the possibility of improvement in the working capital cycle as well, over the medium to long term.
Over FY23-FY25, we are building in volume compound annual growth rate of ~15% and Ebitda CAGR of ~20%.
We maintain 'Buy' on Mold-Tek Packaging with an unchanged target price of Rs 1,150, valued at 30 times price-to-earning on June-25E earnings.
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