Hindustan Adhesives FY20 AGM:
- Domestic tape market is 4,000 Cr annually. The market is growing at 5% and our market share is between 2-3%
- Margins are likely to increase going forward because of economies of scale
- Export benefits: Govt plans to change export benefits scheme but co. is expecting to continue getting 3% export subsidy
- Doing new CAPEX which will start during the second half of this year and over 12 months period, expecting 100 Cr of more sales. Even without new capacity, Sales are expected to increase by 50 Crores from existing capacity
- Old plants at U.P and Utrakhand are operating at 70% utilisations and plan to manufacture value-added products there which are import substitution
- New product: Co is developing many sustainable types of tape. Developed 50-micron packaging film
- 25% Income tax rate currently
- Long term loans interest rate is 10% and the short term rate is 5%. Lower rate because short term loans are pertaining to packing credits and foreign currency loans
- 1st unit was 50 Mn sq mt. 1st phase of Mundra was the addition of 250 Mn sq mt. 2nd phase of Mundra will be another 260 Mn sq mt. Hence, total capacity effectively becoming 10x after completion of the new CAPEX
- Dividend policy: currently using internal accruals for expansion so no immediate plans
- Can achieve 400 Cr topline in a couple of years