MTPL is doing a QIP of INR 150 Cr at 722.40 a share (before 5% discount), proceeds will used for adding up capacities and setting up new plants. One of their major client has asked them to double up their capacity in 2 of their south indian plants as well.
Need info from members names of QIB here, if any one can help me out.
Discl.: Invested
Edits: Grammar
Here are my few thoughts and how I interpret the recent news
Coming to current scenario of 150 cr raised via QIP. Their current book value is ~288 crore. Which means, because of QIP, there is going to be roughly ~32% equity dilution. So dividends would go down by 33% which is same as above for existing investors but now you have a company without 170 crores of additional long term debt.
Now that, from either equity or debt raise, investors are not worse off (if we assume this does not increase CFO). But here is the caveat: as you can appreciate, if there is increase in CFO, equity investors are worse off in QIP as opposed to raising debt. Say CFO goes up to 50% to 60 crores. In QIP scenario, current investors will capture only 68-70% of it ~42 crores. But in debt scenario, investors will capture ~44 crores (60crores - 16 crores). 5% delta essentially. Which I donât believe is quite a big trade off in long run. Besides, ability to raise QIP successfully is plus in itself as investors are willing to put more money into the business as equity.
Besides, with their policy of paying dividends, it is hard to raise debt with literally 3 crores cash in bank. Think the real area to challenge the management is why maintain 3 crores in bank for a 160 crore topline business where Working Capital alone is 90-100crores.
Dear all Valued member, in the past 2 qtr, promoter has reduced stake almost 3%, that quite a lot thinking about low holding already they are having. Anyone has any idea for this reduction of holding. Business is going good and business prospect for future also good, still promoter reduced stake. There might be chance that promoter finds the stock as overvalued hence sold it.
Disc: Invested
Another thing to note here is, sold shares seems to went FIIs DIIs and not to retail public.
Promoter selling is not important for investor unless it is huge as promoter may want to diversify asset or may have cash requirement for personal use
DiscâŚinvested and presented same view in KEI ind. thread when promoters were selling.
Q3FY22 results - https://www.bseindia.com/xml-data/corpfiling/AttachLive/94aff2ed-5345-477f-aa91-dae47e30974a.pdf
Con-call today at 4:30 PM
Disc. - Invested
Can someone clarify this doubt - Asian Paintsâs Q3FY22 saw revenue growth of ~20% QoQ but still MTPLâs paints segment saw a decline.
Thanks
Disc. - Invested
They are not the sole suppliers of asian paints, also asian paints donât take IML packs from them which has higher value which berger uses so due to product mix the correlation wonât exist every time between AP and moldtek
Asian paints revenue growth came from the subsequent price hikes they have taken. In volume terms itâs degrowth.
Q3FY22 Notes
9M - Revenue up by 43%, EBITDA up 42%, PAT up by 54%
Q3 - Revenue up 20%, EBITDA up 14% - per kg EBITDA increased 19% (Q3FY21 36.4, Q2FY22 42.7 ,Q3FY22 43.1) - RM cost/kg Rs 110 (Q3Fy21 Rs 85 , 30% up)
IML/NonIML share stagnating/stabilising - IML growth coming from FMCG - paints and lubes IML still to pick up
104cr QIP at 722.4 per share - Mysore and Vizag expansions 60cr as capacity doubling on projections given by Asian Paints in next 2 years - would supply to Castrol Kolkata from Vizag - Sultanpur expansion OTC pharma requirement may come up anytime, so staying agile with cash - total 9MYTD capex 36cr - 90cr total capex in next 12 months - 250cr in 3 yrs
Bagged high value adding orders from Amul, PVR cinemas, Biostadt , Skyline labs Paints, Beleven, Vital Pharma, etc
Pumps order from HUL and trials for RB, Himalaya, Apollo. Export orders also pursued
Placed order for machines and moulds for IBM packaging for pharma - Unit1 Hyderabad building to be completed by Mar22 - pilot plant to start in May22, order from a client to be confirmed in a week - expansion to be completed by Dec22 - during DMF approval stage plant to start supplies to FMCG and cosmetics - total capex 40cr over FY22 and FY23
QR coded IML containers for UDP Pvt Ltd and expecting sizeable orders from prestigious lubes, food and paint customers - trials at 1 paint, 3 lube, 4 FMCG companies - entered into MOU with IT service provider to provide track and trace services - first order to be executed in Feb22 (question - which IT?)
Paints - 54% share revenue, 58% share of volume - 17% up yoy, 8% down qoq - 8% down in tonnage yoy, 6% qoq - because of price hikes by paint companies in Nov - Feb sales back on track - EBITDA/kg 30-35rs
Lubes - 23% share revenue, 25% share of volume -22% up yoy, 20% up qoq - EBITDA/kg 30-35rs - 15% increase in volumes qoq - stagnant industry volumes, growth is likely to come from QR coded IML as lubes are most affected by counterfeit
FMCG - 22% revenue, 18% volume - 26% up yoy, 6.3% up qoq - 38% increase in volumes of thin-walled products yoy, 12% qoq - major driver in increase in EBITDA/kg - square packs have 35-40rs EBITDA/kg - thin walled packs have 80-100rs ebitda/kg - pump revenue 1cr in Q3 - will pick up as orders have been received - 2cr to 3crs/qtr from April 22
Kanpur plant started in Oct21, 4cr capex
Started using recycled material in last few months - no issue in quality of RM - clients encouraging to blend with fresh RM for ESG - price spread is 15%
Next segments - nutraceuticals, bread butter jams, beverages, detergents - hygienic packaging
Guidance - 13%-14% volume growth in FY22, 18%-20% for FY23 - Pumps will have 50cr turnover in 3 yrs (35% pumps are still being imported from China + low current quality)
Asset turns - 3.5x for others and 2.5x for IBM
Working capital - SMEs place advance orders, 60-70 days for large companies
Entry barrier - fully backward integrated - robots, machines, IML labels are self assembled
New team being created for exports - working to increase confidence as single source supplier for large FMCGs through consistent procurement and delivery
No reason that I could find . Although it has recovered somewhat.
But bigger picture, itâs a steady compounder with a few optionalities.
Pumps - Nowadays I see pumps everywhere - OTC pharma, cosmetics, shampoo, etc. Market is getting bigger. Going forward, I expect to see some segmentation in quality of pumps as well.
IML coding - Again increasing trend. Reduces thin plastic film usage. Win-win. Once commodity prices stabilise, I expect this to pick up.
Pharma packaging - Pharma packaging in India is still pretty basic. Very nascent sector. Will take time to develop. Expect to take place in OTC branded medicines, neutraceutical, lifestyle drugs in that order.
Right now industry is monopsony (or any similar word for few buyer many seller). With product differentiation and need for better packaging, industry may become oligopolistic. However, that I feel is atleast a decade away. The technology integration should be so strong that competitors and new entrants would fear the longer pain period in setting up capacity and expertise. Eg: APL Apollo in structural steel. Until, that happens, happy to hold as company is taking steps in that direction.
Disc : Inveated, biased. Added recently.
Q2 & Q3 sales are stagnant 160cr, even volume dropped from 7583 ton to 7320 still they have managed to raise ebidta to Rs 43.07/kg from rs 42.70/kg , reason is FMCG traction, thin wall product is Rs 80-100/kg which is double from paints & lubes , this opportunity is 10-15k cr or more, as retails expand in Small towns the IML & QR coded IML will be flooded in the mkt, also with the new products development 3-4 every year they r coming with innovative ideas, Due pollution issue EU/US can outsource more to India rather than China, As MDT is BI with own robots, moulds, graphics design, labels, that gives them competitive edge over china as well, also new generation team up to cater export which wasnât effective earlier, long term story, daily fluctuation wont matter , only matter of observation is consumption of total tonnage & capacity
I have tried to summarize packaging industry and Mold Tek packaging.
Some interesting insights from the latest analyst meet of the company - edible oil segment bouncing back, F&F remains strong, robust volume guidance for next 3-4 years, and entry into USA market.
As mentioned by the company in Q3FY22 concall, promoter group shareholding has increased to 34.5% post the conversion of warrants
hello friends, have all of you converted your detachable warrants into equity shares? I hope this process can be done online?
How can we do that? Is it all shareholder gets warrant?
I have done it. It is quite easy. The process has been detailed in this very thread by @nevds.365 (Aug 21 last year). So please search for it and here is the link:
After reading the post, these are a few pointers. The code to be used for offmarket transfer of shares to the Escrow account is: Code 29 (DEPOSIT OF SECURITIES WITH ESCROW AGENT AND ITS RETURN).
You can call Mr. Thakur Vishal Singh, Company Secretary, on 040-40300330. Sometimes, instead of him, Ms Ramani attends the call. She is very helpful.
It is important that folks transfer their warrants fast because I think May is the last month for such transfer after which the warrants might lapse. The warrant exercise form and instructions are also on their site:
All the best,
Sav
Q4FY22 con-call notes
Volume Growth -
Reduction in margins QoQ -
General Updates -
QR coded IML pack -
IBM -
EPR regulations -
Capex for FY23 -
Capacity utilization - 70%
Results PDF - https://www.bseindia.com/xml-data/corpfiling/AttachLive/1e1e79b1-b3a6-4a2e-bcf2-7158f97c17d5.pdf
Concall link - https://www.youtube.com/watch?v=_bS7ShBwLX0
PS - The US restaurant that MTPL exports to is âDesi Bitesâ. They had exported to US in Janâ22 (Source - Mold Tek Packaging Ltd | See Recent Shipments | ImportGenius)
Disc. - Invested
