MOLD TEK PACKAGING---dividend plus growth

over ownership is the biggest reason , some MF holdings have beat the drums & spread it to the last mile, these kind of stock doesn’t move easily when there is no local buyer left,

4 Likes

My observation post analysis
Positive points

  1. Only integrated player who makes its own robots, labels and moulds
  2. When competition in IML increases to manufacture Pails (huge part of portfolio), a EBITDA per ton expansion is likely. Currently this is not possible as Moldtek is the only player in IML.
  3. Pharma packaging is a good segment to give a growth with higher EBITDA per ton
  4. There are many segments waiting to transition to Plastic packaging (for ex Plastic based hospital furniture). Being a leader in the segment Moldtek has all resources to venture into many other industries of plastic products where margins are high.
  5. Business succession seems to have been taken care of as the promoters son and Nephew seems to have a good hold over the business. The son has proved the same by adding pharma sector packaging to the kitty.
  6. Regulatory risk is low as they can make upto 25% use of recycled plastic in their products as per new EPR (extended producer responsibility) norms
  7. With expansion over different geographies, company is trying to build a moat by being the only player who is present closer to the clients all manufacturing facilities through out the country

Some Risks

  1. Largely a family business with many family members already working at several positions
  2. Currently they might not be able to use IML for Manufacturing Pails for Paint industry
  3. Majorly a domestic play, export will not be more than 10% as logistics cost make export unviable

Note: Invested

7 Likes