Mold Tek Packaging Q4FY17 Concall Summary

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Financial Highlights:

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  • This year Volume growth by 12%
  • EBITDA is up by 13% and EPS is up to 9.75 from 8.7.
  • Rs 95 Lakhs deduction of stock valuation due to shortage of material.
  • Rs 30 crores business from Dairy Milk Lickables during 2017-18, 35 crores projected for next year.
  • Expected to cross 15% Growth in financial year 2017-18
  • Have to invest at least 25 Crore in year 2018-19
  • CapEx at 244 Crores in 2016-17
  • Debt at 149 Crores in year 2017, Last year it was 115 Crores
  • Got 80 Lakhs worth of discount in Q3FY17
  • Break even to be achieved by FY2018
  • 18.66% Increase in Employees cost paid in last quarter
  • J Lakshmana Rao as promoter increased his Share to around 35% and Rules out buyback
  • No Plan to increase Debt as cash position is healthy. Free fund to tune of 30 crores still available for investments.
  • Quarterly sale up by more than 50% from IML, 270 tons of RAK sold
  • No addition of top line from Asian Paints plant.
  • Major growth from FMCG and RAK contribution (from next year)
  • Spending on FMCG unit to grow as it is not seasonal and provide stream of revenue throughout the year
  • Dairy milk lickables will contribute around 10% growth alone. The growth combined with RAK would safely lead to more than 20% growth in sales.

Operational Highlights:

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  • IML grew from 44% to 49%. IML contribution to 4th Quarter was 52.7%
  • Drop in stock value of raw material (Rs. 6 below market price) was observed leading to total of 95 lakh drop.
  • Overall volume for 2017 is 18830 tons as compared to last year at 16,880 tons
  • Company expanding it product portfolio by adding products like ice creams, cheese, butter etc.
  • Plant started getting reasonable traction. Utilization in range of 25%-30%
  • 15% increase in spend on food and FMCG unit
  • Raw material is stocked for 10 to 20 days
  • Loss in first four months of Operation of new unit asIt has just started and has very little capacity utilization at this point of time.

Customers and competition

  • Asian Paints contributes 30% to sales
  • One more order from Cadbury, Mondelez
  • Talks are on with Heinz, Danone, TATA Tea etc.
  • Couple of players from Delhi and Bombay pose as competition


  • 80% capacity utilization is realistic given the product mix.
  • RAK Facility capacity is almost 27,000 with 3000 recently added in year 2017
  • Plant building in Mysuru and Vizag to be completed soon.

Effect of demonetization

  • Thanks to First two quarters, where we could grow at 20%. Essentially Demonetization brought down growth volume from 20% to 4% for next two quarters. Third quarter ended with a negative growth.
  • Effect of Demonetization still lingering over business with GST adding to the woes.
  • Slow growth rate is observed in lubes and paints business. Additionally, demonetization would lead to uncertain adverse impact on these businesses.