The management expects EBITDA margin of ~20-21% supported by stabilizing raw material prices, improved sales mix (tilt towards pharma/FMCG products that command higher margin than paints/lubes). and positive operating leverage led by improved utilisation of new plants.
OTC pharma commands higher EBITDA per kg (in the range of 180-200/kg) compared to 80-120 EBITDA per kg of F&F and 30-40 EBITDA/kg of paints and lubes, respectively.
The company is likely to start manufacturing packaging product for GSK’s OTC product Iodex.
It takes three to six months to get approval for OTC pharma products. The commercial production of pharma products is likely to start from Q3FY24 onwards.
The company has developed new moulds for 1 kg, 2 kg SKUs for Horlicks and manufacturing will start from Q4FY23 onwards.
The company plans to expand its manufacturing capacity by ~25,000 MT by FY24 (up 51% in FY22). It is likely to incur capex of 125 crore in FY23.
There was loss of production due to delay in installation of IML printing machines (amid shortage of semiconductors). The company would have recorded 15% volume growth in Q2FY23 had there not been a delay in the supply of IML printing machines. These machines are expected to commissioned by end of December 2022. This will lead to normalisation of EBITDA margin from Q4FY23 onwards.
Hyderabad will be one of the largest pharma hubs in the next two years (as 15000 acres of lands has been allotted to multiple pharma players to boost manufacturing). Mold-Tek Packaging is confident of receiving meaningful businesses from large pharma players for its IBM packaging products due to its strong R&D driven product launches and lower lead distance.
Mold Tek witnessed poor volume offtake of its dispensing pumps products from Wipro. The company is taking ~2-3 lakh pumps/month from Mold Tek vs. expectation of 20-30 lakh pumps. The company has added other customers such as ‘Himalaya’ for the same product. However, the offtake is still lower at 10 lakh pumps per month vs. overall manufacturing capacity of 50-60 lakh pumps.
The company has invested 12-13 crore for its dispensing pump machines and moulds. While the machines are fungibles and can be used to produce other FMCG products, the sunk cost of total investment will be limited to cost of moulds, which is2-3 crore (in case of business loss
There was a delay in launching QR based packaging products. The key customers under Lubes ‘Volvoline’ and ‘Castrol’ has asked Mold Tek for modification in the QR coded products. Mold Tek expects fresh orders from one of these customers from Q4FY23 onwards.
The company has received a letter of intent from Aditya Birla Group (ABG) to set up a facility at Panipat, Haryana. It is planning to acquire 2 acres of land at Panipat to set up a new plant with an investment of 30 crore to cater to the requirements of Aditya Birla Group. and Food & FMCG clients (to cater Baddi based clients). The manufacturing facility will be ready by end of CY23.
The company expects volume of 2000 MTPA from ABG group from FY25 onwards.
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Mold Tek Packaging Concall Q2FY23
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The management expects EBITDA margin of ~20-21% supported by stabilizing raw material prices, improved sales mix (tilt towards pharma/FMCG products that command higher margin than paints/lubes). and positive operating leverage led by improved utilisation of new plants.
OTC pharma commands higher EBITDA per kg (in the range of 180-200/kg) compared to 80-120 EBITDA per kg of F&F and 30-40 EBITDA/kg of paints and lubes, respectively.
The company is likely to start manufacturing packaging product for GSK’s OTC product Iodex.
It takes three to six months to get approval for OTC pharma products. The commercial production of pharma products is likely to start from Q3FY24 onwards.
The company has developed new moulds for 1 kg, 2 kg SKUs for Horlicks and manufacturing will start from Q4FY23 onwards.
The company plans to expand its manufacturing capacity by ~25,000 MT by FY24 (up 51% in FY22). It is likely to incur capex of 125 crore in FY23.
There was loss of production due to delay in installation of IML printing machines (amid shortage of semiconductors). The company would have recorded 15% volume growth in Q2FY23 had there not been a delay in the supply of IML printing machines. These machines are expected to commissioned by end of December 2022. This will lead to normalisation of EBITDA margin from Q4FY23 onwards.
Hyderabad will be one of the largest pharma hubs in the next two years (as 15000 acres of lands has been allotted to multiple pharma players to boost manufacturing). Mold-Tek Packaging is confident of receiving meaningful businesses from large pharma players for its IBM packaging products due to its strong R&D driven product launches and lower lead distance.
Mold Tek witnessed poor volume offtake of its dispensing pumps products from Wipro. The company is taking ~2-3 lakh pumps/month from Mold Tek vs. expectation of 20-30 lakh pumps. The company has added other customers such as ‘Himalaya’ for the same product. However, the offtake is still lower at 10 lakh pumps per month vs. overall manufacturing capacity of 50-60 lakh pumps.
The company has invested 12-13 crore for its dispensing pump machines and moulds. While the machines are fungibles and can be used to produce other FMCG products, the sunk cost of total investment will be limited to cost of moulds, which is2-3 crore (in case of business loss
There was a delay in launching QR based packaging products. The key customers under Lubes ‘Volvoline’ and ‘Castrol’ has asked Mold Tek for modification in the QR coded products. Mold Tek expects fresh orders from one of these customers from Q4FY23 onwards.
The company has received a letter of intent from Aditya Birla Group (ABG) to set up a facility at Panipat, Haryana. It is planning to acquire 2 acres of land at Panipat to set up a new plant with an investment of 30 crore to cater to the requirements of Aditya Birla Group. and Food & FMCG clients (to cater Baddi based clients). The manufacturing facility will be ready by end of CY23.
The company expects volume of 2000 MTPA from ABG group from FY25 onwards.