Market Price Rs 658 (FV10) Analyst : Janak Shah (M.B.A. Finance)
Market Cap Rs 572 crs Date: 19th Dec 2015
Target : Rs 700 Time: 1 year target
About the Company:
TCPL Limited which is run by the K K Kanoria family and presently managed by Mr Saket kanoria. TCPL Packaging Ltd, formerly 21st Century Printers Ltd was incorporated in August 1987. It is one of leading and largest manufacturers of folding cartons in India. The company began commercial production at its plant at Silvassa, Union Territory of Dadra & Nagar Haveli, in April 1990, with a web-fed printing machine equipped with an in-line die cutter. TCPL Packaging Ltd. operates out of its six manufacturing units ; three in Silvassa, 180 kms from Mumbai in Western India ; two in Haridwar, 200 kms from Delhi in Northern India ; and one in Goa, 600 kms from Mumbai in Western India. All the plants are ISO 9001: 2008, ISO 22000: 2005 certified and are also compliant with BRC/IoP Global Standard-Packaging Issue 3, which is suitable for direct food contact. In addition, plants at Silvassa and Haridwar are also FSC certified & SEDEX Compliant. TCPL is one of the largest exporters of printed cartons from India. It regularly caters to consumers in countries like UK, The Netherlands, UAE, Bangladesh etc. Exports constitute about 22% of TCPL's annual revenues. The first client being Godfrey Phillips India (associates of Phillip Morris International).TCPL had its initial experience in the cigarette industry. The second six color rotogravure machine was commissioned at its plant in 1995. With this, it also started forays in the liquor industry TCPL is the largest manufacturer of printed folding cartons, and is one of the few listed companies in India and exports a variety of packing solutions to UAE and Europe
TCPL Packaging Ltd is one of the largest manufacturers of folding cartons. The company is currently converting approx 3600 tons of paperboard every month, making TCPL one of India’s largest converters of paperboard and range of products are printed blanks, Folding cartons, Litho Lamination, Plastic cartons, Blister paper, Shelf ready packaging. The Company’s continuous growth in the economy has created a number of opportunities for servicing the packaging requirements of the FMCG, food, tobacco, liquor and other consumer product manufacturers. Due to geographical locations of the plants set-up by Company, it is ideally suited for catering to both the export market as well as domestic market across India. Therefore, with the change in economic condition, lifestyle of people and launch of organised retail etc. the demand for packaged goods are expected to rise substantially
TCPL has a very good trackrecord. For the year 2014-15, the sales stood at Rs 497 crores and net profit was at Rs 32 crores. Dividend of Rs 6 per share was paid.
For the year 2016 & 2017, the EPS is expected to be in the region of 49 & 59 per share.
The company is available at a relatively less PE if we compare it to its peers. The new expansion which has been completed will add to the turnover.
Book value per share is Rs 152
Promoters holds about 58.42% while public holding stands at 41.54
The Company has made substantial expansion at Haridwar by commencing its second full fledged plant with effect from September 26, 2015. This expansion will add significantly to the topline and bottomline.
The current rate of Rs 658 per share is tipped to touch 700 in the next 1 year time frame. It is a very transparent company with good corporate governance and honest promoters.
( Disclosure: The analyst has no holdings in the company as on date of issue being published) Sebi Registration No: INH000001717