Target: ₹578
CMP: ₹439.80
is the world’s largest manufacturer of large-size plastic drums, with an impressive 50-60 per cent market share in India and a significant share in 10 other countries. It was the first company to launch intermediate bulk containers (IBC) in India and is now the third largest IBC manufacturer worldwide. Additionally, it ranks as the second largest global manufacturer of Type-IV composite LPG and CNG cylinders.
We are optimistic about its value-added composite products (LPG and CNG cascade cylinders), stable and long-standing industrial packaging (drums, jerry cans, IBC etc.) business, and focus on improving financials to turn net debt-free over the next 1-2 years.
After clocking a CAGR of 16/19/39 per cent in revenue/EBITDA/PAT over FY21-25, we estimate a CAGR of 15/16/23 per cent over FY25-28, led by strong performance in its value-added product (VAP) segment (20 per cent revenue CAGR, 18 per cent+ EBITDA margin) and strong cash flow generation. Asset monetisation, business restructuring and cost reduction measures will improve operational efficiency and strengthen the balance sheet.
We initiate coverage on Time Technoplast with a Buy rating and a target price of ₹578 based on 22x FY27E P/E (close to sector average). Our positive stance is backed by the company’s strong growth prospects, improving return ratios and attractive valuation (16x FY27E P/E).