Detailed Narrative
FY25 Financial Performance Overview
TCPL Packaging reported a strong FY25 with consolidated revenue reaching ₹1,770 crore, marking a 15% year-on-year increase. EBITDA grew by 17% to ₹293 crore, improving margins to 16.6%. PAT saw a significant 44% rise to ₹143 crore, while cash profit increased by 21% to ₹249 crore. Q4 FY25, however, was relatively softer, with revenue up 5% YoY to ₹422 crore, EBITDA at ₹72 crore (17% margin), and PAT growing 33% YoY to ₹38 crore.
Strategic Investments and Capacity Expansion
The company is establishing an in-house gravure cylinder manufacturing facility in Silvassa, with an annual capacity of approximately 12,000 cylinders, expected to be commissioned by Q3 FY26. This facility aims to strengthen backward integration and improve quality. Additionally, a new Greenfield facility near Chennai, focused on paperboard cartons, was inaugurated and is expected to ramp up over the next 6 to 12 months, extending the company's manufacturing footprint in Southern India. FY25 capex was about ₹150 crore, with ₹50 crore still in progress, and FY26 capex is anticipated to be lower.
Sustainability and ESG Commitments
TCPL Packaging has announced a target to achieve carbon neutrality for operational Scope 1 and 2 emissions by 2040, using FY23-24 as the base year. This commitment is part of a broader sustainability roadmap, supported by EY as an ESG consultant. The company emphasizes the paperboard industry's green credentials and aims to meet evolving global customer expectations for net-zero supply chains.
Domestic and Export Business Outlook
Management expressed optimism for FY26 domestic business, driven by the new Chennai plant catering to a new geography and existing customer developments. The macro commentary, including Q4 GDP print and rural sector recovery, also supports this view. Export business has seen strong growth for several years, and while sustaining the same percentage growth is challenging due to a higher base, the company remains bullish due to a robust enquiry pipeline and developments in new markets like the U.S. and North America, alongside India's new FTAs.
Operational Efficiency and Utilization
The company's overall capacity utilization is currently around 70% odd, with Innofilms (specialty films) operating at 60-70% utilization. Management noted that the domestic industry has become more volatile, with fluctuations in inventory and demand planning. They aim to improve working capital days, which are currently around 95-100 days. From existing capex, the company expects to achieve peak sales of over ₹2,000 crore.
Creative Offset and Innofilms Performance
Creative Offset, a subsidiary, is expected to grow faster in FY26 than in FY25, with hopes of positively contributing to the company's bottom line and achieving breakeven at the profit before tax level soon. Innofilms, which merged into TCPL, has resolved machinery issues and is performing well, catering to both internal polyethylene film requirements and external demand for specialty films, with utilization at 60-70%.