Time Technoplast Limited

Time Technoplast reported a strong Q3 FY26 with revenue increasing 13% YoY to INR1,567 crores and PAT growing 25% YoY to INR126 crores. For the 9-month period, revenue rose 11% to INR4,433 crores, and PAT increased 21% to INR337 crores. Volume growth for 9 months stood at 15%, with composite volume growing 21% and the CNG Composite Cascade segment achieving 23% growth. The company's ROCE for 9 months reached 18.6%, nearing its FY26 target of 20%.

The company made significant progress in debt reduction, decreasing total debt by INR380 crores to INR266 crores as of the 9-month period end. Management aims to achieve a debt-free status within the next 6 months. This reduction is expected to lower annualized finance costs from INR90-100 crores to INR25-30 crores, primarily covering non-fund based facilities. The balance of INR460 crores from the QIP is currently held in FD accounts, earmarked for value-added products and brownfield expansion.

Demand for Type 4 composite cylinders remains strong, reflected in a healthy order book of INR165 crores. The expansion of the composite product facility, which began two years ago, is nearing completion, with commercialization expected from April 2026. This expanded capacity, combined with existing facilities, is projected to generate INR800 crores in revenue within two years. New products like 6kg and 9kg fire extinguishers are ready for commercialization by April 2026, and 250-liter CNG cylinders are awaiting approval within 45-60 days.

Time Technoplast is actively transitioning to green energy, with solar power initiatives expected to yield substantial cost savings. Benefits from solar power in Gujarat have commenced this month, projected to save INR10 crores annually from next year onwards. Similar benefits are anticipated from Maharashtra following policy clearances. The company's overall power benefit for FY26-27 is estimated at approximately INR10 crores, with the investment equivalent to one year's savings and benefits extending for 14 years.

The company is focused on enhancing operational efficiency through automation, consolidation of manufacturing units, and reengineering. Automation investments, totaling INR75 crores from QIP funds, are expected to contribute INR20 crores to EBITDA margin and have a payback period of four years. The working capital cycle has improved from 120 days to 98-99 days and is targeted to reach 90 days within the next 2-3 years, driven by better inventory, receivables, and creditor management.

Key growth drivers include packaging (11-13% growth), composite products (25-30% growth), and PE pipes (>20-25% growth), leading to a consolidated growth projection of over 15%. The subsidiary TPL Plastech, which is 75% owned, has shown strong growth exceeding 25% in both revenue and PAT, with an ROCE of over 22%. Its new Lote-Parshuram plant, involving an investment of INR30-35 crores, is expected to generate over INR100 crores in revenue within three years.