#SALES #GROWTH
During FY25, the net sales grew by 25.2% YoY and stood at โน1,422 cr. The growth was led both MF and Non-MF segment. The growth in the asset-based revenue was lower as compared to the AUM growth and non asset-based revenue growth was led by transactions revenue. NonMF revenue growth was led by CAMS KRA, AIF and CAMS Pay business. In Q1 FY26, the net sales grew by 7% YoY to โน354 cr led by growth in the mutual fund business. The growth in the asset-based revenue (10% YoY) was lower than the AUM growth (20.8%) due to contraction in the yields on account of resetting of rates for a large customers. However, non asset-based revenue was flat on account of lower NFO compared to previous year and some price reduction. Non MF revenue was flat on account of de-growth in the KRA business.
During FY25, the net sales grew by 25.2% YoY and stood at โน1,422 cr. The growth was led both MF and Non-MF segment. The growth in the asset-based revenue was lower as compared to the AUM growth and non asset-based revenue growth was led by transactions revenue. NonMF revenue growth was led by CAMS KRA, AIF and CAMS Pay business. In Q1 FY26, the net sales grew by 7% YoY to โน354 cr led by growth in the mutual fund business. The growth in the asset-based revenue (10% YoY) was lower than the AUM growth (20.8%) due to contraction in the yields on account of resetting of rates for a large customers. However, non asset-based revenue was flat on account of lower NFO compared to previous year and some price reduction. Non MF revenue was flat on account of de-growth in the KRA business.
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#EBITDA #MARGIN
EBITDA margin for FY25 stood at ~45.9%. It improved by 150 bps on a YoY basis. The company continues to enjoy a healthy EBITDA margin due to high degree of operating leverage. The company announced a strategic partnership with Google Cloud. This is to rebuild their RTA platform as the existing platform is decade old. The transition would take 4-5 years in a phased manner, however the management guided that the impact on the margins would not be more than 0.5%. EBITDA margin for Q1 FY26 stood at ~43.6%. It improved by 164 bps on a YoY basis.
EBITDA margin for FY25 stood at ~45.9%. It improved by 150 bps on a YoY basis. The company continues to enjoy a healthy EBITDA margin due to high degree of operating leverage. The company announced a strategic partnership with Google Cloud. This is to rebuild their RTA platform as the existing platform is decade old. The transition would take 4-5 years in a phased manner, however the management guided that the impact on the margins would not be more than 0.5%. EBITDA margin for Q1 FY26 stood at ~43.6%. It improved by 164 bps on a YoY basis.
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#ROCE
The ROCE in FY25 improved to 61.7%, on account of better operational performance resulting in a higher PBIT. The company has been generating an average ROCE of 58.4% over the last five years.
The ROCE in FY25 improved to 61.7%, on account of better operational performance resulting in a higher PBIT. The company has been generating an average ROCE of 58.4% over the last five years.
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#ROE
In FY25, the return on equity improved to 48.1%. The net worth of the company has been increasing over the years on account of increased retained earnings.
In FY25, the return on equity improved to 48.1%. The net worth of the company has been increasing over the years on account of increased retained earnings.
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#MANAGEMENT
The management team has extensive experience in a variety of financial services sectors, with a demonstrated ability to grow and diversify the business and innovate its services The board of directors collectively possess an effective mix of skills and attributes with significant business, operational, technology, finance, insurance, legal and investment experience in a diverse range of industries. Looking ahead, the management is making strong efforts to enhance its leadership position in the mutual fund industry, AIF PMS segment and to focus on new business lines.
The management team has extensive experience in a variety of financial services sectors, with a demonstrated ability to grow and diversify the business and innovate its services The board of directors collectively possess an effective mix of skills and attributes with significant business, operational, technology, finance, insurance, legal and investment experience in a diverse range of industries. Looking ahead, the management is making strong efforts to enhance its leadership position in the mutual fund industry, AIF PMS segment and to focus on new business lines.
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#COMPANY #POTENTIAL
โข The RTA industry is duopoly in nature. This means that there is an entry barrier for any other company to enter the sector led by greater technology intensity and compliance requirement, deeper integration with MF ecosystem making MF-RTA relationship sticky. โข The AUM of the Indian Mutual Fund Industry is expected to sustain double digit CAGR growth of 14% between FY22 - FY27 to reach ~โน74 lakh crore from โน38.4 lakh crore. (source- CRISIL) โข AIF industry to grow at a CAGR of 27%-29% between FY22 - FY27 to reach โน9.7 lakh crore from โน2.8 lakh crore. The growth is expected on the back of RBI allowance of foreign investment. (source- CRISIL) โข The AUM of NPS (National Pension Scheme) is expected to grow at a CAGR of 18%-19% between FY22 - FY27 to reach โน16.7 lakh crore from โน7.2 lakh crore, owing to rise in subscriber base due to tax benefit provided by NPS.
โข The RTA industry is duopoly in nature. This means that there is an entry barrier for any other company to enter the sector led by greater technology intensity and compliance requirement, deeper integration with MF ecosystem making MF-RTA relationship sticky. โข The AUM of the Indian Mutual Fund Industry is expected to sustain double digit CAGR growth of 14% between FY22 - FY27 to reach ~โน74 lakh crore from โน38.4 lakh crore. (source- CRISIL) โข AIF industry to grow at a CAGR of 27%-29% between FY22 - FY27 to reach โน9.7 lakh crore from โน2.8 lakh crore. The growth is expected on the back of RBI allowance of foreign investment. (source- CRISIL) โข The AUM of NPS (National Pension Scheme) is expected to grow at a CAGR of 18%-19% between FY22 - FY27 to reach โน16.7 lakh crore from โน7.2 lakh crore, owing to rise in subscriber base due to tax benefit provided by NPS.
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#COMPANY #OUTLOOK
โข The management guided that the revenue from the new businesses like account aggregator, insurance repository, AIF would result in an increase in the share of Non-MF based revenue. โข The EBITDA margins is expected to be in the range of ~45%, going forward due to cost optimisation measures and operating leverage benefit. โข The dematerialization of insurance could act as another potential trigger for growth. โข Their proprietary payment gateway infrastructure for cards became operational with Mastercard, RuPay and Visa. โข Due to telescopic pricing and contract renewal, there could be pressure on the yields, going forward or vice versa. They guided yields to contract by ~6%-7% in FY26. So, in line with guidance a large part of contraction has already happened. However, they โข They have emerged as one of the top players in the country in BFSI for UPI AutoPay. donโt expect any sharp decline in yields for next 18-24 months apart from telescopic price impact of 3%-3.5% per year. โข In FY26, the management guided to target a revenue of ~โน11-โน12 crore and to achieve breakeven in the account aggregator business. โข They guided for employee cost rationalization on account of automation initiatives undertaken by them, going forward. โข They aim Non-MF revenue to grow by 24%-25%, in FY26. For the next three years they target a growth of ~20%-25% in this segment.
โข The management guided that the revenue from the new businesses like account aggregator, insurance repository, AIF would result in an increase in the share of Non-MF based revenue. โข The EBITDA margins is expected to be in the range of ~45%, going forward due to cost optimisation measures and operating leverage benefit. โข The dematerialization of insurance could act as another potential trigger for growth. โข Their proprietary payment gateway infrastructure for cards became operational with Mastercard, RuPay and Visa. โข Due to telescopic pricing and contract renewal, there could be pressure on the yields, going forward or vice versa. They guided yields to contract by ~6%-7% in FY26. So, in line with guidance a large part of contraction has already happened. However, they โข They have emerged as one of the top players in the country in BFSI for UPI AutoPay. donโt expect any sharp decline in yields for next 18-24 months apart from telescopic price impact of 3%-3.5% per year. โข In FY26, the management guided to target a revenue of ~โน11-โน12 crore and to achieve breakeven in the account aggregator business. โข They guided for employee cost rationalization on account of automation initiatives undertaken by them, going forward. โข They aim Non-MF revenue to grow by 24%-25%, in FY26. For the next three years they target a growth of ~20%-25% in this segment.
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Cams 600-750
Expected level 950
Support 545
Expected level 950
Support 545
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TIME TECHNOPLAST company details report
Time technoplast is a leader in polymer-based industrial packaging in India and ranks among the top three players globally. It is the worldโs largest manufacturer of large-size plastic drums, holding an impressive 50-60% market share in India as well as a high share across 10 global markets (excluding the US, which is dominated by three large players). ๏ฎ TIME was the first company to launch IBCs in India, and ranks as the third-largest IBC manufacturer worldwide. It is also the second-largest MOX film manufacturer and a major manufacturer of HDPE pipes in India. It caters mainly to companies in the specialty chemicals and non-cyclical sectors (FMCG, F&B, and paints). ๏ฎ Over time, TIME has secured a significant share of business from its long-term relationships with global Fortune 500 companies. These factors have enabled the company to steadily grow its volume to 8-12% in its Established Products (73% revenue mix) while maintaining an EBITDA margin of 12-14%, even amid a volatile environment.
Time technoplast is a leader in polymer-based industrial packaging in India and ranks among the top three players globally. It is the worldโs largest manufacturer of large-size plastic drums, holding an impressive 50-60% market share in India as well as a high share across 10 global markets (excluding the US, which is dominated by three large players). ๏ฎ TIME was the first company to launch IBCs in India, and ranks as the third-largest IBC manufacturer worldwide. It is also the second-largest MOX film manufacturer and a major manufacturer of HDPE pipes in India. It caters mainly to companies in the specialty chemicals and non-cyclical sectors (FMCG, F&B, and paints). ๏ฎ Over time, TIME has secured a significant share of business from its long-term relationships with global Fortune 500 companies. These factors have enabled the company to steadily grow its volume to 8-12% in its Established Products (73% revenue mix) while maintaining an EBITDA margin of 12-14%, even amid a volatile environment.
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A leader in industrial packaging in India and the third largest globally
TIME categorizes its business into two verticals: 1) Polymer Products (64% of the revenue mix) and 2) Composite Products (36% of the revenue mix). However, from a product segment perspective, it categorizes its business into: a) Established Products (73% of the revenue mix) and b) Value-added Products (VAP; 27% of the revenue mix).
TIME categorizes its business into two verticals: 1) Polymer Products (64% of the revenue mix) and 2) Composite Products (36% of the revenue mix). However, from a product segment perspective, it categorizes its business into: a) Established Products (73% of the revenue mix) and b) Value-added Products (VAP; 27% of the revenue mix).
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Strong and established business model
TIME largely follows a B2B business model (~95% of total revenue). It works with a diversified base of over 900 institutional customers, mainly from the chemicals, FMCG, and pharmaceuticals industries globally. The company has established strong and long-standing relationships with many of these clients. It maintains low customer concentration, with no single client contributing more than 5% to its total revenue. It also benefits from a diversified and strong sourcing/supplier base, procuring most of its raw materials locally through multiple suppliers located near its manufacturing plants. Additionally, TIME effectively manages price volatility through its robust pass-through mechanism. Industrial packaging is a working capital-intensive business, typically operating at a gross margin of ~25%, which restricts manufacturersโ return profiles. Additionally, there is a substantial global reconditioning market where these products are cleaned and reused 3-4 times before ultimately being recycled.
TIME largely follows a B2B business model (~95% of total revenue). It works with a diversified base of over 900 institutional customers, mainly from the chemicals, FMCG, and pharmaceuticals industries globally. The company has established strong and long-standing relationships with many of these clients. It maintains low customer concentration, with no single client contributing more than 5% to its total revenue. It also benefits from a diversified and strong sourcing/supplier base, procuring most of its raw materials locally through multiple suppliers located near its manufacturing plants. Additionally, TIME effectively manages price volatility through its robust pass-through mechanism. Industrial packaging is a working capital-intensive business, typically operating at a gross margin of ~25%, which restricts manufacturersโ return profiles. Additionally, there is a substantial global reconditioning market where these products are cleaned and reused 3-4 times before ultimately being recycled.
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TIME technoplast is the world's largest manufacturer of largesize plastic drums, with an impressive 50-60% 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, TIME ranks as the second largest global manufacturer of Type-IV composite LPG and CNG cylinders. ๏ถ 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. ๏ถ After clocking a CAGR of 16%/19%/39% in revenue/EBITDA/PAT over FY21-25, we estimate a CAGR of 15%/16%/23% over FY25-28E, led by strong performance in its value-added product (VAP) segment (20% revenue CAGR, 18%+ EBITDA margin) and strong cash flow generation. Asset monetization, business restructuring, and cost reduction measures will improve operational efficiency and strengthen the balance sheet. ๏ถ Despite annual capex of ~INR1.7b, we estimate pre-tax RoCE/RoIC to expand from ~18% each in FY25 (FY24: 16-17%) to ~23%/26% in FY28 on healthy operating performance, improved plant efficiency and tightening of net working capital cycle (by 10-15 days). An estimated annual FCF of INR4b+ will be used to pare debt and achieve net cash status in FY27E (vs. net debt of INR5.9b/4.7b in FY24/FY25). We estimate healthy OCF/EBITDA (~60%+) and FCF/PAT (80%+) over the next three years.
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