Revenue Growth and Operating Income Trends
Between December 2012 and December 2016, Huhtamaki India’s net sales surged from ₹893.18 crores to ₹2,154.10 crores, reflecting a compound growth trajectory that underscores expanding market demand and effective business strategies. Other operating income also rose, albeit more modestly, contributing to a total operating income of ₹2,177.78 crores by the end of 2016. This growth was supported by a proportional increase in raw material costs, which climbed from ₹621.24 crores in 2012 to ₹1,472.78 crores in 2016, indicating scaling production volumes.
Employee costs and manufacturing expenses also increased over the period, consistent with the company’s expansion and operational scaling. Employee costs more than doubled from ₹70.98 crores in 2012 to ₹192.79 crores in 2016, while manufacturing expenses rose from ₹113.59 crores to ₹270.31 crores, reflecting investments in workforce and production capabilities.
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Profitability and Margins
Operating profit before depreciation and interest (PBDIT) excluding other income rose significantly from ₹89.71 crores in 2012 to ₹247.20 crores in 2016, with the operating profit margin stabilising around 11.3% in the last two years of the period. Including other income, operating profit increased to ₹264.43 crores in 2016, up from ₹97.97 crores in 2012. This improvement reflects enhanced operational efficiency and better cost management despite rising input costs.
Profit before tax (PBT) nearly doubled from ₹61.73 crores in 2012 to ₹140.14 crores in 2016, while profit after tax (PAT) increased from ₹45.12 crores to ₹88.68 crores over the same period. The consolidated net profit followed a similar upward trend, reaching ₹84.58 crores in 2016. Earnings per share (EPS) also showed a healthy rise, from ₹7.19 in 2012 to ₹11.63 in 2016, signalling growing returns for shareholders.
Cash Flow and Financial Stability
Cash flow from operating activities exhibited robust growth, climbing from ₹62.52 crores in 2012 to ₹316.25 crores in 2015, the latest year for which cash flow data is available. This strong cash generation capability supports the company’s investment and financing activities. However, cash flow from investing activities was negative, reflecting substantial capital expenditure and expansion efforts, with outflows increasing from ₹53.93 crores in 2012 to ₹501.27 crores in 2015.
Financing activities showed positive inflows in 2014 and 2015, indicating capital raising or debt management to support growth initiatives. Despite these outflows, the company maintained a stable cash and cash equivalents position, closing at ₹15.36 crores in 2015, slightly higher than the opening balance of ₹11.65 crores for that year.
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Shareholder Equity and Market Position
Equity capital remained stable at ₹14.54 crores from 2014 onwards, while reserves increased steadily from ₹339.66 crores in 2012 to ₹659.55 crores in 2016, reflecting retained earnings and accumulated profits. Public shareholding was significant in earlier years but dropped to zero by 2015 and 2016, indicating possible changes in shareholding structure or delisting from public markets.
Operating and gross profit margins have remained relatively stable, with operating margins around 11% and gross margins near 10%, demonstrating consistent profitability despite fluctuations in raw material and other costs. The PAT margin showed some variability but averaged around 4-5%, which is reasonable for the packaging sector.
Overall, Huhtamaki India’s historical performance reveals a company on a growth trajectory with improving profitability, strong cash flow generation, and a solid equity base. Investors may find the company’s steady expansion and operational efficiency encouraging, though attention to capital expenditure and market positioning remains important for future prospects.
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