CRISIL maintains fair value of Rs 71 to Time Technoplast

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CRISIL maintains fair value of Rs 71 to Time Technoplast

CRISIL Research has come out with its report on Time Technoplast. The research firm has initiated coverage on the company with a valuation grade of 3/5, fundamental grade of 4/5 and maintained fair value of Rs 71 per share, in its August 09, 2011 report.

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CRISIL Research has come out with its report on Time Technoplast . The research firm has initiated coverage on the company with a valuation grade of 3/5, fundamental grade of 4/5 and maintained fair value of Rs 71 per share, in its August 09, 2011 report.

Time Technoplast Ltd's (Time's) Q1FY12 results were in line with CRISIL Research's expectations. Revenue growth was strong, driven by both polymer and composite products. Although EBITDA margin was lower y-o-y as Q1FY11 was an exceptionally good quarter, it grew sequentially by ~320 bps to a healthy 18.6% and was in line with our expectations. PAT grew by 21%, also in line with our estimates. We continue to remain positive on Time's growth prospects in view of its leadership position in the industrial packaging market, expansion into new Asian markets and innovative product launches. We may revisit our estimates post interaction with the management. We maintain our fundamental grade of 4/5.

Q1FY12 result analysis
• Revenues grew 40% y-o-y (de-grew 9% q-o-q) to Rs 3,470 mn due to growth in both segments - polymer (44%) and composite products (11%).

• EBITDA margin was 243 bps lower y-o-y at 18.6% due to increase in employee costs and other expenses. However, it increased sequentially by 322 bps.

• PAT grew 21% y-o-y (8% q-o-q) to Rs 285 mn. EPS for the quarter was Rs 1.4 compared to Rs 1.1 in Q1FY11.

Valuations: Current market price is aligned
We continue to use the discounted cash flow method to value Time. We maintain our fair value of Rs 71 per share. At the current market price, the valuation grade is 3/5, says CRISIL Research report.

Disclaimer: This report (Report) has been commissioned by the Company/Investor/Exchange and prepared by CRISIL. The report is based on data publicly available or from sources considered reliable by CRISIL (Data). However, CRISIL does not guarantee the accuracy, adequacy or completeness of the Data / Report and is not responsible for any errors or omissions or for the results obtained from the use of Data / Report. Opinions expressed herein are CRISIL's opinions as on the date of this Report.  The Data / Report are subject to change without any prior notice. Nothing in this Report constitutes investment, legal, accounting or tax advice or any solicitation, whatsoever. The Report is not a recommendation to buy / sell or hold any securities of the Company. CRISIL especially states that it has no financial liability, whatsoever, to the subscribers / users of this Report. This Report is for the personal information of the authorized recipient only. This Report should not be reproduced or redistributed or communicated directly or indirectly in any form to any other person or published or copied in whole or in part especially outside India, for any purpose.

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