Buy Mold-Tek Packaging; target of Rs 957: Geojit Financial Services

Geojit Financial Services is bullish on Mold-Tek Packaging has recommended buy rating on the stock with a target price of Rs 957 in its research report dated June 12, 2024.

Broker Research

June 12, 2024 / 14:05 IST

Buy

26 Aug, 2025 12:21

Volume

Todays L/H

Geojit Financial Services research report on Mold-Tek Packaging

Mold-Tek Packaging Ltd. (MTEP) is one of the leading manufacturers and suppliers of high quality airtight and pilfer proof containers/ pails in India for paints, lubricants, food and FMCG. The long-term outlook for MTEP is promising, bolstered by the launch of new products like pharma packaging, strong client acquisition, a healthy balance sheet, and a RoE of 15% (avg. 5 years). FY24 revenue declined by 4.3% YoY, led by subdued volume from the largest segment, i.e., paints, and a fall in realization due to softness in RM costs. EBITDA/kg was down by 6.2 YoY at Rs. 37.3, while margins improved by 50bps YoY to 19.1%, led by a drop in input prices. Net profit declined by 17.2% YoY. The earnings miss for FY24 on account of subdued volumes from the paints segment (~50% of sales) have already factored in stock price (33% correction in the last year).

Outlook

We anticipate volume growth of 15.6% CAGR over FY24-26E, with pick-up in volumes from paints and the F&F segment, steady growth in lubes, and traction in pharma packaging. We value MTEP at a P/E of 31x on FY26E and upgrade to BUY from Accumulate rating with a target price of Rs.957.

For all recommendations report, click here