Hold Time Technoplast; target of Rs 58: ICICI Direct

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26 Aug, 2025 12:21

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ICICI Direct's research report on Time Technoplast

Time Technoplast reported an improved QoQ recovery in Q3FY21 supported by improved demand from user industries. While the management expects pre-Covid level sales in Q4FY21 over Q4FY20, the FY21 revenue recovery is likely to be in the range of 75-80%. Going forward, the management anticipates a normalised FY22 with focus on increased revenue contribution from value added product (currently ~21% of topline) and execution of orders in the PE pipe segment (order book is ~Rs 250 crore). On the balance sheet front, the company is looking at RoCE of ~20% in the next three years supported by improved plant utilisation and margin profile (due to rising contribution of value added product category).

Outlook

We tweak our earnings estimate upward by ~11% and 4% for FY21 and FY23E, respectively. We believe improved product mix would help drive EBITDA margin going forward. Further, marginal debt reduction via positive CFO would keep overall D/E below 0.5x. We maintain HOLD on the stock with a revised TP of Rs 58 (valuing at 4x EV/EBITDA FY22E, earlier TP Rs 43).

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