Neutral on CCL Products India: Way2Wealth

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26 Aug, 2025 12:21

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Way2Wealth’s research report on CCL Products IndiaCCL Products India (CCL) Q2FY16 results were slightly below estimates sales declined 8.8% y-o-y to `178.1 crore, primarily on account of lower green coffee prices and a high base effect. Subsidiaries’ sales grew Impact of `5 crores was felt in the current quarter shipment of `5 crore sales which is expected in Q3FY16. On consolidated basis, other operating income declined from `2.3 crore in Q2FY16, largely on account of incentives not realised from the government. Consolidated EBITDA margin jumped 100. Consolidated PAT stood at `29.3 crores, up 12% y from Vietnam and higher tax rate. Working capital cycle was higher due to complete procurement of green coffee and increase in inventory of green coffee. The management commented that high stock was maintained on account of order in hand which will be executed in H2FY16Overall Valuation:We believe the growth levers for CCL products are well placed, except for falling coffee prices. The company’s focus on growing its presence in the domestic market with a strongramp-up of Vietnamese operations will pave the road to healthy profitable growth for the next 2-3 years. At CMP of Rs. 211.20 the stock trades at 21.3x its FY16E estimated EPS of `9.9/- We are presently NEUTRAL on the stock. For all recommendations, click here Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.

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