Ideal Technoplast Industries Ltd. (ITIL) is making waves in the rigid plastic packaging sector, offering specialized solutions for industries ranging from paints and chemicals to cosmetics and food. With a presence in both domestic and international markets, ITIL’s innovative approach, including the use of In-Mould Labelling (IML) via robotic automation, sets it apart. This technology not only enhances production capacity but also ensures the highest quality standards, with stringent testing at every stage from raw material to final product.
The company specializes in manufacturing square containers, known for their durability and ease of handling, using fully automated machinery equipped with robotic arms. This reduces human intervention, ensuring consistency and quality. The technology includes advanced labelling techniques like Heat Transfer Mould Labeling, which allows direct printing on containers, boosting efficiency and maintaining product quality. Custom-designed moulds further enable ITIL to meet specific customer needs, making it a leader in its niche.
On August 21, 2024, ITIL is set to launch its Initial Public Offering (IPO), offering 1,325,000 equity shares at a fixed price of INR 121 per share, aiming to raise INR 16.03 crore. This IPO, constituting 26.50% of the post-IPO paid-up capital, will close on August 23, 2024. The funds raised will primarily be used for capital expenditure and general corporate purposes, with INR 1.60 crore allocated for the IPO process itself.
Managed by Swastika Investmart (BO:SWAF) Ltd., with Bigshare Services Pvt. Ltd. as the registrar and Sunflower Broking Pvt. Ltd. as the market maker, ITIL is looking to enhance its paid-up equity capital from INR 3.68 crore to INR 5.00 crore. Post-IPO, the company’s market cap is expected to reach INR 60.50 crore.
Financially, ITIL has shown impressive growth, particularly in FY24, raising questions about the sustainability of its performance. With average earnings per share (EPS) of INR 2.18 over the last three years and a return on net worth (RoNW) of 17.25%, the company’s valuation post-IPO seems fully priced, with a price-to-earnings (P/E) ratio of 16.97 based on FY24 earnings.
While ITIL operates in a competitive market with listed peers like Mold-Tek Packaging and Time Techno, its sudden surge in earnings has raised some concerns. Investors are advised to consider the potential for long-term growth, but to approach with caution given the company’s small equity base post-IPO and the competitive nature of the industry.
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