Anil Jain, Managing Director and Bharat Vageria - Director (Finance) of the company addressed the call.

Highlights of the call 

Time Technoplast (TimeTech) is a Multinational conglomerate and one of the leading manufacturers of diversified range of polymer based products.

In Q2 revenue grew 14%. India sales grew 15% and Overseas grew 13%.

Polymer products (HM-HDPE plastic Drums/Jerry Cans and Pails, Polyethylene (PE) pipes, Turf & Matting, Disposable Bins, MOX Film) accounted for 70.54% of sales in H1

Composite products (Intermediate Bulk Container (IBC), Composite Cylinders, Energy storage devices, Auto Products, Steel Drum) accounted for 26.76%.

India accounted for 69% of sales and rest came from overseas.

In Chemicals it has clients like BASF, Huntsman, Bayer, Aditya Birla Chemicals, Du Pont, Dow, Eco Lab, Solvay, Etc. In Petrochemicals clients are Shell, Indian Oil, Gulf, ExxonMobil, Total, etc. In Auto it serves Ashok Leyland, Tata Motors, Eicher Motors, Volvo, Etc. and Other clients like Cargill, GE, L&T, Nestle, Wipro, LEAP India, Etc.

Total volumes grew 11%. Volumes for India business grew 11% while that of Overseas grew 12%

India EBITDA margins stood at 14.15% while Overseas EBITDA margins were at 14.32%.

Total Debt for the six months grew from Rs 777 crore to Rs 823.4 crore.

The value added products sales grew by 25% in the six months.

The share of value added products is 20% of the total sales in H1 against 18%.

The company's focus remains to increase the share of value added products in its turnover.

Capacity utilization was 80%. In India capacity utilization was 82%. Overseas capacity utilization was 73%.

Capex stood at Rs 110.5 crore.

Capex for established Products for capacity expansion, re-engineering and automation products were Rs 82.9 crore.

Capex for value added products were Rs 27.6 crore.

Pipe business has order book of around ~20,000 MT (Rs 260. crore)

It has started supply of its newly Launched new generation multilayer PE pipes for power /communication cable duct with silicon in-lining. The pipes/ducts have substantial business potential specially in Smart Cities.

For its Industrial Packaging, the company is undergoing greenfield expansion at Silvassa, India for IBCs, Drum & Jerry Cans.

It has taken brownfield expansion in India and overseas locations continues for future growth and leveraging of existing infrastructure.

It has innovative new applications of the MOX films.

It is launching new products in the market like Truck covers, Pond Liners, Mulching Film & Poly house Films.

It is focusing on new export markets i.e. Thailand, Malaysia, Germany, UK & USA.

Borrowings grew from Rs 330 crore as of FY 2018 to Rs 439 crore in H1

The company has a strong presence in Asia & MENA regions with state-of-the-art manufacturing facilities in 10 countries.

It is the largest producer of large size plastic drums worldwide and sis market leader in 8 out of 10 countries.

It is the 2nd largest Composite Cylinder manufacturer worldwide.

The company is currently exporting composite cylinders to 28 countries and is focusing there as margins are better there.

Currently India has demand for 320 million composite cylinders but is buying just 55-60 million every year.

Private gas distribution companies are aggressively promoting & distributing cylinders across PAN India - Maharashtra, Karnataka, Tamil Nadu, West Bengal, Madhya Pradesh, Rajasthan and will be launched in Hyderabad & New Delhi very soon.

The management is optimistic of the Indian markets for composite cylinders.

The management expects revenues of composite cylinders to grow by 20% in FY 2019 and FY 2020.

The company tied-up with Dow for bringing in revolutionary technology based Smart Cans that enable the transition from large traditional rigid containers to flexible packaging options in consumer product segment.

A technology transfer agreement was signed on 28 August 2018. This ytie up will allow TimeTech to exclusively produce and sell Smart Cans in Indian sub-continent and GCC countries (including Egypt). It is a globally patented technology.

This Smart Can in collaboration with Dow would irreversibly change packaging landscape benefitting user and environment at the same time.

The company is leader in rigid plastic industrial packaging and had been looking at entering into consumer packaging which has huge business potential.

The company will start manufacture of Smart Can first at Daman and later at Sharjah (UAE). The company will go for further expansions in near future in India and other countries of its presence based on customers' acceptance. Total investment in these projects is estimated at $ 10-12 million in the next 2-3 years.

The company's focus remains to increase the share of value added products in its turnover.

The pipes / ducts have substantial business potential specially in development of Smart Cities.

Return ratios will improve as sales growth improves going forward. The management is expecting improvement on this front in the coming years.

The playing field in composite cylinders is getting even.

Going forward, the company's expenditure will rise lesser than the sales growth.

The company is targeting RoCE of 20% in three years down the line.

Historically the company has been able to pass on increase/decrease of raw material price to the customers with a lag of three months.

Overall business to grow by 15% every year till 2021 and borrowings will remain the same.

Effective tax rate should be in the range of 27% for FY 2019.

Value added business to grow by 30-35% in FY 2019.