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

Highlights of the call

For the quarter ended December 2017, it registered a 12% rise in consolidated sales to Rs 754.70 crore. OPM improved from 15.3% to 15.4% which saw OP rise 13% to Rs 116.29 crore.

Volumes grew 14% for India and 17% overseas during the quarter.

Net profit went up 28% to Rs 46.74 crore.

For the nine months, consolidated sales grew 11% to Rs 2160.05 crore. OPM improved from 15.0% to 15.1% which saw OP rise 12% to Rs 327.16 crore.

Volume grew 15%. Volumes in India grew 13% and overseas grew 17%.

Net profit went up 20% to Rs 125.02 crore.

India accounted for 70% of sales and overseas sales accounted for 30%. This is against 71%:29% in FY 3017.

India EBITDA margins stood at 15.38% and Overseas EBITDA margins stood at 14.74% during the nine months. The same in Y2017 were 15.16% & 14.30%.

The company has 900+ institutional customers globally.

The company is 2nd largest Composite Cylinder manufacturer worldwide. It has the largest range of composite cylinder worldwide (2kg-22kg).

It is the 3rd largest Intermediate Bulk Container (IBC) manufacturer worldwide.

It is the largest producer of large size plastic drums worldwide and is market leader in 8 out of 9 countries.

Nine month finance cost reduced by 61 bps (from 3.52% to 2.91%)

Total gross debt as of Dec.'17 stood at Rs 740.4 crore as against Rs 722.1 crore. This

Net cash from Operating Activities for the nine months was Rs 176.2 crore.

Cash Balance as on December was Rs 75 crore.

Capex for the nine months stood at Rs 170.9 crore.

Regular & Maintenance Capex was Rs 42.4 crore.

Value Added Products capex was Rs 128.5 criore.

Capex budget for FY 2018 is Rs 234.7 crore.

Value added products grew 43.65% for the nine months to Rs 398.70 crore.

Value added products contribution grew from 14% to 18%.

Established products grew 5.67% for the nine months to Rs 1762.40 crore.

Value added products contribution fell from 86% to 82%.

Overall capacity utilization stood at 82%.

Capacity utilization in India was 87% and in overseas was 70%.

PE Pipes has healthy order book of around 15,000 MT or Rs 185.0 crore.

The company is witnessing increasing demand of Double Walled Corrugated (DWC) pipes. Orders in hand for DWC pipes stands at 1250 MT. 

The company started supply of composite cylinder to private LPG distributor in India and creating more and more awareness to penetrate the market.

HPCL has finally launched composite cylinder in Pune and will soon be launched in Mumbai. Thus it means that not only HPCL but other will also come out with the same. IOC and BPCL is coming out with tenders soon and the company will participate in the same.

Brownfield expansion at Malaysia for IBCs is completed. With this the company now has 9 overseas IBC manufacturing facilities.

The company is setting up a production facility for Tight Head and Open Top Steel Drums, up to 220 liters (55 gallons) capacity, for the ever-growing petro-chemical & chemical industries in UAE with a capacity of over 2 million drums per annum. The investment could be around Rs 35 crore for 1.8 million drums per year. Balmer Lawrie is currently the leader in this business.

Expansion is going on to double the MOX films capacity from 6000 MT to 12000 MT at its existing location.

Pipe business which was supposed to grow rapidly will now grow slowly.

Polymer prices were lower as new capacities were coming. The company passed down this benefit to its customers.

Mox Films business was Rs 15 crore for the quarter and Rs 43 crore for the nine months against the target of Rs 105 crore for the FY 2018.

In volume terms it was 620 tons for the quarter and 1790 tons for the nine months

Pipe business had target of Rs 360 crore business in FY 2018 against this the company will do around Rs 200 crore in FY 2018

Composite cylinder has order book of 1.5-1.6 million units.

There are no major risks to the company's guidance of improving RoCE till 20-21. The company had previously said that "From here onwards till FY 2020-21 its RoCE will increase by 200 basis points every year. And the internal RoCE target in FY 2020-21 is 21-22%"