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

Highlights of the call

For the quarter ended March 2018, it registered a 16% rise in consolidated sales to Rs 942.70 crore. OPM improved from 13.9% to 15.5% which saw OP rise 30% to Rs 145.91 crore. PBT went up 40% to Rs 83.72 crore. Net profit went up 29% to Rs 55.35 crore.

For FY 2018, consolidated sales grew 13% to Rs 3102.74 crore. OPM improved from 14.7% to 15.2% which saw OP rise 17% to Rs 473.07 crore. Net profit went up 23% to Rs 180.37 crore.

In 2018, revenues grew on the back of around 19% jump in volumes. India volumes grew 18% and overseas 20%.

In FY 2018, revenues grew on the back of around 16% jump in volumes. India volumes grew 14% and overseas 17%.

FY 2018 was impacted by demonetization and GST

Value added products grew 51% and its share grew to 18% of sales against 12% in FY 2017.

India accounts for 70% of sales and overseas accounted for 30% against 71% and 29% each last year.

RoCE improved by 103 bps to 15.71%. If pipes business would have been normal, RoCE would have grown by 50 bps more.

Q4 was significantly better than first three quarters and that should be the basis for future performance.

Brownfield project for doubling capacity of composite cylinders and MOX films came towards the end of FY 2018. So this had not contributed. The capacity utilization was 70% for composite cylinders and 65% for Mox films before this expansion. These are value added products. The management is optimistic for both these products. Capex for both were Rs 110 crore. Out of which Rs 65 crore was for Mox films and Rs 45 crore for composite cylinders.

Capex for 12000 tons of Mox films was Rs 120 crore

The company does not give any credit for Mox film sales.

DWC pipes capacity is only 9000 tons.

Value added business grew by 51% in FY 2018 and regular products grew by 10% in FY 2018.

Segmental reporting could be changed by the end of the year.

Packaging business grew 10.1% in FY 2018.

Pipes revenues were Rs 235 crore in FY 2018 while the target was Rs 360 crore. Pipes business got impacted due to GST. Or else overall sales would have been made Rs 120 crore or 4.5% higher.

Pipe business which has been amongst the fastest growing business over the last few years, was impacted in FY18 because of GST issues. However, the order flow under the GST regime is back to normal and management expects pipes to make up for the lost business in FY19 and be back on fast growth track. Order book of PE Pipes is ~16,000mt (Rs 190 crore) and that of DWC Pipes is 1500mt (Rs 18 crore).

Pipes business will not only make up for the lost business of FY 2018 but will grow on it. The management hopes to do sales of Rs 400 crore in FY 2019.

The company which filed FIR on Time Techno is a trading company and does not have any technical knowhow. He suffered because his project got delayed in Bangladesh due to change of government there. That is why he was looking for an escape route. The company has filed a case against the person and he has assured the court that he would not say anything derogatory against the company or its products. The issues which he had put it up on the site have been now removed.

The company has filed a defamation case with a claim was Rs 20 crore and $ 15 million for not honouring the contract.

The company makes raincoats, car covers, etc from Mox films. This will help it utilize the capacity.

For Packaging business the company is targeting volume growth of 14-15% including both domestic and overseas sales.

Management reiterated FY21 revenue target of Rs 5000 crore, 15% EBITDA margin, 20% RoCE and Net Debt to EBITDA < 2x at any point during this period.

Rising crude prices are a cause of concern. However, since new age polymers are being produced through gas route, the prices are relatively stable thus rising crude prices do not impact the polymer prices much. However, since RM is also imported, volatile currency impacts the landed cost.

In FY18, the capex was Rs 240 crpre out of which Rs 120 crore was towards Regular/Maintenance Capex and Rs 120 crore was towards VAP.

For FY 2019, capex target is around Rs 200 crore of which 50% would be towards maintenance.

The company is in process to start a facility near Bangalore to cater to Southern market. Plants at Hosur and Gummidipoondi (Tamil Nadu) are running at high utilisations with limited scope of increasing capacity.

The company continues to work on the innovative products pipeline and shall be introducing new products at an appropriate time.

In FY 2018 the company did the following capacity enhancements:

Composite cylinders: Doubled capacity from 700k to 1.4mn units

MOX films: Doubled capacity from 6000mt to 12,000mt

Intermediate Bulk containers (IBC): Expansion at three overseas locations Malaysia, Vietnam and Sharjah (UAE). With this, TIME has IBC manufacturing facilities at all overseas locations.

TPL Plastech Ltd (subsidiary) has set up greenfield manufacturing facility for Industrial Packaging products at Vizag(AP).

The company increased polymer processing capacity by 24,000mt at various existing locations.