Thread by @StocksResearch

ACE Equities Delivery/SIP Candidate Pick:
Huhtamaki PPL Ltd
NSE: PAPERPROD
CMP: 215
MARKET CAP: 1600 CRORES
PRICE TO EARNING: 9x
ROCE: 15.22%
DEBT: 268 CRORES V/S 3 YEARS AGO 400 CRORES.
DEBT TO EQUITY: 0.39
PROMOTER HOLDING: 66.94%

(1/n)

Huhtamaki PPL formerly known as Paper Products is now owned by Huhtamäki Oyj a Global Food Packaging specialist headquartered in Finland.

HPPL mainly caters to the premium segment of packaging. It has 65% market share in flexible packaging.

(2/n)

Its major clients include Britannia, Cadbury, Castrol, Coca Cola, Dabur, Emami, Eveready, GSK, Godrej, HUL, ITC, Marico, Nestle, Pepsi, Perfetti, P&G, Tata Tea, TTK-LIG, Wipro etc.

HPPL derives 80-90% of its revenues from the FMCG industry.

(3/n)

FY DEC 19 - Revenue 2582 crores, PBT 202 crores, Net Profit of 170 crores.

Currently stock trades at 0.60x market cap to sales, lower than peer Essel Propack into tubes etc which trades at 2x market cap to sales.

(4/n)

We know how a lesser known MNC called GMM Pfaulder in glass line eqipments has multiplied in recent times.

Post COVID era growth in packaged food sector is expected to acclerate, as a result most of the FMCG Stocks are back to all time highs.

(5/n)

In that scenario, we at ACE Equities feel HPPL seems to be available at throw away prices and valuations.

Stock should be back to its recent highs made in February of 300+.

As it is an MNC, HPPL can be be given space in the Core Portfolio.

(6/n)

10 Year P/E Chart Shows, 10 Year Low on Valuations.

(7/7)

End of Thread.

Happy Sipping!