Equity L/S Analyst | Forensic Accounting | India, Yellowstone Equity

Ankit Agrawal, CFA

Equity L/S Analyst | Forensic Accounting | India

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Yellowstone Equity

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Regulatory Disclosure: 
Note that Ankit Agrawal (Proprietor of Yellowstone Equity) is a SEBI registered Research Analyst (Registration No.: INH000007216). Registration granted by SEBI and certification from NISM in no way guarantee performance of the intermediary or provide any assurance of returns to investors. Investment in securities market are subject to market risks. Read all the related documents carefully before investing.

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Compliance/Grievance Officer:
Name: Ankit Agrawal
Email: services@yellowstoneequity.com
Mobile: +91-7575817289
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Equity Bottom-Up

<ul>
<li>RPPL reported a strong Q1FY25 led by margin improvement. EBITDA margin rose to 14.7% vs 13.5% QoQ and 12.0% YoY. Stability in raw material pricing and operating efficiencies helped margins. </li>
<li>While growth in overall revenues was average at 8.3% YoY, growth in high-margin packaging products segment, which contributes 80% of total revenues, was strong at 16% YoY. </li>
<li>Exports at INR 9.2cr were below the INR 10cr+ run-rate, however, the growth momentum is intact. RPPL is in process of finalizing an export contract with a major global distributor.</li>
</ul>


RPPL reported a strong Q1FY25 led by margin improvement. EBITDA margin rose to 14.7% vs 13.5% QoQ and 12.0% YoY. Stability in raw material pricing and operating efficiencies helped margins. 
While growth in overall revenues was average at 8.3% YoY, growth in high-margin packaging products segment, which contributes 80% of total revenues, was strong at 16% YoY. 
Exports at INR 9.2cr were below the INR 10cr+ run-rate, however, the growth momentum is intact. RPPL is in process of finalizing an export contract with a major global distributor.


RPPL: Scaling Up Well With Consistent Execution

<ul>
<li>RPPL executed well in FY24 with sales volume growth at 18% YoY. However, sudden and significant contraction in raw material prices dampened FY24 sales value growth to just 9% YoY.</li>
<li>Exports sustained its quarterly run-rate of INR 10cr+ in Q4FY24, resulting in FY24 aggregate exports sales at INR 42cr. Exports contributed 15% of revenues in FY24 vs 5% in FY23.</li>
<li>RPPL is also making good progress with its new initiatives. Its Olive Ecopak venture began commercial production in Mar 2024. Its injection molding segment is also scaling up well.</li>
</ul>


RPPL executed well in FY24 with sales volume growth at 18% YoY. However, sudden and significant contraction in raw material prices dampened FY24 sales value growth to just 9% YoY.
Exports sustained its quarterly run-rate of INR 10cr+ in Q4FY24, resulting in FY24 aggregate exports sales at INR 42cr. Exports contributed 15% of revenues in FY24 vs 5% in FY23.
RPPL is also making good progress with its new initiatives. Its Olive Ecopak venture began commercial production in Mar 2024. Its injection molding segment is also scaling up well.


Rajshree Polypack (RPPL): All Set for a Strong FY25

<ul>
<li>
<a href="https://www.smartkarma.com/entities/rajshree-polypack-ltd" target="_blank" data-smartkarma-citation="entities:33486:1" rel="noopener">Rajshree Polypack ("RPPL")</a> reported a robust Q3FY24 led by strong volume growth of 29%+ YoY. EBITDA margin also expanded leading to EBITDA growth of 35%+ YoY.</li>
<li>Export business continues to grow steadily with quarterly run-rate now at INR 10cr. This suggests that on an annualized basis, exports could be INR 40cr vs INR 30cr guided earlier.</li>
<li>Injection molding business is doing well and has reached optimum capacity utilization. RPPL is exploring to expand this capacity and is also expecting it to become profitable from next quarter.</li>
</ul>



Rajshree Polypack ("RPPL") reported a robust Q3FY24 led by strong volume growth of 29%+ YoY. EBITDA margin also expanded leading to EBITDA growth of 35%+ YoY.
Export business continues to grow steadily with quarterly run-rate now at INR 10cr. This suggests that on an annualized basis, exports could be INR 40cr vs INR 30cr guided earlier.
Injection molding business is doing well and has reached optimum capacity utilization. RPPL is exploring to expand this capacity and is also expecting it to become profitable from next quarter.


<ul>
<li>RPPL reported decent Q2FY24 earnings, led by volume growth and margin expansion. Revenue growth was somewhat tepid due to decline in realization led by volatility in raw material prices.</li>
<li>RPPL is seeing good traction in exports with improving mix of value-added products and enhanced geographic reach. Revenue from exports is guided to triple to INR 30cr+.</li>
<li>RPPL has also entered into In-mold Labeling (IML) in rigid plastic injection molding products. This could be a game changer for RPPL in terms of growth and target market potential.</li>
</ul>


RPPL reported decent Q2FY24 earnings, led by volume growth and margin expansion. Revenue growth was somewhat tepid due to decline in realization led by volatility in raw material prices.
RPPL is seeing good traction in exports with improving mix of value-added products and enhanced geographic reach. Revenue from exports is guided to triple to INR 30cr+.
RPPL has also entered into In-mold Labeling (IML) in rigid plastic injection molding products. This could be a game changer for RPPL in terms of growth and target market potential.


RPPL: Climbing Up the Value Chain | All Set for a Strong FY25

<ul>
<li>RPPL reported a weak Q1FY24 due to correction in raw material prices that led to inventory losses and decline in EBITDA margin to 12% vs 14%+ QoQ and 16% YoY.</li>
<li>Given that Q1 tends to be a high demand quarter, RPPL had kept high inventory, which further accentuated the inventory losses.</li>
<li>The raw material prices have stabilized now. EBITDA per kg should stabilize back to around INR 34-35 and should help the EBITDA to grow in line with the volume growth. </li>
</ul>


RPPL reported a weak Q1FY24 due to correction in raw material prices that led to inventory losses and decline in EBITDA margin to 12% vs 14%+ QoQ and 16% YoY.
Given that Q1 tends to be a high demand quarter, RPPL had kept high inventory, which further accentuated the inventory losses.
The raw material prices have stabilized now. EBITDA per kg should stabilize back to around INR 34-35 and should help the EBITDA to grow in line with the volume growth. 


RPPL: Weak Q1FY24 Earnings, However, Long-Term Growth Trajectory Remains Intact

India

Rajshree Polypack Limited manufactures packaging products. The Company offers coffee cups, trays, lids, plates, bowls, and other containers, as well as plastics rigid sheet. Rajshree Polypack serves dairy, beverages, retail, pharmaceuticals, and electronics industries in India.

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Rajshree Polypack (RAJPPL IN)

RPPL: Scaling Up Well With Consistent Execution

RPPL is consistently scaling up its capacities while also introducing new value-added products and technology. It is executing well to sustain its...

Ankit Agrawal, CFA

Rajshree Polypack (RPPL): All Set for a Strong FY25

RPPL is poised for high growth over the next three years led by its various new initiatives across value-added products, new product categories and...

Ankit Agrawal, CFA

RPPL: On Track for a Strong FY25

RPPL's new products and focus on exports is setting it up well for robust growth over FY25 and FY26. At the current valuation, an investment in...

Ankit Agrawal, CFA

RPPL: Climbing Up the Value Chain | All Set for a Strong FY25

RPPL reported a decent Q2FY24. Margins are stabilizing as raw material pricing is normalizing. RPPL's long-term growth trajectory is attractive led...

Ankit Agrawal, CFA

RPPL: Weak Q1FY24 Earnings, However, Long-Term Growth Trajectory Remains Intact

RPPL reported a weak Q1FY24 due to decline in raw material prices. However, RPPL is on track to achieve INR 500cr revenue by FY26. At current...

Ankit Agrawal, CFA

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