Pyramid Technoplast aims to raise Rs 153 crore through a fresh issue of 55 lakh shares and an offer for sale of 37.2 lakh shares. Pyramid Technoplast is an industrial packaging company engaged in the business of manufacturing polymer based molded products (polymer drums), rigid Intermediate Bulk Containers (IBC) mainly used by chemical, agrochemical, specialty chemical and pharmaceutical companies for their packaging requirements.
The company was founded in 1997 by Jaiprakash Bijaykumar Agarwal, Madhu Jaiprakash Agarwal, and Pushpa Devi.
It is headquartered in Mumbai, India. It has 6 strategically situated manufacturing units out of which 4 are in Bharuch, GIDC and 2 are situated at Silvassa. The 7th manufacturing unit is under construction at the Bharuch, GIDC.
Pyramid Technoplast is one of the leading manufacturers of polymer drums in India.
Pyramid Technoplast Limited (“Pyramid Technoplast”) is an industrial packaging company engaged in the business of manufacturing polymer based molded products (Polymer Drums) mainly used by chemical, agrochemical, speciality chemical and pharmaceutical companies for their packaging requirements.
They are one of the leading manufacturers of rigid Intermediate Bulk Containers (IBC) in India manufacturing 1,000 litre capacity IBC. IBCs are industrial-grade containers engineered for the mass handling, transport, and storage of liquids, semi-solids, pastes, or solids.
They also manufacture MS Drums made of mild steel (MS) used in the packaging and transport of chemicals, agrochemicals and speciality chemicals.
The company uses blow molding technology to manufacture Polymer Drums and IBCs. Injection molding technology is used for manufacturing caps, closures, bungs, lids, handles, lugs, etc. for in-house use.
The total installed capacity of their Polymer Drum manufacturing units is 20,612 MTPA.
The total installed capacity of their IBC manufacturing unit is 12,820 MTPA and the total installed capacity of their MS Drums unit is 6,200 MTPA.
Pyramid Technoplast IPO: Financials
Particulars/ Rs. Cr.
2023
2022
2021
Revenue from Operations
480.03
400.42
313.5
Revenue Growth (%)
19.88%
27.73%
–
EBITDA
51.53
44.43
32.5
EBITDA Margin (%)
10.75%
11.03%
10.28%
Profit before Tax
42.81
35.16
22.89
Net Profit f
31.76
26.15
16.99
Net Profit Margin (%)
6.62%
6.53%
5.42%
Share Capital
31.28
3.91
3.91
Reserves
75.97
71.29
44.94
Net Worth
107.25
75.2
48.85
EPS – Basic & Diluted (₹)
10.24
8.43
5.41
RONW (%)
29.61%
34.77%
34.79%
Net Asset Value (₹)
31.28
24.04
15.61
ROCE (%)
21.37%
21.38%
21.11%
Post IPO Share capital
37
FV
10
IPO price
166
EPS Fy23
8.64
PE Fy23
19.22
Market cap in cr.
611
Market Cap/sales
1.27
Anchor Investors
Pyramid Technoplast IPO: Salient Points
The growth of polymer drums & HM-HDPE in India is owing to the rising demand for food & beverage products & ingredients, industrial packaging, chemical industry, pharmaceutical and others.
India is emerging as a prominent manufacturing hub for the chemical and pharmaceutical industry, THis is likely to lead to continuous increase in demand for packaging solutions
The polymer drums market of India is expected to grow in terms of revenue at CAGR (compounded annual growth rate) of 9.87% from year 2022 to 2030 to Rs 2709.38 crore and the MS Drums market of India is expected to grow in terms of revenue at CAGR of 7.95% from year 2022 to 2030 to Rs 5177.95 crore. The India IBC market of India is expected to grow in terms of revenue at CAGR of 10.56% from year 2022 to 2030 to Rs 89319.02 crore.
From Rs. 91 cr. garnered from fresh Issue, for Rs. 40 cr are earmarked for debt repayment and Rs. 40 cr. towards working capital.
Company proposes to utilise the Net Proceeds towards funding the following objects:
Particulars
Amount*
Repayment and/or pre-payment or repayment, in full or part, of certain outstanding borrowings availed by Company
4,000.00
Funding working capital requirements of our Company
4,021.43
General corporate purposes**
[●]
Its current plants ( six in no. ) are operating at 70-80% capacity utilization which can be considered as almost peak capacity.
Pyramid Technoplast is establishing a greenfield plant for intermediate bulk containers (IBC) manufacturing. This will be its 7th plant and shall become operational in H2FY24.
Polymer drums make about 51% of its revenue, 30% comes from IBC and 9% is contributed by MS drums.
With Rs. 40 cr earmarked for debt repayment from the fresh issue, its current debt of Rs. 55 cr. shall stand reduced accordingly. Mangemeng has indicated that i9n due course they will a zero debt company .
Strategic location of its manufacturing units near to end user industries like chemical industries. Its manufacturing units are located at Bharuch, Gujarat and Silvassa, UT of Dadra and Nagar Haveli and company sells its products to companies in and around Maharashtra and Gujarat.
As Pyramid Technoplast is a B2B supplier of products, being close to end-user market provides various advantages including lower freight costs and improved customer relationships.
Pyramid Technoplast has its own fleet of fifty-one (51) commercial vehicles for transporting raw materials to manufacturing units and delivery of its products to customers.
The pyramid IBC production line is having closed room facilities which is one of the topmost requirements of pharmaceutical and food industries making pyramid IBC one of the desired products by the food and pharmaceutical industry.
Pyramid Technoplast is largely focused on domestic industry.
Credit rating of the company has shown a slight improvement over the years.
Type of credit rating
Fiscal 2023
Fiscal 2022
Fiscal 2021
Long –term rating
Acuite BBB+ Stable
[ICRA]BBB/Stable
[ICRA] BBB-
Short- term rating
Acuite A2+
[ICRA] A3+
[ICRA] A3
Company has demonstrated consistent growth in the past and enjoys good demand for its products.
Comparison with Peers
Particulars/ Rs. Lacs/FY23
Pyramid Technoplast
TimeTechno
TPL Plastec
Moldtek
Revenue from operations
48,002.51
4,28,944
27,059.23
72,992.47
EBITDA
5,182.86
58,087
3,092.69
13,682.44
EBITDA margin (%)
10.75%
13.53%
11.38%
18.71%
PAT
3,176.07
22,377
1,603.42
8,043.08
PAT Margin (%)
6.62%
5.21%
5.90%
11.00%
Net Debt
4,955.13
70,885
3,291.12
4,085.38
Total Equity
10,725.02
2,32,743
11,539.70
55,869.17
ROE (%)
29.61%
9.61%
13.89%
14.40%
ROCE (%)
21.37%
6.91%
9.93%
12.89%
EPS
10.24
9.69
2.06
24.4
FV
10
1
2
5
CMP
166
139
40.9
954
PE
19
13.6
19.4
40.8
RoE for Pyramid Technoplast is good at 29.6%.
Among the anchor investors is Carnelian Fund is an investment management firm founded in by Vikas Khemani.
On FY23 earnings Pyramid TechnoplastIPO is valued at 19x P/E.
Iam likely to apply in the Pyramid Technoplast IPO though it is priced fully and margin of safety is not very high. This is mainly driven by prospects of a 20% growth in th past and similar expected growth in future as guided by its management and evident from its expansion plans.
Being a small issue Pyramid Technoplast IPO should see good subscription.
GMP as reported on social media is around Rs. 20-25.
Please do your own diligence. There is good amount of risk in all equity investments including this IPO.
Standard disclaimer: I am not a SEBI registered analyst and above analysis is for educational purpose only. Iam a postgraduate in engineering & Management . Also Certified in some exams like NISM-Series-V-A: Mutual Fund Distributors Certification, NISM-Series-X-A: Investment Adviser (Level 1) Certification and NISM-Series-X-B: Investment Adviser (Level 2) Examination. This post is my view on the subject matter and is only academic and exploratory in nature. It is not meant to influence investment decisions of investors. I may have bias/vested interest in covered Stock/Mutual Funds/NCD etc. due to my own investment or leaning. Further my understanding of the areas on which I write may be imperfect or incomplete and data could be wrong due to limited time and resources at my disposal. Do check the data from company’s RHP and exchanges before making any decision. Please do your own due diligence as stock market/MF investments have high degree of inherent risk.
