Shares of AGI Greenpac, a leading packaging company in India, soared 20 percent on the BSE on Friday, touching its 52-week high, on the back of strong quarterly earnings. As per an exchange filing, sales and profitability rose on an improved product mix and an increase in demand for glass containers for non-alcoholic and alcoholic beverages as well as packaged food.

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Sandip Somany, Group CFO of AGI Greenpac, said, “Rise in demand for the glass packaging containers from both the non-alcoholic and alcoholic beverage segments and our integrated business model and premium products helped us in delivering sustainable growth for the year”.

Speaking to CNBC-TV18, Sikka said that the company aims to expand its non-alcohol business from its current share of nearly 30 percent to approximately 40 percent within the next two years.

“We feel that we should be able to expand our business from almost 30 percent right now to almost 40 percent in the next two years. In terms of export, right now the export is less than 5 percent, but our target in the next four years is to build an extensive export base, given the fact that we have investments in value-added lines to bring it to a level of 5 to 10 percent.”

The company is engaged in various packaging products including glass containers, speciality glass, polyethylene terephthalate (PET) bottles and products, and security caps and closures.

The company recently announced its Q4 results which showed impressive growth on a year-on-year basis. The company's revenue increased by 57 percent, and margins also expanded this quarter.

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AGI Greenpac is projected to grow by 15-18 percent in FY24, and a new plant will help in the production of value-added products. The current capacity utilisation of the company is at 99 percent, indicating strong demand for its products.

“We still feel that from here onwards, we can maintain a momentum of around 15 to 18 percent growth, given the fact that on January 1st, 2023, we started the high-end glass furnace, which is 154 tonne per day, and that is still yet to be fully loaded,” Sikka said.

“Last time, our capacity utilisation was at almost 90-92 percent. So we reached now 99 percent capacity utilisation, and we are still trying to find ways wherein we can take more from the plant. So it really has also on the energy conservation and also it really gives operating leverage to increase the margins,” he added.

Sikka also said that the margin of the company can be expanded by about 100 basis points in the next 12 months. It is targeting a 21-23 percent margin in FY24. The company has planned a capex of Rs 500-700 crore for Hindusthan National Glass, which will take 6-9 months to break even.

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First Published:May 5, 2023 1:55 PM IST