Cosmo Films shares jumped nearly 5 percent after the company reported a good set of June quarter earnings. The company posted an 85 percent year-on-year jump in net profit and a strong EBITDA on account of higher specialty sales and higher operating margin.

Cosmo's packaging films business performed very well in the April-June period.

“Cosmo is not just into packaging films, but also industrial films and lamination label films. So there is a very strong portfolio of films that we have, including synthetic paper. So, yes, the demand for packaging is growing,” Pankaj Poddar, CEO of Cosmo Films, told CNBC-TV18.

“For us, the results are not just driven by packaging, but also growth in synthetic paper, lamination labels, and so on. So basically, our specialty growth journey is going exceedingly well for us. In Q1, based on the corresponding quarter of last year, we grew 20 percent, and that is leading to this improvement in the financial numbers,” he said.

On specialty films, he said, “In value terms, it has already exceeded 80 percent, and if I talk about last year, in volume terms, it was 52 percent... Both in volume and in value terms, it is growing," Poddar said.

Speaking on the company's EBITDA margin, he said: “Profitability is largely driven by three factors. The first factor, very clearly, is the growth in the specialty business. We are continuously moving on quarter-on-quarter basis, and improving our specialty growth. The second thing is that the demand overall for the film industry is very positive. Therefore, margins in the domestic business and exports are running at a very healthy level. They are expected to stay healthy. But it is obviously very difficult to predict in terms of how the margins for the overall film business will stay. The third is that we are taking a lot of initiatives and improving sustainability. Some of these initiatives are also helping us in reducing cost,” he explained.

For full interview, watch accompanying video.

(Edited by : Sandeep Singh)

First Published:Aug 5, 2021 5:02 PM IST