Plastic product maker Supreme Industries on Tuesday reported a 39 percent year-on-year decline in its March quarter net profit at Rs 101.7 crore. Meanwhile, its revenue increased by 4 percent to Rs 1,530.9 crore.

The weakness was led by correction in polyvinyl chloride (PVC) prices as well as competition in the packaging business, said MP Taparia, managing director. Polypropylene and PVC prices went down by 15 percent, 12 percent, respectively in the last quarter, Taparia said.

“Last year there was a big fluctuation in foreign exchange; rupee went as low as 74.20/USD and now it is hovering around 70/USD. However, if we exclude this factor we believe prices have bottomed out in India and demand at this price is quite brisk,” he added.

On packaging business, Taparia said, “We have made many investments in performance and protective packaging product and performance packaging films. All the investments are now up and running and we expect the business to grow in this year.”

“It will grow by 12-15 percent in value and margins may slightly improve in the packaging business,” he added.

The company expects overall revenue of Rs 6,100-6,250 crore in FY20, said Taparia. The company has reported net sales of Rs 5,619.77 crores during the 12 months period ended March 31, 2019

On capacity utilisation front, he said, “We generally utilise capacity between 65-70 percent. Our overall capacity is around 6 lakh tonne.”