www.rudrashares.com 1
Being having strong legacy, a unique client base and relative ine-
lasticity of FMCG sector (derives 80-90 % of revenue) to eco-
nomic cycles, coupled with global footprint of parentage, and
deep market penetration; aids company to make profits in long
run.
In 2018, it suffered from extra provisioning on account of income tax
and interest. However, from Q4 CY 18, most issues have been settled
down and delivered vigorous Q1 CY19 results. Forthcoming, it ex-
pects top line to grow at 10-12 % and likely to see 60-80 Bps
ramp up in operating margin in the next two years. But, the
margin growth depends on upcoming monsoon, scenario of
FMCG sector and volatility in crude oil prices.
LEAD RATIONALE
BUY | CMP 256| TARGET 310 | POTENTIAL UPSIDE 21%
01 JULY 2019
POSITIONAL CALL
RUDRA SHARES &
STOCK BROKERS LTD
HUHTAMAKI PPL LTD
Index Detail
Sensex 39686.50
Nifty 11865.60
Index S&P BSE Small
Cap
M.Cap (` in cr) 1934
Equity ( ` in cr) 15.11
52 wk H/L ` 298.10/155
Face Value ` 2.00
Div. Yield 1.18%
NSE Code PAPERPROD
BSE Code 509820
Stock Data
P/E 32.82
EV/EBITDA 8.69
P/BV 3.14
RONW(%) 10%
Valuation Data
Increasing capacity utilization to a maximum of 80-85 %, improving
demand for flexible packaging, and NASP initiatives would enable to
improve its volume growth and boost revenues as well as profits
ahead.
In addition, the acquisition of PPIL and Ajanta Packaging
(India) would help consolidating its position in pressure sensi-
tive label business, and is likely to be EPS accretive as well,
which could help to expand strong foothold and growth too.
Likely to benefit from growth revival in FMCG industry
Company mainly caters to the premium segment of packaging. Its major clients include Britannia,
Cadbury, Castrol, Coca Cola, Dabur, Emami, Eveready, GSK, Godrej, HUL, ITC, Marico,
Nestle, Pepsi, Perfetti, P&G, Tata Tea, TTK-LIG, Wipro etc. HPPL derives 80-90% of its reve-
nues from the FMCG industry. Hence, the company’s growth largely depends on the growth of
FMCG industry. Economic growth and rising personal disposable income are growth drivers
for the consumer goods sector, which in turn improves the demand for packaging.

www.rudrashares.com 2
Flexible packaging industry continues to maintain its relatively stable growth outlook. The indus-
try is expected to grow around 10% CAGR in the medium term. According to an ASSOCHAM-
EY joint study, India’s packaging industry is estimated to grow to $ 72.6 Billion by FY2020.
Growing rural demand, retail push, planned investments by large MNCs in the FMCG busi-
ness and strong fundamentals of the Indian economy support the view that FMCG and con-
sequently growth for Flexible Packaging would remain strong. Moreover, management has
indicated that certain trends like - use of plastic tubes instead of metal tubes and PET bottles
instead of glass bottles are / would drive its addressable markets. Recent trend of using
pouches instead of rigid packs for hair/edible oils also would expand its market size.
POSITIONAL CALL
RUDRA SHARES &
STOCK BROKERS LTD
HUHTAMAKI PPL LTD
Particulars Q1 FY 19 Q1 FY 18 Variation %
Revenue 619.69 545.19 13.66
EBITDA 96.02 59.95 60.17
PBT 67.62 32.73 106.60
PAT 42.03 17.80 136.12
EPS 5.57 2.36 136.02
Key Financials (` in crores)
EV 2382.88
Net Worth 615.58
BV 81.48
EPS(TTM) 7.80
Key Financial Data
` In crores except EPS
Integrated operations to increase capacity utilization in foreseeable future
In 2018, the company continued with a significant focus on operational excellence and efforts to
improve capacity utilization through effective operation and cost-effective manufacturing. During
the year, the company reported a capacity utilization of about 75% with headroom for more
growth. For its plant in Guwahati, the company is building a customer base around the
North East.
To improve customer responsiveness and service agility the company initiated several projects
on optimizing and improving manufacturing footprint. This will allow creation of centres of
excellence and expertise. These projects will be completed by FY20, although the benefits
will begin to accrue in 2019 itself. The projects initiated were related to increasing the Overall
Equipment Effectiveness of the Processing machines thru scientific assessment of various parame-
ters during the machine operation, and two of the Pilot projects have delivered excellent results to
improve OEE by more than 7%, which offers additional capacity and brings down the overall
manufacturing costs.

www.rudrashares.com 3
POSITIONAL CALL
RUDRA SHARES &
STOCK BROKERS LTD
HUHTAMAKI PPL LTD
 Tax rate will continue to hover around 41-44% till CY 19. From CY 20 onwards tax rate will
move gradually to normal levels. From CY 21, normal tax bracket will apply.
 Interest cost in CY 18 includes interest of ` 9.5 crore on the tax that was not allowed in earlier
period.
 While exports continue to remain under pressure, expects the exports to improve going for-
ward. Exports will not go down below CY 18 levels and continues to remain around 20-22%
of total sales.
 CY 18 capex stood at around ` 90 crore. Plans capex of around ` 100 crore in CY 19 towards
improvement of processes, reduction of overall costing and value addition in some products.
 CY 18 was a difficult year for the company where it faced turbulent issues of rising raw material
prices, carrying high costs inventories, forex volatility and lower off take. Expects CY 19 to be
better; Expecting around double digit growth in net sales.
 March 19 quarter saw significant benefits of ban of plastics and thus shifting towards com-
pany's flexible packaging and lower raw material costs with some inventory gains all leading
to spurt in margins and earnings. The company was able to supply alternative recycled
structures thereby providing options to the customers.
Key Highlights to watch out

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POSITIONAL CALL
RUDRA SHARES &
STOCK BROKERS LTD
HUHTAMAKI PPL LTD
Share price chart has been taken for a period of past 1 year. There is a long term support at
the levels of `209 and short term resistance at level of `270; If it will cross this resistance,
then may reach to next resistance of `281.60 in short to medium term and thereafter reach
to 52W/H @ 300-310.

www.rudrashares.com 5
Disclosures :
Business Activity :
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Analyst) Regulations, 2014. SEBI Reg. No. INH100002524.
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records of Rudra, as a Stock Broker, SEBI has not issued any Administrative warning to Rudra.
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Rudra or its research analysts, or his/her relative or associate has any other
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Rudra or its research analysts, or his/her relative or associates have actual
ownership of one per cent or more securities of the subject company. NO
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Rudra or its associates have received any compensation from the subject
company in the past twelve months. NO
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research report . NO
POSITIONAL CALL
RUDRA SHARES &
STOCK BROKERS LTD
HUHTAMAKI PPL LTD

www.rudrashares.com 6
Other Disclosures:
The research analyst has served as an officer,director,employee of the
subject company. NO
Rudra or its research analyst has been engaged in market making activity
for the subject company. NO
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subject company in the past twelve months. NO
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The information presented in this report, are for the intended recipients only. Further, the intended recipients are ad-
vised to exercise restraint in placing any dependence on this report, as the sender, Rudra Shares & Stock Brokers
Limited, neither guarantees the accuracy of any information contained herein nor assumes any responsibility in rela-
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Ltd or any of its affiliates/group companies shall not be in any way responsible for any such loss or damage that may
arise to any person from any inadvertent error in the information contained in this report. Rudra Shares & Stock Bro-
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retail & HNI and other financial services. Details of affiliates are available on our website i.e. www.rudrashares.com.
We hereby declare, that the information herein may change any time due to the volatile market conditions, therefore,
it is advised to use own discretion and judgment while entering into any transactions, whatsoever.
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deal or trade in securities, within thirty days before and five days after the publication of a research report as pre-
scribed under SEBI Research Analyst Regulations.
Subject to the restrictions mentioned in above paragraph, we and our affiliates, officers, directors, employees and
their relative may: (a) from time to time, have long or short positions acting as a principal in, and buy or sell the secu-
rities or derivatives thereof, of Company mentioned herein or (b) be engaged in any other transaction involving such
securities and earn brokerage or profits.
POSITIONAL CALL
RUDRA SHARES &
STOCK BROKERS LTD
HUHTAMAKI PPL LTD