 "Ashish Kacholia Portfolio: Garware group stock zooms 153% in 5 months")
Shares of Garware Hi-Tech Films (GHFL) hit a new high of Rs 4,211.05, as they rallied nearly 8 per cent on the BSE in Tuesday’s intra-day trade in an otherwise weak market on expectations of strong earnings. In comparison, the BSE Sensex was down 0.26 per cent at 81,758 at 02:45 PM.
The stock of Garware Group Company surpassed its previous high of Rs 3,985 touched on October 1, 2024. In the last five months, the stock has zoomed 153 per cent from a level of Rs 1,667 on the BSE. In the past 8 months, it has skyrocketed 666 per cent from Rs 549.50, the BSE data shows.
Ace investor Ashish Kacholia held 670,879 equity shares, or 2.89 per cent stake in the company, at the end of the June quarter. Kacholia held 3.42 per cent (794,000 shares) at the end of the March quarter, shareholding pattern data shows. GHFL has yet not disclosed shareholding pattern for the quarter ended September.
In April to June quarter (Q1FY25), GHFL had posted a solid 102.2 per cent year-on-year (Y-o-Y) jump in the profit after tax (PAT) at Rs 88.40 crore on account of a better product mix and better realisation of the specialty products. The company, a global manufacturer of solar control films (SCF), paint protection films (PPF) and other specialty polyester films, had posted a profit of Rs 43.7 crore in Q1FY24.
Revenue increased by 25 per cent Y-o-Y to Rs 474.50 crore, supported by continued growth momentum in SCF and PPF businesses. Earnings before interest, taxes, depreciation, and amortisation (Ebitda) witnessed a commendable growth of 78.7 per cent Y-o-Y and 44.9 per cent Q-o-Q at Rs 130 crore, owing to better performance from the Specialty segments. Margins improved to 27.4 per cent in Q1FY25 from 19.2 per cent in Q1FY24 and 20.1 per cent in Q4FY24 primarily due to increased sale of high-end products across all segments.
GHFL is a leading manufacturer of polyester films and value accretive high-margin speciality films in India. Also, it is the sole manufacturer of solar control window films in India and perhaps the only company in the world with backward integration for manufacturing its raw material and components for the manufacture of solar control window films.
The company’s well-established global brands, ‘SunControl Window Films’ and ‘Global Window Films’ are known for their quality and innovation. GHFL offers a wide range of products with diverse end applications, including Bi-axially Oriented Polyethylene Terephthalate (BOPET) / Polyester Films, Solar Control Films, Paint Protection Films, Thermal Lamination Films, Low-Oligomer Films, and high shrink films etc.
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The poly-film industry caters to various sectors including packaging, automobile films, architectural applications, yarn, speciality industrial applications, thick films for insulation, shrink label application and others.
The global speciality films market is poised for significant growth in the coming years, with a projected market size of $55.4 billion by 2028, growing at a compounded annual growth rate (CAGR) of 5.2 per cent. The industry faces challenges due to fluctuating crude oil prices, which impact fuel and chemical costs, and the risks associated with the global economic slowdown and geopolitical tensions. The geopolitical tensions create uncertainties and potential disruptions in supply chains and international trade, affecting market dynamics, GHFL said in its FY24 annual report.
The management said GHFL is continuously improving its position in domestic market as well as in international market. Strong R&D and launch of new products along with increased sales and marketing effort is paying its return. Products like rooftop series, spectrally selective films external and internal for Architectural use. Newly launched Titanium, Matt, Black and White Paint Protection Films help in continuous growth in PPF business.
There has been consistent demand for PET film in the packaging segment throughout the year, both in the domestic and international markets. The growth of PET film is expected to continue, driven by the need for hygienic packaging and the anticipated increase in the consumption of packaged food, the company said.