HUHTAMAKI - Huhtamaki India

📊 NSE: HUHTAMAKI 🏢 Packaging 📅 Last Updated: 12/14/2025 7:48

💰 Financial Performance

Revenue Growth by Segment

Revenue from operations for the standalone flexible packaging segment stood at INR 2,521.18 Cr in CY2024, reflecting a flat trajectory with a marginal decline of 1.1% compared to INR 2,549.44 Cr in CY2023. Q3 2025 sales were INR 604.93 Cr, a 4.7% YoY decline from INR 634.67 Cr.

Geographic Revenue Split

Not disclosed in available documents; however, the company operates 10 manufacturing facilities across Maharashtra, Dadra and Nagar Haveli, Uttarakhand, Assam, Karnataka, Andhra Pradesh, and Himachal Pradesh.

Profitability Margins

Net profit ratio was 3.5% in CY2024, down from 16.1% in CY2023 (which was inflated by exceptional income). Operating margins recovered to 10.7% in Q3 2025 from 4.9% in Q3 2024 due to a favorable sales mix and efficiency measures.

EBITDA Margin

EBITDA margin for CY2024 was 6.0% (INR 150.99 Cr) compared to 8.2% (INR 210.18 Cr) in CY2023. Q3 2025 EBITDA margin improved significantly to 10.7%, a 107.1% YoY increase in absolute EBITDA value to INR 64.87 Cr.

Capital Expenditure

Capex is described as modest and is expected to be fully met through annual cash accruals. Specific planned INR figures for future years are not disclosed, but historical gearing remains below 0.1x, indicating low debt-funded capex.

Credit Rating & Borrowing

CRISIL reaffirmed the short-term rating at 'CRISIL A1+'. Parent Huhtamaki Oyj has a 'BB+' rating with a 'Positive' outlook from S&P. Finance costs for 9M 2025 declined 38.4% YoY to INR 8.98 Cr due to lower borrowing levels.

⚙️ Operational Drivers

Raw Materials

Raw materials include polymers and solvents used in flexible packaging (specific names like Polyethylene not explicitly listed, but 'solvents' and 'raw material prices' are cited). Raw material volatility is a primary driver of margin fluctuations.

Capacity Expansion

Current operations include 10 manufacturing sites. Specific planned capacity expansion in MTPA is not disclosed, though the company focuses on maximizing plant utilization and implementing World Class Operations (WCO).

Raw Material Costs

Raw material costs are a significant portion of revenue; volatility led to a 500 bps margin dip in 2021. In 2024, easing raw material costs helped improve margins from 4.2% in Q4 2023 to 6.3% in Q1 2024.

Manufacturing Efficiency

Manufacturing efficiency is tracked via the World Class Operations (WCO) and Total Productive Maintenance (TPM) programs. Q3 2025 was an 'incident-free' quarter with zero lost-time incidents across 10 sites.

Logistics & Distribution

Logistics costs are impacted by geopolitical issues like the Red Sea crisis; specific distribution costs as a % of revenue are not disclosed.

📈 Strategic Growth

Expected Growth Rate

Not disclosed

Growth Strategy

Growth is targeted through the 'blueloop' recyclable product portfolio, optimizing product and customer mix to eliminate negative margin business, and leveraging the parent's global expertise in sustainable packaging and digital transformation (Shopfloor Digitalisation).

Products & Services

Flexible packaging, labels, cylinders, pet food packaging, barrier packaging, retort pouches, and packaging for healthcare products.

Brand Portfolio

blueloop (recyclable packaging portfolio).

New Products/Services

Recyclable products under the 'blueloop' brand; specific revenue contribution % is not disclosed but is a core focus for future growth.

Market Expansion

Focus on high-quality business and refining the product/customer portfolio. Target regions include domestic expansion across its 10 existing manufacturing locations.

Market Share & Ranking

Described as one of the market and technology innovation leaders in the domestic flexible packaging industry.

Strategic Alliances

Step-down subsidiary of Huhtamaki Oyj, Finland, which holds 67.73% equity through Huhtavefa BV.

🌍 External Factors

Industry Trends

The industry is shifting toward sustainable materials, automation, and digital transformation. Smart packaging technologies are redefining standards for product safety and shelf life.

Competitive Landscape

Operates in the competitive domestic flexible packaging industry; maintains leadership through innovation and parent-company operational support.

Competitive Moat

Moat consists of parent-backed technology leadership, a diverse product range (flexibles, labels, cylinders), and a strong financial profile with gearing below 0.1x.

Macro Economic Sensitivity

Sensitive to FMCG sector growth; upcoming GST reforms are expected to boost growth for FMCG clients, indirectly benefiting Huhtamaki.

Consumer Behavior

Shifting toward sustainable and recyclable packaging, driving the company's investment in the blueloop portfolio.

Geopolitical Risks

The Ukraine conflict and Red Sea crisis are cited as key risks impacting economic resilience and supply chain efficiency.

⚖️ Regulatory & Governance

Industry Regulations

Subject to GST regulations (minor procurement side changes) and evolving regulatory expectations regarding sustainable packaging and plastic waste management.

Environmental Compliance

Focus on sustainability and recyclable products (blueloop); specific ESG compliance costs in INR are not disclosed.

Taxation Policy Impact

Tax expenses for CY2024 were INR 28.9 Cr on a PBT of INR 116.8 Cr, representing an effective tax rate of approximately 24.7%.

⚠️ Risk Analysis

Key Uncertainties

1. Raw material price volatility (high impact on margins). 2. Geopolitical disruptions (Red Sea/Ukraine). 3. Regulatory changes regarding plastic usage.