Packaging Sector from Investment point of view – Part 2

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Hi all, I hope you are doing well. In our ongoing blog series of knowing packaging sector from investment point of view. In part 1 we had discussed companies from paper-plastic manufacturing products(Link

Today we will know more about listed players manufacturing metal as packaging materials. Let’s dive in.

Business: Packaging is basically classified on the basis of type of material being used for it. It mainly classified as below

  1. Plastic
  2. Paper
  3. Glass
  4. Metal

Each and every product we use in our daily routine come with a packaging along with it. So this is never ending business and will grow on the scale of demand and consumption by consumers.

While doing Fundamental analysis of companies we need to use top down approach in order to find out companies working specific sector. Now  that we are discussing Packaging as sector in this blog. I have given brief of the some of the listed players based on the type of material they use to manufacture the packaging products listed above. There are many more listed companies in this sector. I am looking at top 2/3 from each type based on their market Cap as of 29th Aug.

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Leading Listed Players manufacturing packaging material with Metal

Tinplate Company of India limited

 The Tinplate Company of India Limited (TCIL), an associate company of TATA STEEL, pioneered Tinplate production in India in 1920. Today, TCIL is the industry leader in India, providing metal packaging solutions for a wide variety of food and non-food applications through the manufacturing and marketing of Tinplate (ETP) and Tin Free Steel (TFS). 

Overall market share of 40%. Company has a 60% share of business amongst users of prime quality tinplate.  

Tinplate is the most sustainable packaging media and a versatile packaging substrate which finds usage across wide-end use viz; food (edible oil, processed fruits & vegetables), non-food (paints & chemicals, aerosol sprays, battery) and beverages. Tinplate is most suited for packaging processed edibles owing to its excellent barrier properties.

Tinplate is durable, tamper-resistant and convenient – ensuring ease in handling and transportation. It has a long ‘shelf-life’ i.e. it can protect the contents from deterioration for a long time being able to resist air, bacteria and harmful UV rays. Courtesy-company website

Key product:

 PAXEL PAXEL, India’s first branded 15 kg edible oil can, is helping the Company to directly engage with brand owners of edible oils through our Service and Solution Partners (SSPs) by way of offering the highest standards of can quality, safety and hygiene in packaging of edible oils, backed up by the assurance of best quality of tinplate supplied from the house of Tata’s. As pioneers of PAXEL, we offer several benefits including on-time deliveries, maintaining product stocks for peak demand periods and servicing at competitive prices

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Shareholding Pattern :

Fundamental Stats via screener. In:

Also read: Is Tinplate Company of India a buy?

2.    Balmer Lawrie & Company Ltd

Founded by two Scotsmen, Stephen George Balmer and Alexander Lawrie, in Kolkata, Balmer Lawrie & Co. Ltd. started its corporate journey as a Partnership Firm on 1st February 1867. Traversing the 152 years gone by, today Balmer Lawrie is a Miniratna – I Public Sector Enterprise under the Ministry of Petroleum and Natural Gas, Govt. of India, with a turnover of Rs. 1857 crores and a profit of Rs. 280 crores.

Along with its five Joint Ventures and two subsidiaries in India and abroad, today it is a much-respected transnational diversified conglomerate with presence in both manufacturing and service sectors. Balmer Lawrie is a market leader in Steel Barrels, Industrial Greases & Specialty Lubricants, Corporate Travel and Logistics Services.

It also has significant presence in most other businesses, it operates, viz, Leather Chemicals, Logistics Infrastructure etc. In its 152 years of existence, Balmer Lawrie has been successfully responding to the demands of an ever changing environment, leveraging every change as an opportunity to innovate and emerge a leader in industry. Read more at  https://www.balmerlawrie.com/

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Today Balmer Lawrie has six business units – Industrial Packaging, Greases & Lubricants, Leather Chemicals, Travel & Vacations, Logistics and Refinery & Oil Field Services with offices spread across the country and abroad.

Balmer Lawrie Corporate Film :

Shareholding Pattern via NSE :

Fundamental stats via Screener.in.

Last 5 year Analysis on  Sales , Operating Profit and Net Profit for 2 players by Anup Lamb

TCIL
Sales 911 836 830 1,919 2,584 2,106 9,186
Oprating Profit 124 167 91 164 133 151 830
Net Profit 45 68 28 73 58 95 367
 Balmer Lawrie  
Sales 3,254 1,591 1,702 1,720 1,772 1,534 11,573
Oprating Profit 223 205 211 219 226 190 1,274
Net Profit 152 164 155 165 163 125 924
Total last 6 yrs TCIL Balmer Lawrie
Sales 9186 11573
Oprating Profit 830 1274
Net Profit 367 924
Net Profit % over OP 9.03 11
Net Profit % over Sales 3.99 7.98

Balmer has Net profit conversion % far better than TCIL  with 7.98% and hence they have good dividend yield of 6.5% due to good profits.

Closing remarks

These are top 2 leading metal  packaging players listed in index. I have collected this information to give our readers a brief of leading players in this sector. Investment in these stocks comes with risk as these are not traditional Index stocks or bluechip stocks. I urge everyone to do their own due diligence before taking any investment decision on these stocks. Till then take care. I hope you enjoyed reading these    

Anup Lamb



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Prateek Goel
Co-founder of Investeek, Prateek has been investing in the stock markets since 2006 and has beaten the NSE/BSE on a consistent basis. At the age of 24, he was also featured in India Today for his expert insight on gold trading.
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