Academy Research:-For Information Only

EPL LIMITED
(Formerly known as – Essel Propack Limited)
BSE: 500135 | NSE: EPL

Company Overview:-
EPL is the largest global specialty packaging company, Stock Price Data As on April 30,2024
manufacturing laminated plastic tubes catering to the CMP: :INR 197.2
FMCG and Pharma space. Employing over 3,500+ Nifty: :22502.00
people representing over 25 different nationalities, EPL 52 week H/L(INR) :175.15/236.15
functions in eleven countries through 21 state of the art O/s Shares(Crs) :31.4
facilities, and is continuing to grow every year. Market Cap 6291.18
EPL is the world’s largest laminated tube Div Yield :2.20%
manufacturer with units operating across countries
such as USA, Mexico, Colombia, Brazil, Poland,
Germany, Egypt, China, Philippines and India. These
facilities cater to diverse categories that include Relative Strength 2 Years Weekly
brands in Oral Care, Beauty & Cosmetics, Pharma &
Health, Food, and Home, offering customized
solutions through continuously pioneering first-in-
class innovations in materials, technology and
processes.
EPL stands tall today with a total annual production of
over 8 billion tubes and a preferred partner to the EPL LTD Nifty 50
world’s biggest brands in Beauty & Cosmetics, Food,
Oral Care, Pharma & Healthcare and Home Care. It is
estimated that every third tube produced in the oral
Region Wise Revenue (%)
category globally is an EPL tube.
Segment Wise Break Up
Africa,
54% Europe Middle
East &
South
21%
Asia
30% 35%

East Asia 35%

11% Pacific 35%
5%
Americas
Oral Care Beauty & Pharma Others
Cosmetics
 Academy Research:-For Information Only

Historical Financial Statements

Income Statement
All fig are in 'CRs'

Years-> Mar-14 Mar-15 Mar-16 Mar-17 Mar-18 Mar-19 Mar-20 Mar-21 Mar-22 Mar-23
Sales ₹ 2,125 ₹ 2,321 ₹ 2,128 ₹ 2,302 ₹ 2,424 ₹ 2,707 ₹ 2,761 ₹ 3,092 ₹ 3,433 ₹ 3,694
Sales Growth - 9.2% -8.3% 8.2% 5.3% 11.7% 2.0% 12.0% 11.0% 7.6%
COGS ₹ 1,624 ₹ 1,767 ₹ 1,562 ₹ 1,714 ₹ 1,779 ₹ 2,011 ₹ 2,028 ₹ 2,273 ₹ 2,602 ₹ 2,859
COGS % sales 76.4% 76.1% 73.4% 74.5% 73.4% 74.3% 73.4% 73.5% 75.8% 77.4%
Gross Profit ₹ 501 ₹ 554 ₹ 566 ₹ 588 ₹ 645 ₹ 695 ₹ 734 ₹ 819 ₹ 831 ₹ 835
Gross Margins 23.6% 23.9% 26.6% 25.5% 26.6% 25.7% 26.6% 26.5% 24.2% 22.6%

Selling And Administration Exp ₹ 146 ₹ 162 ₹ 162 ₹ 166 ₹ 181 ₹ 196 ₹ 176 ₹ 208 ₹ 262 ₹ 260
S&G Exp % Sales 6.9% 7.0% 7.6% 7.2% 7.5% 7.3% 6.4% 6.7% 7.6% 7.0%
EBIDTA ₹ 355 ₹ 392 ₹ 404 ₹ 422 ₹ 464 ₹ 499 ₹ 558 ₹ 611 ₹ 569 ₹ 575
EBIDTA Margins 16.7% 16.9% 19.0% 18.3% 19.1% 18.4% 20.2% 19.8% 16.6% 15.6%

Depreciation & Amortisation ₹ 126 ₹ 132 ₹ 123 ₹ 141 ₹ 167 ₹ 186 ₹ 230 ₹ 235 ₹ 251 ₹ 281
Depreciation % Sales 5.9% 5.7% 5.8% 6.1% 6.9% 6.9% 8.3% 7.6% 7.3% 7.6%
Other Income ₹ 21 ₹ 26 ₹ 30 ₹ 52 ₹ 21 ₹ 37 ₹3 ₹ (2) ₹ 11 ₹ 41
Other Income % Sales 1.3% 1.5% 2.0% 3.0% 1.2% 1.8% 0.2% -0.1% 0.4% 1.4%
EBIT ₹ 250 ₹ 285 ₹ 312 ₹ 332 ₹ 318 ₹ 350 ₹ 331 ₹ 374 ₹ 329 ₹ 335
EBIT Margins 11.8% 12.3% 14.6% 14.4% 13.1% 12.9% 12.0% 12.1% 9.6% 9.1%

Interest ₹ 81 ₹ 79 ₹ 61 ₹ 58 ₹ 55 ₹ 61 ₹ 56 ₹ 43 ₹ 40 ₹ 67
Interest % sales 3.8% 3.4% 2.9% 2.5% 2.3% 2.3% 2.0% 1.4% 1.2% 1.8%
EBT ₹ 169 ₹ 206 ₹ 251 ₹ 274 ₹ 263 ₹ 289 ₹ 275 ₹ 331 ₹ 289 ₹ 268
EBT Margins 7.9% 8.9% 11.8% 11.9% 10.9% 10.7% 10.0% 10.7% 8.4% 7.3%

Tax ₹ 57 ₹ 61 ₹ 78 ₹ 79 ₹ 89 ₹ 93 ₹ 64 ₹ 87 ₹ 68 ₹ 37
Effective Tax rate 33.7% 29.6% 30.9% 28.7% 33.8% 32.3% 23.2% 26.2% 23.4% 13.9%
Net Profit ₹ 112 ₹ 145 ₹ 173 ₹ 196 ₹ 174 ₹ 195 ₹ 212 ₹ 244 ₹ 221 ₹ 231
Net Margins 5.3% 6.2% 8.1% 8.5% 7.2% 7.2% 7.7% 7.9% 6.4% 6.2%

No. of Equity Shares 31.42 31.42 31.42 31.43 31.44 31.52 31.55 31.56 31.59 31.82
Earning Per Share ₹ 3.56 ₹ 4.62 ₹ 5.51 ₹ 6.22 ₹ 5.54 ₹ 6.20 ₹ 6.71 ₹ 7.74 ₹ 7.01 ₹ 7.25
Dividend Per Share ₹ 0.62 ₹ 0.80 ₹ 1.10 ₹ 1.20 ₹ 1.20 ₹ 1.25 ₹ 3.30 ₹ 4.10 ₹ 4.30 ₹ 4.30
Dividend Pay out Ratio 17.6% 17.3% 20.0% 19.3% 21.7% 20.2% 49.2% 53.0% 61.4% 59.3%

Retained Earnings 82.4% 82.7% 80.0% 80.7% 78.3% 79.8% 50.8% 47.0% 38.6% 40.7%

BALANCE SHEET
Years-> Mar-14 Mar-15 Mar-16 Mar-17 Mar-18 Mar-19 Mar-20 Mar-21 Mar-22 Mar-23
Equity Share Capital ₹ 31 ₹ 31 ₹ 31 ₹ 31 ₹ 31 ₹ 63 ₹ 63 ₹ 63 ₹ 63 ₹ 64
Reserves ₹ 674 ₹ 752 ₹ 933 ₹ 1,008 ₹ 1,219 ₹ 1,325 ₹ 1,470 ₹ 1,635 ₹ 1,761 ₹ 1,926
Borrowings ₹ 1,024 ₹ 962 ₹ 709 ₹ 798 ₹ 734 ₹ 633 ₹ 737 ₹ 642 ₹ 769 ₹ 890
Other Liabilities ₹ 362 ₹ 365 ₹ 334 ₹ 412 ₹ 452 ₹ 492 ₹ 527 ₹ 654 ₹ 670 ₹ 721

TOTAL LIABILITIES ₹ 2,093 ₹ 2,110 ₹ 2,008 ₹ 2,250 ₹ 2,437 ₹ 2,513 ₹ 2,796 ₹ 2,995 ₹ 3,264 ₹ 3,600

Net Block ₹ 898 ₹ 887 ₹ 924 ₹ 1,179 ₹ 1,184 ₹ 1,307 ₹ 1,364 ₹ 1,531 ₹ 1,473 ₹ 1,694
Capital Work in Progress ₹ 36 ₹ 89 ₹ 57 ₹ 19 ₹ 42 ₹ 41 ₹ 35 ₹ 27 ₹ 147 ₹ 178
Investments ₹ 45 ₹ 46 ₹ 30 ₹ 15 ₹ 13 ₹ 17 ₹ 16 ₹ 15 ₹7 ₹ 19
Other Assets ₹ 380 ₹ 364 ₹ 382 ₹ 310 ₹ 279 ₹ 196 ₹ 150 ₹ 176 ₹ 213 ₹ 214
TOTAL NON CURRENT ASSETS ₹ 1,359 ₹ 1,386 ₹ 1,394 ₹ 1,524 ₹ 1,518 ₹ 1,562 ₹ 1,565 ₹ 1,749 ₹ 1,840 ₹ 2,104

Receivables ₹ 368 ₹ 376 ₹ 331 ₹ 377 ₹ 459 ₹ 493 ₹ 490 ₹ 589 ₹ 637 ₹ 643
Inventory ₹ 225 ₹ 232 ₹ 199 ₹ 246 ₹ 286 ₹ 323 ₹ 369 ₹ 415 ₹ 594 ₹ 608
Cash & Bank ₹ 142 ₹ 116 ₹ 84 ₹ 103 ₹ 173 ₹ 134 ₹ 372 ₹ 241 ₹ 193 ₹ 244
TOATAL CURRENT ASSETS ₹ 734 ₹ 724 ₹ 614 ₹ 725 ₹ 919 ₹ 951 ₹ 1,231 ₹ 1,245 ₹ 1,424 ₹ 1,495

TOTAL ASSETS ₹ 2,093 ₹ 2,110 ₹ 2,008 ₹ 2,250 ₹ 2,437 ₹ 2,513 ₹ 2,796 ₹ 2,995 ₹ 3,264 ₹ 3,600

CHECK TRUE TRUE TRUE TRUE TRUE TRUE TRUE TRUE TRUE TRUE

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 Academy Research:-For Information Only

CASH FLOW STATEMENT

OPERATING ACTIVITIES Mar-14 Mar-15 Mar-16 Mar-17 Mar-18 Mar-19 Mar-20 Mar-21 Mar-22 Mar-23
Net Profit Before Tax ₹ 169 ₹ 206 ₹ 251 ₹ 274 ₹ 263 ₹ 289 ₹ 275 ₹ 331 ₹ 289 ₹ 268
Profit from operations ₹ 164 ₹ 177 ₹ 146 ₹ 122 ₹ 211 ₹ 198 ₹ 275 ₹ 316 ₹ 315 ₹ 365
Receivables ₹ (92) ₹ (9) ₹ 41 ₹ 25 ₹ (60) ₹ (38) ₹1 ₹ (61) ₹ (61) ₹ (19)
Inventory ₹ (18) ₹ (7) ₹ 26 ₹ (11) ₹ (40) ₹ (37) ₹ (47) ₹ (44) ₹ (184) ₹ (33)
Payables ₹ 84 ₹ (17) ₹ (20) ₹ 36 ₹ 52 ₹ 35 ₹ 42 ₹ 66 ₹ 30 ₹ 66
Other WC items - - - - - - - - - -
Working capital changes ₹ (26) ₹ (33) ₹ 47 ₹ 50 ₹ (48) ₹ (40) ₹ (4) ₹ (39) ₹ (215) ₹ 14
Direct taxes ₹ (50) ₹ (36) ₹ (83) ₹ (76) ₹ (82) ₹ (90) ₹ (75) ₹ (87) ₹ (78) ₹ (45)
CASH FROM OPERATING ACTIVITIES ₹ 257 ₹ 314 ₹ 361 ₹ 370 ₹ 344 ₹ 357 ₹ 471 ₹ 521 ₹ 311 ₹ 602

INVESTING ACTIVITIES
Fixed assets purchased ₹ (180) ₹ (219) ₹ (199) ₹ (231) ₹ (141) ₹ (304) ₹ (124) ₹ (176) ₹ (276) ₹ (387)
Fixed assets sold ₹4 ₹ 19 ₹3 ₹ 24 ₹3 ₹4 ₹ 17 ₹4 ₹9 ₹5
Investments purchased - - - ₹ (46) ₹ (172) ₹ (92) ₹ (312) ₹ (336) ₹ (407) ₹ (441)
Investments sold - - - ₹ 55 ₹ 172 ₹ 92 ₹ 312 ₹ 336 ₹ 408 ₹ 426
Subsidy received - - - - - - - - - -
Interest received ₹5 ₹ 29 ₹2 ₹ 29 ₹ 13 ₹ 21 ₹3 ₹6 ₹3 ₹7
Dividends received ₹1 - ₹2 ₹2 ₹1 ₹2 - - - -
Redemp n Canc of Shares - - - - ₹5 - - - - -
Acquisition of companies - - ₹ 117 ₹ (129) - - - ₹ (167) - -
Other investing items ₹ (43) ₹ 25 ₹ 28 ₹ 16 ₹ (37) ₹ 90 ₹ (4) ₹ 54 ₹ (3) ₹ (21)
CASH FROM INVESTING ACTIVITIES ₹ (213) ₹ (146) ₹ (47) ₹ (280) ₹ (156) ₹ (187) ₹ (108) ₹ (279) ₹ (266) ₹ (411)

FINANCING ACTIVITIES
Proceeds from shares - - - ₹1 ₹1 ₹5 ₹1 ₹1 ₹5 -
Proceeds from debentures - ₹ 90 - - ₹ 50 - - ₹ 50 - -
Proceeds from borrowings ₹ 433 ₹ 203 ₹ 375 ₹ 303 ₹ 239 ₹ 459 ₹ 337 ₹ 526 ₹ 728 ₹ 854
Repayment of borrowings ₹ (345) ₹ (273) ₹ (548) ₹ (240) ₹ (303) ₹ (476) ₹ (322) ₹ (647) ₹ (625) ₹ (716)
Redemption of debentures - - - - ₹ (50) ₹ (40) - ₹ (50) - ₹ (30)
Interest paid fin ₹ (68) ₹ (65) ₹ (50) ₹ (39) ₹ (37) ₹ (49) ₹ (47) ₹ (39) ₹ (36) ₹ (66)
Dividends paid ₹ (19) ₹ (33) ₹ (34) ₹ (41) ₹ (48) ₹ (48) ₹ (89) ₹ (134) ₹ (138) ₹ (141)
Financial liabilities ₹ (1) ₹ (11) ₹ (3) ₹ (8) ₹ (6) ₹ (45) ₹ (22) ₹ (24) ₹ (30) ₹ (40)
Other financing items ₹ (33) ₹ (78) ₹ (60) ₹ (51) - - - - - -
CASH FROM FINANCING ACTIVITIES ₹ (33) ₹ (167) ₹ (320) ₹ (75) ₹ (154) ₹ (194) ₹ (142) ₹ (317) ₹ (96) ₹ (139)

Net Cash Flow ₹ 11 ₹1 ₹ (6) ₹ 15 ₹ 34 ₹ (24) ₹ 221 ₹ (75) ₹ (51) ₹ 52

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 Academy Research:-For Information Only

Ratio Calculation
Years>- Mar-15 Mar-16 Mar-17 Mar-18 Mar-19 Mar-20 Mar-21 Mar-22 Mar-23 Trend Mean Median
Growth Ratio(%)
Sales 9.2% -8.3% 8.2% 5.3% 11.7% 2.0% 12.0% 11.0% 7.6% 6.5% 8.22%
EBIDTA 10.39% 3.24% 4.36% 9.94% 7.62% 11.68% 9.52% -6.78% 1.07% 5.7% 7.62%
EBIT 14.19% 9.16% 6.68% -4.29% 9.98% -5.40% 12.99% -12.01% 1.91% 3.7% 6.68%
Net Profit 29.84% 19.36% 12.99% -10.94% 12.16% 8.30% 15.45% -9.41% 4.25% 9.1% 12.16%
Dividend 28.07% 37.47% 9.11% 0.02% 4.16% 163.95% 24.20% 4.94% -0.09% 30.2% 9.11%
Margins(%)
Gross Profit 23.9% 26.6% 25.5% 26.6% 25.7% 26.6% 26.5% 24.2% 22.6% 25.4% 25.69%
EBIDTA 16.87% 19.00% 18.32% 19.14% 18.44% 20.19% 19.75% 16.58% 15.57% 18.2% 18.44%
EBIT 12.30% 14.65% 14.44% 13.13% 12.93% 11.99% 12.10% 9.59% 9.08% 12.2% 12.30%
EBT 8.88% 11.78% 11.91% 10.86% 10.66% 9.97% 10.71% 8.41% 7.25% 10.0% 10.66%
Net Profit 6.25% 8.14% 8.50% 7.19% 7.22% 7.66% 7.90% 6.45% 6.25% 7.3% 7.22%
Sales Expenses % sales 7.0% 7.6% 7.2% 7.5% 7.3% 6.4% 6.7% 7.6% 7.0% 7.1% 7.21%
Depreciation % sales 5.68% 5.79% 6.15% 6.89% 6.88% 8.32% 7.59% 7.32% 7.59% 6.9% 6.89%
Returns Ratio(%)
Return On Capital Employed 16.4% 18.6% 18.1% 16.0% 17.3% 14.6% 16.0% 12.7% 11.7% 15.7% 16.03%
Return On Assets 6.87% 8.62% 8.69% 7.15% 7.78% 7.57% 8.16% 6.78% 6.41% 7.6% 7.57%
Return on Equity 18.52% 17.94% 18.83% 13.93% 14.08% 13.81% 14.39% 12.13% 11.60% 15.0% 14.08%
Retrun On Invested Capital 11.51% 12.85% 12.90% 10.61% 11.73% 11.21% 11.79% 9.72% 10.03% 11.4% 11.51%
Self Sustained Growth rate 15.31% 14.36% 15.20% 10.91% 11.24% 7.01% 6.77% 4.68% 4.72% 10.0% 10.91%
Solvency Ratio(%)
Debt To Equity 1.69x 1.08x 1.17x 0.95x 0.81x 0.82x 0.76x 0.79x 0.81x 0.99x 0.82x
Net Debt/EBITDA 3.09x 2.37x 2.63x 2.18x 1.98x 1.60x 1.73x 2.19x 2.37x 2.24x 2.19x

Current Ratio 1.98x 1.84x 1.76x 2.03x 1.93x 2.34x 1.90x 2.12x 2.07x 2.00x 1.98x
Interest Coverage ratio 3.60x 5.12x 5.72x 5.78x 5.71x 5.95x 8.72x 8.17x 4.98x 5.97x 5.72x
Dividend
DPS ₹ 0.80 ₹ 1.10 ₹ 1.20 ₹ 1.20 ₹ 1.25 ₹ 3.30 ₹ 4.10 ₹ 4.30 ₹ 4.30 ₹ 2.39 ₹ 1.25

Dividend Yield(%) 1.28% 1.38% 1.01% 1.00% 1.07% 2.13% 1.74% 2.22% 2.65% 1.6% 1.38%
Dividend Payout 17.3% 20.0% 19.3% 21.7% 20.2% 49.2% 53.0% 61.4% 59.3% 35.7% 21.66%
Earning Per Share(Rs)
EPS 4.62 5.51 6.22 5.54 6.20 6.71 7.74 7.01 7.25 ₹ 6.31 ₹ 6.22

CEPS
BVPS 55.34 61.13 63.49 70.23 105.09 109.68 114.91 118.95 124.12 ₹ 91.44 ₹ 105.09
Efficiency Ratios
Debtors Turnover 6.25x 6.02x 6.51x 5.80x 5.68x 5.61x 5.73x 5.60x 5.77x 5.89x 5.77x
Creditors Turnover 3.23x 3.02x 2.96x 2.70x 2.80x 2.62x 2.48x 2.61x 2.71x 2.79x 2.71x

Inventory Turnover 5.13x 4.96x 4.96x 4.35x 4.31x 3.82x 3.79x 3.25x 3.16x 4.19x 4.31x

Capital Turnover 1.33x 1.27x 1.25x 1.22x 1.34x 1.22x 1.32x 1.32x 1.28x 1.28x 1.28x

Total Asset Turnover 1.10x 1.06x 1.02x 0.99x 1.08x 0.99x 1.03x 1.05x 1.03x 1.04x 1.03x

Fixed Asset Turnover 2.62x 2.30x 1.95x 2.05x 2.07x 2.02x 2.02x 2.33x 2.18x 2.17x 2.07x

Opearating Leverage 2.00x 1.94x 1.82x 1.77x 2.03x 1.99x 2.22x 2.19x 2.53x 2.05x 2.00x
(In Days)

Debtor Days 58 61 56 63 64 65 64 65 63 62 63
Creditors Days 113 121 123 135 130 139 147 140 135 131 135
Inventory Turnover days 71 74 74 84 85 96 96 112 116 90 85
Cash Conversion Cycle 17 13 6 12 19 21 13 38 44 20 17
Valuation(x)
P/E 0.43x 0.46x 0.61x 0.69x 0.60x 0.73x 0.97x 0.87x 0.70x 0.67x 0.69x
P/BV 1.13x 1.31x 1.87x 1.70x 1.11x 1.41x 2.06x 1.63x 1.31x 1.50x 1.41x
EV/EBITDA 8.10x 8.58x 11.48x 10.29x 9.35x 10.38x 13.94x 12.93x 11.35x 10.71x 10.38x
EV/Sales 1.37x 1.63x 2.10x 1.97x 1.72x 2.09x 2.75x 2.14x 1.77x 1.95x 1.97x
Market Cap/Ocf
 Academy Research:-For Information Only

Forecasting (Historical Approach)

Sales Forecasting EBITDA
Year Weight Year Sales Sales Growth Year Weight Year Sales EBITDA Growth
1 2014A ₹ 2,125 1 2014A ₹ 355
2 2015A ₹ 2,321 9.24% 2 2015A ₹ 392 10.39%
3 2016A ₹ 2,128 -8.33% 3 2016A ₹ 404 3.24%
4 2017A ₹ 2,302 8.22% 4 2017A ₹ 422 4.36%
5 2018A ₹ 2,424 5.28% 5 2018A ₹ 464 9.94%
6 2019A ₹ 2,707 11.68% 6 2019A ₹ 499 7.62%
7 2020A ₹ 2,761 2.01% 7 2020A ₹ 558 11.68%
8 2021A ₹ 3,092 11.96% 8 2021A ₹ 611 9.52%
9 2022A ₹ 3,433 11.04% 9 2022A ₹ 569 -6.78%
10 2023A ₹ 3,694 7.61% 10 2023A ₹ 575 1.07%
11 2024E ₹ 3,645 -1.33% 11 2024E ₹ 642 11.51%
12 2025E ₹ 3,817 4.72% 12 2025E ₹ 670 4.44%
13 2026E ₹ 3,989 4.51% 13 2026E ₹ 699 4.25%
14 2027E ₹ 4,161 4.31% 14 2027E ₹ 727 4.08%
15 2028E ₹ 4,333 4.13% 15 2028E ₹ 756 3.92%

Sales Growth EBIDTA Growth

₹ 10,000 ₹ 1,000 20.00%
50.00%

40.00%

30.00%
10.00%

20.00%

10.00%

- 0.00% - 0.00%
2021A 2022A 2023A 2024E 2025E 2026E 2027E 2028E 2021A 2022A 2023A 2024E 2025E 2026E 2027E 2028E

Net Profit Forecasting Gross Profit

Year Weight Year Net Profit Sales Growth Year Weight Year Net Profit Sales Growth

1 2014A ₹ 112 1 2014A ₹ 501

2 2015A ₹ 145 29.84% 2 2015A ₹ 554 10.63%
3 2016A ₹ 173 19.36% 3 2016A ₹ 566 2.18%
4 2017A ₹ 196 12.99% 4 2017A ₹ 588 3.93%
5 2018A ₹ 174 -10.94% 5 2018A ₹ 645 9.70%
6 2019A ₹ 195 12.16% 6 2019A ₹ 695 7.81%
7 2020A ₹ 212 8.30% 7 2020A ₹ 734 5.53%
8 2021A ₹ 244 15.45% 8 2021A ₹ 819 11.53%
9 2022A ₹ 221 -9.41% 9 2022A ₹ 831 1.56%
10 2023A ₹ 231 4.25% 10 2023A ₹ 835 0.43%
11 2024E ₹ 258 11.82% 11 2024E ₹ 900 7.82%
12 2025E ₹ 270 4.77% 12 2025E ₹ 941 4.51%
13 2026E ₹ 283 4.55% 13 2026E ₹ 981 4.32%
14 2027E ₹ 295 4.35% 14 2027E ₹ 1,022 4.14%
15 2028E ₹ 307 4.17% 15 2028E ₹ 1,063 3.98%

Net Profit Growth Gross Profit Growth

₹ 1,000 20.00% ₹ 1,200 20.00%

₹ 1,000

₹ 800

10.00% ₹ 600 10.00%

₹ 400

₹ 200

- 0.00% - 0.00%
2021A 2022A 2023A 2024E 2025E 2026E 2027E 2028E 2021A 2022A 2023A 2024E 2025E 2026E 2027E 2028E

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 Academy Research:-For Information Only

WACC Calculation
All figures are in INR unless stated otherwise

Peer Comps Debt/ Debt/ Levered Unlevered

Name of the Comp Country Total Debt Total Equity Tax Rate 1 Equity Capital Beta 2 Beta 3
EPL Ltd India 890 6,279 25.00% 14.17% 12.41% 0.68 0.62
AGI Greenpac India 616 4,428 25.00% 13.91% 12.21% 1.59 1.44
Huhtamaki India India 255 2,293 25.00% 11.10% 9.99% 0.82 0.76
Polyplex Corpn India 748 2,816 25.00% 26.56% 20.99% 1.70 1.42
TCPL Packaging India 548 1,936 25.00% 28.31% 22.06% 1.21 1.00

Average 25.00% 18.81% 15.53% 1.20 1.05

Median 25.00% 14.2% 12.4% 1.21 1.00

Cost of Debt Cost of Equity

Pre tax cost of Debt 7.57% Risk free return 7.10%
Tax Rate 25% Equity risk Premium 9.71%
4
Post Tax Cost of Debt 5.68% Levered Beta 1.14
Cost of Equity 18.13%
Capital Structure Levered Beta
Current Target Comps Median Unlevered Beta 1.0
Total Debt 890 12.41% 16% Target Debt / Equity 18.4%
Market Capitalisation 6,279 87.59% 84.47% Tax Rate 25.00%
Total Capital 7168.8 100.00% 100.00% Levered Beta 1.1357

Debt / Equity 14.2% 18.4% Levered Beta

Notes: Cost of Equity 18.13%
1.Tax Rate considered as Marginal Tax Rate of the country Weighted Equity 84.47%
2.Levered Beta is based on 5 year monthly data
3.Unlevered Beta= Levered Beta/(1+(1-tax rate)*debt/equity) Cost of debt 5.68%
Levered Beta= 4.Unlevered Beta*(1+(1-tax rate)*debt/equity) Weighted Debt 16%

WACC 16.2%

₹ 1,024
Equity Debt ₹ 962
₹ 890

₹ 798
₹ 769
₹ 734 ₹ 737
₹ 709
₹ 633 ₹ 642

Debt y-o-y

MA R -14 MA R -15 MA R -16 MA R -1 7 MA R -1 8 MA R -1 9 MA R -2 0 MA R -21 MA R -22 MA R -23 Mar-14 Mar-15 Mar-16 Mar-17 Mar-18 Mar-19 Mar-20 Mar-21 Mar-22 Mar-23

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Regression Beta
2- year weekly returns

EPL Ltd- Weekly Returns NIFTY 50 - Weekly Returns

Date Closing Price Returns Closing Price Returns

16-05-2022 154.56 16266.15

23-05-2022 157.79 2.09% 16352.45 0.53%
30-05-2022 163.15 3.39% 16584.30 1.42% Beta Drifting
06-06-2022 158.37 -2.93% 16201.80 -2.31% Levered Raw Beta 0.58
13-06-2022 147.61 -6.79% 15293.50 -5.61% Raw Beta Weight 75%
20-06-2022 145.97 -1.11% 15699.25 2.65%
27-06-2022 151.57 3.83% 15752.05 0.34% Market Beta 1
04-07-2022 159.38 5.16% 16220.60 2.97% Market Beta Weight 25%
11-07-2022 176.18 10.54% 16049.20 -1.06%
18-07-2022 177.67 0.85% 16719.45 4.18% Adjusted Beta 0.68
25-07-2022 168.07 -5.40% 17158.25 2.62%
01-08-2022 160.16 -4.71% 17397.50 1.39%
08-08-2022 159.48 -0.42% 17698.15 1.73%
15-08-2022 158.80 -0.42% 17758.45 0.34%
22-08-2022 160.35 0.97% 17558.90 -1.12%
Relative Strength 2 Years Weekly
29-08-2022 163.97 2.26% 17539.45 -0.11%
05-09-2022 165.80 1.12% 17833.35 1.68%
12-09-2022 165.75 -0.03% 17530.85 -1.70%
19-09-2022 157.74 -4.83% 17327.35 -1.16%
26-09-2022 170.00 7.77% 17094.35 -1.34%
03-10-2022 158.03 -7.04% 17314.65 1.29%
10-10-2022 151.28 -4.27% 17185.70 -0.74%
17-10-2022 152.39 0.73% 17576.30 2.27%
24-10-2022 151.81 -0.38% 17786.80 1.20%
31-10-2022 146.93 -3.21% 18117.15 1.86%
07-11-2022 146.40 -0.36% 18349.70 1.28% EPL LTD Nifty 50
14-11-2022 154.32 5.41% 18307.65 -0.23%
21-11-2022 158.10 2.45% 18512.75 1.12%
28-11-2022 156.34 -1.11% 18696.10 0.99%
05-12-2022 160.35 2.57% 18496.60 -1.07%
12-12-2022 186.98 16.61% 18269.00 -1.23%
19-12-2022 159.86 -14.50% 17806.80 -2.53%
26-12-2022 166.91 4.41% 18105.30 1.68%
02-01-2023 163.78 -1.88% 17859.45 -1.36%
09-01-2023 164.51 0.45% 17956.60 0.54%
16-01-2023 157.56 -4.22% 18027.65 0.40%
23-01-2023 147.72 -6.24% 17604.35 -2.35%
30-01-2023 149.63 1.29% 17854.05 1.42%
06-02-2023 157.02 4.94% 17856.50 0.01%
13-02-2023 151.89 -3.27% 17944.20 0.49%
20-02-2023 156.98 3.35% 17465.80 -2.67%
27-02-2023 161.19 2.68% 17594.35 0.74%
06-03-2023 157.56 -2.25% 17412.90 -1.03%
13-03-2023 153.35 -2.67% 17100.05 -1.80%
20-03-2023 153.70 0.22% 16945.05 -0.91%
27-03-2023 158.49 3.12% 17359.75 2.45%
03-04-2023 159.03 0.34% 17599.15 1.38%
10-04-2023 155.51 -2.22% 17828.00 1.30%
17-04-2023 158.59 1.98% 17624.05 -1.14%
24-04-2023 171.12 7.90% 18065.00 2.50%
01-05-2023 170.68 -0.26% 18069.00 0.02%
08-05-2023 184.34 8.00% 18314.80 1.36%
15-05-2023 185.76 0.77% 18203.40 -0.61%

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Return on Market
Year Returns(%)
2001 -14.65% Average Return 15.61%
2002 -16.18% Dividend Yield 1.20%
2003 3.25% Total Market return 16.81%
2004 71.90%
2005 10.68%
2006 36.34%
2007 39.83%
2008 54.77%
2009 -51.79%
2010 75.76%
2011 17.95%
2012 -24.62%
2013 27.70%
2014 6.76% Market Returns(Annually)
2015 31.39% 100.00%

2016 -4.06% 80.00%

2017 3.01%
60.00%
2018 28.65%
40.00%
2019 3.15%
20.00%
2020 12.02%
2021 14.90% 0.00%
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024

2022 24.12% -20.00%

2023 4.32% -40.00%

2024 19.42%
-60.00%

Nifty 50 Returns Over the Years

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Intrinsic Growth
Calculation of ROIC

Years Mar-17 Mar-18 Mar-19 Mar-20 Mar-21 Mar-22 Mar-23

Current Assets
Inventories ₹ 246 ₹ 286 ₹ 323 ₹ 369 ₹ 415 ₹ 594 ₹ 608
Trade receivables ₹ 377 ₹ 459 ₹ 493 ₹ 490 ₹ 589 ₹ 637 ₹ 643
Short term loans ₹ 107 ₹ 107 ₹ 21 ₹1 ₹1 ₹1 ₹1
Other asset items ₹ 203 ₹ 171 ₹ 175 ₹ 149 ₹ 175 ₹ 212 ₹ 212
Total Current Assets ₹ 933 ₹ 1,023 ₹ 1,012 ₹ 1,009 ₹ 1,180 ₹ 1,444 ₹ 1,464
Current Liabilities
Trade Payables ₹ 147 ₹ 188 ₹ 206 ₹ 354 ₹ 422 ₹ 453 ₹ 500
Advance from Customers ₹1 ₹3 ₹4 - - - -
Other liability items ₹ 258 ₹ 256 ₹ 277 ₹ 164 ₹ 199 ₹ 183 ₹ 217
Total Current Liabilities ₹ 406 ₹ 447 ₹ 487 ₹ 518 ₹ 621 ₹ 636 ₹ 717

Net Working Capital ₹ 527 ₹ 576 ₹ 525 ₹ 491 ₹ 559 ₹ 808 ₹ 747

Non Current Assets

Land ₹ 17 ₹ 19 ₹ 16 ₹ 13 ₹ 19 ₹ 19 ₹ 19
Building ₹ 212 ₹ 235 ₹ 244 ₹ 261 ₹ 285 ₹ 292 ₹ 310
Plant Machinery ₹ 1,197 ₹ 1,355 ₹ 1,609 ₹ 1,685 ₹ 1,918 ₹ 2,021 ₹ 2,422
Equipments - - - ₹ 153 ₹ 175 ₹ 197 ₹ 228
Furniture n fittings ₹ 21 ₹ 25 ₹ 30 ₹ 34 ₹ 36 ₹ 38 ₹ 41
Vehicles - - - ₹1 ₹1 ₹1 ₹1
Intangible Assets ₹ 53 ₹ 55 ₹ 56 ₹ 64 ₹ 184 ₹ 154 ₹ 158
Other fixed assets ₹ 78 ₹ 94 ₹ 108 ₹ 157 ₹ 180 ₹ 260 ₹ 275
Gross Block ₹ 1,578 ₹ 1,783 ₹ 2,063 ₹ 2,368 ₹ 2,798 ₹ 2,982 ₹ 3,454
Accumulated Depreciation ₹ (398) ₹ (599) ₹ (756) ₹ (1,004) ₹ (1,266) ₹ (1,508) ₹ (1,760)
Net Non Current Assets ₹ 1,180 ₹ 1,184 ₹ 1,307 ₹ 1,364 ₹ 1,532 ₹ 1,474 ₹ 1,694
Invested Capital ₹ 1,707 ₹ 1,760 ₹ 1,832 ₹ 1,855 ₹ 2,091 ₹ 2,282 ₹ 2,441
EBIT ₹ 332 ₹ 318 ₹ 350 ₹ 331 ₹ 374 ₹ 329 ₹ 335
ROIC 19.47% 18.08% 19.10% 17.84% 17.89% 14.42% 13.74%

Calculation of Reinvested Rate

Years Mar-17 Mar-18 Mar-19 Mar-20 Mar-21 Mar-22 Mar-23
Net Capex ₹ 207 ₹ 138 ₹ 300 ₹ 107 ₹ 172 ₹ 267 ₹ 382
Change in Working Capital ₹ 49 ₹ (51) ₹ (34) ₹ 68 ₹ 249 ₹ (61)
EBIT ₹ 332 ₹ 318 ₹ 350 ₹ 331 ₹ 374 ₹ 329 ₹ 335
Marginal Tax Rate 25% 25% 25% 25% 25% 25% 25%
EBIT (1- Tax Rate) ₹ 249 ₹ 239 ₹ 262 ₹ 248 ₹ 281 ₹ 247 ₹ 252

Reinvestment ₹ 187 ₹ 249 ₹ 73 ₹ 240 ₹ 516 ₹ 321

Reinvestment Rate 78% 95% 29% 86% 209% 128%

5 years Average 109%

5 years Median 90%

Calculation of Growth Rate

Years Mar-17 Mar-18 Mar-19 Mar-20 Mar-21 Mar-22 Mar-23
Reinvestment Rate 78% 95% 29% 86% 209% 128%
ROIC 18.08% 19.10% 17.84% 17.89% 14.42% 13.74%
Intrinsic Growth 14.17% 18.12% 5.25% 15.30% 30.15% 17.53%

5 years Average 17.3%

5 years Median 16.4%

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DCF Calculation
Calculation of FCFF
Years 2023
EBIT 335.4
Less:Tax Rate 25%
EBIT(1-Tax Rate) 251.55
Add: D&A 280.5
Less:Change in WC -61
Less:Net Capex 382
FCFF 211.05

Calculation of PV of FCFF
Years Mar-23 A Mar-24E Mar-25E Mar-26E Mar-27E Mar-28E
Free Cash Flow to firm ₹ 211.05 ₹ 245.70 ₹ 286.04 ₹ 333.01 ₹ 387.68 ₹ 451.34
Mid Year Convention 0.5 1.5 2.5 3.5 4.5
Discounting Factor 0.93 0.80 0.69 0.59 0.51
PV of FCFF - ₹ 227.9 ₹ 228.4 ₹ 228.8 ₹ 229.3 ₹ 229.7

Expected Growth 16.4%

Terminal Growth 5.10% Sensitivity Analysis
WACC 16.2% ₹ 3,554.6 14.0% 15.0% 16.2% 14.0% 15.0%
5.0% ₹ 4,115.4 ₹ 3,818.3 ₹ 3,533.0 ₹ 4,115.4 ₹ 3,818.3
Calculation of Terminal Value 6.0% ₹ 4,486.9 ₹ 4,115.4 ₹ 3,767.4 ₹ 4,486.9 ₹ 4,115.4
FCFF ₹ 525.4 5.1% ₹ 4,148.8 ₹ 3,845.3 ₹ 3,554.6 ₹ 4,148.8 ₹ 3,845.3
Wacc 16.2% 8.0% ₹ 5,601.1 ₹ 4,964.4 ₹ 4,407.7 ₹ 5,601.1 ₹ 4,964.4
Terminal Growth Rate 5.10% 9.0% ₹ 6,492.5 ₹ 5,601.1 ₹ 4,861.3 ₹ 6,492.5 ₹ 5,601.1

Terminal Value ₹ 4,736.2

Calculation of Equity Value per share

PV of FCFF ₹ 1,144.1
PV of terminal Value ₹ 2,410.5
Enterprise Value ₹ 3,554.6

Add: Cash & Bank 244.4

Less: Debt 769
Value of equity ₹ 3,030.0
No. of Equity Share 31.84
Equity Value per Share 95.17
Share Price (Current) 197.6
Discount/Premium 1.08 x

Notes:-
• Tax rate have set constant at 25% for all FY.
• Terminal growth rate has been taken from FMCG growth rate i.e @5.1%
• Future FCFF have been estimated by adding intrinsic growth to current and compounded over the years.

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Comparable Company Valuation

Market Data Financials Valuation
Share Shares Equity Net Enterprise
Company Ticker Price Outstanding Value Debt Value Revenue EBIDTA Net Income EV/Revenue EV/EBIDTA P/E
EPL Ltd ₹ 197.2 31.84 ₹ 6,279 ₹ 674 ₹ 6,953 ₹ 3,856 ₹ 751 ₹ 280 1.80x 9.26x 22.42x
AGI Greenpac ₹ 684.5 6.47 ₹ 4,428 ₹ 255 ₹ 4,684 ₹ 2,421 ₹ 588 ₹ 251 1.93x 7.96x 17.62x
Huhtamaki India ₹ 303.7 7.55 ₹ 2,293 ₹ (57) ₹ 2,235 ₹ 2,498 ₹ 202 ₹ 400 0.89x 11.07x 5.73x
Polyplex Corpn ₹ 896.8 3.14 ₹ 2,816 ₹ 42 ₹ 2,858 ₹ 6,307 ₹ 425 ₹ 86 0.45x 6.72x 32.60x
TCPL Packaging ₹ 2,127.9 0.91 ₹ 1,936 ₹ 543 ₹ 2,480 ₹ 1,484 ₹ 256 ₹ 104 1.67x 9.68x 18.64x
High 1.93x 11.07x 32.60x
75th Percentile 1.80x 9.68x 22.42x
Average 1.35x 8.94x 19.40x
Median 1.67x 9.26x 18.64x
25th Percentile 0.89x 7.96x 17.62x
Low 0.45x 6.72x 5.73x

EPL Ltd - Comparable Valuation EV/Revenue EV/EBIDTA P/E

Implied Enterprise Value ₹ 6,443 ₹ 6,953 ₹ 5,220

Net Debt ₹ 674 ₹ 674 ₹ 674
Implied Market Value ₹ 5,769 ₹ 6,279 ₹ 4,546
Shares Outstanding 31.84 31.84 31.84
Implied Value per Share ₹ 181 ₹ 197 ₹ 143
Overvalued Overvalued Overvalued

Note:
1.Share price as on 20-5-24
3.Net Debt= Cash - total Debt

Sources: Screener.in, Google.

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Common Size Statement

Income Statement
Mar-14 Mar-15 Mar-16 Mar-17 Mar-18 Mar-19 Mar-20 Mar-21 Mar-22 Mar-23

Sales 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
Raw Material Cost 49.07% 48.98% 43.67% 43.96% 43.46% 43.17% 42.78% 41.68% 45.86% 46.15%
Change in Inventory 0.15% 0.03% 0.26% 0.18% 0.69% 0.14% 0.84% -0.16% 1.65% 0.84%
Power and Fuel 3.02% 2.98% 3.00% 2.99% 2.72% 2.64% 2.61% 2.41% 2.38% 2.67%
Other Mfr. Exp 8.67% 8.57% 9.40% 10.09% 10.00% 10.14% 9.61% 9.64% 10.23% 10.73%
Employee Cost 15.82% 15.64% 17.60% 17.61% 17.90% 18.50% 19.26% 19.64% 18.96% 18.69%
Selling and admin 5.71% 5.83% 6.17% 5.91% 5.95% 5.75% 5.58% 5.96% 6.91% 6.39%
Other Expenses 1.16% 1.16% 1.42% 1.31% 1.52% 1.51% 0.81% 0.77% 0.73% 0.64%
Other Income 0.99% 1.10% 1.43% 2.26% 0.88% 1.36% 0.12% -0.06% 0.33% 1.10%
Depreciation 5.92% 5.68% 5.79% 6.15% 6.89% 6.88% 8.32% 7.59% 7.32% 7.59%
Interest 3.83% 3.42% 2.86% 2.52% 2.27% 2.26% 2.01% 1.39% 1.17% 1.82%
Profit before tax 7.94% 8.88% 11.78% 11.91% 10.86% 10.66% 9.97% 10.71% 8.41% 7.25%
Tax 2.68% 2.63% 3.65% 3.42% 3.67% 3.44% 2.31% 2.81% 1.97% 1.01%
Net profit 5.08% 6.06% 8.00% 8.27% 7.08% 7.11% 7.51% 7.73% 6.25% 6.14%

Balance Sheet
Mar-14 Mar-15 Mar-16 Mar-17 Mar-18 Mar-19 Mar-20 Mar-21 Mar-22 Mar-23
Equity Share Capital 1.50% 1.49% 1.56% 1.40% 1.29% 2.51% 2.26% 2.11% 1.94% 1.77%
Reserves 32.23% 35.62% 46.48% 44.79% 50.03% 52.73% 52.56% 54.60% 53.97% 53.49%
Borrowings 48.95% 45.59% 35.32% 35.49% 30.12% 25.17% 26.35% 21.45% 23.56% 24.71%
Other Liabilities 17.32% 17.30% 16.63% 18.33% 18.55% 19.59% 18.83% 21.84% 20.54% 20.03%
Total Liabilities 100% 100% 100% 100% 100% 100% 100% 100% 100% 100%

Net Block 42.92% 42.05% 46.02% 52.43% 48.60% 52.03% 48.78% 51.13% 45.15% 47.05%
Capital Work in Progress 1.70% 4.21% 2.84% 0.86% 1.71% 1.64% 1.26% 0.91% 4.49% 4.94%
Investments 2.17% 2.17% 1.51% 0.68% 0.54% 0.67% 0.57% 0.50% 0.22% 0.54%
Other Assets 0.18 0.17 0.19 0.14 0.11 0.08 0.05 0.06 0.07 0.06
Receivables 17.56% 17.81% 16.49% 16.74% 18.84% 19.64% 17.54% 19.67% 19.51% 17.86%
Inventory 10.75% 10.98% 9.89% 10.93% 11.75% 12.87% 13.21% 13.86% 18.20% 16.89%
Cash & Bank 6.77% 5.52% 4.20% 4.57% 7.12% 5.35% 13.29% 8.06% 5.90% 6.79%
Total Assets 100% 100% 100% 100% 100% 100% 100% 100% 100% 100%

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Altman’s Z Score
About Altman's Z score:
Altman's Z-Score is a financial metric used to assess the likelihood of bankruptcy for a company. It was developed by
Edward I. Altman and is based on multiple financial ratios that measure various aspects of a company's financial
health and stability. The Z-Score is calculated using a formula that incorporates several financial ratios to produce a
single score, which is interpreted to assess the risk of financial distress.

Working Capital / Total Assets

Mar-17 Mar-18 Mar-19 Mar-20 Mar-21 Mar-22 Mar-23
Working Capital ₹ 630 ₹ 749 ₹ 659 ₹ 863 ₹ 800 ₹ 1,001 ₹ 991
Total Assets ₹ 2,250 ₹ 2,437 ₹ 2,513 ₹ 2,796 ₹ 2,995 ₹ 3,264 ₹ 3,600
Working Capital / Total Assets (A) 28.00% 30.74% 26.23% 30.87% 26.72% 30.67% 27.53%

Retained Earnings / Total Assets

Mar-17 Mar-18 Mar-19 Mar-20 Mar-21 Mar-22 Mar-23
Retained Earnings 157.9 136.5 156.0 107.5 114.9 85.4 94.0
Total Assets 2,249.7 2,436.7 2,512.7 2,795.8 2,994.5 3,263.5 3,599.6
Retained Earnings / Total Assets 7.02% 5.60% 6.21% 3.84% 3.84% 2.62% 2.61%

EBIT/ Total Assets

Mar-17 Mar-18 Mar-19 Mar-20 Mar-21 Mar-22 Mar-23
EBIT 332.4 318.1 349.9 331.0 374.0 329.1 335.4
Total Assets 2,249.7 2,436.7 2,512.7 2,795.8 2,994.5 3,263.5 3,599.6
EBIT/ Total Assets (c) 14.78% 13.06% 13.92% 11.84% 12.49% 10.08% 9.32%

Market Cap / Long Term Liabilities

Mar-17 Mar-18 Mar-19 Mar-20 Mar-21 Mar-22 Mar-23
Market Cap 1,867.5 1,881.4 3,678.0 4,893.5 7,455.0 6,116.4 5,162.3
Long Term Liabilities 799.0 734.0 633.0 738.0 642.0 769.0 890.0
Market Cap / Long Term Liabilities (D) 233.73% 256.32% 581.04% 663.08% 1161.22% 795.37% 580.03%

Sales / Total Assets

Mar-17 Mar-18 Mar-19 Mar-20 Mar-21 Mar-22 Mar-23
Sales 2,302.3 2,423.9 2,706.9 2,761.4 3,091.6 3,432.8 3,694.1
Total Assets 2,249.7 2,436.7 2,512.7 2,795.8 2,994.5 3,263.5 3,599.6
Market Cap / Long Term Liabilities (E) 102.34% 99.47% 107.73% 98.77% 103.24% 105.19% 102.63%

Altman's Z score

Final Scores 3.35 3.41 5.42 5.78 8.79 6.56 5.18

Financial Stability Strong Strong Strong Strong Strong Strong Strong

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Dupont Analysis
Return on Equity- ROE
Mar-17 Mar-18 Mar-19 Mar-20 Mar-21 Mar-22 Mar-23
Net Profit ₹ 196 ₹ 174 ₹ 195 ₹ 212 ₹ 244 ₹ 221 ₹ 231
Average Shareholders Equity ₹ 1,521 ₹ 1,770 ₹ 2,013 ₹ 2,227 ₹ 2,464 ₹ 2,674 ₹ 2,901
Return on Equity (ROE) 12.86% 9.84% 9.71% 9.50% 9.91% 8.28% 7.95%

ROE- Dupont Equation

Mar-17 Mar-18 Mar-19 Mar-20 Mar-21 Mar-22 Mar-23

Net Profit 195.6 174.2 195.4 211.6 244.3 221.3 230.7
Sales 2,302.3 2,423.9 2,706.9 2,761.4 3,091.6 3,432.8 3,694.1
Net Profit Margin 8.50% 7.19% 7.22% 7.66% 7.90% 6.45% 6.25%

Sales 2,302.3 2,423.9 2,706.9 2,761.4 3,091.6 3,432.8 3,694.1

Average Total Assets 2,128.9 2,343.2 2,474.7 2,654.3 2,895.2 3,129.0 3,431.6
Asset Turnover Ratio (B) 1.08x 1.03x 1.09x 1.04x 1.07x 1.10x 1.08x

Average Total Assets 2,128.9 2,343.2 2,474.7 2,654.3 2,895.2 3,129.0 3,431.6
Average Shareholders Equity 1,521.4 1,770.1 2,013.3 2,226.6 2,464.4 2,673.6 2,901.5
Equity Multiplier (C) 1.40x 1.32x 1.23x 1.19x 1.17x 1.17x 1.18x

Return on Equity (A*B*C) 12.86% 9.84% 9.71% 9.50% 9.91% 8.28% 7.95%

Return on Assets- ROA

Mar-17 Mar-18 Mar-19 Mar-20 Mar-21 Mar-22 Mar-23

Net Profit ₹ 196 ₹ 174 ₹ 195 ₹ 212 ₹ 244 ₹ 221 ₹ 231
Average Total Assets ₹ 2,129 ₹ 2,343 ₹ 2,475 ₹ 2,654 ₹ 2,895 ₹ 3,129 ₹ 3,432
Return on Assets(ROA) 9.19% 7.43% 7.90% 7.97% 8.44% 7.07% 6.72%

ROA- Dupont Equation

Mar-17 Mar-18 Mar-19 Mar-20 Mar-21 Mar-22 Mar-23
Net Profit 195.6 174.2 195.4 211.6 244.3 221.3 230.7
Sales 2,302.3 2,423.9 2,706.9 2,761.4 3,091.6 3,432.8 3,694.1
Net Profit Margin (A) 8.50% 7.19% 7.22% 7.66% 7.90% 6.45% 6.25%

Sales 2,302.3 2,423.9 2,706.9 2,761.4 3,091.6 3,432.8 3,694.1

Average Total Assets 2,128.9 2,343.2 2,474.7 2,654.3 2,895.2 3,129.0 3,431.6
Asset Turnover Ratio (B) 1.08x 1.03x 1.09x 1.04x 1.07x 1.10x 1.08x

Return on Assets (A*B) 9.19% 7.43% 7.90% 7.97% 8.44% 7.07% 6.72%

Dupont Remarks*
• The ROE of the company has fell down from 12.876% to 7.95% since 2017 .
• The reson behind the drop in ROE over the years is the continous fell in net profit margin from 8.50 % in FY2017 to 6.25% in FY 2023.and the other reason
is that the company's financial leverage has also fell down which indicates that gradually, the company is more reliable tow ards its equity rather than
on debt which sounds good for investors.
• When i see in the asset turnover ratio ,that suggests me that the company's efficiency in generating sales from its assets has been relatively consistent
over the years.
• The decline ROA trend indicatesv that while the company is efficient in utilising its asset,the declining profactibility is s ignificantly affecting the ROA.

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Strength And Weakness

Strength:-
• Strong Promoter Group: As of September 30, 2023, Blackstone Group L.P., through Epsilon Bidco Pte. Ltd., owned a 51.52% stake in EPL.
Blackstone is a major global asset management company with over $1 trillion in assets and 30 years of experience. Their involvement brings
professional and technical expertise in packaging, leveraging their global portfolio. Ind-Ra expects Blackstone to enhance EPL's leadership
in oral care and expand in personal care and new regions. Blackstone's backing also improves EPL's financial flexibility.
• Well Diversified Presence; Established Market Position: EPL has a global presence and operates across four geographical segments: i)
Africa, Middle East and South Asia (AMESA; 35% of FY23 revenue), ii) East Asia Pacific (EAP; 22%), iii) Americas (22%), and iv) Europe (21%).
The company has an established position in the global oral care tubes market, and as per the management, it commands more than a third
of the global market share in FY23. The oral care segment accounted for 53% of the company’s revenue in FY23 (FY22: 54%). EPL also caters
to the personal care segment, which includes pharmaceutical, beauty and healthcare products, and food industries. As the personal care
segment offers higher EBITDA margins than the oral care segment, the company has been focusing on increasing the former’s revenue
share.
• Contracts with Cost Pass-Through Provide Cash Flow Visibility: The company has agreements with some customers that help keep its
cash flow steady. About half of the company's money comes from these contracts, which usually last about three years. These contracts let
the company increase prices if the cost of raw materials goes up, but it takes three to four months to adjust. For customers without
contracts, the company can still raise prices based on raw material costs and other expenses. This helps the company maintain steady
revenue and cash flow, even when costs like raw materials and shipping go up and down a lot. Many of these customers are big, well-known
companies, which also helps the company plan its spending on new equipment and projects.
• Liquidity Indicator – Adequate:The company has enough money to handle its day-to-day needs. From September 2022 to August 2023, it
used only about 20% of its available funds. By the end of March 2023, the company had around INR 2,573 million in cash (compared to INR
1,901 million the previous year) and had access to an additional INR 1,164 million if needed. In the financial year 2023, the company made a
lot more money from its regular operations (INR 5,030 million) compared to the previous year (INR 2,495 million). The previous year's lower
earnings were due to high raw material costs, which meant they had to spend more money on their working capital. However, they still spent
a lot of money on their Brazil plant, so they didn't have much free cash left.

Risk:-
• Competition: There are many small companies that can easily start in this industry, so EPL has to compete with them. But, EPL has strong,
long-term relationships with its customers and constantly creates new products, which helps reduce this competition risk.

• Demand Slowdown: Sometimes, people might not buy as much in the places where EPL sells its products. This can affect how much the
company sells.

• Raw Material Prices: The prices of the raw materials EPL uses, which come from crude oil, can go up and down a lot. EPL deals with this by
having agreements in their contracts that allow them to adjust prices to cover these costs, although this can take a few months to take
effect.

• Foreign Exchange Risks: Since EPL operates in many countries, the value of money can change and affect their business. They manage this
by including special terms in their contracts, using techniques like forward contracts (which lock in exchange rates for the future), and
balancing their earnings and costs in different currencies.

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 Academy Research:-For Information Only

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