Manjushree Technopack - a potential multi-bagger

MUMBAI: Bangalore based packaging company Manjushree Technopack has been consistently delivering earnings growth of over 40% over the last five years. With the steady increase in capacity over the next two years and increasing client-base, Manjushree is likely to maintain its growth momentum for atleast another two years. Considering this, the current P/E of 5,the company's stock appears very attractive.

Initially a plastic packaging company, Manjushree Technopack is gradually increasing its footprints in the PET bottle segment. Its client portfolio includes leading companies in FMCG, Pharma and Food & Beverages sectors; including brands like Coca Cola, PepsiCo, GSK, Nestle, Unilever, Pfizer, DelMonte, Reckitt Benckiser and Cadburys among many others.

In the current fiscal the company has already increased its capacity from 50000 units to 78000 units and will increase it to 100,000 units by FY15. It has also added liquor market packaging by adding clients such as Bacardi, United Spirits and Diageo in the current year.

Also the company's net profit margin has remained constant at around 7 over the last five years, which means the company is insulated from volatility in the raw material prices. The company has consistently improved its return on capital over the last five years. In the last fiscal, it ROCE was 20 and ROE was 23. It has a debt to equity of 0.6, which is quite low.

All these make Manjushree Technopack a potential multi-bagger.