Mold-Tek eyes strategic diversification with FMCG, pharma push

As of FY25 Q3, Mold-Tek Packaging (MTPL), a leading manufacturer of rigid plastic packaging based in Hyderabad, India, had notched a capacity of 53,000-tonnes, with 39,000-tonnes expected utilisation in FY25 (73.6%). Revenue for FY24 was INR 700-crore (standalone), with a market cap of INR 1,427-crore. Readers of WhatPackaging? magazine will recall that Mold-Tek pioneered in-mould labelling (IML) in India in 2011, offering premium, durable decoration that enhances brand appeal.

Mold-Tek's competitive edge lies in its IML expertise and higher margins (18-20% vs peers' 14-15%). Beyond Mold-Tek's IML leadership and pharmaceutical innovations, there is a strong focus on lightweighting and sustainable plastics.

Mold-Tek's strategic push into pharmaceuticals is yielding significant results. The company's pharma segment has now broken even at the EBITDA level, a key milestone. They have also successfully added 3-4 new pharma clients, with more in the pipeline, indicating robust growth in this sector. One of their dedicated pharma units is already operating at a good capacity utilisation of 600/800-900 tons.

To further bolster its presence, Mold-Tek has begun Phase 1 of its pharma expansion, acquiring 2.5 acres for future growth. The company has set confident revenue targets for pharma sales, aiming for INR 30-35 crore in FY26 and INR 50-60 crore in FY27. This aggressive targeting, alongside continued growth in FMCG, are crucial steps towards diversifying its revenue mix.

Mold-Tek expects its margins to improve from 37-38% to a healthy 40%. The group is also anticipating a 12-15% volume/sales growth for the next two years, highlighting a positive outlook for overall business expansion.

Mold-Tek's USP is its work on weight reduction and single-piece canisters, which aligns with global sustainability trends. Highlighting these efforts could attract new clients.

Mold-Tek, established in 1985, specialises in injection-moulded containers for diverse sectors including paints, lubricants, food and FMCG, and pharmaceuticals. The facility in Panipat, which was inaugurated in 2023 with an investment of approximately INR 30-crore, included facilities for manufacturing food and FMCG IML containers to cater to the demand in North India. Mold-Tek's client roster includes major names such as Asian Paints, Akzo Nobel Nerolac, Castrol, Shell, Amul, Unilever, and Cadbury.

While the company's IML expertise and higher margins provide a competitive edge, it historically faced challenges from its relatively smaller scale and significant reliance on the paints sector. However, the strategic push into pharmaceuticals and growth in FMCG are now demonstrably crucial steps towards diversifying its revenue mix and fostering long-term contracts.