Dear shareholder,
I am honoured to present to you our inaugural annual report following our successful
listing on the stock exchanges. It is a pleasure to share my thoughts on your Company's
performance in FY 2023-24, a landmark year in the history of Pyramid Technoplast. This
milestone reflects the trust our stakeholders repose in our vision and value proposition.
As I write this letter to you, my mind goes back to the events that have unfolded over
the past 26 years. Our story began with a small plant in Silvassa, at Dadra Nagar and
Haveli. Through sheer dedication and a resolute zeal, we have steadily expanded our
operations, which have now reached Bharuch, Gujarat and beyond.
I am glad to share that now we operate seven state-of-the-art manufacturing units, with
an eighth currently under construction in Maharashtra. We intend to drive further
expansion in the near term.
Right from the outset, we were driven by a clear mission—to provide our clients
with only the finest quality products that can shoulder the global best. Meanwhile, we
ensured on-time services and competitive prices. This customer-focused approach has helped
us gain an expanding client fraternity, which currently comprises 500+ customers.
Over the years, we have consistently diversified our offerings to address the evolving
needs of our clients in various industries. In keeping with this, besides Polymer Drums,
we now offer a wide range of bulk industrial packaging solutions, including MS Drums and
Intermediate Bulk Containers (IBCs). This year, we concentrated on strategic expansion
through targeted capex initiatives.
Indian Market Scenario*
The Indian steel drum and IBC market presents an exciting growth opportunity for
Pyramid Technoplast. Fueled by the robust expansion of key industries like chemicals, and
petroleum, and growing awareness of the superior product lifespan offered by steel
packaging, coupled with increasing import/export activities, the market is projected for
significant growth. With a projected CAGR of 4.6% for steel drums and 3.8% for IBCs over
the next decade, we at Pyramid Technoplast are well-positioned to capitalise on this
dynamic market landscape. By CY 2033, the Indian steel drum industry is expected to reach
a valuation of USD 468.7 million, with the IBC market reaching USD 260.5 million. This
robust market growth underscores the significant potential for Pyramid Technoplast as we
move forward.
Business performance
Speaking of our financial highlights in the year gone by, our revenue surged to H532.4
crores. Our Polymer Drums segment accounted for RS 254 Cr of our total revenue followed by
IBC at H177 Cr and MS Drums at H47 Cr and H55 Cr from operating income. We closed the year
with a net profit of H29.3 crores, while our EBITDA margin stood at 9.1%.
The industry pricing norm dictates that raw material price changes are reflected in
monthly selling prices.
While this lag had a temporary impact on our EBITDA margin this year, it also provided
us with an advantage during periods of higher raw material prices.
We have already begun to see recovery from the lows experienced in January 2024 and are
optimistic that this will translate into positive results in the upcoming financial year.
Our balance sheet remains healthy. In the years ahead, we will continue to ensure
prudent financial management, with our future capex being funded primarily through
internal accruals and our existing cash balance.
Enhancing our capabilities
To sustain our growth momentum, at Unit 6 in Gujarat, we embraced automation to
increase our Metal Drum capacity from 30,000 to 50,000 units per month.
We have secured land adjacent to this facility to facilitate further expansion. Our
near-term goal is to reach a capacity of
70.000 units per month by September 2024, with the potential to scale this to
90.000 units per month through continued automation efforts.
Our unit 7 saw the successful commissioning of Line 1 for IBC production in July 2023.
At present, this line operates at 50% capacity. We intend to order Line 2 IBC as we reach
70-75% capacity on Line 1. Our strategy emphasises a phased expansion approach to ensure
both steady growth and enhanced operational efficiency.
Initially, the land proposed for Unit 8, adjacent to Unit 7, will now be merged into
Unit 7 to optimise efficiency. This will increase the production of both IBC and HDPE
polymer drums at this facility. Civil work is in progress and is expected to conclude by
the end of Q3 FY 2025.
Our growth strategy
Recently, we have acquired land in Wada, Maharashtra, where civil work is already
underway. Completion is expected by Q4 FY 2025. Implementation of the new unit will be
done in three phases over the next 4-5 years. The annual revenue potential is of
approximately H400 crores upon achieving full capacity utilization across all 3 phases.
Additionally, we are focused on getting a greater revenue share from high- margin products
like IBC. From an overall perspective, we expect an asset turnover five times that of the
present day.
Going forward, we remain optimistic about our prospects. Improving movements in the
chemicals and pharmaceuticals, food and beverage and transportation and storage of liquids
are likely to fuel the growth of our industry.
Backed by a diversified portfolio and expanded capacities, we are geared to capitalise
on these trends and deliver exceptional value to our clients.
This phenomenon can especially be seen in our backward integration initiative where we
are venturing to undertake the pellet production which is used in plastic manufacturing.
The pellet will be used in IBC adding the incremental margins for the consolidated entity.
Gratitude
In closing, I would like to thank our entire team at Pyramid Technoplast for
collectively steering our organisation forward. I would like to express my sincere
gratitude to each and every employee for upholding our shared commitment to quality,
adaptability and sustainability. I would also like to extend my gratitude to our partners,
investors and stakeholders for their sustained cooperation.
As we embark on our next growth phase,
I am confident that Pyramid Technoplast is poised to drive sustained growth in the
industrial packaging sector.
Sincerely,
Mr. Bijaykumar Agarwal
Managing Director and Chairman