EPL Ltd. share price target

EPL Ltd. (EPLL) reported a weak operating performance in 1QFY22 on the back of higher other expenses due to an increase in freight costs and onetime expenses. Factoring in the 1QFY22 performance, we decrease our earnings estimate for FY22 by 6% on account of a slower pickup in volumes post the total shutdown in Colombia and the shutdown of its unit in Russia. On the other hand, we maintain our earnings estimate for FY23. We value the stock at 26x FY23E EPS to arrive at TP of INR320. Maintain Buy....

Performance of America and European regions has remained volatile amid pandemic led challenges. This, coupled with improved revenue contribution from personal care segment would help drive future margins...

The management has guided for double digit revenue growth in FY21-23E (we estimate ~10%) led by 8%, 12% revenue CAGR in the oral and personal care segment, respectively. The company has a strong order in pipeline (29% growth in April 2021 over April 2020) supported by new customer addition in Europe. We believe new client addition, consolidation of Stylopack in Amesa and increasing wallet share from existing clients in all...

We interacted with EPL's MD and CEO Mr. Sudhanshu Vats for an overall update on its business performance. The discussion included some key factors such as: a) future growth drivers, b) product pipeline/new initiatives, c) gradual shift from...

AMESA performance impacted topline EPL's Q3FY21 Revenue, EBITDA and net profit grew ~8%, 0.4% and 18% YoY to `7.7bn, `1.6bn and `709mn respectively. Topline saw subdued performance in AMESA region. Management highlighted weakness in beauty & cosmetics segment and temporary shifts from tubes to larger packs impacting overall volume performance despite most of the end-consumer companies reporting healthy volume growth. Personal care performance was however strong in other geographies aided by shift to laminated...

EPLL reported strong growth across EAP and the Americas region. This was primarily led by an increase in Personal Care revenue share in the EAP region. Operating profit was offset by sluggish performance in Personal Care in the AMESA region, coupled with higher employee and other expenses cost (attributable to expansion on the West Coast of America). 3QFY21 revenue was in line with our estimate, while EBITDA/PAT was below our expectation. Due to slower pick-up in AMESA and Americas, amid COVID-related lockdowns, we decrease our FY21E earnings estimate by 7%,...

Acquisition of Creative Stylo Packs for `2.5bn In line with its ambitions of scaling-up presence in Beauty and Cosmetics segment, EPL announced the acquisition of Creative Stylo Packs. The company is engaged in the business of plastic tubes, laminated tubes and corrugated boxes for the Beauty & Cosmetics and Pharma industry with marquee clients such as L'Oreal, Marico, Zydus etc. Annual production of 200mn tubes specialty plastic and decoration (Enough headroom for capacity and would be rationalize further); most of the business comes from Beauty and cosmetics (~85-90%) and 10-15% from...

EPL Ltd. (EPLL) reported strong growth across Europe and the EAP region amid the COVID-19 crisis. This was primarily led by an increase in market share and new customer additions. Operating profit was offset by sluggish performance in Oral Care in the AMESA region. 2QFY21 numbers were in line with our estimates, and we maintain our estimates for FY21. However, in the backdrop of the acquisition, we increase our earnings estimate for FY22/FY23E by 6%/3%. Maintain Buy....