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Control Print Limited Q4 FY2024 Earnings Conference Call Summary
Submission Details • Date of submission: May 18, 2024 • Regulatory compliance: Submitted to BSE and NSE following SEBI regulations • Call date: May 13, 2024 • Key management present: Joint Managing Director Shiva Kabra and CFO Jaideep Barve
Financial Highlights • Q4 revenue: INR 98 crores (up from INR 84 crores in the previous quarter) • Full-year revenue: INR 344 crores (compared to INR 291 crores in FY2022-23) • Stable margins with a target of INR 400 crores in sales by FY2025
Strategic Insights • Focus on day-to-day operations rather than specific revenue predictions • Long-term growth strategy includes: • Increasing market share • Expanding product offerings • Exploring new geographies • Consumables accounted for 61% of total sales
Recent Investments • Establishment of a holding company in the Netherlands • Acquisition of a 50.49% stake in Codeology Group Limited • Acquisition of CP Italia S.r.l. and V-Shapes for single-dose packaging solutions
Revenue Breakdown • Codeology: £700,000 • Markprint: €750,000 • CP Italia: Recently started operations with a revenue drop post-COVID-19
Innovation and Market Positioning • Emphasis on innovation in the printing space • Focus on understanding customer needs and material cost impacts • No further acquisitions planned for the year, but geographical expansions are being explored
Sales and Tax Clarifications • Total printers sold: 2,859 for the year, 868 for the quarter (year-over-year decline) • Shift towards larger, more profitable customers despite lower sales volume • Tax adjustment of INR 32,00,000 due to investment gains
Future Outlook • New rental model for machines expected to generate ongoing revenue • Strategic focus on enhancing digital printing, track and trace solutions, and geographic expansion • Integration of new product lines from acquisitions to strengthen offerings
Closing Remarks • Acknowledgment of thoughtful questions from participants • Emphasis on a careful acquisition strategy and integration challenges • Positive early benefits anticipated from the V-Shapes acquisition, with a two-year projection for full potential realization
Control Print Limited Q3 FY2024 Earnings Conference Call Summary
Submission Details • Date of submission: January 31, 2024 • Compliance with SEBI regulations • Call held on: January 23, 2024 • Key management present: Joint Managing Director Shiva Kabra and CFO Jaideep Barve
Financial Performance • Consolidated revenues: • Q3 FY2024: INR 89 crores • Year-to-date: INR 262 crores • Year-over-year growth noted • Strong performance in consumables across industries • Optimism for future growth, especially in track and trace division • Higher expenses impacting EBITDA growth, but expected improvements with revenue increase
Q&A Highlights • Volume Growth and Capacity Utilization • Increased volume growth expected to lead to higher printer sales • Industrial sector growth noted, with a positive market outlook
• Competitive Position • Non-CIJ machine sales growing faster, contributing to market share gains
• Printer Sales Figures • 630 printers sold in the quarter, approximately 2,000 year-to-date • Focus on larger customers to enhance revenue per sale
• Market Share Stability • Revenue growth slightly faster than competitors • Revenue mix: 16% printers, 62% consumables, 7% spares, 14% services
Initiatives and Future Plans • Markprint and Track-and-Trace Updates • Progress in Markprint with ongoing projects in India • Track-and-Trace nearing completion of major installation, with plans for a second phase
• Financial Matters • Increase in tax outgo due to higher sales of investments • Average tax rate expected to remain around 17% • Strategy to maintain growth while building relationships with larger clients
• International Expansion • Pursuing growth initiatives: QRiousCodes, V-Shapes, and Markprint acquisition • Cautious approach to international markets following past challenges
• Track and Trace System • Compliance-driven system for pharmaceuticals using QR codes and blockchain technology • Existing thermal inkjet printers sufficient for application
Investment and Market Share • Total investment in Markprint: EUR 1.7 million (80% ownership stake) • Market share approximately 16-17% in a projected INR 2,000-2,100 crores industry • Clients often have multiple suppliers; contracts range from three to six years
Supply Chain and Future Growth • No significant global supply chain challenges reported • Potential benefits from increased manufacturing in India • Emphasis on ongoing sales strategy improvements and new initiatives for growth
Control Print Limited Q2 FY2024 Earnings Conference Call Summary
Submission and Compliance • Transcript submitted to Bombay Stock Exchange and National Stock Exchange of India on October 31, 2023. • Call held on October 23, 2023, featuring management including Joint Managing Director Shiva Kabra and CFO Jaideep Barve.
Financial Highlights • Record Q2 operating revenues: INR 83 crores (up from INR 68 crores last year). • Profit After Tax (PAT): 17.5%. • Steady expense ratio with plans for focused marketing and increased market share.
Printer Sales and Capacity Utilization • Sold 705 printers in Q2, an increase from 679 units last year. • Capacity utilization at 60-70%, with potential to scale up to 1,000 printers. • Consumables utilization at 60-65%.
Market Outlook and Growth • Positive outlook for capital expenditure in FMCG and large-scale manufacturing. • Optimism for better sales numbers by March, dependent on product mix and pricing.
Gross Margin Concerns • Decline in gross margins from 68% to 60% over five years discussed. • Fluctuations attributed to product mix and external factors (e.g., GST benefits, COVID-related costs).
Revenue Breakdown • Revenue sources: Consumables (62%), Printers (15%), Spares (7%), Services (14%). • Mask business contributes only 0.2% of total revenue, with revival efforts underway.
Demand Environment • 22% revenue growth in H1, significantly above industry average (9-11%). • Increased inquiries driven by manufacturing growth in India, focusing on mid- to large-sized corporate clients.
Tax Benefits and Regulatory Landscape • Tax benefits in Guwahati expiring in May 2025, reverting to normal tax rates. • Development of new technologies, including Markprint, and compliance with pharmaceutical track and trace regulations.
Production Costs and Market Growth • Production line costs range from INR 25 lakhs to INR 45 lakhs based on product volume and value. • Coding and marking market estimated at INR 1,800 crores, with expected growth of 10-12% annually.
Future Growth Areas • Key growth areas identified: packaging, digital printing, and track increase software. • Challenges in increasing market share beyond current 23-24% due to operational complexities.
Equity Investments • Market-to-market value of equity investments: INR 52 crores, cost of INR 42 crores as of September 30. • Updates on growth initiatives to be shared in January.
Submission Details • Date of Submission: August 7, 2023 • Regulatory Compliance: Transcript submitted to Bombay Stock Exchange and National Stock Exchange of India. • Conference Call Date: August 1, 2023 • Key Participants: Joint Managing Director Shiva Kabra and CFO Jaideep Barve.
Key Updates • Acquisition: Markprint B.V. is launching technology in India. • Revenue: INR 2.35 crores from Markprint for the quarter. • Expansion: Growth in dairy business and exploration of other sectors.
Performance Highlights • Market Stability: Focus on pharmaceuticals and packaging. • Printer Sales Decline: 650 units sold this quarter vs. 775 last year due to technical issues and strategic focus on higher-value customers. • Customer Acquisition: Despite sales challenges, the company is gaining new customers.
Growth Strategy • Market Growth Projection: Expected to grow at 1.5 times India's GDP growth (6-7%). • Core Focus: Coding and marketing business, with potential acquisitions. • Addressable Market: Estimated between INR 1,800 to INR 2,000 crores in India.
Operational Updates • Sri Lanka Operations: Gradual business revival expected over 2-3 years. • Southeast Asia Expansion: Currently focused on India due to resource limitations.
Technical Challenges • Printer Issues: Addressing technical difficulties and component shortages. • Barcoding Regulations: Prepared for new regulations in the pharma sector.
Financial Insights • Q1 Standalone Revenue: INR 79 crores, with expectations to surpass last year's turnover. • Capacity Utilization: Guwahati facility operating at 60% capacity.
Consumables and Packaging • Consumables Growth: Margins steady, with growth slightly outpacing printers. • Packaging Sector: Stable demand, driven by premiumization among top customers.
Buyback Announcement • Buyback Amount: INR 800, with INR 27 crores allocated. • Purpose: Return excess cash to shareholders, viewed as a tax-efficient alternative to dividends.
Track and Trace Solution • Deployment Readiness: Technologically superior solution ready for market. • Revenue Contribution: Currently minimal, but aims for growth through superior technology.
Closing Remarks • Gratitude: Thanks to participants and acknowledgment of shareholder value initiatives. • Future Outlook: Cautious optimism about growth dependent on market conditions and execution.
Control Print Limited Q4 FY2023 Earnings Conference Call Summary
Submission and Compliance • Transcript submitted to Bombay Stock Exchange and National Stock Exchange of India on May 9, 2023. • Call held on May 2, 2023, featuring management including Mr. Shiva Kabra (Joint Managing Director) and Mr. Jaideep Barve (CFO). • Hosted by Asian Markets Securities Limited; transcript available on the company website.
Company Overview • Established in 1991, specializes in coding and marking solutions. • Only Indian manufacturer in a market dominated by a few major players. • State-of-the-art manufacturing facilities in Himachal Pradesh and Assam.
Financial Performance • 15% increase in operating revenue for FY2023, totaling ₹291 Crores. • Robust installed base of over 70,000 printers supporting consumable sales. • Growth in key metrics: EBITDA and PAT, with stable expense ratios.
Strategic Collaborations • Joint venture with an Italian company and acquisition in the Netherlands to enhance product offerings. • Focus on increasing consumable sales and expanding market share.
Q&A Highlights • Printer lifespan confirmed as 5 to 8 years, ensuring steady demand for consumables. • Revenue breakdown: 55-60% from consumables, 15-20% from printer sales, 10-15% from service income, 8-10% from spare parts. • Top sectors: pipes and dairy (40% of revenue), with other sectors contributing 6-7% each.
Future Outlook • No specific revenue projections provided; aim for sustainable growth and stable margins around 25%. • Minimal capital expenditures expected for FY2024, typically covered by depreciation. • Approximately 950 printers sold in Q4, with 3,200 to 3,300 for the full year.
Joint Ventures and Market Position • Packaging joint venture aims for a 50:50 equity structure, currently at 90:10 pending approvals. • Sales for track and trace products increasing due to pharmaceutical industry demands. • Company positioned as the fourth player in the coding and marking industry, with a market size estimated at ₹1800 to ₹2000 Crores.
Cash Management and Investments • Cash and cash equivalents around ₹70 Crores; board considering tax-efficient methods for returning excess cash to shareholders. • Focus on maintaining liquidity for potential acquisitions.
Operational Updates • Supply chain improvements with 80% of previous challenges resolved. • Inventory levels aligned with sales needs amidst global supply chain tensions. • Ongoing efforts to enhance software capabilities for supply chain tracking.
Conclusion • Emphasis on long-term strategic focus, managing costs, and optimizing margins. • Acknowledgment of challenges in customer acquisition within an oligopolistic market.
Control Print Limited Q3 FY2023 Earnings Conference Call Summary
Compliance and Overview • Date of Call: January 23, 2023 • Submission of transcript to Bombay Stock Exchange and National Stock Exchange of India on January 30, 2023. • Key Management: Joint Managing Director Mr. Shiva Kabra and CFO Mr. Jaideep Barve.
Financial Performance • Revenue Growth: 20% year-on-year. • Revenue Breakdown: • 20% from printers • 57% from consumables • 13% from services • 8% from spares • Margins: Drop in gross margins due to high raw material costs; stable EBITDA margins.
Market Strategy • Focus on optimizing inventory and expanding market share in sectors like pipes, food, and FMCG. • Gradual improvement in market share in food and pharmaceutical sectors. • Acquisition of Mark Print contributing EUR 0.5 million in revenue.
Product Development and Customer Acquisition • Ongoing optimization of products to meet diverse customer needs. • Plans to expand sales and service team by adding 20-30 personnel. • Confirmation of executing all outstanding orders despite supply chain challenges.
Revenue Targets and Future Outlook • Revenue target of Rs. 400 crores for FY25, contingent on market conditions. • Expected revenue growth of 17% to 20% over the next five years. • Focus on existing customers for revenue growth rather than new market dynamics.
Supply Chain and Cash Management • Supply chain issues affecting margins; improvements expected in 3-6 months. • Over 50 crores in cash reserves; board considering options for redistributing excess cash, including buybacks.
Joint Ventures and New Initiatives • Investment of ₹10 crore in V Shapes for innovative packaging solutions. • Target markets for new products include pharmaceuticals, cosmetics, and high-value food items. • Establishment of a joint venture with existing customers focusing on proprietary materials.
Conclusion • Emphasis on sustainable growth despite challenges. • Ongoing efforts to address cost increases and improve product offerings. • Encouragement for investors to submit complex questions for future clarity.