Tinplate

Tinplate Company of India Ltd (TCIL) for Q2FY16 posted a 11% (YoY) decline in net sales at Rs.223 crore and yet net profit was up 40% at Rs.21 crore. This was thanks mainly to the reduction in costs. Apart from lower raw material costs, 13% drop in consumption of stores and spares and 24% drop in packaging cost helped. EBITDA was up at 30% at Rs.48 crore while margins were up from 14.8% to 21.52%. Interest cost was down 65%.

TCIL is an associate company of Tata Steel. Incorporated in 1920 at Jamshedpur, TCIL is the leader in the Indian tinplate industry and its products are used mainly for packaging food.  It has been exporting 25-30 per cent of its production to South East Asia, West Asia and Europe, and hopes to increase this proportion. The company is one of the lowest cost converter of hot rolled coils from Tata Steel to tinplate.  As at 30th Sept 2-15, Tata Steel holds 74.96% stake in the company. The good news here – its H1FY16 net profit at Rs.44 crore is already what it had ended FY15 with so clearly it will end FY16 on a bumper note, what with metal prices being down.