HUHTAMAKI - HUHTAMAKI INDIA LIMITED Share Price

Management's outlook for Huhtamaki India Limited indicates a cautious but strategic approach moving into 2026, focusing on delivering profitable growth and improving operational efficiencies.

Key financial highlights include:

• Q4 2025 net sales were INR 6 billion, flat year-on-year and sequentially.
• For the full year, net sales totalled INR 23.9 billion, reflecting a 2.5% decline from INR 24.5 billion in 2024.
• Profit before tax (PBT) in Q4 increased to INR 410 million, up from INR 152 million in Q4 2024, while yearly PBT reached INR 1.57 billion, an 83% increase compared to INR 860 million in 2024.
• Net profit for Q4 was INR 303 million, compared to INR 117 million in the same period last year.
• For 2025, net profit reached INR 1.182 billion, increased from INR 880 million in 2024.

Forward-looking points include:

• Continued focus on operational efficiencies and product mix optimization to support sustainable profit margins.
• Proactive measures taken on regulatory impacts, notably regarding employee liabilities, suggesting minimal future business disruption.
• The company aims for significant improvements in sustainability, with safety incidents reduced by nearly 50% year-on-year and upcoming renewable energy initiatives expected by Q2 2026.
• Anticipation of potential volume growth despite previous years of stagnation, with strategies in place to enhance market share against competitors.

Kamal Taneja emphasized the importance of profitable growth, capital discipline, and accountability in driving the company's future direction. Challenges remain, particularly around external factors influencing market dynamics.

Q&A Section Summary

Question 1: What sort of capacity utilization are you currently working on, and what is the outlook for growth?
Answer: We have conducted optimization exercises and improved operational efficiency, allowing us room for growth. I am confident that our capacity utilization for the next few years will be sufficient for our growth ambitions.

Question 2: What are your thoughts on your return ratios, which remain in single digits?
Answer: I wouldn't label our returns as inferior; they are competitive within the industry. However, I acknowledge the need for improvement, and we will focus on enhancing our performance moving forward.

Question 3: How sustainable are your margins, and when do you anticipate top-line growth?
Answer: Our recent operational changes are designed to be sustainable. Nevertheless, external factors like market conditions may impact growth. Our main priority globally is to drive profitable growth, and we will report on our progress in future calls.

Question 4: Can you confirm the repayment status of the ECB from the parent company?
Answer: The ECB scheduled for repayment in February 2026 has been postponed to June 2027, as it aligns with regulations. I will check for further clarity on this matter.

Question 5: What is your strategy for revenue growth, considering you have been stagnant around INR2,500 crores?
Answer: We've developed a clear strategy focusing on profitable growth, capital discipline, and accountability. By discontinuing low-profit segments, we aim to enhance overall profitability and market positioning.

Question 6: How is the Blueloop product performing, and are there plans for introducing new products?
Answer: Blueloop is a priority, and while growth has been slower than expected, we believe in its potential. We regularly evaluate new product opportunities, and there's a robust pipeline based on global innovations.

Question 7: What are your current tailwinds and headwinds, and what are your 2026 priorities?
Answer: Tailwinds include India's growing market, while headwinds revolve around regulations and customer demand shifts. Our priorities for 2026 remain focused on profitable growth, capital discipline, and accountability.

Question 8: Why have there been simultaneous leadership changes recently?
Answer: These changes were not part of a systematic plan; they reflect individual circumstances. The key takeaway is that the company's principles and operations will guide our success, regardless of personnel changes.

Question 9: What is the current market share of Huhtamaki?
Answer: Given the fragmented nature of our market, estimating share is challenging. I emphasize that we continue to focus on achieving profitable growth moving forward.

Question 10: Can you address the high IT costs relative to margins?
Answer: While the costs may seem high, they enable operational efficiency and provide essential support. While I'm new, I acknowledge the concern and will evaluate this as we move ahead.

Question 11: What are your thoughts on taking dividends for minority shareholders?
Answer: We've maintained a strong dividend policy, and any changes will be communicated. Your feedback is noted, and we'll assess future distributions accordingly.

Question 12: What external factors impact your growth and margin aspirations?
Answer: We strive for a fair, regulated environment to help our customers succeed, but many factors are beyond our control. Our primary focus remains on aligning our strategy for profitable growth.