During the trading session of Friday, the shares of one of the largest recyclers of End of Life Tyres (ELT) in Asia moved up by 0.7 percent on BSE to Rs. 1,774.
With a market capitalisation of Rs. 2,940.3 crores, the shares of Tinna Rubber and Infrastructure Limited opened in the green at Rs. 1,771, up by 0.5 percent, as against its previous closing price of Rs. 1,761.75.
Stock Performance
In the previous six months, the stock has delivered multibagger returns of nearly 146.5 percent, while around 312 percent in the last one year. So far in 2024, it has given about 199 percent of multibagger returns.
The stock has delivered multibagger returns of around 21,172 percent over a five-year period, spanning from Rs. 9.55 in July 2020 to the current stock price level of Rs. 1,716.
This indicates that if an investor had invested Rs. 10,000 in the stock five years ago, it would have gained to nearly Rs. 21.3 lakhs.
Management Guidance:
Tinna Rubber has allocated approximately Rs. 48 crores for capital expenditure (CAPEX) in FY25.
By FY27, the company aims to achieve a revenue compound annual growth rate (CAGR) of over 25 percent, exceed 30 percent return on capital employed (RoCE), reach revenues of Rs. 900 crores, and attain an EBITDA margin of 18 percent.
Additionally, the company targets a 33 percent growth in profitability and plans to expand its capacity to 2.5 lakh metric tonnes per annum (MTPA) by FY27.
Segment Performance:
In Q1 FY25, the infrastructure segment experienced a 65 percent increase in volume and a 48 percent increase in revenue on a YoY basis, since Q1 was the peak season for road infrastructure, and due to the parliamentary elections, road construction activities were at their peak.
The industrial segment sales remained consistent, with MRP volume increasing by 6 percent YoY. There was 51 percent YoY volume growth from export accounts.
The consumer segment, particularly turf, rubber tiling, and gym mat applications, has witnessed a 150 percent volume growth on a YoY basis.
The steel segment revenue in Q1 FY25 increased by 85 percent YoY, with a nearly 72 percent volume growth, as a result of higher levels of tyre crushing.
Financials:
The company experienced significant growth in its revenue from operations, showing a year-on-year rise of around 70 percent from Rs. 80 crores in Q1 FY24 to Rs. 136 crores in Q1 FY25.
Similarly, its net profit increased during the same period from Rs. 7 crores to Rs. 16 crores, indicating a rise of nearly 128.6 percent YoY.
On a year-on-year basis, the Earnings Before Interest, Taxes, Depreciation, and Amortisation, or EBITDA increased from Rs. 17.7 crores in Q1 FY24 to Rs. 24.7 crores in Q1 FY25, registering a growth of 39.5 percent.
In terms of return ratios, Tinna Rubber has reported a return on equity (RoE) of 36 percent, and a return on capital employed (RoCE) of 32.6 percent, while the company’s Earnings Per Share (EPS) stands at Rs. 29.
In addition, the company has maintained better margins over the years. In FY24, the company reported a net profit margin of 10.49 percent and an operating margin of 15.84 percent.
Shareholding Pattern:
As per the latest shareholding pattern, the Promoters hold a 72.65 percent stake in the company, Foreign Institutional Investors (FII) hold a 0.79 percent stake, while Retail Investors hold a 26.22 percent stake in Tinna Rubber.
As of June 2024 shareholding data available with the BSE, ace investor Dolly Khanna holds nearly 1.76 lakhs equity shares or equivalent to a 1.03 percent stake in the company.
About the Company:
Founded in 1977, Tinna Rubber & Infrastructure Limited is primarily engaged in the recycling of waste tyres/end-of-life tyres (ELT) and the manufacturing of value-added products.
The company manufactures crumb rubber, crumb rubber modifier (CRM), crumb rubber modified bitumen (CRMB), polymer modified bitumen (PMB), bitumen emulsion, reclaimed rubber/ ultrafine crumb rubber compound, cut wire shots, polymer composites etc.
The products are primarily used for making/repairing roads, tyres and the auto parts industry.
The company is the first to market and the largest player for Rubberised Bitumen (CRMB) in India. It is also the largest supplier of Micronized Rubber Powder to the tyre & conveyer belt Industry in India and holds the position of the largest manufacturer of Crumb Rubber and Crumb Rubber Modifier (CRM) in the country.
Written by Shivani Singh
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