UFlex India's Egypt Plant To Generate Revenue From FY27: CFO Rajesh Bhatia

Rajesh Bhatia said the aseptic packaging plant will be up and running by Q2FY26.

Ufelx share price gained 3.4%. (Source: Company website)

UFlex Ltd. will see revenues from the new aseptic packaging plant start coming in by FY27, the company’s group president (finance and accounts) and chief financial officer Rajesh Bhatia has said.

UFlex on October 4 announced that its step-down wholly-owned subsidiary, Flex Asepto (Egypt) SAE, will start a new aseptic packaging facility in Egypt with an investment of $126 million.

Talking to NDTV Profit, Bhatia said that the plant will be up and running from the third quarter of FY26.

“We will have the revenues clicking in from FY27 onwards,” he added.

UFlex started its first aseptic packaging plant in Sanal, India, with a capacity of 3.5 billion packs a year. In 2022, the company doubled its capacity to 7 billion packs and now the plant has a 120% capacity utilisation.

“In light of this, we thought of taking this product global for the first time through our project in Egypt which now has a capacity of 12 billion packs a year,” Bhatia said.

Also Read: Uflex's Bullish Commentary For FY20

The CFO also revealed that the $126 million investment will not be upfront and the company will incur some debt for it.

“We are expecting to do 70% debt and 30% equity, or maybe a little more on the debt side. The next few weeks will establish how much we can achieve,” he said.

Bhatia explained that if the company took the entire amount as debt with an average interest rate of 7%, it would have an additional $8.5 million in interest when the full project is on.

“At a turnover of $150 million, we are well within the margins. We look forward to healthy Ebitda margins and post-interest margins,” he added.

The top executive emphasised that the new project would not affect the company's profitability.

He noted that given the company already supplies its products to various countries, the approval process for the products from the Egypt facility will be faster.

“In about the first year, we should be looking at 50% capacity utilisation level, going up to about 65-70% in the third year,” he said.

UFlex is looking at Europe as a market to supply its products from the Egypt facility, mainly because exports from the country are duty-free in Europe.

Ufelx share price gained 3.4% to touch an intraday high of Rs 685 apiece on the NSE on Tuesday, compared to its previous close of Rs 662.50.

At around 3 pm, the stock was up 2.33% at Rs 677.90 apiece compared to the benchmark Nifty 50's gain of 0.73%.

Also Read: Uflex Q3 profit jumps 47.22 per cent to Rs 53 crore

Watch LIVE TV , Get Stock Market Updates, Top Business , IPO and Latest News on NDTV Profit.
WRITTEN BY
N
NDTV Profit News
NDTVProfitnews@ndtv.com... more
GET REGULAR UPDATES