1. At a Glance
Garware Hi-Tech Films Ltd is India’s most profitable film producer — not the Bollywood kind, the polyester kind. With a 70% market share in shrink films and sole dominance in solar control window films, this chip-to-film pioneer is raking in export bucks, improving margins, and giving long-term investors blockbusters on the bourses.
2. Introduction with Hook
What happens when you take a boring B2B business, throw in vertical integration, strong exports, and zero debt?
📈 You get a 77% 5-year CAGR stock with no media hype and no CNBC noise.
Garware Hi-Tech is the polyester mafia you didn’t know existed. It doesn’t sell to you directly—but your food, your car window, your solar panel, your home interiors? They’re probably wearing a layer of Garware.
3. Business Model – WTF Do They Even Do?
Garware Hi-Tech Films operates in these niche-but-profitable segments:
- 🌞 Solar Control Window Films: Used for auto + architectural use. They’re the only backward-integrated manufacturer in the world.
- 🥤 Shrink Films: 70% domestic market share for product labels and packaging.
- 📦 Packaging Films: Used in flexible food & pharma packaging.
- 🎯 Specialty Films: Used in lamination, thermal insulation, and other high-margin B2B verticals.
This isn’t “plastic company hai” — it’s precision polymer engineering with global applications.
4. Financials Overview – Profit, Margins, ROE, Growth
| Metric | FY21 | FY22 | FY23 | FY24 | FY25 |
|---|---|---|---|---|---|
| Revenue (₹ Cr) | 989 | 1,303 | 1,438 | 1,677 | 2,109 |
| Net Profit (₹ Cr) | 126 | 167 | 166 | 203 | 331 |
| ROCE (%) | 13% | 13% | 12% | 14% | 20.5% |
| ROE (%) | 9% | 10% | 11% | 12% | 15.0% |
| OPM (%) | 22% | 18% | 16% | 17% | 21% |
🚨 TTM Net Profit up 63% YoY. Yes, that’s not a typo.
5. Valuation – Is It Cheap, Meh, or Crack?
| Metric | Value |
|---|---|
| CMP | ₹3,710 |
| EPS (TTM) | ₹142.57 |
| P/E | 26x |
| Book Value | ₹1,021 |
| P/B | 3.63x |
| Dividend Yield | 0.27% |
🎯 EduFair Value Range:
- Base Case (20x EPS of ₹142) = ₹2,840
- Bull Case (30x EPS of ₹155) = ₹4,650
- Current Price = ₹3,710
🧮 Fair Value Range: ₹2,800 – ₹4,650
Valuation is reasonable given growth, ROCE jump, and margin expansion — but not a fire sale.
6. What’s Cooking – News, Triggers, Drama
- 📈 Q4FY25 PAT up 34.5% YoY, OPM jumped to 21%
- 🏭 ₹643 Cr investments on books — big infra capex cycle visible
- 🌍 Exports growing strong — targeting global solar film markets
- 👮♂️ June 2025: GST raids on company premises; operations unaffected (so far)
- 👨👩👧👦 Insider trading penalty slapped on relatives of insiders — small, but ugly optics
In short: operations? 🔥. Governance? Hmm… needs watching.
7. Balance Sheet – How Much Debt, How Many Dreams?
| FY25 Snapshot | Value |
|---|---|
| Equity Capital | ₹23 Cr |
| Reserves | ₹2,349 Cr |
| Total Borrowings | ₹15 Cr (basically debt-free) ✅ |
| Total Assets | ₹2,682 Cr |
| Investments | ₹643 Cr (up 75% YoY) 🧐 |
🪙 Strong reserve build-up and net cash balance make this a robust balance sheet — could fund future capex without blinking.
8. Cash Flow – Sab Number Game Hai
| FY | CFO (₹ Cr) | Capex Outflow | Net Cash |
|---|---|---|---|
| FY23 | ₹218 Cr | ₹168 Cr | ₹-39 Cr |
| FY24 | ₹172 Cr | ₹-46 Cr | ₹48 Cr |
| FY25 | ₹330 Cr | ₹-274 Cr | ₹3 Cr |
Heavy investment in FY25, yet cash positive. That’s quality management — barring the insider trading chintu.
9. Ratios – Sexy or Stressy?
| Metric | FY25 |
|---|---|
| ROCE | 20.5% ✅ |
| ROE | 15% ✅ |
| OPM | 21% 🔥 |
| Working Capital Days | 120 😬 |
| Inventory Days | 116 |
| Cash Conversion Cycle | 68 Days |
| Promoter Holding | 60.73% (rock solid) |
🚨 WC days spiked — likely due to rising exports + capex stocking.
10. P&L Breakdown – Show Me the Money
- 💰 Sales: ₹2,109 Cr
- 🛠️ Operating Profit: ₹441 Cr
- 🧾 Other Income: ₹54 Cr
- 💥 PBT: ₹445 Cr
- 🧮 PAT: ₹331 Cr
- 💸 Dividend: ~₹12 Cr payout (~8% payout ratio — conservative)
Not a cash-guzzler. Payout is meh, but earnings growth is king.
11. Peer Comparison – Who Else in the Game?
| Peer | P/E | ROE | OPM | Market Cap |
|---|---|---|---|---|
| Supreme Industries | 57x | 17.1% | 13.7% | ₹53K Cr |
| Astral | 77x | 15.3% | 16.2% | ₹39K Cr |
| Garware Hi-Tech | 26x | 15% | 21% | ₹8.6K Cr |
⚡ Garware beats them all on margins, loses on visibility. It’s the quiet topper in a class full of noisy first-benchers.
12. Miscellaneous – Shareholding, Promoters
| Shareholder | Mar 2025 |
|---|---|
| Promoter | 60.73% |
| FII | 3.5% (up from 0.07% in 2022!) 📈 |
| DII | 4.75% |
| Public | 31.03% |
| Shareholders | 57,364 (up from 31K in 2022) 🚀 |
👀 FII accumulation is a signal. Retail’s waking up late, but the party’s not over yet.
13. EduInvesting Verdict™
Garware Hi-Tech Films is a unicorn in disguise:
- ✅ Export-heavy, niche product mix
- ✅ Strong margins and balance sheet
- ✅ Debt-free with smart capex
- ✅ Insane profit growth (63% TTM!)
BUT…
- 🧾 Watch for working capital buildup
- 🕵️♂️ Keep an eye on governance noise (insider trades, GST raid)
Verdict™: This ain’t just another plastic stock. It’s a specialty film blockbuster — playing in quiet theatres, earning big, and scripting multi-year sequels.
✍️ Written by Prashant | 📅 9 July 2025
Tags: Garware Hi-Tech Films, Shrink Films, Solar Control, Specialty Plastics, Polyester, Export Multibagger, ROCE, EduInvesting
