Cosmo First results – Expects worst to be behind

Cosmo First declared its financial results for the quarter that ended June 2023.

The results for the quarter would have been better by Rs. 20 crores, but for the non-repetitive inventory loss arising from the sharp drop in prices of raw materials towards the quarter end.

During the quarter, the BOPP demand has started picking up and demand-supply balance should get restored in the coming quarter(s). In the case of BOPET where the supply is far in excess of demand, it will take many more quarters for the supply-demand gap to bridge. Margins are, therefore, likely to remain under pressure with little downside risk.

The export markets showed signs of improvement with better specialty sales. Cosmo with over two-thirds of its revenue coming from BOPP specialty films could withstand the margin pressure better than the industry. We continue to build our specialty films portfolio by adding specialty polyester films, including shrink label and sun shield films which would further strengthen our overall margins and also the ability to withstand margin pressures, if any, in the future.

The company’s Petcare vertical (Zigly) continues to grow rapidly and clocked monthly revenue (GMV) with a run rate revenue of Rs.3 crores on the back of expanding retail footprints, innovative sales promotion, and increasing online presence. The acquisition of Petsy, an online venture in the Petcare space, is complete and would further accelerate the growth of the Petcare vertical.

The Specialty Chemical subsidiary is set to launch newer adhesives in H2, FY24.

Commenting on the company’s performance Pankaj Poddar, group chief executive officer, Cosmo First, said, “The company is working on multiple growth drivers including specialty BOPET films, sun shield film, rigid packaging, specialty chemicals, petcare, etc. We are optimistic that these initiatives will provide impetus to faster growth of the Company in the coming years. In the short-term, we remain focused on increasing specialty sales & grow new businesses.”