| Experienced management and established track record of operations
DPIPL is managed by Mr. Naresh Gangabishan Sikchi along with Mr. Anil Ramgopal Mali and a team of experienced personnel. The directors possess nearly a decade of experience in the manufacturing business. The long-standing experience of the promoter and long track record of operations has helped the company to establish comfortable relationships with key suppliers and customers. Acuite believes that the company will continue to benefit from its established presence and track record along with a healthy relationship with customers.
Steady growth in revenues amidst modest scale of operations and comfortable liquidity
The company’s operating scale remained modest, however improved with operating income increasing to Rs. 87.16 Cr. in FY2026 as against Rs. 58.52 Cr. in FY2025, driven by higher sales volumes and improved realizations and increasing demand from the hygiene and flexible packaging segments. The company has continued its growth momentum in the current year, achieving an operating income of Rs. 53.31 crore during H12027, higher than previous year same period. The company's operating margin recovered marginally to 11.33 percent in FY2026 as against 10.45 percent in FY2025 and 14.18 per cent in FY2024, mainly supported by higher sales volumes, improved product mix, strong operating leverage and better capacity utilisation. Further, the operating margin stood at 12.55 percent in H12027. Consequently, the PAT margin improved to 5.68 percent in FY2026 from 4.18 percent in FY2025, primarily due to higher operating profits and improved cost absorption. Acuite believes that the company's operating performance is expected to improve steadily over the medium term on the back of steady demand.
Moderate Financial Risk Profile
The financial risk profile of the company remains moderate, characterized by a modest net worth base, low gearing, and comfortable debt protection metrics. The tangible net worth remained modest at Rs. 21.97 crore as on March 31, 2026, as against Rs. 17.01 crore as on March 31, 2025, supported by accretion of profits to reserves. The company's total debt stood at Rs. 13.85 crore as on March 31, 2026, comprising long-term debt of Rs. 10.51 crore, short-term debt of Rs. 2.35 crore, unsecured loans from promoters/directors of Rs. 0.31 crore, and current maturities of long-term debt of Rs. 0.68 crore. The capital structure remained comfortable, with gearing improving to 0.63 times as on March 31, 2026 from 0.95 times as on March 31, 2025. The debt protection indicators also improved and remained comfortable, marked by an Interest Coverage Ratio (ICR) of 7.31 times in FY2026 as against 4.55 times in FY2025 and a Debt Service Coverage Ratio (DSCR) of 5.21 times as against 3.94 times during the same period. Further, the TOL/TNW improved to 1.01 times as on March 31, 2026 from 1.42 times as on March 31, 2025, while Net Cash Accruals to Total Debt (NCA/TD) improved to 0.55 times from 0.25 times, supported by higher accrual generation during the year. Acuite believes that the financial risk profile of the company would remain moderate over the medium term due to modest net worth base.
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| Moderately intensive working capital management
The working capital operations of the company remained moderately intensive, albeit with an improvement during FY2026, as reflected by the Gross Current Assets (GCA) days of 111 days as against 127 days in FY2025. The improvement was primarily driven by a reduction in the debtor collection period, which moderated to 57 days in FY2026 from 80 days in FY2025, indicating relatively better receivables realization. Inventory holding increased to 56 days in FY2026 from 34 days in FY2025, owing to higher stocking levels maintained to support the increased scale of operations and ensure timely execution of customer orders. Creditor days stood at 34 days in FY2026 as compared to 49 days in FY2025. Furthermore, the company's reliance on bank working capital limits remained moderate, with average utilisation of fund-based working capital facilities at around 16.18 per cent during the six months ended September 2026. Acuite believes that the operations of the company would remain moderately working capital intensive in near to medium term.
Susceptibility of profitability to volatility in raw material prices and demand in end-user industry
DPIPLs profitability remained susceptible to volatility in raw material prices, major raw materials such as HDPE, LDPE, LLDPE are derivatives of crude oil, hence their prices witness fluctuations, thus any variations in raw material prices can impact profitability. Further, the company supplies PE films to hygiene/ baby product manufactures where there is stiff competition, thus the scale and fortunes of DPIPL are highly dependent on the performance in the end user industry.
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