Crystal Plastic Manufacturing and Technology Joint Stock Company just listed its stock on HOSE on August 21, 2017 with stock code PLP. After just one week of trading, this stock witnessed a continuous increase in ceiling price, from the floor price of VND 12,000 / share to VND 18,800 / share.
The precursor of the company was Pha Le Mineral Joint Stock Company, starting from a small mining factory focusing on exploiting and trading stones, now the company has grown into a well-known enterprise with its head office in Hanoi. and two branches in Hai Phong (where the factory is located) and Nghe An (the mine site).
Currently, Pha Le Plastic owns 2 Granite quarries in Ninh Thuan, 3 white marble quarries in Nghe An and especially limestone quarries in Thung Hung Mountain, Quy Hop with a total area of over 10 hectares, reserves. Abundant amount and whiteness above 98.7%. This is a strategic asset to help establish the position of the company in the domestic market and the world.
PLP started focusing on investing in the production of Filler Masterbatch additives (which are additives added with CaCO3 as the main component and other additives) from the end of 2016. Since then, PLP’s revenue and profit have increased. Breakthrough growth, the first 6 months of 2017 revenue reached 145 billion, nearly 5 times the same period in 2016; Profit after tax reached VND 24.7 billion while that of 2016 was only VND 7.6 billion. Plastic resin alone contributed 83% of revenue and 99% of the company’s gross profit.
The great advantage of PLP is that its factory in Hai Phong and manufacturing facilities have convenient logistics systems and good infrastructure, located near Hai Phong port (2km away) and close to the Hanoi – Hai Phong highway, Therefore raw materials and finished products can be shipped at low cost and time. In addition, PLP’s mines are in convenient locations for shipping by sea.
Plastic additives story
Realizing that many world manufacturers come to Vietnam to buy white limestone at very low prices, then create very high value-added products such as high-tech biodegradable bags and products. Other plastics, Mr. Mai Thanh Phuong, Chairman of PLP and his colleagues were anxious to find ways to bring these added values to Vietnam.
Originating from geological studies, with the desire to fully utilize the value of resources from Vietnam’s mines, Mr. Phuong realized that mixing white limestone powder (can account for 75-85%) to create Plastic additives are very low cost compared to conventional plastic resins, thus helping to significantly reduce the cost of products. Meanwhile, limestone mines with a whiteness of over 98% in the world are very rare, only some countries such as Italy or Egypt, and in Vietnam also focus mainly in Yen Bai (currently HII production). and in Nghe An (Quy Hop and Tan Ky districts). Since then, PLP’s Filler Masterbatch has been launched and is currently exported to nearly 30 countries around the world, including Europe, the US, China, the Middle East, India, Bangladesh and Russia.
Additive resin market
With the total worldwide consumption of more than 300 million tons of plastic beads per year, the consumption of plastic additives is equivalent to 40 million tons. According to a report on the plastic additive plastic market of Plastic Europe, the revenue of plastic additives in the world in 2017 is estimated at 10.5 billion USD and is expected to increase to 13.41 billion USD in 2022, reaching a growth rate. The average growth is 5.1% / year.
In Vietnam, each year, Vietnam has to import about 3.5 million tons of raw materials for the plastic industry, not to mention additives for the plastic industry, while domestic enterprises only meet 900 thousand tons / year. . The average annual growth rate of production output from 2006 to now is about 19%, showing the growth potential of the industry and the huge demand for plastic resins. The State through Decision No. 2992 / QD-BCT has given many financial incentives to plastic businesses from now until 2025, so PLP is enjoying a lot of incentives from the State’s policies such as: exemption of corporate income tax for the first 4 years, reduction of 50% of payable tax amount for the next 9 years (starting from 2016), import and export tax exemption …
Future development plan
At the end of Q4 / 2016, PLP put into operation three production lines of Filler Masterbatch with a capacity of 4,000 tons of products per month, helping 2016 revenue to quadruple compared to 2015. Expected, by the end of the year 2017 PLP continues to increase its capacity to over 9,000 tons / month (2 new lines will start trial run in October 2017 and go into mass production from early December 2017).
According to the plan, in mid-2018, the company will continue to make major investments to expand its factory in Hai Phong, bringing the total production line here to 10 lines, equivalent to a capacity of 15,000 tons per month. In addition, the company will bring production and crushing points to Nghe An to optimize logistics activities and production processes.
In 2017, investing in the factory and production line will double the design capacity of Crystal plastic additives. Currently, the company has contacted foreign partners to solve the output for the product. In the first 6 months of 2017, PLP’s sales activities were very positive. Some of the major contracts being implemented are those with Filler Master Batch with Global New Material Ltd., Hindusthan National Glass & Industries ltd., Rakha Al-Khaleej International FZCO; Limestone contract with Orientlink Ltd., Bashundhara Multipaper Industries Ltd …
At the present time, the company’s performance capacity is about 70%, due to the management’s guidelines of solid product development, good quality management and control to ensure a stable export market. firm.
According to VPBS Securities Company, sales volume of Crystal Filler Masterbatch of Crystal in 2017 is expected to reach 40,068 tons. With the selling price of USD 330 / ton (equivalent to VND 7.2 million / ton), the revenue from this segment of the company will reach VND 288 billion. In addition to the revenue from the sale of CaCO3 and other stone powder, the company’s total revenue is expected to reach VND 341 billion in 2017, an increase of 165% year-on-year and after-tax profit at VND 56.4 billion, an increase of 6.5 times more than last year. According to this scenario, 2017 EPS of Crystal is expected to reach 3,763 dong / share.
PLP’s stock is currently trading at a forward P / E of 5.0x, much lower than the average P / E of domestic plastic industry (10.5 times) and VNIndex (15.2 times). ).