PAG-backed Manjushree doubles down on pharma, high-margin packaging

“Over the past 18–24 months, we have taken several strategic measures to strengthen our financials through both organic and inorganic routes,” said Thimmaiah.

Pharma play begins

MTL’s push into pharmaceutical packaging follows PAG’s acquisition of the company last year from Advent International, which exited at a $1 billion valuation. Advent had initially planned to exit via an IPO but opted for a private-market deal instead, when PAG offered a better price.

The move is part of a broader shift toward specialised, higher-margin segments such as nutraceuticals and agrochemicals, which are more resilient and offer better profitability despite lower volumes.

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“Emerging sectors like nutraceuticals and agrochemicals may have lower volumes, but they deliver higher margins due to unique product requirements and elevated entry barriers for smaller players,” Thimmaiah said.

The company is also engaged in material conversion—shifting packaging from glass and metal to rigid plastics—citing its recyclability and low carbon footprint.

MTL’s profit more than doubled to ₹140 crore in FY24, while revenue rose marginally to ₹2,117 crore from ₹2,096 crore a year earlier. For FY25, the company expects to touch a scale of ₹3,500 crore, though final audited results are pending.

Thimmaiah said the company has actively optimised SG&A (selling, general and administrative) costs and boosted operational efficiency—across manufacturing, logistics, and packaging.

“We have optimised our SG&A costs and actively worked on improving efficiency across various operational areas including manufacturing setups, reducing lead times, and lowering logistics and packaging expenses,” he said.

MTL runs an innovation centre near its Bengaluru plant, with 25–30 employees handling the complete packaging lifecycle for a client base of around 1,000 brands —from concept and rapid prototyping to pilot runs and final production.

“We’ve transformed our approach to provide a one-stop solution—handling everything from concept design and rapid prototyping to pilot production and final manufacturing, including the use of recycled materials,” Thimmaiah said.

Private equity backing

These developments follow PAG’s acquisition of MTL last year, which has enabled the company to broaden its packaging platform.

PAG has also invested in Pravesha Industries, a specialised pharmaceutical packaging player. Its acquisition of MTL enables the creation of a broader packaging platform, allowing MTL to expand more aggressively into pharma packaging.

Currently, MTL operates six business units—container services for FMCG clients, preforms and closures for the beverage sector, pumps and dispensers, recycling, and pharmaceutical packaging via Pravesha.

Acquisition agenda

To grow its market share, the company plans to enter newer product segments and geographies through acquisitions. MTL claims to be India’s largest rigid plastic packaging player, with a 7% market share, underscoring the industry’s fragmented nature.

It aims to make 4–5 more acquisitions, spending a combined $150–180 million, as Mint had reported earlier.

 “As we continue exploring acquisition opportunities, we adopt a flexible financing approach,” Thimmaiah said. “Depending on the specific case, we may use internal accruals, raise additional capital, or consider a combination of both.”

Over the years, Manjushree Technopack Ltd (MTL) has expanded its national footprint and diversified its product offerings through a string of acquisitions. These include Pearl Polymer, Classy Kontainers, Oricon Enterprises Ltd, and Hitesh Plastics Pvt. Ltd, enabling MTL to enter new customer segments and industries across India.

“Most of the acquisitions we’ve made in recent years have been fully integrated within six months. We typically target companies with annual revenues between ₹100 crore and ₹1,000 crore,” said Thimmaiah.

Other key deals include Varahi in 2017 and select facilities of National Plastics Industries Ltd (Napla) in FY20. These moves, according to a Crisil report from December, have enhanced MTL’s product mix, helped onboard new clients, and increased wallet share from existing customers.

With over 30 manufacturing facilities across India, MTL serves a wide spectrum of consumer categories—home care, personal care, food and beverages, paints, nutraceuticals, agrochemicals, liquor, spirits, and dairy.

Its client list includes Reckitt Benckiser, Dabur India, Hindustan Coca-Cola Beverages, PepsiCo India, and Mondelez India Foods. MTL also competes with listed packaging peers such as Moldtek Packaging, TCPL Packaging, Uflex Ltd, and EPL Ltd.

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Consolidation ahead

Thimmaiah anticipates further consolidation in the packaging sector, given its highly fragmented nature and growing competitive intensity.

“For companies that lack scale, it becomes increasingly difficult to invest in R&D, talent, and facility upgrades. This results in outdated technologies and limits their ability to deliver high-quality solutions,” he explained.

He added, “This will drive smaller players to explore consolidation with larger ones. We expect the industry to eventually be dominated by 10–12 major players. Customers too are seeking partnerships with fewer, more capable suppliers that can offer end-to-end innovation and reliably meet expectations, even under fluctuating demand.”

Sector tailwinds

India’s packaging industry—estimated at ₹6.4 trillion in FY23—is projected to grow to ₹8.6 trillion over the next five years, according to a Technopak report. The growth is being driven by rising disposable incomes, urbanisation, increasing consumption of processed and packaged foods, and the expansion of e-commerce.

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In addition, government initiatives in organised retail and food safety regulations are expected to further drive demand for high-quality, standardised packaging solutions.