UFlex sees 12.8% revenue growth in Q3 FY25 as packaging business expands

UFlex Limited, India’s largest flexible packaging and solutions provider, reported robust financial results for the third quarter of fiscal 2025, driven by strong demand for packaging films and flexible packaging solutions. The company recorded a 12.8% year-on-year revenue growth, with consolidated net revenue reaching ₹37,742 million for the quarter ended December 31, 2024. This growth was fueled by higher sales volumes, improved operational efficiencies, and favorable forex movements.

UFlex’s normalized EBITDA for Q3 FY25 stood at ₹5,207 million, up 22.3% year-on-year, with margins expanding to 13.8%. Profit after tax also showed a significant turnaround, rising to ₹1,368 million, compared to a net loss of ₹672 million in Q3 FY24. The company benefited from better capacity utilization in packaging films, an optimized product portfolio, and a forex gain of ₹257 million, reversing the previous year’s currency-related losses. The total sales volume for Q3 FY25 reached 157,036 metric tons, an increase of 6.3% year-on-year. Packaging films accounted for 78.5% of total sales, while flexible packaging contributed 21.5%, reflecting sustained demand across India, Europe, and Nigeria.

What is driving growth in the packaging films business?

UFlex’s packaging films segment remains the primary growth driver, supported by higher capacity utilization and increased global demand. The company’s consolidated packaging films production volume increased by 10.9% year-on-year, reaching 129,169 metric tons in Q3 FY25. Capacity utilization improved by 600 basis points year-on-year to 83.6%, underscoring UFlex’s ability to optimize its manufacturing capabilities.

In India, the packaging films market witnessed strong momentum, with BOPET films leading the growth. UFlex India’s packaging films capacity utilization rose to 76.4% in Q3 FY25, up from 73.7% in the previous year, driving a 3.7% increase in production volume. However, pricing fluctuations in the BOPET and BOPP segments remain a challenge due to global supply chain dynamics, shifting import-export trends, and volatile raw material costs.

In the Americas, particularly the U.S. and Mexico, election-driven consumer demand and festive season spending bolstered sales, resulting in a 15.2% year-on-year increase in sales volume. Capacity utilization in this region surged to 103.7% in Q3 FY25, compared to 94.8% in Q3 FY24, reflecting strong operational efficiency.

In Europe, packaging films sales volume grew by 13.5% year-on-year, with a notable 27.3% increase in the nine-month period. The CIS region contributed significantly, with the new CPP film line boosting capacity utilization to 60.9% in Q3 FY25 from 49.4% in the previous quarter.

The Middle East and Africa region also witnessed strong growth, with production volumes rising by 11.4% year-on-year. In Nigeria, the BOPET plant achieved 89.7% utilization, a sharp increase from 64.6% in Q3 FY24.

How is the flexible packaging segment recovering?

UFlex’s flexible packaging business rebounded in Q3 FY25, with a 15.0% year-on-year revenue increase. Despite seasonal weakness in liquid packaging, the company reported record-high capacity utilization of 103.6% in Q3 FY25, compared to 83.7% in Q3 FY24. This was driven by sustained demand from FMCG and food and beverage manufacturers, who continue to seek innovative and sustainable packaging solutions.

The company remains optimistic about a revival in FMCG consumption, as the FY26 Budget’s tax relief measures and rural development investments are expected to drive higher disposable income and increased consumer spending. The anticipated growth in FMCG sales will boost demand for flexible packaging solutions, including packaging films, inks, adhesives, and holography products.

How is UFlex investing in future growth?

UFlex is actively expanding its global footprint and production capacity, with several major capital investment projects underway. The company incurred ₹3,647 million in capital expenditure during Q3 FY25, with key investments including an aseptic packaging facility in Egypt, a virgin PET chips plant in Egypt, and aseptic packaging debottlenecking in India.

The company is also setting up a woven polypropylene bags manufacturing plant in Mexico, with an investment of ₹4,162 million. This facility will cater to North and South America’s growing pet food market, which is projected to reach $135 billion by 2030.

In India, UFlex is strengthening its recycling capabilities, investing ₹317 crores in advanced recycling infrastructure. The company has already recycled over 618 million plastic PET bottles and 5,942 metric tons of MLP waste in FY25 year-to-date, reinforcing its commitment to sustainability and circular economy initiatives.

What does the future hold for UFlex?

Looking ahead, UFlex plans to commercially commission key projects in Q4 FY25, including a 5-billion-pack expansion at the Asepto liquid packaging facility in India, a 216,000 metric tons per annum virgin PET chips plant in Egypt, and an 18,000 metric tons per annum CPP packaging film line in Mexico. These expansions are expected to drive revenue growth, enhance profitability, and strengthen UFlex’s market position in FY26 and beyond. Additionally, falling interest rates and pro-growth fiscal policies are expected to stimulate private investment and consumer spending, creating favorable conditions for packaging industry expansion.

UFlex Poised for Continued Growth

UFlex’s Q3 FY25 performance highlights the company’s ability to leverage operational efficiencies, strategic expansions, and strong global demand. With a well-diversified revenue mix, investments in sustainability, and a strong focus on innovation, UFlex is well-positioned for long-term growth in the flexible packaging industry.

The company’s commitment to sustainability, including its USFDA-approved PET recycling initiatives, aligns with global industry trends. As consumer preferences shift towards eco-friendly and high-barrier packaging solutions, UFlex’s sustainable packaging innovations will play a crucial role in driving future revenue streams.

With key capacity expansions, a growing international presence, and a strong financial foundation, UFlex is on track to achieve higher profitability and maintain its leadership in the flexible packaging industry.