Control Print has been a long-tracked name for us. We recommended the stock to our Premium Members in 2014 at around Rs 55 levels and exited coverage in 2024 at roughly Rs 800 levels. Over this period, the company also returned Rs 60+ per share through dividends, underlining the role of steady cash flows in long-term compounding.

Recently, Control Print reported a steady operating performance in Q3 and 9M FY26, supported by growth in its core coding & marking business and improved profitability at the standalone level.

Below is a detailed, factual summary, covering financial performance, business mix, installed base, overseas operations, employee cost impact, and technology commentary.

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Control Print Q3 & 9M FY26: Earnings Update, Margins, and Business Mix

Source: Control Print presentation

Financial Performance – Standalone

Revenue

  • Q3 FY26 operating revenue: ₹109 crore
    • Q3 FY25: ₹94 crore

Profitability

  • EBITDA growth: 21% YoY
  • PBT (excluding exceptional items): 35% YoY growth
  • PAT growth: 19% YoY, lower due to higher tax provisioning

Cost Structure (Q3 FY26)

  • Cost of goods sold: ~41% of operating revenue
    • Comparable with FY25 average (~42%)
  • Manufacturing cost: ~2%
  • Employee cost: 19% (Q2: 16%, Q1: 18%)
  • Depreciation: ~4%
  • Other expenses: ~14% (historically 13–14%)

Business Mix & Segment Details

Coding & Marking

  • Contributes ~92% of total revenue
  • Key industries:
    • Pipes, food, healthcare, dairy, steel & metal, cable & wire
  • Market leadership mentioned in:
    • Cement, plywood, sugar, dairy
  • Printer sales (9M FY26): ~2,100 units
  • Installed base: ~22,000+ printers
  • Revenue breakup within coding & marking (Q3):
    • Printers: 18%
    • Consumables: 58%
    • Spares: 7%
    • Services: 15%

Track & Trace

  • Management indicated continued traction
  • Business is compliance-driven, especially in pharmaceuticals
  • Focus shifting from compliance-only solutions to data-driven intelligence layers
  • Two large pilots mentioned to be in commercial finalisation stage

Packaging (V-Shapes)

  • Machines installed in India and Italy
  • Execution delays due to:
    • Machine refinement
    • Quality control and reliability enhancements
  • Co-packaging activity gaining traction
  • Issues highlighted:
    • Small batch complexity
    • Long lead times for reverse printing and lamination
  • Supply chain and turnaround processes being streamlined

Safety Division

  • Mask business restructured into broader safety division
  • Products sold include:
    • Masks, helmets, hard hats, gloves, ARC flash shoes, blankets

Overseas Subsidiaries & Consolidated Performance

Italy (Packaging Business)

  • Main source of consolidated losses
  • Delays due to:
    • Machine redesign
    • Quality validation
    • Factory acceptance testing
  • R&D costs expensed fully in Italy (~€0.8 million)
  • Management stated:
    • Technology developed benefits global operations
    • Losses expected to reduce as execution improves
    • Targeting breakeven around Q4 FY26 / Q1 FY27

UK (Codeology)

  • Slightly profitable
  • Losses attributed to:
    • Market slowdown
    • Investments in packaging and co-packaging setup

Markprint

  • Profitable but sub-scale
  • Management stated scope exists to improve scale

Margins, Costs & Labour Code Impact

Employee Costs

  • Increase attributed to:
    • Gratuity provisions under new labour codes
    • Incentive provisioning
  • Management indicated:
    • One-time adjustment elements
    • Increase estimated at ~₹5 crore
  • New labour code effective from 21 Nov 2025

Other Expenses

  • Increase due to:
    • Travel
    • Business promotion
  • Management stated cost optimisation measures are underway

Capacity, Capex & Cash Flows

  • Current capacity utilisation: ~65–70%
  • Peak utilisation: ~85–90% (industry standard)
  • No major capex planned for core coding & marking
  • R&D expenses fully expensed
  • Maintenance capex broadly aligned with depreciation
  • Dividend payout: ~₹15 crore annually (as referenced in Q&A)

Market Outlook & Growth Commentary (Factual)

  • Coding & marking industry growth expectation:
    • ~10–12%
  • Company growth expectation (near-term):
    • ~15% if product edge sustains
  • Track & trace demand remains compliance-led
  • India–EU FTA:
    • Management stated no material impact on competitive dynamics

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Disclaimer: This is not a recommendation to buy/sell any of the stocks mentioned above. The securities quoted are for illustration only and are not recommendatory.

Ekansh Mittal
Research Analyst
Web: https://www.katalystwealth.com/

 

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