The market cap of Tainwala Chemicals & Plastics (India), a small cap chemicals company, has doubled in the past year to Rs 115 crore.

What is the secret sauce of the company, which primarily makes plastic sheet and profile extrusion?

It is certainly not the finances:

As you can see, the company’s high other income is very interesting. It pushed us to probe a little more.

The balance sheet has been burnished because nearly 35% of its m-cap is available in non-current financial assets.

The non-current financial assets primarly comprise two assets.

One, mutual funds. And two, Samsonite South Asia Private Ltd

Ah! This is where it gets even more interesting. Samsonite is an important player in the organised luggage market in India with a market share of 35% after VIP, which tops the list at 50%. Here is what the market looks like:

The Samsonite Connection

Let’s take a closer look at the Tainwala’s links with Samsonite. Turns out Tainwala Group holds a 40% stake in Samsonite South Asia Pvt Ltd with the balance 60% held by Samsonite Corp of the US.

Ramesh Tainwala, the chief executive officer of Samsonite International S.A., was also part of Tainwala Chemicals and Plastics (India) Limited.

Samsonite is growing at a fast clip in India. The company clocked sales of about Rs 1,250 crore in 2017 and expects sales to grow about 18-20% in India to touch Rs 1,600 crore in 2018, by growing its Kamillant brand of luggage, according to reports.

Stacked against these numbers, the BSE-listed Tainwala ’s 9% stake in Samsonite would be valued at about Rs 400 crore.

For American Tourister specifically, Samsonite got Virat Kohli on board last year as a brand ambassador. In 2018, Christiano Ronaldo also got on board.

The focal points going ahead for Samsonite are utilisation of cash in books, listing of Samsonite in India and a way of growing its core business in the country.

First Published:May 7, 2018 3:54 PM IST