Overview
Acme Printing and Packaging manufactures flexible packaging for tea, FMCG, pharmaceuticals and other consumer sectors, targeting both local and export markets with certified food-safety standards. The single biggest change is corporate restructuring to repair the balance sheet: the company recapitalised through a large rights issue and is disposing assets, yet the latest reported quarter delivered its weakest margins on record, indicating that operating recovery has not yet taken hold.
Price performance
The share closed at LKR 4.60 as of 2026-08-07. Returns are mixed across windows and must be read in light of a 6-for-1 rights issue at LKR 2.50 on 2026-02-05, which mechanically dilutes historical prices: the 1-year return is +267.3% on a restated basis but -11.5% as traded. Over 3 months the stock fell 29.7% versus the ASPI’s -7.1%. It sits 68.3% below its 52-week high and 281.4% above the low, at the 25.5th percentile of its range. Recent activity is quieter than its own year, with 60-day volatility at 53.1% annualised and 20-day volume 58.7% below the 60-day average.
Valuation
Earnings are negative (EPS TTM -1.76), so P/E is not meaningful. The stock trades at P/B 6.05 against a sector median 1.76, a rich multiple for a company in losses. The dividend yield is 0.0%, below the sector’s 3.3%, and there is no recent payout history to offset this. Book value per share stands at LKR 0.76.
News and sentiment
Coverage is about normal, with 4 material articles in 90 days, all neutral. On 29 Apr 2026 ACME announced a sale and purchase agreement to sell its Piliyandala factory to Singer for Rs 630 million as part of its restructuring. On 12 May 2026 it proposed a Rs 1.6 billion stated capital reduction to offset accumulated losses, subject to shareholder approval. Committee changes and routine disclosures were also filed. A 6-for-1 rights issue was confirmed with ex-date 5 Feb 2026.
Financials
Mar-26 was very weak. Gross margin was -7.8% versus -5.6% a year earlier. Operating margin fell 72.5 points to -120.9% from -48.4%. Net margin deteriorated to -149.8% from -61.0%. Each of these ranks as the worst among its past March quarters, underscoring broad-based operating strain rather than a one-off item.
Risks
The lead risk is liquidity and leverage. At Mar-25, interest cover was -1.12x and the current ratio 0.42, with total debt of LKR 1.66 billion. Cash conversion was 0.06x, indicating operating losses did not translate into cash, and free cash flow was LKR -85.78 million. While subsequent recapitalisation lifted reported equity by Mar-26, sustained operating losses and finance costs still threaten cash runway until the restructuring completes and costs fall.
Outlook
Next results (quarter ended Jun-26) are due now and expected by 2026-10-26. As at 2026-08-07, two near-term swing factors stand out: cash proceeds and any cost effects from the Rs 630 million factory disposal, and progress on the proposed Rs 1.6 billion stated capital reduction to clean up retained losses. A falling T-bill yield backdrop is consistent with some easing in finance costs, but the immediate question the next filing answers is whether operating losses start to narrow from the Mar-26 trough.