Overview
ACL Plastics manufactures cable-grade PVC compounds for domestic and export customers, serving the cable and electrical industry within the ACL Group. Its latest quarter showed a material improvement in operating performance: profitability advanced faster than revenue, and margins reached the strongest levels in the comparable March record. The business remains focused on production efficiency, recycling and advanced machinery.
Price performance
The share closed at LKR 143 on 2026-08-12. On an adjusted basis, it fell 2.9% in one week, 4.0% over three months and 16.9% over six months, while the ASPI returned 1.2%, fell 6.9% and fell 9.8% over the same windows. Over one year, ACL Plastics rose 96.2% against the ASPI's 9.0% gain.
The price sits 28.3% below its 52-week high and 55.4% up the range from its low. Recent annualised volatility was 33.1%, 34.9% below its own one-year level, while 20-day volume was 29.0% below its 60-day average. The 1:10 subdivision effective 2025-12-29 means adjusted returns should be used; as-traded returns are distorted by the share-basis change.
Valuation
ACL Plastics trades at a P/E of 7.38 and P/B of 1.37, versus manufacturing medians of 12.78 and 1.8. The P/E is unusually low at the 5th percentile of 23 peers, while P/B is at the 37th percentile of 28, making earnings the stronger valuation signal.
Return on equity was 18.5% over the twelve months to 2026-03-31, supporting a valuation above book value despite the low P/E. The dividend yield is 2.6%, below the sector median and at the 35th percentile of 21 peers. The payout has risen from LKR 2.00 per share in FY2024 to LKR 2.50 in FY2025 and LKR 3.75 in FY2026, so the yield is supported by a rising payout rather than repeated cuts.
News and sentiment
Coverage is thin: only one material company article appeared in the 90-day window, and it was positive. The confirmed first interim dividend of LKR 3.75 per share went ex on 2026-08-12 and is payable on 2026-09-02; the 1:10 share subdivision went ex on 2025-12-29.
Financials
The quarter ended 2026-03-31 delivered the strongest comparable March margins in the record. Gross margin widened to 35.2% from 22.1%, operating margin to 34.9% from 21.8%, and net margin to 31.9% from 20.8%. Gross and operating margins ranked first of 7 comparable March quarters, while net margin ranked second of 7. Revenue rose year-on-year and net profit grew 86.1%.
Operating profit grew faster than revenue, indicating that the earnings improvement was primarily operational rather than a below-the-line effect. The below-the-line drag was LKR 24 million, leaving most operating profit in net profit. Equity increased to LKR 4.41 billion by the latest quarter, although per-share comparisons must account for the 1:10 subdivision, which expanded the reported share count from 4.21 million to 42.13 million.
The latest twelve months to 2026-03-31, reconstructed from interim filings rather than an audited full-year statement, generated revenue of LKR 2.85 billion, with operating and net margins of 30.6% and 28.6%. These figures describe the period already filed and are historical rather than a forecast.
Risks
The main financial risk is not leverage but the sustainability of unusually strong margins in a specialised manufacturing business. At 2025-03-31, gearing was 0.0% of owners' equity, interest cover was 1,629x and the current ratio was 19.1x, leaving substantial balance-sheet liquidity.
Cash conversion was strong at 1.88x and free cash flow was LKR 1.15 billion in the audited year to 2025-03-31, so the prior profit improvement was cash-backed. However, the latest quarter's cash conversion cannot be judged from interim figures. Sector-wide manufacturing conditions also include labour shortages and fuel imports up 58.8%, while July inflation reached 7.3%, creating potential cost pressure that the company-specific news flow does not quantify.
Outlook
As at 2026-08-12, the next specific event is the filing for the quarter ended 2026-06-30. It is due now and historically falls within the exchange's 2026-07-31 to 2026-10-26 publication range; that filing will supersede the March figures used here and show whether the latest operating improvement continued.
The dividend payment is scheduled for 2026-09-02, following the ex-date on 2026-08-12. Easing domestic market rates could improve the wider manufacturing financing environment, but fuel and labour pressures remain relevant sector risks. The available data cannot establish what caused the recent share-price decline.