Smurfit Kappa Group PLC Is Given A Buy Rating By UBS For Its Packaging Group | Valdamark Foil

Smurfit Kappa Group is given a ‘buy’ rating by analysts at the Swiss banking giant UBB.

Smurfit

As one of Europe’s largest packaging manufacturers it is thought they are very well positioned for the future.

Smurfit Kappa Group has been awarded the ‘buy’ rating by analysts at the Swiss Bank.

UBS had commented that they think Smurfit Kappa’s position as the largest corrugated packaging manufacturer in Western Europe put the company in strong position that can benefit from conservative trends in order to drive growth.
They also commented that the Smurfit Kappa Group position could further be strengthened with investment in their current packaging production operation as well as a general consolidation of assets the market.

UBS advice naturally gave a lift to the Smurfit Kappa Group PLC shares listed on the London stock exchange. Opening on Wednesday the bank initiated coverage with a ‘buy’ rating for the Dublin headquartered packaging company.

Analysts at the bank also advised clients with a note stating that it was the opinion of the bank that Smurfit as the largest foil packaging manufacturer by volume were in a strong position to benefit from secular market trends.

Furthermore the note pointed out that production rates for the packaging manufacturing industry had been increasing steadily since 2012. With no major capacity issues analysts expect the growth to continue in the years to come.
One Analyst at UBS has commented that looking forward to the 2019/20 year they expect to see continued growth volumes from Smurfit whilst some pressures are eased through investments.

They expect a fairly linear 2019 with little to no growth, however 2020 should yield growth around 7%.

Despite these impressive figures UBS insist that the valuation is modest and conservative. Smufirt shares are currently trading at a discount to their peers of around 12%.

Smurfit are a FTSE 100 company that manufacturers a wide variety of packaging materials & other consumables. Their portfolio of products included FIBC bags, corrugated & paper packaging as well as heat sealer machines for use in a diverse range of markets.

Expanding Innovation Across Europe

Smurfit Kappa Packaging's Design2Market Factory is making waves across Europe after a successful first year in operation. This cutting-edge facility empowers customers to fine-tune their packaging solutions on a small scale before entering the market. It is set to expand into new territories, including Germany, Italy, Poland, and the UK.

Design2Market
The original Design2Market Factory has already hosted over 50 successful projects for some of the world's most prominent consumer brands. Smurfit Kappa's versatile team takes on packaging challenges and swiftly crafts innovative solutions.

It is ready for market testing in just two weeks. This approach reduces risk and turnaround time. It also provides customers with sustainable packaging options, supporting their recyclability objectives.

Design2Market Factory's user-driven prototypes are created through close collaboration with customers. It combines creativity, technical expertise, and advanced AI models to meet specific requirements.
To date, the team has devised and launched numerous groundbreaking solutions.

These solutions include shelf-ready packaging for detergents, paper-based alternatives to shrink wrap, and a comprehensive range of e-commerce packaging solutions. Additionally, these solutions meet Amazon's rigorous certification standards.

With the success of the Design2Market Factory, Smurfit Kappa Packaging revolutionises packaging solutions. They support their customers' sustainability efforts across the continent. This expansion promises a brighter and more eco-friendly future.

Packaging's Impact on Consumer Choices

In the food and beverage industry, packaging wields substantial influence. Ipsos' research reveals that a staggering 72% of shoppers look at a product's presentation. This means simple yet impactful product communication will establish a connection with consumers. Nowadays, consumers face overwhelming info and desensitisation.

In an era where the cost of living continues to rise, consumers are on the hunt for products that align with their needs and offer financial savings. Moreover, escalating energy costs have compelled consumers to seek out "energy-saving" products.

In a recent report, on-pack messaging will spotlight the most energy-efficient cooking techniques. Brands that incorporate guidance on their packaging regarding the judicious use of energy when storing or preparing food will find themselves in high demand. In a world where every watt counts, these brands will stand out as beacons of efficiency, offering both savings and sustainability.

A Shift Towards Health and Sustainability

In the landscape of 2023, both small and large businesses in the food and beverage industry find themselves at a crucial crossroads. Their packaging strategies highlight natural ingredients and key health benefits. Interestingly, consumers are leaning towards brands that prioritise health benefits and natural ingredients.

A profound and enduring consequence of the global pandemic is the widespread yearning for products that promote healthy living. This new wave of health-consciousness among consumers is reshaping the industry.

Furthermore, consumers are now seeking reassurance from trustworthy sources. They want to validate the claims made by brands. Packaging that effectively conveys this valuable information fosters trust. It also establishes a lasting sense of loyalty to the brand.

On a parallel track, sustainable packaging is taking centre stage on the global front. In a study conducted by Ipsos, a striking 85% of individuals opt for brands that align with their concerns regarding climate change and environmental issues. Consequently, sustainability has swiftly transformed from an option to a packaging "must."

Acknowledging this pivotal shift in consumer preferences, Smurfit Kappa proudly stands as one of the world's premier providers of sustainable packaging.

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