Stock Analysis & Valuation Aluflexpack AG (AFP.SW)

• Previous Close: CHF16.00
• Sector Valuation Confidence Level: Moderate

Valuation method	Value, CHF	Upside, %
Artificial intelligence (AI)	17.10	7
Intrinsic value (DCF)	6.26	-61
Graham-Dodd Method	10.50	-34
Graham Formula	1.80	-89

Strategic Investment Analysis

Company Overview

Aluflexpack AG is a leading Swiss-based provider of flexible packaging solutions, specializing in aluminum containers, films, foils, and printed packaging for industries such as food, pharmaceuticals, and pet food. Founded in 1987 and headquartered in Reinach, Switzerland, the company operates across Europe, Asia, and other global markets, serving clients in coffee, confectionery, dairy, and non-food sectors. As a subsidiary of Montana Tech Components AG, Aluflexpack leverages its expertise in high-barrier packaging to ensure product freshness and sustainability. The company’s diversified geographic presence and strong R&D capabilities position it as a key player in the packaging industry, catering to both regional and multinational brands. With a focus on innovation and eco-friendly solutions, Aluflexpack remains competitive in the growing demand for sustainable packaging alternatives.

Investment Summary

Aluflexpack AG presents a moderate investment opportunity with stable revenue growth (CHF 381.5M in FY 2023) and a net income of CHF 10.5M. The company operates in a resilient sector (flexible packaging) with steady demand from food and pharmaceutical industries. However, its high total debt (CHF 174.9M) and negative free cash flow (due to capital expenditures of CHF -34.4M) pose financial risks. The absence of dividends may deter income-focused investors, but its low beta (0.912) suggests lower volatility compared to the broader market. Expansion in sustainable packaging could drive long-term growth, but competition and raw material costs remain key challenges.

Competitive Analysis

Aluflexpack AG competes in the flexible packaging industry with a focus on aluminum-based solutions, differentiating itself through high-barrier packaging for perishable goods. Its competitive advantages include a strong European footprint, diversified client base, and technological expertise in lacquered foils and printed packaging. However, the company faces stiff competition from larger global players with broader product portfolios and greater economies of scale. Its specialization in aluminum packaging is both a strength (premium applications) and a weakness (vulnerability to aluminum price fluctuations). While Aluflexpack’s mid-market positioning allows it to serve niche segments effectively, it lacks the vertical integration of some competitors, potentially impacting margins. Sustainability initiatives could enhance its appeal, but scalability remains a hurdle compared to multinational rivals.

Major Competitors

• Amcor plc (AMCR): Amcor is a global leader in flexible and rigid packaging with a vast product portfolio and strong R&D capabilities. Its scale and diversified client base give it pricing power, but its broad focus may dilute specialization in aluminum packaging, where Aluflexpack excels. Amcor’s sustainability commitments are a key strength.
• Ball Corporation (BLL): Ball Corporation dominates aluminum beverage packaging but also competes in food packaging. Its massive production capacity and recycling initiatives are strengths, but it lacks Aluflexpack’s focus on flexible packaging for niche markets like pharmaceuticals and pet food.
• SIG Group AG (SON1.DE): SIG specializes in aseptic carton packaging, competing indirectly with Aluflexpack in food and beverage sectors. Its sustainable packaging solutions are a strength, but it does not offer the same aluminum-based flexibility, giving Aluflexpack an edge in certain applications.
• Tetra Pak (private) (TVNDY): Tetra Pak is a dominant player in liquid food packaging, with unmatched brand recognition. While it focuses on cartons, its innovation in sustainable materials poses indirect competition. Aluflexpack’s aluminum solutions remain critical for oxygen-sensitive products where Tetra Pak is less competitive.
• GrafTech International Ltd. (GRAF): GrafTech produces advanced materials, including packaging components, but its focus on industrial applications limits direct overlap. Aluflexpack’s specialization in consumer-facing flexible packaging gives it a distinct market position.