Uflex is an innovation leader in the flexible packaging industry, and has consistently performed in the sector to become a brand with global presence. But to understand if this stock is worth holding onto for the long term, we need to inspect the macro and micro associated with it.Let us being by looking at the macroeconomic strokes that are churning the industry. The packing industry in India is the 5th largest sector, and is one of the fastest growing sectors with a reported annual rate of 13%. In this broad segment, flexible packaging, the segment which Ufelx specializes in, has seen growth at the rate of nearly 20% per annum. The growth is primarily driven by the necessity to pack things ranging from satellites to shampoo sachets. The majority of the demand comes from large sectors like pharmaceuticals, FMCG, healthcare, food processing, etc. These industries are staples in the modern consumption-based lifestyle, and hence their dependence on the packaging industry means that the sector is deemed to have assured cash-flows.The innovation in the packaging industry of India is driven by the FMCG giants like Nestle, PepsiCo, Coca Cola, etc. who want their products to penetrate the tier two and tier three cities. Thus, smaller packs and more logistics friendly packaging has become the need for this this penetration. The F&B industry accounts for 85% of the demand in the sector.More over the per capita packaging consumption of India stands at a meager 4.2 kg, while that for developed economies stands above the 35 kg mark. This indicates that as the economic prowess of India progresses, a higher per capita packaging consumption may be expected.At the supply end we see that many players exist in the market to service this demand, but most prstaple solutions. There are only few companies that are actually pushing the innovation in the polymer usage to cater to new prospective clients. Uflex is one of the leading players in the game-change.At the micro level, the company actually has been performing well at sales, with consistent sales growth, and has reported a steady profit after tax margin of nearly 5% over the last 10 years. This speaks volumes about its capacity to handle the dynamics of the changing market scenarios. The balance sheet shows that the company makes a lot of sales based on credit and it has reflected as an increased receivable days. It is only in FY2018, that we see an increased level of trade payables, indicating a better bargaining status of Uflex. The cash conversion cycle has been effectively handled, and we do not see it exploding beyond the 60 days mark. The management has also effectively, and periodically reduced the debt burden to conservative levels, all the while the debt utilization boosting the sales. This goes to show that the management has capitalized on it vintage to create a consolidated position for Uflex in the flexible packing industry of India.Moreover, Uflex recently has ventured into engineering packaging materials, and has acquired ISRO as one of its customers. Such client acquisition only helps us presume, that other high profile customers may follow suit. These customers are assured cash-flows, which in turn increases the valuation of the firm.The only threat to Uflex, or even the industry in general is the input risk. Raw materials make up more than 30% of the cost of production for packing products. Any volatility in the price of these raw materials can wreck havoc on the bottom line of Uflex, or the industry in general.Finally coming to the fundamental valuation of Uflex, which is trading around Rs.290, we see that the fundamental value of the stock is around Rs. 510, thereby indicating a growth head of 75%. Moreover the PE and PB ratio for the stock are 6.78 and .53 respectively, while that of the industry are 22.86 and 2.40 respectively. The relative valuation analysis also show Uflex to be an undervalued stock.Thus, as per my reading of the market, I see Uflex to be a prospective earner. The last 10 years of financial figures of Uflex stand testament to its resilience in this high speed market.I hope my analysis helps you plant some clarity in your doubts.For more such topics on investment, head over to my website - Insignia InvestmentsI also publish weekly videos on investment management at my YouTube Channel - Insignia Investments.Happy investing!