INDUSTRY STRUCTURE AND DEVELOPMENTS
Amidst global macroeconomic uncertainty, the Indian economy continues to exhibit strength, resilience, and optimism. Real GDP growth is estimated at 7.3% for FY
2024- 25 and is expected to remain resilient at 7% in FY
2025- 26, driven by sustained domestic demand, private capital expenditure, and stable consumption. India remains the fastest-growing major economy and the fifth largest globally, and in purchasing power parity (PPP) terms, the third largest. As per the International Monetary Fund (IMF), Indias contribution to global growth is projected to rise from 16% to 18% by 2028.
The Indian paper industry, with an estimated annual turnover of 70,000 crore and a market size of 80,000 crore, contributes 5,000 crore to the national exchequer and provides employment to over 2 million people. Growing demand from packaging, education, FMCG, and e-commerce sectors continues to fuel the industrys expansion. The increasing popularity of ready-to-eat and perishable foods is expected to further boost demand for kraft paper and duplex boards.
India has also become a key destination for global paper manufacturers, with foreign players entering via greenfield investments or strategic acquisitions, signalling confidence in the sectors long-term viability.
OPPORTUNITIES AND THREATS
OPPORTUNITIES
Low Per Capita Consumption: Indias paper consumption per capita stands at just 15 kg compared to the global average of 57 kg, indicating significant growth potential.
Booming Packaging Segment: The shift towards sustainable packaging and increased usage in food, retail, and FMCG sectors are expected to accelerate demand for paper and paperboard products.
Supportive Policies and Spending: Government focus on education, literacy, and infrastructural development supports sustained growth in writing and printing paper demand.
Sustainability Transition: Global efforts to reduce single-use plastics are enhancing the relevance of paper-based alternatives such as paper straws, bags, and packaging.
THREATS
Raw Material Constraints: India is a wood fibre- deficient country. Current pulpable wood demand
is about 11 million tonnes per annum (TPA), while domestic availability is only 9 million TPA, with demand projected to increase to 15 million TPA by FY 2025-26.
Weak Wastepaper Recovery: The domestic wastepaper collection system remains largely unorganised, leading to lower recycling efficiency and raw material shortages.
Fragmentation and Scale Challenges: The
industry remains highly fragmented, with many small and medium mills operating below optimal capacity and struggling with modernisation and quality benchmarking.
Digital Substitution: Growing digitisation in education, corporate operations, and data storage continues to impact demand for traditional printing and writing paper.
The sectors long-term competitiveness depends on strengthening raw material linkages, achieving scale, investing in technology, and complying with evolving environmental regulations.
OUTLOOK AND FORECAST FOR FY 2025-26
The outlook for the Indian paper industry remains positive, underpinned by structural demand and shifting consumption patterns. Despite raw material limitations and global uncertainties, the industry is expected to sustain its growth momentum into FY 2025-26.
Industry Growth Forecast: The paper and board industry is projected to grow at a CAGr of 6.5-7%, led by packaging and specialty segments.
Packaging Demand: Expected to grow at over 8% CAGR, driven by food delivery, online retail, and sustainability mandates.
Raw Material Gap: The gap between domestic wood pulp demand and availability is likely to widen, increasing the importance of captive plantations and agro-forestry initiatives.
Investment and Modernisation: Larger players are expected to invest in technology upgrades, backward integration, and green energy initiatives to enhance competitiveness and meet ESG expectations.
Policy Environment: Continued government focus on self-reliance (Atmanirbhar Bharat) and environmental sustainability is expected to support long-term growth and innovation in the industry.
The Indian paper industry is poised for steady expansion, despite structural challenges. Companies that prioritise scale, sustainability, and supply chain integration will be better equipped to capitalise on the sectors untapped potential. The increasing substitution of plastic, rising literacy, and formalisation of consumption will remain the key drivers as the industry moves forward into FY 2025-26 and beyond.
RISKS AND CONCERNS
The Companys risk management strategy encompasses the proper and in-depth identification, assessment and prioritization of risks, followed by speedy mobilization of resources to minimize, monitor and control the probability of unfortunate events.
Export duties and taxes on wood exports are raising concerns. For instance, fibrous raw material represents the highest share of production costs, and so its availability at affordable prices is very important for the sector. Due to digitalisation, the consumption of graphic paper is reducing.
INTERNAL CONTROL SYSTEM AND ADEQUACY
The Company has proper and adequate internal control system to ensure maintenance of proper accounting records, their accuracy and that all the assets are safeguarded from loss or damages.
PERFORMANCE
Your Company has reported net loss of 1,597.76 thousands for the year ended 31st March, 2025.
KEY FINANCIAL RATIOS
The Key Financial Ratios for the financial year ended 31st March 2025 are as under:
Particulars |
2024-25 | 2023-24 |
1 Debtors Turnover |
- | - |
2 Inventory Turnover |
- | - |
3 Interest Coverage Ratio |
- | - |
4 Current Ratio |
0.11 | 0.12 |
5 Debt Equity Ratio |
-1.03 | -1.05 |
6 EBIDTA Margin (%) |
-1214.58 | 695.20 |
7 Net Profit/(Loss) Margin (%) |
-1214.58 | 695.20 |
8 Return on Net Worth (%) |
-1.33 | 0.96 |
There were no debtors and inventory for the current as well as in previous year. During the year, there were no income from operations, hence the EBIDTA Margin, Net Profit / (Loss) Margin ratios will not give accurate results. Interest coverage ratio is nil as there was no interest cost and principal repayment during the year.
CAUTIONARY STATEMENT
Statements in this report on Management Discussion and Analysis, describing the Companys objectives, projections, estimates, expectations or predictions may be forward looking, considering the applicable laws and regulations. These statements are based on certain assumptions and expectation of future events. Actual results, could, however differ materially from those expressed or implied.
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