West Coast Paper Mills Ltd Management Discussions

Global economic review

The global demand for paper and board is estimated to have grown by a modest 1-2% during FY 2025-26, with the segment showing a clear internal divergence. The writing and printing segment recorded a marginal decline of 0-1% and is expected to contract further on the back of accelerating digitisation, while newsprint demand fell by 1-3% as e-paper readership expanded.

Incontrast,theglobalpaperboardsegment grew 2-4%, supported by rising demand from e-commerce and pharmaceutical end-users; this is expected to be the principal long-term demand driver for the industry. Global pulp prices firmed during the period, with softwood and hardwood pulp rising by approximately 7% and 8% respectively, though realisations are expected to remain broadly range-bound over the longer term.

The global fibre optic cable market, valued at around US$ 12.5-13.8 Billion, is on a robust, technology-driven growth trajectory, projected to expand at a CAGR of approximately 10% through the next decade. Robust growth is underpinned by the concurrent rollout of 5G standalone networks, the bandwidth requirements of hyperscale data centres supporting AI computing, and national broadband initiatives targeting universal fibre-to-the-home access.

Asia-Pacific remained the largest fibre optic cable region, accounting for 36-44% of the market, driven by large-scale FTTH deployments in China and India complied with sustained government policy support. Single-mode fibre continued to lead the demand on account of its suitability for long-distance, high-capacity transmission.

Indian economic review

The Indian paper industry is the third-largest consumer of paper and paperboard globally, with annual consumption of around 23-24 Million Tonnes and around 5% share of the global market, trailing only China and the United States. Domestic demand for paper and paperboard is estimated to have grown 5-7% in FY 2025-26, led by a healthy offtake from the FMCG, e-commerce and pharmaceutical end-use industries.

Packaging paper and paperboard remain the backbone of the market, accounting for nearly 65% of total volumes, while specialty paper, including tissue and thermal paper, is expected to grow at an 11-13% CAGR. Per capita paper consumption in India remained low at around 15 kg against the global average of 57 kg, indicating significant headroom for long-term expansion.

The operating environment, however, remained challenging. Margins were pressured by elevated raw material costs, competition from low-priced imports and GST-related disruptions, although operating margins were expected to recover by about 200 basis points during FY 2025-26.

The ban on single-use plastics and the New Education Policy continue to provide structural demand support, while the Minimum Import Price on paperboard acted as a key policy buffer. The industry is investing with a long-term view, with capacity additions of approximately 1.8-2.2 Million Tonnes underway and demand growth projected at 6-8% over FY 2026-27.

(Source: IBEF, CareEdge Ratings, PrintWeek India, The Pulp and Paper Times, IndexBox)

The Indian optical fibre cable sector navigated a recovery during FY 2025-26 after several subdued quarters. Following a period of weak demand and low capacity utilisation, the market saw a revival driven by 5G fronthaul and backhaul rollouts, the BharatNet Phase III rural broadband programme, hyperscale data centre expansion and rising export orders.

Tariff and non-tariff barriers on Chinese optical cable imports tightened, while the government preference for domestic supply in BharatNet and 5G-related procurement reinforced the position of Indian manufacturers. The India fibre optics market is projected to grow at a CAGR in the range of 10-14% over the medium term, supported by the Digital India programme and the Smart Cities Mission.

The recovery was visible in industry performance, with leading domestic players reporting a sharp ramp-up in capacity utilisation and strong year-on-year revenue growth through FY 2025-26, alongside large multi-year supply agreements with European and US telecom operators. With structural demand drivers intact, the sector is positioned for sustained growth.

(Source: 6Wresearch, TechSci Research, Mordor Intelligence, Grand View Research, The Machine Maker, Acheron Research, IndexBox)

Union Budget FY 2026-27

The Union Budget 2026-27 laid a strong foundation for Indias economic trajectory with a focus on investment-led growth, fiscal discipline, and inclusive development, guided by the theme of Action over Ambivalence, Reform over Rhetoric, People over Populism and aligned with the long-term vision of Viksit Bharat.

Fiscal consolidation: The fiscal deficit is targeted at 4.3% of GDP in 2026-27, lower than the revised estimate of 4.4% of GDP for 2025-26, reinforcing the governments commitment to fiscal consolidation. The debt-to-GDP ratio is estimated to decline to 55.6% in Budget Estimates 2026-27 from 56.1% in Revised Estimates 2025-26, with the central government aiming to reduce its outstanding liabilities to around 50% of GDP by March 2031.

Capital expenditure: Infrastructure spending was raised by about 11% to a record 12.2 Lakh Crore, while effective capital expenditure increased to 17.15 Lakh Crore, i.e., 4.4% of GDP, signifying a continued focus on infrastructure, logistics, and industrial capacity building. The sustained capex push will support the demand for industrial paper, packaging board and telecom infrastructure, including optical fibre deployment.

Income tax relief: The Union Budget 2026 retained the income tax slab structure introduced in Budget 2025, with income up to 12 Lakh remaining tax-free under the new tax regime. For salaried individuals, the effective tax-free limit is 12.75 Lakh after the 75,000 standard deduction, which is expected to support household purchasing power and discretionary consumption — a positive for packaging and paperboard demand from FMCG and consumer-facing sectors.

Economic growth projections: The government estimated a nominal GDP growth rate of 10% in 2026-27, while the Economic Survey 2026 projects real GDP growth of around 7.4% in FY 2025-26, supported by strong domestic demand, sustained public capital expenditure and early signs of renewed private investment.

Trade and global integration: The recently concluded free trade agreement with Europe created new opportunities for market access and exports. To mitigate the impact of higher US tariffs on Indian exports, the Budget extended and liberalised duty-free import schemes for specified inputs used in export-oriented sectors. The tariff rate on dutiable goods imported for personal use was reduced from 20% to 10%.

In fiat ion and monetary policy: Inflation moderated sharply, with headline CPI at 1.7%, supported by food price corrections and favourable monsoon patterns, while monetary conditions remained accommodative — a benign environment for input cost management.

Budget implications for the paper and board sector: The Budget proved broadly positive for the sector. The increased public capital expenditure of 12.2 Lakh Crore, alongside a policy focus on manufacturing and electronics, is expected to drive the demand for packaging materials, particularly paperboard used in FMCG, pharmaceuticals and e-commerce. Continued income tax relief supports consumption and, in turn, packaging demand. Investment in freight corridors and coastal cargo movement is likely to reduce logistics costs and improve the flow of raw materials and finished goods, while digital single-window cargo clearance and operator-centric customs warehousing are expected to shorten inventory cycles and reduce working capital locked in imported inputs. The Budget also reinforced the circular economy framework, favouring manufacturers investing in domestically sourced recycled fibre.

Budget implications for the cable sector (optical _bre cables): The Budget is a strong demand signal for the optical fibre cable sector. The total telecom outlay was raised by nearly 38% to 73,990 Crore, with the allocation for the BharatNet rural broadband programme increased sharply to 20,000 Crore from a revised estimate of 5,500 Crore in 2025-26.

A capital outlay of 2,098 Crore was provided for fibre, 4G/5G and satellite connectivity in the North-Eastern region, and 975 Crore for an optical fibre-based network for defence services. Higher capital infusion into BSNL further supported network rollout. Together with continued government preference for domestic supply in BharatNet and 5G-related procurement, these measures are expected to underpin domestic optical fibre cable demand through FY 2026-27.

(Source: PRS India, Press Information Bureau, IBEF, KPMG, Ministry of Finance, Economic Survey 2025-26, PrintWeek India, Bizz Buzz, Indian Infrastructure, Reuters)

THE PULP AND PAPER INDUSTRY Global pulp and paper industry

The global pulp and paper market refers to the worldwide industry involved in the production, processing, and sale of pulp - the raw fibrous material derived mainly from wood, recycled paper, agricultural residues, and paper-based products.

The global pulp and paper market size was valued at US$ 351.7 Billion in 2025, and is expected to grow from US$ 357.6 Billion in 2026 to US$ 416.56 Billion by 2035, a CAGR of 1.7%.

Asia Pacific dominated the pulp and paper market with a market share of 56% in 2025. The market size in Asia Pacific accounted for US$ 198.3 Billion in 2025 and is expected to be US$ 202.1 Billion in 2026. In this region, China is the largest global manufacturer and consumer of paper product, its market projected at US$ 122.9 Billion in 2026.

Additionally, the rising adoption of pulp and paper-based products, improving lifestyles, and healthier economic growth will provide opportunities for paper-based products in India. India is anticipated to be valued at US$ 27.2 Billion in 2026, while Japan is set to reach US$ 14.1 Billion in the same year.

The pulp and paper industry was driven by strong demand for sustainable packaging amid the expansion of e-commerce, retail, and food delivery, alongside regulatory shifts away from single-use plastics. Rising hygiene awareness supported steady growth in tissue and paper products, while urbanization and economic development in emerging markets boosted consumption of writing, printing, and packaging grades. Technological advancements enhanced efficiency and sustainability, improving competitiveness and environmental performance.

The global containerboard market size stood at US$ 152.01 Billion in 2026 and is expected to reach US$ 172.17 Billion by 2031, expanding at a 2.52% CAGR over the period. Asia-Pacific controlled 40% of 2025 output, anchored by Chinas 120-Million-Ton capacity.

The carton board market is expected to grow from US$ 76.58 Billion in 2025 to US$ 80.83 Billion in 2026 and expected to reach US$ 105.96 Billion by 2031 at a 5.55% CAGR over 2026-2031. Intensifying legislation against single-use plastics, brand owner sustainability pledges, and rapid digital-printing adoption collectively reinforce demand momentum. Recycled-fiber leadership demonstrated the materials circular-economy credentials, while folding boxboard versatility kept it at the forefront of premium consumer-goods packaging. This evolving global landscape sets the context for India, where structural demand drivers continued to support faster growth relative to global averages.

(Source: Fortune Business Insights, Cognitive Market Research, Mordor Intelligence)

Indian pulp and paper industry overview

The Indian pulp and paper industry remained essential despite digitalisation. The market shifted from print to high-growth segments like packaging, hygiene, and specialty applications. Demand from e-commerce and FMCG, a continued reliance on paper in education, and rising hygiene awareness underpinned steady consumption, while the push to replace single-use plastics strengthened its relevance.

The market is valued at approximately US$ 4.7 Billion and projected to grow at a 13.4% CAGR, reaching nearly US$ 11.3 Billion by 2032. Per capita paper consumption in India remained low at 15 kg, compared to the global average of 57 kg, indicating a significant room for long-term expansion. While the industry remained fragmented, capacity additions, supportive policy initiatives, and shifting consumer preferences are transforming it into a resilient and diversified sector. The packaging industry in India grew rapidly due to increased consumerism, e-commerce growth, and organized retail. Packaging paper remained a vital component for various packaging solutions, contributing to the demand for paper products. Rising literacy rates and educational activities contributed to the demand for printing and writing paper. The education sectors growth drove the need for textbooks, notebooks, and other educational materials, which significantly boosted the Indian paper and pulp market growth. Investments by key players in expanding production capacities and modernizing facilities contributed to meeting the growing demand for paper and pulp products.

This limited availability of domestic raw materials restrained the Indian paper and pulp market. The recovery of wastepaper in India remained low at approximately 30%, primarily due to the absence of an efficient collection mechanism.

The paper industry grappled with challenges such as obtaining quality raw materials at competitive prices. To overcome this hurdle, industry players often resorted to importing pulp, wastepaper, and even pulpwood, incurring premium costs, impacting profitability and capacity addition.

Outlook

The outlook for the Indian pulp and paper industry remained positive, expected to reach US$ 11.3 Billion by 2032, supported by strong demand, favourable policies, and a growing shift toward sustainable cum value-added paper products. Continued momentum in packaging, hygiene, and education-related segments is expected to drive steady volume growth over the medium term.

The implementation of NEP 2020 is well underway across India and has begun supporting the demand for printing and writing paper through higher enrolment, multilingual education, and the increased use of learning materials. As the policy moves toward full implementation, the industry is expected to witness growth driven by a rising demand for textbooks, workbooks, and other educational resources. At the same time, the sustained rise in e-commerce, food delivery, and FMCG consumption could boost demand for paper-based packaging.

Investments in capacity expansion, use of alternative raw materials, and adoption of cleaner, more efficient technologies could easily strengthen the industrys competitiveness and environmental compliance. The growing focus on recyclability and circularity aligns well with global sustainability trends, opening new opportunities in export-oriented packaging and specialty paper segments. While challenges such as raw material availability, import pressure, and regulatory compliance remain, the industry is positioned to navigate them through innovation, scale, and improved supply chain efficiency. Players that focus on sustainability, product diversification, and operational agility are likely to lead the next phase of growth.

(Source: Maximize Market Research, The Pulp and Paper Times)

Indian paper industry personality

Core: The Indian pulp and paper industry continued to be a significant contributor to the Indian economy, supporting a large workforce and contributing to industrial output. India remained a moderate paper-producing nation, accounting for about 5% of global paper production with an annual industry turnover estimated at around 95,000 Crore.

Cyclical: The Indian paper industry operated in a cyclical environment, with performance closely linked to overall economic conditions, input costs, and demand trends across packaging, education, and industrial sectors. Companies needed to navigate fluctuations in raw material prices, shifts in consumer preferences, lingering competitive pressures from alternative materials, and evolving technologies that influenced production efficiency and end-use applications.

Versatile: Indias robust paper manufacturing ecosystem remained diversified, comprising approximately around 526 mills. The industrys installed capacity was estimated at around 30-32 million Tonnes per annum, producing a range of grades (packaging boards, writing and printing papers, tissue, and specialty products).

(Source: Infomerics Valuation and Rating Ltd.)

Paper demand drivers in India

Rise in literacy rate: The literacy rate in the country was 74.04% (82.14% for males and 65.46% for females). The progress toward broader educational access and long-term universal literacy goal were expected to catalyse the demand for writing, printing, and other paper-based products.

Growth in online food delivery: The rapid expansion of Indias online food delivery ecosystem created a strong demand for paperboard and packaging solutions. Revenue in the online food delivery market was expected to reach US$ 1.54 Trillion in 2026.

Shift toward eco-friendly packaging:

The paper and packaging industry increasingly aligned with sustainability trends. Growing environmental awareness and regulatory measures accelerated the shift towards recyclable and biodegradable paper-based packaging alternatives.

Expanding population: Indias population, estimated at 1.48 Billion in 2026, continued to rise. This demographic growth acted as a structural driver for higher consumption of paper across education, packaging, hygiene, and commercial applications.

(Source: Statista).

Sectoral opportunities

Opportunities within the paper industry extended beyond conventional segments such as printing and stationery to high-value applications across hygiene products, construction materials, electronics, and automotive sectors. Printing: The Indian printing market size reached US$ 36.5 Billion in 2025. The market is expected to reach US$ 46.7 Billion by 2034, a growth rate (CAGR) of 2.80% during 2026 to 2034. Paper remained the primary medium for producing printed materials, including newspapers, magazines, books, and promotional content.

Stationery: The global stationery products market size was valued at US$ 165.87 Billion in 2025 and was expected to grow from US$ 173.93 Billion in 2026 to US$ 268.08 Billion by 2034, exhibiting a CAGR of 5.56% during the period of 2025 to 2032. The growing demand for personalized and sustainable stationery created opportunities for manufacturers to cater to niche segments.

Hygiene products: The global disposable hygiene products market size was valued at US$ 206.52 Billion in 2025. The market was expected to grow from US$ 220.4 Billion in 2026 to US$ 415.44 Billion by 2034, a CAGR of 8.25%. The market depended on paper-based products like tissues and toilet paper. Increasing hygiene awareness boosted the demand for quality, soft, and environmentally friendly paper products. Specialty papers: The specialty paper market size was valued at US$ 32.98 Billion in 2025 and estimated to grow from US$ 34.39 Billion in 2026 to reach US$ 42.38 Billion by 2031, at a CAGR of 4.27% during 2026 to 2031. Its applications extended from components used in electronic devices to filter papers and specialized coatings for automotive parts. These segments offered a significant scope for growth, innovation, and market expansion, supported by evolving consumer preferences, technological progress, and an increased emphasis on sustainability.

(Source: Fortune Business Insights, Mordor Intelligence, IMARC Group)

Sectoral threats

Raw material challenges

Restricted availability and inconsistent quality of key inputs such as wood, recycled fibre, and water, along with potential supply chain disruptions.

Shift toward digital alternatives

Growing adoption of digital platforms is decreasing the demand for conventional paper products.

Volatile input costs

Fluctuations in raw material prices can put pressure on profit margins for paper manufacturers.

Regulatory developments

Changing regulations related to waste management and recycling may create compliance challenges for the paper industry.

Segment mix and market outlook

Writing and printing: Writing and printing paper, widely used across educational institutions and corporate offices, accounted for a significant 30% share of the market. The writing and printing paper market size was 77.78 Million Tonnes in 2025 and projected to decline to 75.81 Million Tonnes by 2030, translating into a –0.51% CAGR. Structural pressures from digitalization squeezed volumes, even as the writing and printing paper market continued to find support in pockets like examination papers, fintech security forms, and premium stationery where tactile quality mattered. Paper cup stock: Paper cups, also known as disposable cups, are typically made from bleached virgin paper pulp and coated with plastic or wax to prevent liquids from soaking through. They are often lined with polyethylene, which enhances durability, prevents moisture absorption, and helps retain the original flavor of the beverage. The paper cups industry market size in 2026 was estimated at 5.41 Million

Tonnes, growing from 2025 to 5.23 Million Tonnes with 2031 expectations showing 6.41 Million Tonnes, growing at 3.45% CAGR over 2026-2031. Key drivers of this growth included increasing use in social and public gatherings, rising demand for cost-effective and sustainable alternatives, and a growing environmental awareness.

(Source: Mordor Intelligence)

OPTIC FIBRE CABLE INDUSTRY Global optic _ber cable industry

The fiber optic cable market reached US$ 14.22 Billion in 2026 and is expected to attain US$ 22.74 Billion by 2031, growing at a 9.84% CAGR, underscoring a steady expansion in data-transport infrastructure worldwide.

Rising backbone upgrades for 5G, sustained hyperscale data-center builds and government-funded rural broadband programs continued to reinforce the demand for high-capacity glass fiber links.

Global growth drivers

High-speed internet growth and rising data tra_c: Global IP traffic reached 4.8 zettabytes in 2025 and is expected to surpass 7.2 zettabytes by 2028, accelerating the shift from legacy copper networks to last-mile fibre. Countries such as Japan achieved over 85% household fibre penetration.

Rapid 5G roll-out and _bre-deep networks: Mid-band 5G requires low-latency fibre backhaul, prompting telecom leaders to expand fibre-fed infrastructure.

Urban fibre-deep architectures replaced older systems, while countries like South Korea and Singapore mandated fibre-ready standards in new developments.

Hyperscale data centre expansion:

Hyperscalers significantly increased data-centre capacity in 2025, boosting demand for high-capacity fibre interconnects. Companies deployed advanced fibre technologies to reduce latency. Data-residency regulations in the European Union and Middle East also supported regional fibre demand.

Government - supported rural broadband: Public funding programme in countries including the United States, India, Australia, and the United Kingdom accelerated fibre-to-the-premises rollouts, expanding connectivity in rural and underserved areas while encouraging competitive participation.

(Source: Mordor Intelligence, Grandview Research).

Indian optic _ber cable industry

India fiber optics market size reached US$ 517.2 Million in 2025. Looking forward, the market is expected to reach US$ 1,195.7 Million by 2034, exhibiting a growth rate (CAGR) of 9.76% during 2026 to 2034. The growing penetration of technological advancements and communication infrastructures is primarily driving the market growth across the country. The Indian optical fiber cables market is poised for strong growth due to a combination of favorable factors. The governments flagship programs like BharatNet, under Digital India and the rollout of 5G networks are driving large-scale investments in fiber infrastructure. The Ministry of Electronics and Information Technology (MeitY) received an allocation of 21,632.96 Crore in the Union Budget 2026–27. While this was lower than the Budget Estimate of 26,026.25 Crore for FY 2025–26, it represented an increase of about 6.9% over the revised FY 2025–26 allocation of 20,232.95 Crore, reflecting a continued focus on Indias digital, semiconductor and AI ecosystem development.

(Source: IMARC Group, Business Standard, Techsci Research)

Indian growth drivers

Broadband penetration: Indias internet user base expanded rapidly, crossing 1 Billion broadband subscribers in 2025, reflecting a strong growth in digital connectivity across urban and rural areas. Internet subscribers reached about 969 Million by March 2025, with broadband accounting for most connections and penetration continuing to rise steadily. The expanding broadband ecosystem is driving demand for high-speed internet among households and businesses. This trend is accelerating investments in fibre-optic infrastructure, as fibre networks provide the high bandwidth and reliable data transmission required to support growing digital consumption and next-generation connectivity. (Source: IBEF).

Rising internet TV streaming services:

The growing popularity of internet-based television and OTT platforms is driving significant demand for high-speed broadband infrastructure. The global OTT market was valued at around US$ 399 Billion in 2025 and is expected to grow rapidly through the next decade, supported by rising digital consumption and connected devices.

In India, OTT adoption continues to expand, with the audience base exceeding 600 Million users in 2025, reflecting a strong growth in online video consumption. Platforms such as Netflix and Amazon (Prime Video) are contributing to higher bandwidth requirements as consumers increasingly prefer on-demand digital content. This rapid expansion of streaming services is increasing the need for reliable, high-bandwidth internet infrastructure. Fiber-optic networks play a critical role in supporting seamless high-definition and ultra-high-definition video streaming, driving growth in the optical fibre industry.

(Source: Precedence Research, The Economic Times).

Sectoral opportunities

Digital connectivity:

The accelerating demand for high-speed internet, 5G rollout, data centres, cloud computing, and enterprise digitalization continues to drive strong demand for optical fibre cables. Increasing data consumption, FTTH (Fiber-to-the-Home) expansion, and rural broadband penetration are further strengthening long-term growth prospects.

Industrial automation and Industry 4.0:

AdoptionofIndustry4.0technologies, including IoT, AI-enabled systems, robotics and smart manufacturing solutions, requires secure and high-speed data transmission infrastructure. Optical fibre cables play a critical role in enabling seamless industrial automation and digital transformation across manufacturing facilities.

Infrastructure initiatives:

Large-scale infrastructure programs such as BharatNet, expansion of broadband connectivity, smart city projects and digital inclusion initiatives are creating sustained opportunities for OFC deployment. Modernization of signalling and communication systems under Indian Railways is also contributing to increased fibre network investments.

Utilities and smart grid deployment:

The power, oil and gas sectors continue to deploy advanced Supervisory Control and Data Acquisition (SCADA) systems and smart grid technologies for real-time monitoring and operational efficiency. This drives the demand for reliable fibre connectivity across the transmission and distribution networks.

5G and telecom network:

Ongoing 5G network rollout and telecom capacity augmentation across urban and semi-urban areas are accelerating fibre backhaul requirements. Telecom operators are increasingly investing in dense fibre networks to support higher bandwidth and low-latency applications.

Data centre growth and enterprise digitization:

The rapid expansion of hyperscale data centres and enterprise IT infrastructure across India is increasing fibre intensity per project. The shift towards digital services, OTT platforms, and cloud adoption supports sustained OFC demand.

Sectoral threats

Competition: The OFC industry faced competition from domestic and global manufacturers. Alternative technologies such as advanced wireless communication systems, particularly for last-mile connectivity, could reduce a dependence on fibre deployment in certain applications, exerting a pricing pressure and impacting margins.

Geopolitical and supply chain risks:

Geopolitical tensions, trade restrictions, and global uncertainties may disrupt supply chains, affecting the availability and cost of critical inputs such as optical fibre preforms and specialty materials. Such disruptions could impact production schedules and overall cost structures.

Raw material price volatility: Fluctuations in the cost of key raw materials, including polymers and fibre components, could affect profitability. In a competitive pricing environment, the ability to pass cost increases to customers could be limited.

Telecom capex cyclicality: The OFC business is linked to telecom capital expenditure cycles. Any slowdown or deferment in telecom investments, including delays in 5G rollout or broadband expansion, could temporarily affect order inflows.

Company overview

Established in 1955, West Coast Paper Mills Ltd. (WCPML), the flagship company of the SK Bangur Group, has evolved into a leading industrial enterprise. Headquartered in Kolkata, the Company operates a technologically advanced paper manufacturing facility at Dandeli, Karnataka, with an installed capacity of 320,000 Metric Tonnes per annum. Its fully integrated operations and captive power generation capacity of 74.8 MW. WCPML markets products across India through an extensive and well-established dealer network.

West Coast Optilinks (WCO), the Companys cable division and formerly known as Sudarshan Telecom, is a prominent Indian manufacturer and exporter of optical fibre cables. Founded in 1996, WCO runs a state-of-the-art production facility located in the high-tech electronics zone of Mysore, manufacturing a wide portfolio of optical fibre cables catering to diverse applications.

In response to growing global demand driven by 5G deployments, West Coast Optilinks has expanded its production footprint by commissioning a new manufacturing unit at Fab City, Hyderabad, Telangana, effectively doubling its optical fibre cable capacity. Commercial operations at this facility commenced on February 14, 2024.

This expansion aligns with the Companys long-term strategic vision and supports national initiatives such as Atmanirbhar Bharat and Digital India. Additionally, WCO also set up an Optical Fibre manufacturing plant at the same location, became operational during the current financial year, strengthening backward integration and ensuring a stable supply of critical raw materials for the Mysore and Hyderabad facilities.

Business segments

Paper and paperboard division (89% of revenues, FY 2025-26)

West Coast Paper Mills Ltd., a prominent player in the Indian paper industry, markets its quality paper products under the WESCO brand. The Companys diversified portfolio, spanning office stationery, premium printing materials, and value-added products, generated 89% of its FY 2025-26 revenue.

A separate cable division (11% of FY 2025-26 revenue) operates a manufacturing facility in Mysore and Hyderabad producing optical fiber and optical fiber cables for the Indian telecom and utilities sectors, as well as exporting to several countries in Europe and the MEA region.

COMPANY STRENGTHS Paper segment

Market position: West Coast Paper Mills Ltd. is a prominent participant in Indias writing and printing paper segment, supported by its long-standing industry presence, strong dealer network across the country and technical capabilities. The Dandeli paper mill has an installed capacity of about 3.2 Lakh MTPA. The Company is emphasizing the development of value-added products to diversify its portfolio and strengthen its market position. Integrated: With its fully integrated manufacturing operations including pulp production, paper manufacturing, captive power generation, and a chemical recovery system. West Coast Paper Mills sustained a competitive cost structure amid changing market conditions.

Capacity utilization: The Company benefited from economies of scale by operating at around 99.98% capacity utilization its paper and paperboard production.

Distribution network: The Company is established distribution network supported by 72 long-standing dealers and six zonal offices, exports products to more than 15 countries.

Optic _ber cable segment

Green field expansion: The recently set up greenfield facility for manufacturing of optical fibre at Fab City in Hyderabad, Telangana, ensured a reliable supply of optical fibre, a key raw material for the Companys optical fibre cable plants in Mysore and Hyderabad.

Strong R&D capabilities: The Companys R&D and application engineering teams supported the expansion of its product portfolio into telecom and utility segments, with ongoing development of products aligned with 5G and data centre requirements.

Value-chain integration: The Companys strategic backward integration into optical fibre manufacturing is set to strengthen the value chain and enhance the Company competitive positioning.

Export presence: The Company exported a range of optical fibre and optical fiber cables to more than 25 countries, demonstrating its growing acceptance in international markets.

Our performance over the years

Operational review	FY 2025-26	FY 2024-25	FY 2023-24	FY 2022-23	FY 2021-22
Production
Paper and paper board segment (Tonnes)	3,19,933	3,18,590	3,03,766	3,14,919	2,96,785
Optical fibre cable segment (Km)	1,09,564	1,05,481	84,719	72,246	63,630
Optical fibre (FKM)	26,50,270	Nil	Nil	Nil	Nil
Sales
Paper and paper board (Tonnes)	3,20,567	3,13,823	3,04,950	3,10,349	3,03,715
Optical fibre cable (Km)	1,08,022	1,08,626	79,387	81,388	63,470
Optical fibre (FKM)	8,13,744	Nil	Nil	Nil	Nil

Value impact (production)

In FY 2025-26, the Companys paper and paperboard production recorded a year-on-year increase of 0.42%, reaching 3,19,933 Tonnes as compared to 3,18,590 Tonnes in FY 2024-25.

Production of optical fibre cables registered a year-on-year increase of 4%, rising from 105,481 Km in FY 2024-25 to 1,09,564 Km in FY 2025-26. This growth reflected our responsiveness to expand the customer base and meet their demand in spite of the sluggish market. The newly set up plant of optical fibre recorded a production of 26.50 Lakh FKM of fibre. The augmented production capacity positioned the Company to better meet customer requirements and capitalize on emerging opportunities in the sector.

Value impact (sales)

In FY 2025-26, our paper and paperboard sales volume experienced a moderate year-on-year increase of 2%, rising from

3,13,823 Tonnes in FY 2024-25 to 3,20,567. Our optical fiber cable sales volume experienced a slight year-on-year decrease of approximately 1% in FY 2025-26, falling from 1,08,626 Km in FY 2024-25 to 1,08,022 Km. Optical fibre sales volume was 8.14 Lakh FKM during FY 2025-26. Due to current geopolitical conditions, market was volatile, however, the company took all the necessary steps and remained hopeful for growth in the Indian and international markets.

Financial review

This has been dealt with in the Directors report.

Key performance indicators

Particulars	FY 2025-26	FY 2024-25	(%) change	Comments
Interest coverage ratio (times)	17.20	24.86	-30.81%	The decrease is due to lower revenues and profits during the year
Current ratio (times)	4.62	3.69	25.20%	The increase is due to drop in current dues.
Debt-equity ratio (times)	0.03	0.06	-50.00%	The debt-equity ratio decreased due to drop in total debts.
Net profit margin (%)	6.15%	11.34%	-45.77%	The decrease is due to lower revenues and profits during the year
Return on net worth (%)	5.87%	11.42%	-48.60%	The decrease is due to lower revenues and profits during the year

Risk strategy and management

The Company implemented a comprehensive risk management framework to identify, assess, and mitigate key business risks. Oversight was provided by the Board of Directors and the Risk Management Committee, which reviewed risk exposures and recommended appropriate strategies in line with a structured risk management policy. The framework ensured proactive monitoring and a timely response to emerging risks.

Risk category	Risk description	Mitigation strategy
Business environmental risk	The paper industry is mature and capital- intensive, characterized by intense competition and cyclical demand fluctuations.	Focus on cost optimization and access to competitively priced raw materials to maintain a strong competitive position during market volatility.
Realization risk	Profitability may be impacted by fluctuations in selling prices and market realizations.	Diversified product portfolio across writing and printing and specialty papers to capture demand from education, e-commerce and packaging growth.
Raw material risk	Disruption in availability or price volatility of pulpwood and other inputs may affect operations.	75% local sourcing from Karnataka, supplemented by Andhra Pradesh and Maharashtra; farm forestry and plantation programs; selective use of imported pulp for specialty grades.
Quality risk	Inability to consistently deliver high-quality products could affect brand reputation and customer retention.	Investments in quality control systems; adherence to ISO 9001:2015 QMS, ISO 14001:2015 EMS, ISO 45001:2018 OHSMS, and FSC certifications.
Human resource risk	Unexpected attrition of skilled personnel could impact operational efficiency.	Retention initiatives, structured training, leadership development, succession planning, and exit analysis monitoring.
Liquidity risk	High capital intensity could create liquidity pressures.	Strong operational cash flows, prudent working capital management and maintenance of adequate liquidity reserves.
Environmental risk	Compliance with stringent environmental regulations requires significant capital investments.	Reduced water consumption from 46 m/MT in FY 2024-25 to 43 m/MT in FY 2025-26.

Environmental sustainability

The Company ensured a rigorous compliance with applicable environmental regulations, including the Environment (Protection) Act, 1986 and CREP norms. Its commitment to sustainable operations was reflected in substantial investments in a state-of-the-art effluent treatment plant commissioned in 2010 and the implementation of 100% elemental chlorine-free (ECF) bleaching processes. By further strengthening its environmental safeguards, the Company upgraded its effluent treatment systems by incorporating tertiary treatment for pulp effluent and enhanced secondary treatment for paper machine effluent, underscoring its focus on continuous environmental performance improvement.

Water and energy conservation

Sustained water and energy conservation initiatives led to a reduction as compared to the last year. Energy conservation efforts enabled a compliance with PAT Cycle II energy efficiency standards.

Adequacy and effect iveness of internal controls

The Company prioritized operational efficiency, financial transparency and regulatory compliance through a robust internal control system. This system featured defined managerial roles and responsibilities, ongoing monitoring of key operating parameters, and regular internal audits. In compliance with Section 134(5)(e) of the Companies Act, 2013, the Company has also implemented a process-driven framework for Internal Financial Controls (IFC). The

Audit Committee provided oversight, periodically reviewing the performance of statutory and internal auditors and assessing the effectiveness of internal controls, suggesting enhancements as needed.

Workforce

The Company regarded its employees as its most valuable asset and a cornerstone of long-term success. It emphasized aligning human resource policies and practices with its strategic objectives, recognizing that its workforce plays a pivotal role in driving growth and realizing its vision. Fostering harmonious employee relations remained a priority, as employees were integral partners in executing policies and achieving organizational goals. As of March 31, 2026, the Companys total employee strength stood at 2450 individuals.

Cautionary statement

The statements provided in this report under Management Discussion and Analysis, detailing the Companys objectives, projections, estimates, expectations, or predictions, may constitute forward-looking statements as per applicable securities laws or regulations. These statements are based on certain assumptions and anticipations of future events. Actual results may vary significantly from those expressed or implied. Key factors that could impact on the Companys operations include global and domestic demand-supply dynamics, prices of finished goods, availability and cost of raw materials, alterations in Government regulations and tax structures, macroeconomic conditions, as well as other factors such as litigation and industrial relations. The Company does not undertake any obligation to publicly amend, modify, or revise any forward-looking statements based on subsequent developments, information or events.