JK Paper reports Q2 turnover of Rs 1,777cr amidst rising costs and market pressures
JK Paper Limited reported its financial results for the quarter ended September 30, 2024, showcasing a solid turnover of Rs. 1,777 crore on a consolidated basis. However, the company grappled with profitability due to elevated wood costs and increased competition from lower-priced imports. Despite these challenges, JK Paper’s EBITDA stood at Rs. 295 crore, while the profit after tax (PAT) amounted to Rs. 128 crore for the quarter.
The half-year performance underscored resilience, with consolidated turnover reaching Rs. 3,582 crore, an EBITDA of Rs. 605 crore, and a PAT of Rs. 268 crore. Harsh Pati Singhania, Chairman and Managing Director of JK Paper, pointed out that profitability pressures stemmed from persistently high wood prices and an influx of cheaper imports that affected both volume and pricing in the Printing & Writing and Packaging Board segments.
Challenges amid competition and rising costs
JK Paper’s quarterly results highlighted the significant influence of increased operational costs. The company attributed these to a challenging cost environment for wood procurement. Additionally, the entry of cheaper imported paper products into the market created competitive pricing pressures, which impacted the company’s volume and realization metrics in key segments.
Despite these obstacles, JK Paper has remained proactive. The company is doubling down on its social farm forestry initiatives at its various plant locations to source raw materials more affordably while contributing to environmental sustainability. This year alone, JK Paper has planted 8.81 crore saplings, covering 61,134 acres in regions such as Odisha, Gujarat, Andhra Pradesh, Telangana, and Maharashtra.
A commitment to social responsibility
Beyond its financial metrics, JK Paper continues to deepen its Corporate Social Responsibility (CSR) impact. So far in 2024, the company has supported 846 villages across nine states, benefiting nearly 9.64 lakh people. Their CSR programs encompass a wide range of initiatives, including women’s empowerment, education, healthcare, sustainable agriculture, rural infrastructure development, and natural resource management. The company also announced plans to participate in the PM Internship Scheme, adding further support for youth employment.
accolades and industry recognition
JK Paper’s performance and innovative approaches have not gone unnoticed. The company was awarded at the prestigious “Adam Smith Awards ASIA 2024”, earning commendation for its automated treasury solution in India. It also secured multiple honors in energy management, with its Unit JKPM recognized as an “Excellent Energy Efficient Unit” and declared a “National Energy Leader” by the Confederation of Indian Industries (CII), Hyderabad. Additionally, the Odisha Assembly of Small & Medium Enterprises (OASME) recognized it as the “Best Mother Plant” for promoting the MSME sector in Odisha.
Future outlook and strategic initiatives
To mitigate ongoing challenges, JK Paper plans to enhance its sustainability efforts and pursue further cost-effective procurement practices. The company’s strategic focus on value-added products, such as coated papers, virgin fiber packaging boards, and high-end maplitho, is expected to drive revenue stability amid fluctuating market conditions.
Industry expert perspective
Analysts noted that JK Paper’s efforts in diversifying its product line and sustainability practices could position it favorably for future growth despite current headwinds. The investment in energy-efficient operations and social forestry underscores a commitment that appeals to both investors and eco-conscious stakeholders.
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