Input costs to ease in the next 6–9 months for paper manufacturing: Pawan Agarwal shares roadmap at Paperex 2025

Input costs to ease in the next 6–9 months for paper manufacturing: Pawan Agarwal shares roadmap at Paperex 2025

- Chasing sales without improving margins weakens the business: “If your bottom line is not improving, it is not healthy, then top line has no meaning.”

The Pulp and Paper Times | New Delhi

Pawan Agarwal, MD, Naini Papers Limited, delivered an impactful address at Paperex 2025, stressing resilience, innovation, efficiency, and a strong focus on input cost management over the next six to nine months. Opening his remarks, he said, “Ladies and gentlemen, when Rahul started off with bad times and good times, I thought, oh my God, some of my content has already been spelled out now. But Rahul, I would like to differ a little bit over here. There are no bad times and no good times.”

Agarwal emphasized that the industry has always seen cycles. “With my experience, I would say there are comfortable times and there are tough times. We have seen comfortable times in the past. We have seen equally bad times in the past. Don't forget about COVID times. And we are seeing equally tough time now,” he said, adding that it is up to the industry whether it turns these tough times into good ones or labels them as bad.

He reiterated the well-known thought: “When the going gets tough, the tough get going,” urging the industry to evaluate its resilience and preparedness. “Friends, I have been given four minutes. I will just spell out my thoughts on how to gear ourselves, how to steer ourselves from these so-called tough times. We cannot change the geopolitical situation. We really don't have say in that. We have to flow with the tide. But we can do one thing. We can look at our own house.”

Drawing inspiration from his school days, Agarwal said he once wrote an essay titled “Need is the mother of all inventions.” Reflecting on that thought, he added, “What are the needs of today’s time? And let us innovate because need is the mother of all inventions or innovations.”

Agarwal highlighted that tough times bring challenges, but challenges inherently create opportunities. He advised mills to use this phase to enhance operational efficiency. “We can take the extra flap out of our body. We can make ourselves agile,” he said.

He encouraged all paper manufacturers—kraft, board, writing and printing, tissue, or any grades—to focus on product re-engineering and innovation. For the first time in decades, he noted, the paper industry is getting recognized as a fully sustainable sector. “Look at our raw materials, wood, agro, paper, waste paper. All this is totally sustainable,” he said.

Agarwal listed sustainable inputs such as wood sourced from agricultural fields, wheat straw, bagasse, and recycled fiber. He further stressed the sustainability of paper products, which are biodegradable, compostable, and recyclable up to twelve times.

He positioned the paper industry as central in the global shift away from single-use plastic. “Today plastic has become a big menace everywhere globally,” he said, urging companies to deploy marketing, R&D, and technical teams to deeply understand consumer and brand-owner needs and help replace plastic with paper-based solutions. “There is lot of opportunity, believe me in that,” he added.

Agarwal then shifted his focus to financial strategy during tough times. In good times, companies chase top-line growth, he said, but in tough times, “please decouple your top line with your bottom line. Try to look into your bottom line. That will give you the desired cash flow.”

He warned that chasing sales without improving margins weakens the business: “If your bottom line is not improving, it is not healthy, then top line has no meaning.”

Sharing his outlook, Agarwal stated: “These tough times, I feel personally, maybe some of you may differ, these are for next six to nine months. And then the cycle will change.”
On the raw material front, he explained that plantations across India are expanding significantly, and this will help correct current high raw material prices. “This is really going to reverse towards the end of next year,” he said, noting that cost pressures will ease once the cycle turns.

He urged the industry to gear up for the next nine to ten months with discipline and efficiency. Looking ahead to the next edition of the event, he said, “I really hope when we meet in the next Paperex, we'll be meeting more cheerful faces next time.”

Despite the ongoing challenges, Agarwal struck an optimistic tone: “It is not so gloomy. We should all remain cheerful, hopeful for the future.”

As he concluded, he praised the organisers: “In my last 25 odd years coming to Paperex, I would say this is one of the finest of the exhibitions I have seen so far. The kind of ambience, the kind of technology being used. So congratulations to the organisers and thank you so much. Namaskar.”
 

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