Kuantum Papers has reviewed and approved capex projects worth INR 735 crores, including pulp mill upgrades, capacity expansion, and AI integration

Kuantum Papers has reviewed and approved capex projects worth INR 735 crores, including pulp mill upgrades, capacity expansion, and AI integration
- KPL reported a revenue of INR 1,217 crores for the fiscal year 2024, which is a decline of 7.3% from the previous year.
- Integrating AI into plant operations for advanced operational and process controls.
- Introduction of Kuantum Korra, a superior quality paper crafted with 90-95% agro pulp which is specifically designed for the notebook segment.
The Pulp and Paper Times:

Kuantum Papers Ltd. (KPL) specializes in producing high-quality agro and wood-based paper products, serving the diverse needs of its customers. Established in 1980, the company has grown from a modest manufacturing capacity of 30 tons per day (TPD) to a remarkable 450 TPD, demonstrating a strong commitment to innovation and excellence in the paper industry.

KPL maintains a sharp focus on product excellence and steady growth, consistently expanding its capacity and optimizing production efficiency over the years. Backward integration, upgradation projects, and collaborations with industry leaders in green technologies have further strengthened the company's sustainability efforts.

Kuantum Papers operate an integrated pulping facility with separate agro and wood pulping lines, boasting a total capacity of 380 MT of pulp per day for paper manufacturing. KPL’s Agro pulp is made from agro residues which primarily constitutes wheat straw. The wood raw materials are mostly sourced as wood chips and veneer waste which are byproducts of the furniture and plywood industry.

“We leverage a perfect blend of our own agro and wood resources with imported softwood pulp to create superior-quality pulp for paper production. The unique configurations of our four paper machines enable us to manufacture a wide array of products, such as surface-sized, non-surface-sized and value-added specialty papers, catering to the diverse needs of our customers,

“Our focus on maintaining superior product quality and adapting to dynamic market demand, has enabled us to command a premium price that is 5% to 7% higher than our competitors. We have developed a distinguished range of branded products that resonate with our customers, reinforcing our market leadership,” Mr. Jagesh Kumar Khaitan, Chairman of Kuantum Papers Ltd. Stated in the annual report for FY 23-24.

“We reported a revenue of INR 1,217 crores for the fiscal year 2024, which is a decline of 7.3% from the previous year. This reduction in revenue was primarily on account of a drop in the sales realisation which was witnessed throughout the industry . However, notwithstanding the challenging market conditions and mounting import pressure, we continued to prioritise operational excellence and cost optimization,” Mr. Pavan Khaitan, Vice Chairman & Managing Director of Kuantum Papers stated in the annual report.

On the mill upgradation and expansion plan, Mr. Pavan Khaitan informed, that, the Board has reviewed and approved capex projects worth INR 735 crores keeping in view the strong fundamentals of the paper industry in India and its growth potential. These projects are directed towards upgrading and modifying our existing 4 paper machines to increase the overall production capacity from the current 450 TPD to 675 TPD. Furthermore, the Utilities section comprising of our Agro and Wood Pulp Mills, Co-Gen Power Plant, Chemical Recovery Plant and Effluent Treatment Plant will also undergo upgradation commensurate with this enhanced paper making capacity. Aligned with our resolve towards fostering environmental stewardship, we will also be expanding our Clonal Propagation Center (Nursery) to nurture the Social Farm Forestry Programme.

“We embarked on our Industry 4.0 journey in the last financial year with the launch of Project Neev to create a foundation for IT-OT convergence. With the successful implementation of Project Neev which involved the deployment of BTG’s data management tool dataPARC in 2023, we launched Project Nirmaan, meaning “building upon”. This project will enable Kuantum Papers to step into a new era of integrating AI into our plant operations for advanced operational and process controls. This project aims to enhance our operational efficiency and bottom-line performance to position us at the forefront of the paper industry,” Mr. Khaitan said.

“Our innovation journey has led to the introduction of Kuantum Korra, a superior quality paper crafted with 90-95% agro pulp which is specifically designed for the notebook segment. Through extensive R&D efforts over the past year, we have developed this eco-friendly agro furnish based product to meet the needs of the environmentally conscious customer, reinforcing our position as a market leader in sustainable and innovative paper solutions,

“Two new notable additions to our product portfolio include Kosmo Litho K2 - a premium quality paper product made exclusively from 100% mill hardwood pulp, designed for high-end printing; and Kosmo Maplitho NS UV- a security paper developed with UV Fibers for enhanced security features.” Mr. Khaitan stated.

KPL is pursuing organic growth opportunities through debottlenecking and upgrading its plant operations. This approach aims to increase production capacity by almost 50%, from the current 450 TPD to 675 TPD . KPL is also leveraging the power of Industry 4.0 technologies, including the Internet of Things (IoT), Artificial Intelligence (AI) and cloud computing, to drive operational efficiency and optimal resource utilisation.

A cornerstone of our eco-conscious strategy is the on-site Clonal Propagation Center (Nursery), with an enhanced production capacity of 40 lakhs saplings per annum through the installation of new high-tech chambers in our on-site nursery. With an ambitious trajectory to increase this to 1 crore saplings per year, Kuantum Papers aims to cover 50,700 acres of land under Social Farm Forestry by 2028-29, making significant contributions to reforestation and biodiversity conservation along with ensuring a reliable and sustainable raw material supply. Furthermore, it contributes to socioeconomic development of small and marginal farmers working on barren, non-arable lands.

Kuantum prioritizes water conservation through a comprehensive strategy that emphasizes reusing and recycling water within plant operations and ensuring all treated wastewater is utilized for irrigation on over 2,000 acres of land in nearby fields. These efforts have resulted in a remarkable 15% reduction in water consumption over the last three years, with a decrease of 5 m3 per tonne of paper produced in the last year alone. Kuantum envisions to achieve a further 35% reduction in water consumption within the next two years.

OPERATIONAL PERFORMANCE HIGHLIGHTS:

Though the overall consumption levels of Paper in Domestic Market remained stable, prices have dropped during the year, compared to an extremely favourable and buoyant market in FY 2022-23.
During FY 23-24, the performance of the Kuantum Paper was satisfactory and the Company achieved a production of 1,56,956 metric tonnes as against 1,52,172 metric tonnes in the previous year. The quantitative figure for the sale of paper was 1,56,931 metric tonnes this financial year as against the sale of 1,52,305 metric tonnes in the previous financial year.

The Company recorded a Net Sales Turnover (net of GST) including other income of INR 1,21,693.66 Lakhs (Previous Year INR 1,31,316.25 Lakhs) lower by 7.32 %; Operating Profit at INR 33,870.49 Lakhs (Previous Year INR 38,281.71 Lakhs), lower by 11.52%; Profit before exceptional items INR 24,761.06 Lakhs (Previous Year INR 26,638.59 Lakhs) lower by 7.04%; and the Net Profit after Tax and other comprehensive income (expense) at INR 18,320.86 Lakhs (Previous year INR 13,569.66 Lakhs) up by 35.01% .

Expansion Plan:

Locking ahead and considering the strong fundamentals of the paper business and its growth potential, the Management has reviewed and re-evaluated the capex projects. Going forward, the proposed cost of the projects had been envisaged at Rs. 735.00 crores. The implementation period of the capex projects ranges from 6 months to 27 months. The project cost of Rs. 735.00 crores is proposed to be funded by loans of Rs. 535.00 crores and internal accruals/ USL of Rs. 200.00 crores. The implementation of projects will lead to enhancement of Paper Production from 450 TPD to 675 TPD with State of Art Technology of Shoe Press, Film Size Press & Calendar Section. The Company has planned setting up of new Displacement Digester System (DDS) for Wood Pulp Mill and upgradation of both Pulp Mills to enhance capacity from 365 TPD to 440 TPD, Upgradation of Power Plant, Recovery Boiler Island, Effluent Treatment facilities, Surface Water & WTP, Expansion of Nursery for Farm Forestry, Colony and other Infrastructure. Projects will be commissioned in a phased manner over a period of 2.25 years and all the projects are expected to be completed by 31st March 2026.
 

Web Title: Kuantum Papers has reviewed and approved capex projects worth INR 735 crores, including pulp mill upgrades, capacity expansion, and AI integration