TNPL, JK Paper, and West Coast hit by profit slump in FY25 due to rising hardwood pulp costs and import pressure

TNPL, JK Paper, and West Coast hit by profit slump in FY25 due to rising hardwood pulp costs and import pressure

- Low-Cost Imports Squeeze FY25 Profits of Leading Paper Firms
-TNPL Consolidated net profit plummeted 98% for the FY ended on March 25, Profit after tax is Rs.22.12 Crore ( Q4 FY 25) as against a profit of Rs.32.99 Crore in the corresponding quarter of the previous year.
- Domestic hardwood pulp prices saw a 20-25% hike due to heightened demand from other wood-based industries
- West Coast records a 40% decline in its net profit for the FY ended March 2025

The Pulp and Paper Times

India’s paper industry experienced a tough Fourth quarter of FY25, grappling with rising raw material costs, a surge in imports, and falling market prices. Major companies such as JK Paper Ltd., Tamil Nadu Newsprint and Papers Ltd. (TNPL), and West Coast Paper Mills Ltd. posted mixed financial results, with profitability strained by elevated wood prices and reduced realizations. Nevertheless, these firms are maintaining their focus on enhancing operational efficiency, advancing sustainability efforts, and pursuing strategic growth initiatives to adapt to the shifting market environment.

JK Paper

Indian paper and packaging board maker JK Paper reported its seventh consecutive quarter of lower profits, as high prices of wood pressured its margins.

JK Paper Ltd recorded a Consolidated Turnover of Rs. 1,805.28 Cr, EBITDA of Rs.241.63 Cr and Profit after Tax (PAT) of Rs.76.20 Cr for the Quarter ended March’25. For the year ended March,2025, the Consolidated Turnover was Rs.7,120.20 Cr, EBITDA Rs.1,036.28 Cr and PAT Rs.409.82 Cr.

JK Paper earned a profit after tax of Rs. 76.20 crore for the quarter ended March 2025, compared to Rs. 275.64 crore in the corresponding quarter of the previous year ended March 2024.  Consolidated net profit plummeted 72.4% in Q4 FY25 while full year net profit dropped by 63.50%

Commenting on the results, Shri Harsh Pati Singhania, Chairman & Managing Director, said, “Profits have been significantly impacted due to surge in imports at low prices and high wood cost. Despite adverse market scenario, the Company achieved highest ever sale of 8.06 LMT during the year and maintained its leadership position across its product categories.”

Tamil Nadu Newsprint and Papers Ltd

TNPL reported total revenue of Rs.1393.79 Crore for the quarter ended 31st March, 2025 as against Rs.1250.66 Crore in the corresponding quarter of the previous year. The company earned Profit before Interest, Depreciation and Tax (EBITDA) of Rs.160.12 Crore for the quarter ended 31st March, 2025 as against Rs.181.45 Crore during the corresponding quarter of the previous year. After providing Rs.76.90 Crore towards depreciation & amortization and Rs.52.39 Crore for finance cost, the company earned profit before tax of Rs.30.83 Crore for the quarter ended 31st March, 2025 as against a profit of Rs.53.39 Crore in the corresponding quarter of previous year. Profit after tax is Rs.22.12 Crore as against a profit of Rs.32.99 Crore in the corresponding quarter of the previous year.

Paper Industry has shown a mixed performance during the year. The demand for packaging, printing and speciality papers segments have faced price corrections due to fluctuating raw material costs and raising imports.

Significant increase in paper imports from ASEAN counties at very low prices during the year led to severe price pressure on domestic mills, resulting in reduction in sales realisation. Also Domestic hardwood pulp prices saw a 20-25% hike due to heightened demand from other wood-based industries and lower plantation during Covid.

The combination of above factors severely impacted the profit margins and affected the profitability of the company during the year.

Paper production for the quarter ended 31st March, 2025 is 109690 MT against 107564 MT in the corresponding quarter of the previous year and Packaging Board production is 52268 MT against 47133 MT in the corresponding quarter of the previous year.

Paper production for the year ended 31st March, 2025 is 425166 MT against 422742 MT in the corresponding period of the previous year and Packaging Board production is 189406 MT against 195437 MT in the corresponding period of the previous year.

TNPL reported total revenue of Rs.4588.31 Crore for the year ended 31st March, 2025 as against Rs.4761.80 Crore in the corresponding period of the previous year. The company earned Profit before Interest, Depreciation and Tax (EBITDA) of Rs.527.17 Crore for the year ended 31st March, 2025 as against Rs.838.75 Crore during the corresponding period of the previous year. After providing Rs.303.74 Crore towards depreciation & amortization and Rs.216.13 Crore for finance cost, the company earned profit before tax of Rs.5.30 Crore as against a profit of Rs.324.76 Crore in the corresponding period of previous year. Profit after tax is Rs.3.73 Crore as against a profit of Rs.208.16 Crore in the corresponding period of the previous year.

West Coast Paper Mills

West Coast Paper Mills Limited one of the oldest and the largest producers of paper for printing, writing and packaging in India. Established in 1955, the company enjoys a pedigree standing over the past 70 years as premium brand in paper industry, widely acknowledged in India and abroad. West Coast reported total revenue of Rs. 631.04 Crore (Standalone) for the quarter ended 31st March, 2025 as against Rs. 629.14 Crore in the Q3FY25. Profit after tax is Rs. 41.39 Crore (Standalone) as against a profit of Rs. 58.22 Crore in the Q3FY25. 

Commenting on the results Mr. S.K. Bangur, Chairman & Managing Director, West Coast Paper Mills Limited said: “During the quarter under review, a significant rise in wood prices and decreased realization has affected performance for both, the quarter and the entire year. Selling prices have remained under pressure due to surge in imports at low prices. However, the company persists in its efforts to enhance operational efficiencies and boost margins.”

West Coast records a 40% decline in its net profit for the FY ended March 2025
 

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