**Raama Paper Mills Limited** is an Indian manufacturer of **Newsprint, Duplex Board, and Tissue paper**. Historically a diversified player in the domestic paper industry, the company is currently in a state of severe financial and operational distress. It is presently undergoing a **Corporate Insolvency Resolution Process (CIRP)** under the **Insolvency and Bankruptcy Code (IBC), 2016**, with its manufacturing operations suspended and its management powers transferred from the Board of Directors to a **Resolution Professional (RP)**. --- ### **Current Insolvency Status & Resolution Timeline** The company’s trajectory is currently dictated by legal proceedings rather than commercial strategy. Following an acute shortage of working capital and debt defaults, the **National Company Law Tribunal (NCLT)** initiated insolvency proceedings on **June 7, 2024**. * **Management:** Managed by a **Resolution Professional**; the Board of Directors remains suspended. * **Resolution Plan Status:** A plan approved by the **Committee of Creditors (CoC)** on **April 16, 2025**, was subsequently **set aside** by the NCLT Allahabad Bench on **January 7, 2026**, with specific directions. This has extended the period of uncertainty regarding the company’s future ownership and revival. * **Operational Mode:** The plant is in **"Shut Mode."** Current revenue is negligible, derived primarily from the sale of **scrap and raw materials**. --- ### **Historical Production Capacity & Asset Evolution** Before the operational halt, the company underwent multiple phases of expansion to diversify its product mix. However, recent years saw a contraction as obsolete machinery was liquidated to manage debt. | Phase / Development | Key Products | Capacity (TPA) | | :--- | :--- | :--- | | **Initial Project** | Paper Products | **3,300** | | **Expansion 1** | Duplex/Triplex Board | **9,000** | | **Diversification (1992-93)** | Writing, Printing, Newsprint | **8,250** | | **Unit No. 3 Expansion (1995-96)** | Newsprint and Kraft Paper | **18,500** | | **Modernization (2005-06)** | Unit No. 3 Upgrade | **44,000** | | **Imported Line (2007-08)** | High-grade Paper | **16,320** | | **2021 Rationalization** | *Sale of obsolete units to repay debt* | *(Reduced)* | --- ### **Financial Performance & Capital Erosion** The company’s financial health has deteriorated sharply, characterized by widening losses and a complete erosion of net worth. **Key Financial Indicators (₹ in Lakhs)** | Particulars | FY 2024-25 | FY 2023-24 | FY 2022-23 | | :--- | :--- | :--- | :--- | | **Total Revenue** | **687.69** | **6,159.73** | **8,101.46** | | **PBTDA** | **(1,050.87)** | **(1,262.56)** | **(65.00)** | | **Net Profit / (Loss)** | **(1,644.00)** | **(1,948.00)** | **(552.13)** | | **Accumulated Losses** | **6,635.00** | **3,823.00** | *Not Disclosed* | | **Net Worth** | **(4,501.00)** | **(1,857.00)** | *Positive* | **As of December 31, 2025:** * **Accumulated Losses:** Increased to **₹71.08 Crore**. * **Negative Net Worth:** Deepened to **₹49.75 Crore**. * **Asset-Liability Gap:** Current liabilities exceed total assets by **₹33.56 Crore**. --- ### **Debt Profile & Liquidity Constraints** The company is in default on its primary financial obligations, leading to significant legal and financial exposure. * **Secured Borrowings:** Totaled **₹46.27 Crore** as of March 2024, primarily consisting of **12% p.a. Secured Inter-Corporate Deposits (ICDs)** from **Amar Ujala Limited** and **Impressions Printing and Packaging Limited**. * **Interest Non-Provision:** Since the CIRP commencement, the company has stopped providing for interest on secured ICDs. Unprovided interest reached **₹8.56 Crore** by December 2025. * **Preference Share Liability:** **₹5 Crore** of **14% non-cumulative preference shares** were reclassified as **"Other Financial Liabilities"** following redemption defaults. Arrears on preference dividends stood at **₹6.55 Crore** in 2024. * **Contingent Liabilities:** Includes an **Income Tax/MAT demand** of **₹6.40 Crore** (A.Y. 2019-20) and capital commitments of **₹5.66 Crore**. --- ### **Capital Structure & Shareholding** * **Equity Capital:** **₹19.66 Crore** (96,64,733 shares of ₹10 each). * **Promoter Activity:** **2,083,333** equity shares issued to the promoter group received BSE trading approval in the 2023-24 period. * **Proposed Capital Induction:** Prior to insolvency, the board authorized the issuance of **3,000 Secured NCDs** (totaling **₹30 Crore**) and **12,50,000 OCDs**, though these plans are currently superseded by the CIRP. --- ### **Critical Risk Factors & Audit Qualifications** Investors should note the high level of regulatory and operational risk currently associated with the entity: * **Going Concern Uncertainty:** Auditors have repeatedly flagged **material uncertainty** regarding the company's ability to continue as a going concern given the plant shutdown and negative net worth. * **Governance & Internal Controls:** * **Shareholder Dissent:** In the September 2024 AGM, shareholders **rejected** resolutions to adopt financial statements and re-appoint directors. * **Asset Mismanagement:** The RP reported difficulties in recovering company assets (including a **Mercedes car**) from suspended management. * **PUFE Transactions:** A transaction auditor (**M/s KRA & Co.**) is investigating potential **Preferential, Undervalued, Fraudulent, or Extortionate** transactions. * **Compliance Failures:** * No physical verification of **Inventory** or **Property, Plant & Equipment** was conducted for FY25. * Persistent defaults in statutory dues (**PF, TDS, GST, ESI**). * Non-compliance with the **MSMED Act, 2006** regarding trade payables. * **SEBI/BSE warnings** issued due to a non-functional corporate website. * **Legal Risks:** Pending proceedings under **Section 138 of the Negotiable Instruments Act** related to dishonored cheques for preference share redemptions.