Shree Krishna Paper Mills & Industries Ltd. (SKPMIL) is an established Indian manufacturer specializing in the production of high-quality paper and allied products. Operating from a centralized facility in Rajasthan, the company serves diverse sectors including printing, packaging, and specialty paper. Following a successful multi-year financial restructuring, the company is currently pivoting toward sustainable energy, asset monetization, and high-value product innovation. --- ### **Manufacturing Infrastructure & Technological Integration** The company’s operational core is a single-segment manufacturing business located at the **RIICO Industrial Area, Village Keshwana, Jaipur (Rajasthan)**. As of March 31, 2025, the facility is supported by a workforce of **270 personnel**. SKPMIL emphasizes **indigenous technology absorption**, having imported no technology in the last three years. Instead, it focuses on incremental process optimization to drive productivity and cost reduction. | Focus Area | Technology/Equipment Implemented | Primary Benefit | | :--- | :--- | :--- | | **Paper Quality** | New **Ceramic Roll** (replacing rubber rolls) | Improved surface quality and durability | | **Water Management** | **RO System** installation | Enhanced paper quality through purified process water | | **Production Efficiency** | **Bi-nip Press** installation | Increased **moisture control** and reduced **steam consumption** | | **Pulping Capacity** | New equipment in **DIP (De-inked Pulp) section** | Increased throughput and raw material processing | **Key R&D and Operational Efforts:** * **Fiber Quality:** Modifications to **HD Pulpers** and continuous monitoring of the **DIP section** ensure high-grade output and potential for import substitution. * **Process Efficiency:** Comprehensive **pulping studies** are conducted to optimize **retention** and **yield**. * **Energy Conservation:** The company invested **₹77.08 Lakhs** in FY 2024-25 in energy-efficient equipment, including **Variable Frequency Drives (VFD)**, **Soft Starters**, and **energy-efficient transformers**. --- ### **Strategic Roadmap: Deleveraging & Sustainable Growth** SKPMIL is executing a multi-pronged strategy to counter market competition and inflationary pressures while strengthening its balance sheet. * **Sustainable Energy Transition:** In **April 2026**, the company entered a **Power Purchase Agreement (PPA)** with **M/S Ratan Green Projects One Private Limited (RGPOPL)**. SKPMIL is acquiring a **26.5% equity stake** in **RGPOPL** to source solar power as a captive user, aimed at drastically reducing long-term energy overheads. * **Asset Monetization:** To reduce interest burdens, the company received shareholder approval in **2024** to dispose of non-core land at the **Keshwana** facility: * **Plot No. SPL-A3 (29.982 Acres):** Designated for outright sale. * **Plot No. SPL-A2 (31.690 Acres):** Designated for leasing. * **Plot No. SPL-A (29.558 Acres):** Retained for active production. * **Capital Augmentation:** In **December 2025**, the company increased its borrowing powers from **₹175 Crores** to **₹500 Crores** to fund future expansion and maintain business momentum. * **Product Innovation:** Management is introducing eco-friendly and specialized lines, including **PACKMATE LAMCOTE®** and **Tree-Free Paper**, to target premium segments. --- ### **Financial Performance & Capital Structure** The company achieved a landmark milestone in **FY 2024-25** by officially closing its **Corporate Debt Restructuring (CDR)** package, which had been in place since **April 1, 2009**. This was finalized following the payment of dividends on **4% cumulative redeemable preference shares** (approx. **₹1.46 crore**). #### **Comparative Financial Summary** | Financial Parameter (₹ in Lakhs) | 2024-25 | 2023-24 | 2022-23 | | :--- | :--- | :--- | :--- | | **Revenue from Operations** | **16,870.84** | **14,435.22** | **17,787.69** | | **Profit Before Tax (PBT)** | **195.00** | **65.36** | **325.96** | | **Net Profit After Tax (PAT)** | **112.74** | **38.04** | **1,256.22*** | | **Earnings Per Share (₹)** | **0.83** | **0.28** | **9.29** | | **Debt to Equity Ratio** | **0.70** | **0.79** | **0.89** | *\*Includes exceptional income of ₹1,332.39 lakhs.* #### **Revenue and Debt Profile** * **Revenue Concentration:** In FY 2023-24, three major customers accounted for **₹6,292 Lakhs**. * **Geographical Split (FY 24-25):** Domestic/Deemed Exports contributed **₹15,929.41 lakhs**, while international sales contributed **₹879.96 lakhs**. * **Interest Rates:** The maximum interest rate on cash credit facilities improved to **12.36% p.a.** in FY 2024-25, down from **14.15% p.a.** * **Credit Rating:** External ratings were withdrawn as total credit exposure remains below the **₹50 Crore** threshold. --- ### **Governance & Leadership Transition** The company underwent a significant leadership restructuring in **August 2025** to align with its new growth phase. | Executive | Designation | Tenure | | :--- | :--- | :--- | | **Mr. Narendra Kumar Pasari** | **Executive Chairman** | **Aug 2025 – Aug 2028** | | **Mr. Naynesh Pasari** | **Managing Director** | Until **Aug 2026** | | **Mrs. Devika Ohri** | **Additional Director (Independent)** | **Nov 2025 – Oct 2030** | | **Mr. Ashish Sharma** | **Independent Director** | **Mar 2025 – Mar 2030** | **Related Party Transactions:** The company maintains sales/purchase agreements for paper products with entities including **Busimatix Global LLP**, **Gopala Sales Private Limited**, and **Packmate Grreen LLP**. Due to recent periods of inadequate profits, the company has secured approval for minimum managerial remuneration to retain key leadership. --- ### **Risk Profile & Mitigation Framework** SKPMIL operates in a volatile commodity environment and manages risks through a Board-approved framework. #### **1. Market and Operational Risks** * **Raw Material Volatility:** High dependence on **waste paper** and **wood pulp**, which are subject to global price cycles. * **Competition:** Intense pressure from low-priced imports and domestic competitors. * **Legal Contingencies:** Significant **litigations are pending**; management uses high-degree estimates for **contingent liabilities**. #### **2. Financial Risk Management** * **Liquidity Risk:** As of March 31, 2024, unutilized working capital stood at **₹5.46 crore**. * **Currency Risk:** The company uses **forward contracts** to hedge foreign exchange risk. A **5% change** in the **USD** rate would impact PBT by **₹18.99 Lakhs**. * **Interest Rate Risk:** A **50 bps** increase in floating rates would impact PBT by **₹8.07 Lakhs**. * **Credit Risk:** Managed via an **Expected Credit Loss (ECL)** model; concentration risk is currently deemed **low** due to industry diversification. #### **Contractual Maturities (As of March 31, 2024)** | Category | < 1 Year (₹ Lakhs) | 1-5 Years (₹ Lakhs) | Total (₹ Lakhs) | | :--- | :--- | :--- | :--- | | **Borrowings** | **1,555.69** | **1,029.24** | **2,584.93** | | **Trade Payables** | **1,599.62** | **96.20** | **1,695.82** | --- ### **Investor Outlook** While SKPMIL has faced headwinds from subdued discretionary spending and high raw material costs, the **closure of the CDR package**, the shift toward **captive solar power**, and the **monetization of surplus land** provide a clearer path toward improved margins. The company’s listing on the **BSE** and its focus on **Tree-Free** and specialty paper products position it to benefit from the growing demand for sustainable packaging solutions.