JK Paper
JK Paper, part of the JK Group, is one of the leading paper companies, with a 28% market share in copier paper and 17% in packaging board. A very strong brand with one of the best distribution networks in the industry. Almost 65% of total capacity caters to packaging, which is growing at double digits. Very strong financials and a good payout history increase our confidence in the business.
Key facts
Shareholding pattern, June 2025
Financials (₹ crore)
| Financials (₹ crore) | FY25 | FY26(E) | FY27(E) |
|---|---|---|---|
| Revenue | 6,718 | 7,462 | 8,020 |
| EBITDA | 928 | 1,371 | 1,629 |
| PAT | 412 | 668 | 1,113 |
| EPS | 24.19 | 36.84 | 46.04 |
Company profile
- A leading domestic writing & printing paper (WPP) and paper-board manufacturer, with installed capacity of 7,61,000 tonnes per annum.
- Market leader in corrugated boxes, with 3,50,000 tonnes of capacity.
Industry leadership and stable growth in paper
- Market leader with a 24% share in branded copier and 12% in coated paper.
- No major new entrants; demand is projected to grow at a 6–7% CAGR to ₹1,00,000 crore by FY28.
- Backward integration ensures margin stability, cost efficiency and quality control.
Packaging expansion through strategic acquisitions
- Built through organic and inorganic initiatives, including a greenfield corrugated plant in Ludhiana.
- Horizon Packs Pvt Ltd (2023; FY25 revenue ₹722 Cr) and Securipax Packaging Pvt Ltd (2023; ₹88 Cr).
- Manipal Utility Solutions (2023; ₹130 Cr) and Radhesham Wellpack (2025; ₹91 Cr).
- Borkar Packaging (2025; FY25 revenue ₹393 Cr).
Backward integration, BCTMP mill
- A ₹600–650 crore BCTMP mill, coming online in H2 FY26, to supply high-quality pulp.
- Supports lightweight coated-board production and energy efficiency.
Cycle at the bottom, recovery signs emerging
- Wood prices are declining after a ~80% rise over the previous year, easing input costs and aiding margins.
- A government minimum import price of ₹67,220/tonne on virgin multilayer paper board (until March 2026) provides a price floor.
- Channel checks indicate rising paperboard and WPP prices on stronger demand and improved domestic pricing.
- Anti-dumping probes against imports from Indonesia, Chile and China are expected to lead to anti-dumping duties.
Strong balance sheet and cash flow
- Net debt/EBITDA of 0.25x, robust cash conversion and a dividend yield of ~1.35%.
- Debt-equity has been cut sharply over the last decade, with improved return ratios.
Risks
- Raw-material price volatility may pressure near-term margins.
- Pressure from cheap imports may continue, or anti-dumping duties may be delayed.
- Turnaround of acquisitions may take longer than expected.
Conclusion
- Despite a ~20% correction over the last year, the industry is poised for recovery.
- Falling input costs, regulatory protection and price increases support the up-cycle.
- Current valuations appear highly attractive; we view the risk-reward as favourable with limited downside.
Disclaimer. This report is for the personal information of the authorised recipient and does not constitute investment advice. Care PMS is not soliciting any action based upon it; recipients should rely on their own investigations. Care PMS, through proprietary and client funds, has an interest in the Company.
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