💰 Financial Performance

Revenue Growth by Segment

Paper Sacks division revenue accounted for 61.23% of total revenue but recorded marginally reduced turnover; Flexible Division accounted for 38.77% of total revenue and achieved higher turnover compared to the previous year.

Geographic Revenue Split

Not disclosed in available documents, though the company operates a manufacturing facility in Balasore, Odisha and exports products as evidenced by foreign exchange earnings of INR 1.44 Cr.

Profitability Margins

Operating margins have remained stable between 11% and 13% over the three fiscals ending March 31, 2025. Reported PAT margin improved from 6.41% in FY23 to 8.89% in FY24.

EBITDA Margin

EBITDA margin for FY25 stood at INR 16.01 Cr, representing a 7.68% decrease compared to the previous year, primarily due to rising operational costs and supply chain challenges.

Capital Expenditure

The company has planned debt-funded capital expenditure of less than INR 25 Cr for the FY25-26 period to expand production capacity for flexible laminates and conduct repairs and maintenance in the paper division.

Credit Rating & Borrowing

Ratings reaffirmed at CRISIL BBB/Stable for long-term and CRISIL A3+ for short-term bank facilities. Bank limit utilization is low at approximately 3% for the 12 months ended June 2025.

⚙️ Operational Drivers

Raw Materials

Paper and polypropylene granules are the primary raw materials, accounting for the bulk of production expenses.

Import Sources

Approximately 45-50% of total raw material requirements are imported to ensure high-quality output, with lead times exceeding 60 days due to shipment challenges.

Key Suppliers

Not disclosed in available documents, though the company maintains long-standing relationships with various international and local suppliers.

Capacity Expansion

Current capacity not specified in MT; however, the company is actively expanding flexible laminate capacity through a capex of under INR 25 Cr to meet rising demand in the FMCG and e-commerce sectors.

Raw Material Costs

Raw material costs represent the bulk of production expenses; even slight price variations in paper or polypropylene granules drastically impact profitability due to the modest scale of operations.

Manufacturing Efficiency

Capacity utilization for bank limits was low at 21% in FY24 and dropped to 3% by June 2025, indicating significant headroom for production ramp-up.

Logistics & Distribution

Rising logistics costs are driving a shift toward flexible packaging solutions, which are lighter and more cost-effective for distribution.

📈 Strategic Growth

Expected Growth Rate

12.7%

Growth Strategy

Growth will be achieved through a '4X4 mantra' focusing on customer conversion to sustainable solutions, capacity expansion in flexible laminates (INR 25 Cr capex), and targeting high-growth sectors like FMCG and e-commerce.

Products & Services

Paper sacks and flexible laminates used for packaging tea, carbon-black, and chemicals.

Brand Portfolio

B & A Packaging India Limited (BAPIL).

New Products/Services

Development of sustainable, eco-friendly paper-based packaging materials and value-added flexible laminates to cater to the retail and FMCG sectors.

Market Expansion

Targeting the retail sector through customized colors, designs, and prints for paper bags and sacks, leveraging the national plastic ban trend.

Market Share & Ranking

Not disclosed in available documents; however, the Indian packaging industry is the 5th largest sector in the economy.

Strategic Alliances

The company pays service charges (up to INR 1.50 Cr in FY25) to Barooahs & Associates Pvt. Ltd. for advisory services in factory supervision, banking, and sales.

🌍 External Factors

Industry Trends

The Indian flexible packaging market is projected to grow at a CAGR of 12.7% (2024-2028), while paper bags/sacks are expected to grow at 8.5% (2025-2031) due to plastic bans and sustainability shifts.

Competitive Landscape

The industry is characterized by intense competition from both organized and unorganized players, which limits scalability and pricing power.

Competitive Moat

The moat is built on the 30+ years of experience of the Barooah family promoters and established relationships with tea and chemical industry clients, which are sustainable but challenged by intense competition.

Macro Economic Sensitivity

Highly sensitive to GDP growth and urbanization, which drive demand for packaged consumer goods and e-commerce.

Consumer Behavior

Increasing consumer preference for sustainable, recyclable, and lightweight packaging is driving demand for paper-based solutions and pouches.

Geopolitical Risks

Shipment challenges and international supply chain disruptions impact the 45-50% of raw materials that are imported.

⚖️ Regulatory & Governance

Industry Regulations

Operations are governed by the Food Safety and Standards (Packaging) Regulations 2018, Legal Metrology Act 2009, and the Factories Act 1948.

Environmental Compliance

The company spent INR 0.28 Cr (INR 28,22,747) on Corporate Social Responsibility (CSR) in FY25. It must comply with the Pollution Control Act and Plastic Waste Management rules.

Legal Contingencies

Secretarial audit reports indicate compliance with applicable laws; no specific pending high-value court cases or litigation amounts were disclosed.

⚠️ Risk Analysis

Key Uncertainties

Volatility in raw material prices (paper/polypropylene) and the impact of new recycling policies in India which increase operational costs for vendors.

Geographic Concentration Risk

Manufacturing is concentrated in a single facility in Balasore, Odisha, creating regional operational risk.

Third Party Dependencies

High dependency on external suppliers for 45-50% of raw materials via imports, with significant lead times.

Technology Obsolescence Risk

Risk of falling behind in 'new-age' packaging solutions; the company is mitigating this by investing in flexible laminate machinery.

Credit & Counterparty Risk

Debtor days of 64 days and a policy of allowing up to 60 days credit to combat competition indicates moderate counterparty risk.