MAGNUM - Magnum Ventures

📊 NSE: MAGNUM 🏢 Paper 📅 Last Updated: 12/14/2025 9:25

💰 Financial Performance

Revenue Growth by Segment

The Paper division revenue declined by 20.6% YoY to INR 210.22 Cr for 9M FY25, while the Hotel division revenue decreased by 10.1% YoY to INR 67.62 Cr. Total consolidated income for FY25 fell 14.1% to INR 397.26 Cr from INR 462.35 Cr in FY24.

Geographic Revenue Split

100% of operations are concentrated in the Northern region of India, specifically Sahibabad, Uttar Pradesh, where both the 5,00,000 sq. ft. paper unit and the hotel are located.

Profitability Margins

Net Profit Margin declined from 5.36% in FY24 to 2.40% in FY25 due to lower net sales. Operating Profit Margin turned negative at -0.24% in FY25 compared to 0.72% in FY24, primarily impacted by the decline in paper segment realizations.

EBITDA Margin

EBITDA margin improved significantly to 19.64% in FY25 from 11.68% in FY24, driven by upgraded machinery leading to increased manufacturing efficiency and favorable changes in raw material costs.

Capital Expenditure

The company has planned a total capital expenditure of INR 90 Cr to be completed by the end of FY26, with INR 40 Cr specifically allocated for the paper segment to enhance production capabilities.

Credit Rating & Borrowing

The company holds an 'ACUITE BB | Stable' rating for its INR 180 Cr Non-Convertible Debentures. It is currently refinancing INR 240 Cr of debt to reduce the coupon rate and extend repayment tenures.

⚙️ Operational Drivers

Raw Materials

The paper division utilizes 100% wastepaper as its primary raw material, which accounted for a significant portion of the INR 260.51 Cr cost of materials consumed in FY25.

Import Sources

Raw materials are primarily sourced domestically within India, leveraging the company's established supply chain in the Northern region.

Capacity Expansion

Current paper manufacturing capacity is 85,000 MTPA. The company is undertaking an INR 90 Cr capex program to be completed by FY26 to further expand or modernize this capacity.

Raw Material Costs

Cost of materials consumed was INR 260.51 Cr in FY25, representing approximately 65.8% of revenue from operations. Procurement strategies focus on 100% wastepaper recycling to align with sustainability trends.

Manufacturing Efficiency

The paper division achieved a capacity utilization of 103% in Q3 FY25, driven by increased production of higher GSM (Grams per Square Meter) paper products.

📈 Strategic Growth

Growth Strategy

Growth will be achieved through an INR 90 Cr capex plan for the paper segment, refinancing INR 240 Cr of debt to lower interest costs and improve cash flow, and expanding into higher GSM and specialty paper products to tap new market segments.

Products & Services

The company sells Newsprint, Duplex Board, Printing Paper, and Grey Board. The hotel segment provides hospitality services, including room stays and food and beverage services.

Brand Portfolio

Country Inn & Suites by Radisson (managed by Radisson Group) and Magnum.

New Products/Services

Expansion into higher GSM papers and specialty products is expected to contribute to future revenue growth, though specific percentage contributions are not yet disclosed.

Market Expansion

The company is focusing on tapping into new market segments through specialty products and maintaining its dominant position in the Northern Indian paper printing market.

Market Share & Ranking

Magnum is recognized as one of the largest paper printing concerns in the Northern region of India.

Strategic Alliances

The hotel segment is managed under a strategic agreement with the Radisson Group.

🌍 External Factors

Industry Trends

The paper industry is shifting toward 100% wastepaper and renewable energy. The hotel industry in India is seeing a recovery, with Magnum's occupancy rising from 80% in FY23 to 84% in FY24.

Competitive Landscape

The company operates in a highly competitive and fragmented industry for both paper manufacturing and hospitality services.

Competitive Moat

The company's moat is built on a 40-year track record in paper and hospitality, a strategic location in the NCR region, and a strong brand association with Radisson.

Macro Economic Sensitivity

Demand is highly sensitive to urbanization, literacy rates, and the growth of the packaging industry, which drive paper consumption.

Consumer Behavior

Increased demand for sustainable packaging and premium hospitality experiences is positively influencing the company's strategic shift toward specialty papers and hotel quality improvements.

⚖️ Regulatory & Governance

Industry Regulations

Operations are subject to FSSAI standards for food safety in the hotel segment and environmental pollution control norms for the paper manufacturing unit.

Environmental Compliance

The company complies with environmental norms by using 100% wastepaper and renewable energy sources like solar and bio-diesel.

Taxation Policy Impact

The company benefited from a deferred tax credit of INR 9.61 Cr in FY25, which significantly supported the reported Profit After Tax of INR 9.50 Cr.

Legal Contingencies

The company received an order under Section 73 of the SGST Act. Other pending matters include historical SEBI penalties related to market access which are excluded per instructions.

⚠️ Risk Analysis

Key Uncertainties

Key risks include market volatility affecting paper prices, which caused a revenue decline in FY25, and the intensive working capital nature of the business.