💰 Financial Performance

Revenue Growth by Segment

The continuing business (Water Bottle division) reported an operating profit margin of 6.45%, an improvement of 25.92% YoY. The discontinued Paper division reported total income of INR 1.25 Cr for H1 FY26, down from INR 4.12 Cr for the full year FY25.

Geographic Revenue Split

Not disclosed in available documents, though operations are primarily focused on the Indian domestic market.

Profitability Margins

Operating profit margin for continuing business is 6.45% (up from 5.12%). Net profit margin is -64.84% (improved from -68.08%). Return on Equity (ROE) is -272%, a 548.20% variance from the previous period's -42% due to increased losses from discontinued operations.

EBITDA Margin

Operating profit margin of continuing business is 6.45%, which improved by 25.92% YoY due to decreased production costs and increased efficiency.

Capital Expenditure

Not disclosed in available documents, though the company is currently focused on the disposal of non-core assets rather than expansion.

Credit Rating & Borrowing

Debt coverage indicators are weak with negative interest coverage and total debt to PBILDT. Total borrowings stand at INR 376.43 Cr, including INR 350 Cr in non-current borrowings and INR 26.43 Cr in current borrowings.

⚙️ Operational Drivers

Raw Materials

Waste paper and coal are the primary raw materials, though specific percentage of total cost is not disclosed.

Capacity Expansion

Not disclosed in available documents, but the company has converted machines to manufacture Writing and Printing Paper (WPP) and Kraft paper.

Raw Material Costs

Raw material costs are a significant driver of losses; high waste paper and coal prices led to negative contributions at the operating level in the paper division.

Manufacturing Efficiency

Operating profit ratio improved by 25.92% mainly due to a decrease in cost of production and an increase in manufacturing efficiency.

📈 Strategic Growth

Expected Growth Rate

Not disclosed

Growth Strategy

The company is pursuing a turnaround strategy involving the disposal of non-core assets (Paper division plant and machinery) to settle liabilities and exploring funding options to strengthen working capital. Future focus is on the Water Bottle division, currently the only operating segment.

Products & Services

Writing and Printing Paper (WPP), Kraft paper, Newsprint (discontinued), and Packaged Water Bottles.

Brand Portfolio

Shree Rama, living green.

New Products/Services

The Water Bottle division is the primary active operating segment as of June 30, 2025.

🌍 External Factors

Industry Trends

The industry is shifting away from newsprint toward WPP and Kraft paper due to digital disruption and import competition; the company is positioning itself by exiting the paper segment to focus on water bottles.

Competitive Landscape

Intense competition from cheap international imports of newsprint.

Competitive Moat

The company lacks a durable moat as evidenced by persistent losses and a material uncertainty regarding its status as a going concern.

Macro Economic Sensitivity

Highly sensitive to global and domestic demand-supply conditions and raw material price fluctuations.

Consumer Behavior

Shift in consumer behavior toward digital media has reduced the long-term demand for newsprint.

Geopolitical Risks

Threat of cheap imports of newsprint paper from international markets impacting domestic demand and pricing.

⚖️ Regulatory & Governance

Industry Regulations

Operations are subject to changes in Government regulations, tax regimes, and pollution norms.

Environmental Compliance

Not disclosed in available documents, though the company uses 'living green' branding.

Taxation Policy Impact

Current tax rate is 0% as the company has not made any provision for income tax due to current losses, unabsorbed depreciation, and brought forward business losses.

Legal Contingencies

The company recognized an impairment loss of INR 69.56 Cr related to discontinued operations. No capital market-related penalties were reported in the last three years.

⚠️ Risk Analysis

Key Uncertainties

There is a material uncertainty that casts significant doubt on the company's ability to continue as a going concern, as current liabilities exceed current assets by INR 101.65 Cr.

Geographic Concentration Risk

Operations are concentrated in India, specifically Ahmedabad, Gujarat.

Technology Obsolescence Risk

The newsprint segment faces high obsolescence risk, which the company addressed by converting machines to WPP/Kraft before eventually discontinuing the division.

Credit & Counterparty Risk

Trade receivables increased by INR 8.31 Cr during H1 FY26, indicating potential credit risk or collection delays.