STARPAPER - Star Paper Mills

📊 NSE: STARPAPER 🏢 Paper 📅 Last Updated: 12/14/2025 13:43

💰 Financial Performance

Revenue Growth by Segment

The company operates in a single segment of Paper, Paper Board, and related products. Revenue for FY24 was INR 447.78 Cr, representing a 9.12% decline from INR 492.69 Cr in FY23. 9MFY25 revenue stood at INR 322.25 Cr, down 6.33% from INR 344.04 Cr in 9MFY24.

Geographic Revenue Split

Not disclosed in available documents; however, the company operates an integrated mill in Saharanpur, U.P., and is based in West Bengal.

Profitability Margins

Operating margins fell to 13.49% in FY24 from 16.40% in FY23 due to higher raw material costs. Despite this, PAT margins improved to 14.29% in FY24 from 13.33% in FY23, likely aided by non-operating income or tax adjustments.

EBITDA Margin

EBITDA margin for 9MFY25 was 8.27% (INR 26.65 Cr), a significant contraction of 622 bps from 14.49% (INR 49.87 Cr) in 9MFY24. FY23 EBITDA margin was 16.40%, up from 9.68% in FY22.

Capital Expenditure

The company is planning capital expenditure that has not yet been finalized. In H1FY25, the company spent INR 3.19 Cr on the purchase of Property, Plant, and Equipment including CWIP.

Credit Rating & Borrowing

Acuité reaffirmed the long-term rating of 'ACUITE A+' with a 'Stable' outlook in February 2025. The company maintains a healthy financial risk profile with an Interest Coverage Ratio (ICR) of 104.09 times for FY24.

⚙️ Operational Drivers

Raw Materials

Wastepaper and pulp are the primary raw materials, which have seen rising global prices in FY24 and FY25, impacting core margins.

Import Sources

Sourced from the global market; specific countries are not disclosed.

Capacity Expansion

The company operates an integrated Pulp and Paper Mill in Saharanpur, U.P. Planned expansion is under consideration but specific capacity targets and timelines are not yet finalized.

Raw Material Costs

Raw material costs have increased significantly, leading to a decline in operating margins from 16.40% in FY23 to 13.49% in FY24. The company previously achieved a 32% growth in price realization in FY23 to offset costs.

📈 Strategic Growth

Expected Growth Rate

Growth Strategy

Growth is expected to be achieved through a planned capital expenditure program and by maintaining its steady business risk profile in its core segments of Industrial, Packaging, and Cultural papers.

Products & Services

Industrial Papers, Packaging Papers, and Cultural Papers.

Brand Portfolio

Star Paper Mills.

🌍 External Factors

Industry Trends

The paper industry is currently facing margin pressure due to rising input costs and high competition, following a period of high profitability in FY23.

Competitive Landscape

Operates in a highly competitive industry with numerous players in the industrial and packaging paper segments.

Competitive Moat

The company's moat is based on its 30-year promoter experience and its integrated manufacturing facility in Saharanpur, which provides a cost advantage over non-integrated competitors.

Macro Economic Sensitivity

Highly sensitive to global pulp and wastepaper price cycles and competitive intensity in the domestic paper industry.

Geopolitical Risks

Global trade dynamics affecting the availability and pricing of imported wastepaper.

⚖️ Regulatory & Governance

Industry Regulations

Subject to pollution control norms and manufacturing standards applicable to integrated pulp and paper mills.

Legal Contingencies

The company has pending litigations related to direct and indirect taxes and various other claims. Provisions and contingent liabilities are monitored as a Key Audit Matter.