You are here » Home » Companies » Company Overview » JK Paper Ltd

JK Paper Ltd.

BSE: 532162 Sector: Industrials
NSE: JKPAPER ISIN Code: INE789E01012
BSE 00:00 | 29 Nov 201.80 -10.30
(-4.86%)
OPEN

212.00

HIGH

212.15

LOW

197.80

NSE 00:00 | 29 Nov 201.50 -10.75
(-5.06%)
OPEN

212.25

HIGH

212.50

LOW

197.65

OPEN 212.00
PREVIOUS CLOSE 212.10
VOLUME 75785
52-Week high 284.80
52-Week low 96.00
P/E 7.68
Mkt Cap.(Rs cr) 3,418
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 212.00
CLOSE 212.10
VOLUME 75785
52-Week high 284.80
52-Week low 96.00
P/E 7.68
Mkt Cap.(Rs cr) 3,418
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

JK Paper Ltd. (JKPAPER) - Chairman Speech

Company chairman speech

The global economy remains in unchartered waters even after more than ayear into the COVID-19 pandemic. While green shoots of recovery are visible these arerestricted to the developed world particularly the US and less so Europe. This iscreating a dichotomy with the emerging economies the global growth engine of the last twodecades. A disproportionate distribution of fiscal stimulus and vaccination is enhancingthe uncertainty.

Given the limited space for fiscal policy support the emergingeconomies including India are expected to undergo greater pain a reality reflected alsoin the paper industry. While the global paper and paperboard market contracted by around6% in 2020 India the fastest growing paper market before the pandemic outbreak was theworst hit. The market narrowed by almost 15% led by a sharp demand contraction forprinting & writing paper arising out of weaker demand from schools colleges officesand institutions that remained shut. Given this background your Company'sperformance can be considered satisfactory as it came in the backdrop of national andlocal lockdowns in the early part of the year. The economy improved appreciably in thesecond half of the year reflected in a pick-up in demand for packaging board as thepandemic accelerated online purchases due to social distancing restrictions. The emphasison hygiene increased the demand for tissue paper. Going forward we expect that growthwill be driven by these and specialty paper segments induced by plastic substitution asthe world replaces single-use plastic with eco-friendly paper-based alternatives. Even asthe pandemic made it difficult to train employees in the conventional physical format theCompany enhanced skills and knowledge through the online learning portal. Continuing itspledge to the ‘green' initiative the Company undertook initiatives across itsmanufacturing plants to moderate power costs and increase the use of renewable energy. Theresult is that we were felicitated with the Best Pollution Control Excellence Award. JKPaper remained committed to the interests of the marginalised community; its CSR footprintcovered more than 400000 direct beneficiaries across 578 villages as it focused onempowering the youth women and farmers. I am pleased to communicate that efforts toimprove irrigation facilities enabled farmers to practice multi-crop farming in lands thathad earlier been rain-fed resulting in a two to three-fold yield increase and equivalentgrowth in income. We formed 22 Farmer Producer Groups during the year and our farmlivelihoods programme reached over 3000 farming families. In partnership with‘Climate Reality Project' and ‘One Tree Planted' your company planted150000 fruit trees to provide sustainable livelihoods to families affected by CycloneFani in Odisha. Uncertainty prevails following the second pandemic wave that proved moredevastating than the first. Even though a gradual unlocking has commenced disruptions areexpected to sustain for some time. One is unsure about the willingness of consumers tospend as they could be prone to precautionary savings. Besides COVID-19 brought untimelymisery to many especially those who lost their family members and in some cases theirsole earning member. Your Company announced a comprehensive relief package called JK CARES(Covid Assistance Relief & Support) for the bereaved families comprising financialassistance and education support for the children. However these are not enough as tomove the economy forward end consumers need more safety nets to revive demand assuccessfully seen in developed countries. Estimates show that without swift fiscalsupport last year's severe collapse could have been three times worse.

India was projected to grow in double-digit percentage growth ratesthis year but the second pandemic wave has raised downside risks. Whether the recoverymaterialises soon will depend on the government's policy support faster vaccinationand return to normalcy. Your Company remains committed to do its best to prevail over theongoing challenges. With your continued support we expect to soon return to growth.

Bharat Hari Singhania

Vice-chairman & Managing Director's statement

The Indian economy was poised for a double-digit expansion in 2021after a tumultuous 2020. The devastating second wave turned that euphoria into paranoia;growth forecasts have since been scaled down. Estimates suggest that India would only justbe able to recover lost ground effectively losing two years of growth unlikely to berecovered.

The COVID induced lockdown significantly affected the operations ofIndia's paper manufacturing of which a major part is clustered in only eight statesand JK Paper has a presence in three - Gujarat Odisha and Telangana. Despite initialdisruptions the Company's capacity utilization improved to 70-75% by end of thefirst half and by the end of the fiscal year it was operating at over 100% capacityutilisation; much of this recovery was driven by exports which almost doubled.India's printing & writing segment contracted almost 20% following a steepdecline in the publishing and school note books segment which accounts for almost 65% ofthe W&P market. Some of the loss was offset by a 4-5% growth in the packaging boardsegment. Overall volumes declined almost 15% over the previous year. The demand decline inthe printing & writing segment led to weaker paper prices.

On the other hand a lockdown in most countries resulted in a globalsupply chain disruption resulting in abnormally high pulp and other commodity pricestowards the end of the fiscal year under review. We offset some of this cost increase withprice corrections in the last quarter of the year. The result is that our turnover whichhad declined to RS. 500 cr in the first quarter increased to RS. 980 crores by the fourthquarter. During these severely testing times your Company achieved the best performancein the paper industry. Team JK Paper demonstrated its passion to outperform. TheCompany's focus on cost austerity especially in raw material sourcing fromplantations within 200 km of its manufacturing facilities enabled it to reduce inputcosts. We moderated our finance through better working capital management and reduction ininterest rates. Optimized steam and water consumption resulted in significant costsavings. Digital transformation in key manufacturing processes helped reduce processvariations improve quality and moderate costs. The Packaging Board project at Unit CPMprogressed well and the Company has made a provision for virtual commissioning and islikely to commence trial production in the second quarter of the current fiscal year. Thisbodes well as packaging board markets are likely to grow at more than 10% per annum forthe next few years.

To maintain quality leadership trials were conducted by the Company toupgrade existing product quality and introduce new products which made it possible toparticipate in all market segments. The Company revamped its customer incentive programmecalled JK Super Sitare re-launched as JK Super Sitare Premium League to make it moreinteresting for our customers. We conducted the second season of the AutHer Awards whichstrengthened our brand recall across the print television and digital media. In line withAtmanirbhar Bharat drive we developed lower GSM Coated Paper with the objective toreduce imports into India. The Company's farm forestry programme enhanced ruraleconomic sustainability by providing over 65000 farmers an assured income whileenhancing raw material supply predictability for the Company. The Company'sstate-of-art clonal production centres ensured the production of quality planting materialround the year. As an extension of your Company's capacity to pioneer and embracelatest environment friendly technologies the new pulp mill will not only be efficientbut also the quality of the pulp will be better. We are replacing the chlorine-based pulpmill with the Elemental Chlorine Free (ECF) process. Water saving schemes will reduce theconsumption of water steam and power per ton of paper. Our GHG emissions are consistentlydeclining. I am pleased that our collective resilience resulted in no job losses or paycuts at any level. We ensured timely payments to our suppliers and distributors. Onaccount the strength of this ecosystem your Company is prepared to return to growth andovercome prevailing challenges.

Harsh Pati Singhania

.