Emami Paper Mills Ltd: ₹1,884 Cr Sales, 36x P/E — Printing News But Not Much Profit
1. At a Glance
Emami Paper Mills is India’s largest newsprint maker, yet ironically its profits read more like an obituary column. With sales of nearly ₹1,900 Cr and profits of barely ₹20 Cr, the company runs on thin margins (1.3% NPM) while carrying a debt pile of ₹941 Cr. At a P/E of 36x, the stock trades as if it’s JK Paper, but the reality is closer to “breaking news, breaking balance sheet.”
2. Introduction
Once upon a time, when newspapers ruled mornings, Emami Paper was the king of the East. Today, half its production feeds a shrinking print industry, while the other half tries to ride the FMCG/e-commerce packaging wave. The company’s Balasore and Dakshineswar mills churn out ~3 lakh tonnes of paper annually — newsprint, writing/printing, and multilayer coated boards.
The problem? The newsprint business is like Doordarshan — once essential, now fading. Emami has diversified into packaging boards, but competition is brutal (JK Paper, West Coast, ITC Packaging). Despite a good pedigree (Emami Group), the numbers don’t inspire confidence. Return ratios are stuck in single digits, and interest coverage barely at 1.39x means lenders are always on speakerphone.
3. Business Model – WTF Do They Even Do?
Newsprint: Largest domestic capacity (~1.5 lakh TPA). Customers: print media houses. Future? Let’s just say, “RIP print.”
Writing & Printing Paper: For education, diaries, and general stationery. Still relevant in India’s education-heavy economy.
Multilayer Packaging Boards (~2 lakh TPA): The new saviour. Used in FMCG, retail, and e-commerce. This is where growth could come.
Exports: Kraft paper and boards shipped to Bangladesh, Vietnam, Thailand, Middle East.
New product innovation: Oil & grease-resistant paper (for your samosa packets?) and bulky paper (for textbooks that nobody reads).
So yes, the model is shifting from “breaking news” to “breaking open Amazon cartons.”
