1. At a Glance – Ayodhya Mein Mahabharat
Pakka Ltd is a ₹418 Cr market-cap company trading at ₹93, down 65% in one year, while still flexing a 63x P/E like it’s a SaaS unicorn. Latest quarter sales came in at ₹96.6 Cr, PAT at ₹7.08 Cr, and margins bounced back to 14.4% OPM after flirting with single digits last quarter. Sounds decent? Wait.
Debt stands at ₹299 Cr, CWIP has ballooned to ₹287 Cr, and interest coverage is a nervous 2.09x. Promoters hold 41.6%, with 8.94% pledged, and ROCE has slid from 27% (FY23) to 11.2% (FY25).
This is a company simultaneously pitching $1 billion revenue potential while generating TTM PAT of ₹7 Cr. That’s not ambition — that’s cinematic confidence.
Question: is this a temporary execution dip… or a balance-sheet stress thriller loading in slow motion?
2. Introduction – When Sustainability Meets EMIs
Pakka sits at the intersection of two powerful narratives:
- Plastic ban tailwinds, and
- Eco-friendly packaging virtue signaling.
On paper, it looks beautiful. Agro-based paper. Compostable tableware. Bagasse products. Exports to 31 countries. Clients like Haldiram’s and Blinkit. Even the brand name screams “Green”.
But markets don’t pay for intentions. They pay for cash flows, and Pakka’s recent numbers read like a startup that forgot it’s listed.
Sales are shrinking YoY, profits are down 84% TTM, working capital is choking at 440 days, and debt has nearly tripled in two years. Meanwhile, management announcements keep coming faster than free samples at a sustainability expo.
So the real question isn’t “Is Pakka a good business?”
It’s “Can Pakka survive its own
expansion plans?”
3. Business Model – WTF Do They Even Do?
Pakka operates two main verticals:
1) Paper & Pulp (87% of H1 FY25 revenue)
They manufacture machine-glazed agro-based paper (30–100 GSM) and agro pulp used in food packaging and specialty papers like greaseproof and glassine.
This segment grew 34% from FY22 to FY24, driven more by volume than pricing power. It’s capital-heavy, margin-sensitive, and brutally cyclical.
2) Moulded Products (CHUK brand – 13%)
This is the sexy part. Compostable bagasse tableware. Cups, trays, donas, forks — the Instagram-friendly ESG story.
Volumes grew 35%, revenue grew 73% between FY22–FY24. But it’s still small, margin-volatile, and needs serious scale to matter.
In short:
Pakka is 80% old-school paper mill, 20% green storytelling.
Ask yourself: is the valuation pricing the paper mill… or the dream?
4. Financials Overview – Numbers Don’t Lie, But They Do Laugh
Quarterly Comparison Table (₹ Cr)
| Metric | Latest Qtr (Dec’25) | YoY Qtr (Dec’24) | Prev Qtr (Sep’25) | YoY % | QoQ % |
|---|---|---|---|---|---|
| Revenue | 96.6 | 106.0 | 76.3 | -8.9% | +26.6% |
| EBITDA | 13.9 | 15.2 | 1.7 | -8.2% | 🚀 |
| PAT | 7.08 | 8.89 | -2.11 | -20.4% | 🚀 |
| EPS (₹) | 1.58 | 1.98 | -0.47 | -20.2% | 🚀 |
Yes, QoQ looks heroic — because the previous quarter was almost a loss-making
