Welcome to a stock that looks like it was manufactured by ChatGPT on caffeine. Banganga Paper Industries Ltd is back from the financial graveyard, and it’s doing everything — including solar PPAs, CFO musical chairs, and a 14797% sales growth — except actually convincing us it’s real.
Here comes the full EduInvesting 13-point breakdown — sharp, sarcastic, and stacked with numbers. 🧠👇
1. 🚨 At a Glance
Banganga Paper went from ₹0.39 Cr in revenue (FY24) to ₹58.1 Cr (FY25). The stock is up ~500% from its 52-week low, sports a P/E of 506, and trades at 61x book value. 🧻 Either they’re reinventing Kraft paper… or it’s one hell of a pump.
2. 🎣 WTF Do They Even Do?
They manufacture kraft paper and corrugated board materials at a facility in Nashik (via subsidiary Banganga Paper Mills). This includes:
- Paper cones
- Carton boards
- Corrugated box kraft sheets
- All made with recycled paper + reused water (90-95%)
✅ ESG vibes.
❌ But FY24 sales were basically zero, so… ESG of what?
3. 💰 Financials – Profit, Margins, YOY
| Metric | FY24 | FY25 |
|---|---|---|
| Revenue (₹ Cr) | 0.39 | 58.10 |
| Operating Profit | -0.02 | 4.75 |
| Net Profit (₹) | -0.02 | 1.88 |
| EPS (₹) | 0.00 | 0.16 |
| OPM % | -5.1% | 8.18% |
| ROE | – | 23.66% |
Yes, that’s 14,797% revenue growth and 9,500% PAT growth.
From zero. So… startup miracle? Or accounting makeover?
4. 💸 Valuation – Is It Cheap, Meh, or Crack?
- P/E: 506x
- P/B: 60.9x
- ROCE: 27%
- CMP: ₹79.4
- Book Value: ₹1.30
📉 Stock is trading at valuation levels usually reserved for AI companies with Nobel laureate founders.
For a paper mill. In Nashik.
5. 🍿 What’s Cooking – Triggers & Headlines
🧾 The full TV serial of announcements:
- Feb 2025: Solar PPA signed (ESG flex?)
- Jan 2025: Borrowings & asset mortgage approved
- Oct 2024: New CFO, new directors, and… company name change 🤔
- Aug 2024: Resignation of auditors
- Jul 2024: Filed Letter of Offer — possible reverse merger?
Also, promoter holding jumped from 0.13% to 71.09% in Mar 2025.
Yes, in one quarter. 🎩🪄
6. 🏦 Balance Sheet – Assets vs Hopes
| Metric | FY24 | FY25 |
|---|---|---|
| Total Assets | ₹0.52 Cr | ₹39.01 Cr |
| Borrowings | ₹0.00 | ₹10.01 Cr |
| Fixed Assets | ₹0.00 | ₹17.03 Cr |
| Reserves | ₹0.03 | ₹3.63 Cr |
| Equity Capital | ₹0.25 | ₹11.98 Cr |
They added ₹38.5 Cr in assets in one year — without operations in FY24.
🤨 Something smells fishier than used cardboard in the monsoon.
7. 💵 Cash Flow – Real or Fantasy?
| Cash Flow Item | FY25 (₹ Cr) |
|---|---|
| CFO | -2.36 |
| CFI | -19.58 |
| CFF | +22.61 |
| Net Cash Flow | +0.68 |
💡 Funded entirely by financing. Business isn’t generating real free cash flow yet.
8. 📊 Ratios – Sexy or Stressy?
| Ratio | Value |
|---|---|
| ROCE | 27.0% |
| ROE | 23.7% |
| D/E | ~0.85x |
| Debtor Days | 40.9 |
| Working Cap Days | 42.5 |
✅ Working capital improvements look engineered for Screener “pros” list.
9. 📈 P&L Breakdown – Show Me the Paper
- Q1–Q3 FY25 = Zero revenue
- Only Q4 had ₹58 Cr — means entire FY25 business was “done in one quarter.”
Either the paper flew off the shelves like Harry Potter books… or this is “Kaagaz ke Mahal” season 2.
10. 🥊 Peer Comparison – Are They Even Comparable?
| Company | P/E | ROE | P/B |
|---|---|---|---|
| International Geo | 39.5x | 54% | 15.9x |
| Nirlon | 21.3x | 59.8% | 13x |
| Banganga | 506x | 23.7% | 61x |
It’s not a peer group, it’s a meme group.
11. 🧪 Misc – Shareholding, Promoters, Drama
- Promoter stake: 71.09% as of Mar 2025 (from 0.13% in Dec)
- Public holding: 28.91%
- Shareholders grew from 134 to 915 in 1 year
📌 Classic signs of:
- Corporate control change
- Possible reverse merger / shell company entry
- Suspicious rally → operator-driven?
12. 🎯 Fair Value – Let’s Not Kid Ourselves
Let’s say FY26 EPS = ₹1.50 (optimistically 10x FY25 EPS)
Give it a generous P/E of 20x (vs 506x now)
🎯 Fair Value = ₹30 max
CMP ₹79 = 150%+ overvalued by even stretched assumptions
Unless they become India’s Amazon of Kraft Paper, this looks way overheated.
13. 🧑⚖️ EduInvesting Verdict™
This ain’t just a penny stock story — it’s a potential Bollywood thriller disguised as a financial comeback.
- 📉 From ₹0 revenue to ₹58 Cr in one quarter
- 🎩 Promoter stake vanishes → then magically returns
- 📄 Auditor exits, new directors walk in
- 🌞 Solar PPAs + asset build-up out of thin air
Verdict:
“Banganga Paper is not just making kraft paper — it’s crafting a narrative. And if you’re a retail investor, remember: sometimes the packaging is shinier than what’s inside the box.”
✍️ Written by Prashant | 📅 10 July 2025
Tags: Banganga Paper, SME Pump Stocks, Kraft Paper, Operator Rally, Promoter Drama, Financial Shenanigans, Screener Red Flags, EduInvesting
