1. At a Glance
Andhra Paper Ltd currently trades at ₹66, valuing the company at a ₹1,317 Cr market cap, which is funny because the stock is priced below book value (0.71× BV) while simultaneously demanding a 70× P/E multiple. Yes, both are true at the same time. Welcome to Indian paper stocks.
The company just reported Q3 FY26 results with ₹418.7 Cr revenue, up 8.6% YoY, but PAT fell 15% YoY to ₹9.85 Cr. Margins are thinner than a wedding invitation card. ROCE sits at 4.5%, ROE at 3.1%, and yet investors are apparently paying SaaS-like multiples.
Three-month return? -8.9%.
Six-month return? -11.6%.
One-year return? -22.6%.
So the market is clearly unimpressed — but not unimpressed enough to re-rate it rationally.
Promoters (West Coast Paper) hold 72.45%, debt stands at ₹263 Cr, dividend yield is 1.5%, and the company is in the middle of a massive capex cycle involving tissue paper, paperboard, and pulp expansion.
This stock is not dead. It’s just… exhausted.
Curious why the valuation still hasn’t collapsed? Let’s open the file. 📂
2. Introduction
Paper companies are supposed to be boring. Stable. Cash-generating. Low-drama businesses that quietly benefit when education, packaging, and FMCG demand grows.
Andhra Paper clearly didn’t get the memo.
Once upon a time, this company was printing money — literally and financially. FY23 PAT was ₹522 Cr, margins were wild, ROCE crossed 50%, and everyone suddenly believed paper was the new tech.
Fast forward to FY26, and reality has arrived like an overdue electricity bill.
Margins have collapsed. Profits have evaporated. Cash flows are shaky. Yet the valuation… refuses to cooperate.
The company is now deep into a capacity expansion phase, which explains the weak numbers — but also explains why the market is confused. This is no longer a dividend cow, but it’s not yet a growth story either.
So what exactly is Andhra Paper right now?
A turnaround
play?
A capex story?
Or just a stock waiting for margins to come back from their vacation?
Let’s decode it step by step.
3. Business Model – WTF Do They Even Do?
Andhra Paper manufactures writing & printing paper, packaging paper, and specialty paper. In simple terms, if it’s made of pulp and doesn’t beep when you touch it, they probably make it.
Core product buckets:
1. Writing & Printing
- SS & Non-SS Maplitho (textbooks, notebooks)
- Reflection Copier paper (offices still exist, shockingly)
2. Industrial & Packaging
- Carton & Wrapper grades
- Cupstock paper (yes, your chai cup)
3. Specialty Papers
- Thermal paper (POS receipts)
- Carbonless paper (duplicate forms)
- Sapphire range (wedding cards that scream “upper middle class”)
Geographically, 92% of revenue comes from India, with exports at 8%. South India dominates distribution (52%), followed by West India (22%).
The business model is simple:
- Buy wood / recycled fiber
- Convert to pulp
- Convert pulp to paper
- Pray that raw material prices behave
Spoiler: they rarely do.
4. Financials Overview
Quarterly Comparison Table (₹ Cr)
| Metric | Latest Qtr (Dec-25) | YoY Qtr (Dec-24) | Prev Qtr (Sep-25) | YoY % | QoQ % |
|---|---|---|---|---|---|
| Revenue | 418.69 | 385.70 | 362.08 | +8.6% | +15.6% |
| EBITDA | 15.40 | 28.31 | -6.81 | -45.6% | Turnaround |
| PAT | 9.85 | 11.65 | -20.26 | -15.4% | Turnaround |
| EPS (₹) | 0.50 | 0.59 | -1.02 | -15.3% | Turnaround |
Margins are recovering sequentially, but YoY numbers still look bruised.
EPS Annualisation
Q1 FY26 EPS (Jun-25): ₹1.07
Q2 FY26 EPS (Sep-25): ₹-1.02
Q3 FY26 EPS (Dec-25):
