Pakka LtdQ4 FY27Paper, Forest & Jute Products

Pakka Ltd

Q4 FY27 Earnings Call Analysis

Management growth scorecard

Revenue

Category 3

Margin

Category 3

Fundraise

Yes

Order

N/A

Capex

Yes

2 of 4 growth signals are positive.

Revenue guidance

Category 3

→Revenue growth initiatives have started to show results; confidence in stronger coming quarters.
→B2C revenue increased 80% YoY in the first nine months, driven by new channels and marketplaces.
→After expansion, quarterly revenue expected to increase from about ₹100 crore to ₹300 crore.
→Paper machines projected to produce around 8,000 to 9,000 tons by calendar year-end, up from current 4,000 tons.
→Delivery range product is ready to launch, expected to significantly impact sales in the current quarter.
→New product launches (e.g., clamshells, meal trays) are contributing to sales and unlocking new customer segments.
→Target to offer full compostable disposable packaging range catering to growing food delivery market.
→Optimizing production efficiency and expanding capacities (e.g., Project Jagriti, PM4) targeted within next 1-2 years.
→Management plans cautious optimism, aiming for realistic growth while stabilizing projects before aggressive expansion.

Category 3

→Management expects profitability to improve steadily in upcoming quarters as operational efficiencies cover price drops (Page 6-7).
→B2C revenue increased by 80% YoY; improving margin in this segment is anticipated to lift overall profitability (Page 7).
→New product launches (leak proof delivery range, clamshells, meal trays, flipper and dip cups, straws, cutlery) are expected to contribute significantly to sales and margins (Page 7).
→Stabilization and ramp-up of Project Jagriti and capacity expansions (PM3, PM4) aim for higher output and improved margins (Pages 19, 30).
→Management remains optimistic but plans to be more realistic with future commitments to achieve better results (Page 19-20).
→EBITDA available for investment approximately ₹20 crore per quarter supports internal funding and growth (Page 23).
→Plans to infuse equity at a premium to bolster investor confidence and company valuation (Page 31).

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Yes

→The company acknowledges the need to raise funds, with a current equity gap of about ₹60 crore for Project Jagriti.
→Plans are underway to fund this gap through internal approvals and promoter equity infusion targeted within February and March.
→The company believes the share price is heavily undervalued and intends to infuse confidence in investors by potentially investing in shares themselves.
→No firm figures disclosed yet on the exact infusion price, but they aim to do it at a premium to the previous 90-day average price (~₹150).
→Debt repayment for new loan facilities is planned over 15-18 quarters starting the quarter after commissioning.
→The company is open to fundraising but is prioritizing internal accruals and promoter contributions, reflecting a cautious, focused approach rather than large external fundraising at present.
→Fundraising efforts with Rothschild for project financial support are on hold to prioritize stabilizing current projects first.

→The company has some pending orders in the US, which they plan to fulfill despite taking a strategic pause in US and Guatemala activities.
→There is a focus on stabilizing the India side first before resuming actions in other geographies.
→The pause in Guatemala is temporary, with all relationships and groundwork intact, aiming to resume within 6-9 months.
→No specific numerical value of the current order book or pending orders is provided in the transcript.
→The company is working on optimizing flexible grades and pushing paper substrate tie-ups within India as part of ongoing business development.

Yes

→Project Jagriti: Major ongoing capex of about ₹500 crore focused on India expansion, stabilizing and commissioning expected by July 2026. No pause on this project.
→Project Ka Valk (Guatemala): Capital investment paused to focus resources on stabilizing Jagriti first; about $4 to $5 million USD spent so far with a board-imposed cap of $10 million.
→Delivery Range Expansion: Continued investments in product development and optimizing machine efficiencies, targeting food delivery market with compostable solutions.
→Flexible Packaging/Flexi Structures: Ongoing trials and product optimizations, especially for PM4 paper machine related products.
→Strategic focus to slow down activities in US and Guatemala for next 6 months to prioritize Indian operations.
→Plans to infuse funds including internal accruals and promoter equity, targeting a gap funding infusion by February-March period.

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1Pakka Ltd

Rev 3Mar 3

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