Dear Shareholders,
It gives me an immense pleasure to present before you the performance of your Company
for FY 2023-24. Being established as the major player in paper industry known for superior
quality of Kraft Paper, Duplex Board and Writing and Printing Paper (WPP), we continue our
journey on the path of growth and excellence with true spirit.
The paper packaging industry experienced a good growth over the last decade, owing to
substrate choice changes, new market expansion, ownership dynamics, and government
initiatives to ban plastics and encouraging paper based products. Sustainability and
environmental issues continue to be emphasized, and various innovations catering to paper
and paper board packaging are expected to drive market growth in India.
The Indian Paper and Paperboard Packaging Market size is estimated at USD 12.87 billion
in 2024, and is expected to reach USD 17.74 billion by 2029, growing at a CAGR of 6.63%
during the forecast period (2024-2029).
Paper-based packaging to preserve food products has advanced significantly in recent
years. For example, corrugated board packaging for transporting fresh fruits and
vegetables has become increasingly popular. The layers of the corrugated board need to
bond at high temperatures to kill bacteria. The recyclability of grooved boards prevents
repeated use, reducing cross-contamination.
The paper packaging industry in India is segmented by product type which includes
folding cartons, corrugated boxes and other product types and by end-user industry such as
food, beverage, healthcare, personal care and household care, hardware and electrical
products and other end-user industries and the market studies shows the demand for paper
and paperboard packaging products like folding cartons, corrugated boxes, and others,
which are frequently used for packaging food and beverage products, such as juices, milk,
and cereals. Over the last many quarters, the Kraft Packaging industry has faced
challenges on excess supply front due to diversion of exports supply to domestic supply
leading to pressure on Net sales realization coupled with increase in input costs.
There are numerous grades of paperboard packaging. Paperboard is the most common
material used to make containers like folding cartons. Paperboard requires pulping,
optional bleaching, refining, sheet forming, drying, calendaring, and winding to
manufacture paper.
In addition, in an increasingly eco-friendly world, sustainable packaging plays a vital
role in reducing the environmental impact of packaging materials. It reduces waste through
the use of biodegradable, recyclable and compostable materials contributing to the
circular economy. Adopting sustainable packaging practices also increases customer
loyalty, as customers are more likely to support businesses that share their environmental
values.
Over the last few years, the industry has upgraded itself by investing in clean and
green technologies in order to meet the growing needs of the consumers and has emphasized
more on sustainability and environmental issues.
We, at Genus, are focusing more on upgrading our technologies and improving our
machines which will further bring more value to the products to be ahead of our
competitors in future and for this, we need to constantly upgrade it if, we have to move
ahead of time. We use the virgin pulp and the best grades of recycled paper for our
production in both the units situated at Moradabad and Muzaffarnagar, respectively. The
Company has during the year commenced the production of writing and printing paper at one
of its machine line which gave an edge to the Company by diversifying the product line.
The Kraft Paper industry during last many quarters has witnessed a supply excess situation
in India due to many internal and external factors beyond control. We have taken up a
project for backward integration for producing pulp for WPP products and improving the
quality factor in other products too by invested in machinery for pulp making section and
focused on automation. India is a growing country and if this kind of growth persists in
the near future, then packaging and WPP will certainly have a huge requirement. We are now
in the process of implementing several new initiatives to further strengthen the Company
and expand more. These are expected to result in significant additional improvements in
the coming couple of years.
You will be reassured to know that your Company has taken proper steps to ensure the
smooth continuation of operation in respond to any unexpected events in the future and
took all possible cost control measures across the organisation, mainly to preserve
liquidity. With these steps, the Company has emerged to meet its business commitments and
financial obligations and further plans to diversify into writing/printing/white/cupboard,
etc. to deviate itself from sole dependence on packaging and duplex.
Performance in FY 23-24
Your Company has generated annual revenue of Rs. 651.03 Crores in FY24 against FY23
revenue of Rs. 655.12 Crores. The EBIDTA (Earnings before Interest, Tax, Depreciation and
Amortization) stood at Rs. 56.16 Crores (Previous Year Rs. 24.25 Crores) and PAT (Profit
after Tax) stood at Rs. 5.66 Crores (Previous Year Rs. (13.73) Crores) with EPS (Earning
per Share) of Rs. 0.22 (Previous Year Rs. (0.53)) at the face value of Re. 1.
The year under review witnessed various fluctuations in higher raw material costs, fuel
(coal) costs, and reduction in Net Selling Rate (NSR). The global uncertainty impacted the
demand-supply significantly resulting into reduced margins. However, some improvements in
demand has been witnessed thereby firming up NSR in recent QY.
The Company would continue to focus on its key strengths to achieve healthy growth by
further enhancement of quality. Though we enjoy premium in pricing compared to other
market players, we hope to improve the sales realization further due to our thrust on
quality and brand positioning. We are constantly looking for growth opportunities in the
manner most beneficial to all Stakeholders.
Acknowledgement
As we place our feet firmly on new journey to capitalize on exciting opportunities and
make our business sustainable, I take the opportunity to thank my colleagues on the Board
for their invaluable guidance in progressing the Company on the right path. I thank the
entire team for their persistent perseverance in delivering up to the customers'
expectations. I also take the opportunity to thank all our stakeholders for their
unforgettable support in our journey and multiple endeavors.
Yours truly Ishwar Chand Agarwal