Blitz Bureau
NEW DELHI: Writing and printing paper manufacturers are expected to see their revenue grow by 4-5 per cent this fiscal, driven by an improvement in prices and steady volumes, a new report said. This is a sharp recovery after a 7 per cent decline previous year, according to a data compiled by Crisil Ratings.
The report said realisations, which had dropped by around 12 per cent previous fiscal, are likely to rise 2-3 per cent this year.
This improvement will be supported by stable demand-supply conditions, limited imports of low-cost W&P paper from ASEAN countries, higher domestic production, and no new capacity additions in the country. While the implementation of the National Education Policy 2020 boosted demand previous fiscal, volume growth is expected to slow by 200-300 basis points this year due to increasing digitalisation.
However, steady demand from the banking, education, and judiciary sectors is expected to keep volume growth positive at around 2-3 per cent. Operating profitability is forecast to improve by 200-250 basis points as hardwood prices ease on the back of better supply, while process efficiency measures will also support margins.
“With no fresh capacity addition in ASEAN countries and no new domestic capacity on the horizon, we expect a modest increase in realisations along with a similar growth in volumes, helping revenues rebound,” said Shounak Chakravarty, Director, Crisil Ratings. W&P paper is widely used in education, coaching, banking documentation, and the judiciary.
