Synopsis: Emami Paper Mills delivered a strong start to FY27, reporting robust revenue growth and a more than five-fold increase in quarterly profit, supported by improved operating performance. Alongside the results, the company also approved the redemption of two series of optionally convertible redeemable preference shares worth Rs. 123.75 crore, strengthening its capital structure.
India’s paper and paperboard industry continues to benefit from improving demand across packaging, FMCG, education, and industrial applications. While input costs and energy prices remain key variables for manufacturers, companies with efficient operations and disciplined cost management are better positioned to expand margins and generate stronger earnings. Against this backdrop, Emami Paper Mills reported a healthy improvement in both revenue and profitability during the first quarter of FY27.
Shares of Emami Paper Mills Limited were trading at Rs 122.83, up by 3.6 percent from the previous close of Rs 118.63. The stock opened at Rs 124.57 and reached an intraday high of Rs 133.7, with a day’s low of Rs 120.75. The company currently has a market capitalisation of Rs 749 crore.
Q1 FY27 Earnings
Emami Paper Mills reported revenue from operations of Rs. 560.16 crore for the quarter ended 30 June 2026, registering a 21.8% year-on-year increase from Rs. 459.76 crore in the corresponding quarter last year. Including other income, total income stood at Rs. 560.37 crore, compared with Rs. 461.36 crore a year ago.
The company’s profitability improved at a much faster pace than revenue. Profit before tax (PBT) increased to Rs. 53.26 crore, compared with Rs. 9.35 crore in Q1 FY26, while net profit surged more than five-fold to Rs. 38.61 crore from Rs. 6.31 crore reported in the year-ago quarter. Earnings per share (EPS) also rose sharply to Rs. 6.21, against Rs. 0.84 in the corresponding quarter last year, reflecting significantly higher earnings for shareholders.
Sequentially, the company also delivered an improved performance, with revenue increasing from Rs. 496.41 crore in the March quarter to Rs. 560.16 crore, while profit after tax rose from Rs. 31.50 crore to Rs. 38.61 crore, indicating continued operational momentum entering FY27.
Revenue Growth Outpaces Cost Increase
The improvement in earnings came from strong revenue growth, which offset higher operating expenses. Total expenses increased to Rs. 507.11 crore from Rs. 452.01 crore in the corresponding quarter last year. The largest expense, raw material consumption, rose to Rs. 352.84 crore, reflecting higher production activity.
Employee benefit expenses increased to Rs. 23.94 crore, while finance costs remained largely stable at Rs. 16.96 crore despite the higher scale of operations. Depreciation stood at Rs. 12.93 crore, and other operating expenses increased to Rs. 59.79 crore.
Although costs increased across several categories, revenue grew at a faster pace, allowing the company to expand profitability. Unlike the previous financial year, the quarter also did not include any exceptional items impacting earnings, providing a cleaner reflection of the company’s operating performance.
Board Approves Rs. 123.75 Crore Preference Share Redemption
Alongside its quarterly results, Emami Paper Mills’ board approved the redemption of two series of Optionally Convertible Redeemable Preference Shares (OCRPS). OCRPS are hybrid securities that provide investors with the option to either convert their holdings into equity shares or receive repayment from the company on the scheduled redemption date, as per the terms of issue.
The company will redeem 7.5 lakh Series II Tranche IV OCRPS on 31 July 2026. Each preference share carries a face value of Rs. 100 and will be redeemed with a Rs. 500 premium per share, resulting in a total payout of Rs. 45 crore.
Additionally, Emami Paper will redeem 11.25 lakh Series III OCRPS on 16 September 2026. These shares have a Rs. 100 face value and a Rs. 600 premium per share, totalling Rs. 78.75 crore. The two redemptions total Rs. 123.75 crore and will follow the terms for issuing preference shares.
Strategic Insight and Industry Analysis
The quarter reflects a meaningful improvement in Emami Paper’s operating performance, with revenue growth translating into disproportionately higher profit growth. Higher earnings and stable finance costs despite a larger revenue base and no significant exceptional charges suggested improved operating efficiency during the quarter. Meanwhile, rising raw material and operating costs emphasise the importance of cost management in maintaining margins amid fluctuating input prices.
The company’s planned redemption of Rs. 123.75 crore in preference shares shows its commitment to meeting capital obligations on time. Investors will likely watch paper and packaging demand, raw material and energy costs, margin sustainability, and the preference share redemption’s impact on the company’s capital structure and cash flows.
Emami Paper Mills Limited is one of India’s leading manufacturers of paper, paperboard, and newsprint products. The company caters to packaging, publishing, and industrial customers across domestic and international markets, with a focus on value-added paper products and sustainable manufacturing practices.
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