Pudumjee Paper Products Limited

Basic Materials — Paper & Paper Products · NSE

₹97.20−₹0.78 (−0.80%)

DalalBaazaar Score

68 / 100

🟢 Good

Verdict

REASONABLE

Risk

High

Driven by high debt relative to equity, micro-cap size, which brings thin liquidity, falling profits.

In simple words: Strong business and financial position, though profits are falling even as sales grow. Debt is the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 7:46 pm

Understanding the Business

Company site ↗

The 60-second version of Pudumjee Paper Products Limited — what it does, how it earns, and who it competes with, before any of the numbers below.

What does this company do?

Pudumjee Paper Products Limited manufactures and markets specialty paper products in India. The company operates in Paper and Hygiene Products segments.

IndustryPaper & Paper Products

SectorBasic Materials

Employees646

Annual revenue₹805 Cr

How does it make money?

Turns over ₹805 Cr a year. Of every ₹100 of sales, about ₹12 reaches shareholders as profit, with ₹17 left at the operating level before interest, tax and depreciation. Each of its 646 employees supports ₹1.25 Cr of revenue a year, the signature of a capital- or asset-led business.

Revenue / employee₹1.25 Cr

Who are its competitors?

The closest listed comparisons in its industry are TATA STEEL LIMITED, JSW STEEL LIMITED, ULTRATECH CEMENT LIMITED, ASIAN PAINTS LIMITED. These are the companies its valuation and returns are measured against elsewhere in this report.

Compared side by side in Peers ↓

What is its competitive advantage?Some evidence

ROCE of 16.4% is above what capital typically costs, which suggests some pricing power, though not yet the sustained, wide gap that marks a durable advantage.

Peer median ROE22.3%

What has been driving growth?

Profit has moved mainly because margins changed, not because the business sold much more. Over 3 years revenue moved +6% while net margin moved +48% relative to itself. What this cannot tell you is which products, customers or geographies did the work — that lives in the segment disclosures of the annual report.

Revenue effect+6%

Margin effect+48%

DalalBaazaar Score

68/ 100

Good

Weighted across six categories. Every point is explained below.

✓ Beta of 0.08 — historically steadier than the index
✗ Micro Cap: thinner liquidity and sharper drawdowns are normal
✗ High leverage magnifies any downturn in earnings
✓ Profits have been consistent from year to year

Quality vs. Valuation

Company Quality

68/ 100

Good

How good the business is, ignoring the share price entirely.

Valuation

81/ 100

Cheap

What you are being asked to pay, ignoring how good the business is.

A good business currently available at an undemanding price — the combination this framework is built to look for.

Historical Valuation

Current P/E

10.1x

3Y Median

10.0x

40 monthly readings · mean 10.8x · range 6.5x–19.5x

Sector Median

28.7x

median of 4 sector peers

🟡Currently trading close to its 3y median of 10.0x — the market is paying about what it usually pays for this company.

🟢Against its sector it trades 65% below the peer median of 28.7x.

vs. its own history

Fair

10.0x median over 40 months · +1%

vs. sector peers

Cheap

28.7x median of 4 peers · -65%

vs. generic bands

Cheap

Below 15x

EV/EBITDA

7.0x

PEG

0.62

What's Good / What's Bad

🟢 What's Going Well3

Margins are improving
EBITDA margin is up from 11.9% to 16.6% over 3 years.
Debt is being paid down
Total debt is down 22% over 3 years.
Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention0

Nothing stands out as clearly deteriorating on the years of data available.

Red Flags

1 item require attention · 1 high

🔴High leverageFinancial
Debt/Equity of 6.35x — earnings must service borrowings before shareholders see anything.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Margin expansion has further to run
EBITDA margin has risen from 11.9% to 16.6%. If that holds, profit compounds faster than sales and today's multiple looks cheaper in hindsight than it does now.
Deleveraging frees up earnings
Debt is down 22% over 3 years. Every rupee of interest not paid drops to the bottom line, so profit can grow even if revenue does not.
Cheaper than its peers
It trades 65% below the sector median. Either the market sees a problem the numbers do not show, or the discount closes.
Earnings have proved durable
Profitable in every one of the last 4 reported years. Consistency lowers the risk that any single bad year is structural rather than cyclical.

🔴 Bear CaseWhat could go wrong?

Leverage amplifies any setback
Debt/Equity of 6.35x. Interest is payable whether or not the business has a good year.
Growth barely outpaces inflation
Revenue compounding at 2.1% a year is close to the rate prices rise, so the business is gaining little ground in real terms. That leaves the share price dependent on a re-rating rather than on earnings growth.
Size brings its own risk
Micro Cap businesses are thinly traded, so exits are harder in a falling market and single events move the price more than they would for a larger company.

🟡 Key Things to WatchMeasurable tripwires, set against where this company stands today

1EBITDA margin holds above 15%✓ 16.6%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Revenue growth stays above 4% a year✗ 2.1% CAGR
Latest reported year was 3.3%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
3Free cash flow remains positive✓ ₹8 Cr
Profit that never becomes cash eventually stops being profit.
4Debt / EBITDA stays below 2x✓ 0.3x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
5ROCE stays above 13%✓ 16.4%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

Investment Checklist

8 / 11 checks passed

✗ Strong return on equity (ROE ≥ 15%)
✓ Strong return on capital employed (ROCE ≥ 15%)
✓ Healthy net margin (≥ 10%)
✓ Generates positive free cash flow
✗ Manageable leverage (Debt/Equity < 1.0)
✓ Adequate short-term liquidity (Current Ratio ≥ 1.0)
✓ Revenue growing year-over-year
✗ Profit growing year-over-year
✓ Not trading at an extreme valuation (P/E < 40x)
✓ Not buying right at the 52-week high
✓ Short-term technical trend isn't bearish

Price history

Quick Metrics

5 good · 4 neutral · 2 weak

Market Cap

₹923 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

10.1x

Cheap

Cheap against the generic band

P/B Ratio

1.38x

Reasonable

Reasonable against the company's book value

EPS (TTM)

₹9.59

Profitable

Profitable on a per-share basis

ROE

14.0%

Moderate

Moderate capital efficiency

ROCE

16.4%

Strong

Earns comfortably above its likely cost of capital

Debt/Equity

6.35x

High

High leverage

Revenue Growth (YoY)

3.3%

Modest

Modest growth

Profit Growth (YoY)

-7.1%

Falling

Profits are shrinking

Dividend Yield

0.62%

Modest

Small cash return — most of the return has to come from the price

Free Cash Flow

₹8 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

Operating Margin

15.0%

Good

Healthy core-business profitability

Net Margin

11.2%

Good

Strong bottom-line conversion

Current Ratio

3.47

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.08

Defensive

Steadier than the market

52W Range Position

54%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

96.1 / 94.5

Bullish alignment (short > long)

Price vs SMA 200

Above

Long-term uptrend

RSI (14)

57.2

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹756 Cr	₹782 Cr	₹806 Cr	₹805 Cr	+2.1%
EBITDA	₹90 Cr	₹141 Cr	₹136 Cr	₹134 Cr	+14.2%
EBITDA Margin	11.9%	18.0%	16.9%	16.6%	—
PAT (Net Profit)	₹59 Cr	₹98 Cr	₹96 Cr	₹94 Cr	+16.4%
EPS	₹6.26	₹10.34	₹10.09	₹9.86	+16.4%
ROE	15.0%	19.9%	16.4%	14.0%	—
ROCE	15.7%	23.6%	19.4%	16.4%	—
Total Debt	₹54 Cr	₹19 Cr	₹12 Cr	₹43 Cr	-7.9%
Free Cash Flow	₹24 Cr	₹125 Cr	₹56 Cr	₹8 Cr	-30.6%

🟢 Revenue has grown at 2.1% a year over 3 years.

🟢 EBITDA has grown at 14.2% a year over 3 years.

🟢 EBITDA Margin has risen from 11.9% to 16.6% over 3 years (+4.8 pts).

🟢 PAT (Net Profit) has grown at 16.4% a year over 3 years.

🟢 EPS has grown at 16.4% a year over 3 years.

🟡 ROE has held roughly flat at 14.0% over 3 years.

🟡 ROCE has held roughly flat at 16.4% over 3 years.

🟢 Total Debt has shrunk at 7.9% a year over 3 years.

🔴 Free Cash Flow has shrunk at 30.6% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹920 Cr

Total Liabilities

₹251 Cr

Cash & Equivalents

₹23 Cr

Operating Cash Flow

₹121 Cr

Capex

-₹113 Cr

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

73.0%

Corporate Actions

Dividend Rate

₹0.6

Ex-Dividend Date

24 Aug 2026

Peer Comparison

Company	P/E	ROE
TATA STEEL LIMITED	19.8x	10.8%
JSW STEEL LIMITED	12.0x	24.7%
ULTRATECH CEMENT LIMITED	37.6x	11.1%
ASIAN PAINTS LIMITED	46.9x	22.3%

Recent News

2 positive4 general

Is Pudumjee Paper Products the Best Stock in Its Sector? A Look at the Numbers

Univest, 06 Oct

Compare with

Equitymaster, 14 Oct

Board of Pudumjee Paper Products approves subscription to additional shares of Saraswat Bank

Business Standard, 11 Aug

Pudumjee Paper sells MITCON Solar stake for ₹2.40 crore

scanx.trade, 07 Oct

Pudumjee Paper Q4 Net Profit Rises 4.8% to ₹19.7 Cr as Revenue Hits ₹200 Cr

Sahi, 22 MayResults

🟢Potentially positiveReported improvement. Check whether it came from volume, price or a one-off item before treating it as a trend.

Pudumjee Paper Products Q1 Results: Revenue Rises but Profit Slips YoY

scanx.trade, 11 AugResults

🟢Potentially positiveReported improvement. Check whether it came from volume, price or a one-off item before treating it as a trend.

Watch Items

Cross-check against the company's latest quarterly filing / investor presentation before acting.

DalalBaazaar Thesis

StrongBusiness Quality · Financial Health · Growth · Profitability · Valuation

MiddlingRisk

Points for each in the Score ↑

Attractive on both counts

A good business currently available at an undemanding price — the combination this framework exists to look for. The work left is qualitative: whether the advantage the numbers imply is one you can identify and expect to last. 1 high-severity red flag sits above this conclusion and should be read first.

1 of 5 tripwires tripped — Revenue growth stays above 4% a year · see Key things to watch ↑