West Coast Paper Mills Limited

Basic Materials — Paper & Paper Products · NSE

₹837.90+₹15.50 (+1.88%)

DalalBaazaar Score

40 / 100

🟡 Moderate

Verdict

CAUTION

Risk

Moderate

Driven by high debt relative to equity, small-cap size, which brings sharper price swings.

In simple words: The business is earning a fairly low return on the money invested in it, with both sales and profits growing well. Debt is the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 6:07 pm

Caution warranted. Multiple fundamental metrics — flagged in red below — point to either valuation stretch, leverage risk, or weakening profitability. This doesn't mean avoid the stock outright, but it does mean the burden of proof is on the growth story to justify the current price.

Understanding the Business

Company site ↗

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

What does this company do?

West Coast Paper Mills Limited manufactures and sells pulp, paper, and paper boards in India and internationally. It operates through Paper, Cables, and Others segments.

IndustryPaper & Paper Products

SectorBasic Materials

Employees2,428

Annual revenue₹4,263 Cr

How does it make money?

Turns over ₹4,263 Cr a year. Of every ₹100 of sales, about ₹4 reaches shareholders as profit, with ₹11 left at the operating level before interest, tax and depreciation. Each of its 2,428 employees supports ₹1.76 Cr of revenue a year, the signature of a capital- or asset-led business.

EBITDA margin11.3%

Net margin3.5%

Revenue / employee₹1.76 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.

TATA STEEL LIMITEDP/E 19.8x · ROE 10.8%

JSW STEEL LIMITEDP/E 12.0x · ROE 24.7%

ULTRATECH CEMENT LIMITEDP/E 37.6x · ROE 11.1%

ASIAN PAINTS LIMITEDP/E 46.9x · ROE 22.3%

What is its competitive advantage?Little sign of one

Returns on capital of 5.9% are at or below what the capital likely costs. That is the financial pattern of a business competing largely on price, where advantage has to come from execution rather than position.

ROCE5.9%

ROE4.2%

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 -13% while net margin moved -82% 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-13%

Margin effect-82%

DalalBaazaar Score

40/ 100

Moderate

Weighted across six categories. Every point is explained below.

✗ Revenue has contracted at 4.5% a year
✗ Profit has declined at 45.7% a year

Quality vs. Valuation

Company Quality

37/ 100

Weak

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

Valuation

49/ 100

Fair

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

Weak on business quality and not cheap enough to compensate.

Historical Valuation

Current P/E

24.1x

3Y Median

5.4x

40 monthly readings · mean 9.2x · range 3.7x–36.8x

Sector Median

28.7x

median of 4 sector peers

⚠️Current valuation is approximately 343% above its 3y median of 5.4x. Paying more than usual needs a reason — faster growth, a better balance sheet, or a re-rating you believe in.

🟢Against its sector it trades 16% below the peer median of 28.7x.

vs. its own history

Expensive

5.4x median over 40 months · +343%

vs. sector peers

Fair

28.7x median of 4 peers · -16%

vs. generic bands

Fair

15x–35x

P/E (Trailing)

24.1x

P/B

1.53x

EV/EBITDA

12.1x

PEG

—

Dividend Yield

0.36%

What's Good / What's Bad

🟢 What's Going Well1

Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention7

Margins are compressing
EBITDA margin has slipped from 34.9% to 11.3% over 3 years.
Debt is rising
Total debt is up 49% over 3 years — worth checking what it funded.
Return on equity is falling
ROE has dropped from 36.5% to 4.2% — each rupee of shareholder capital earns less than it did.
Return on capital is falling
ROCE has declined from 44.5% to 5.9% — often a sign of competition or overexpansion.
Receivables growing faster than sales
Receivables are up 17% against revenue growth of -13% — customers are taking longer to pay.
Inventory building faster than sales
Inventory is up 64% against revenue growth of -13% — stock may not be moving.
Valuation above its historical average
At 24.1x the stock trades 343% above its own median of 5.4x.

Red Flags

6 items require attention · 3 high · 3 watch

🔴High leverageFinancial
Debt/Equity of 8.24x — earnings must service borrowings before shareholders see anything.
🔴Significant margin compressionFinancial
EBITDA margin has fallen 23.6 points, from 34.9% to 11.3%.
🔴Inventory building faster than salesFinancial
Inventory up 64% against revenue up -13% — stock may not be moving.
🟡Debt is increasingFinancial
Total debt is up 49% over 3 years.
🟡Profit is decliningFinancial
Net profit is down 84% over 3 years.
🟡Receivables growing faster than salesFinancial
Receivables up 17% against revenue up -13% — sales are being booked faster than they are collected.

Investment Thesis

🟢 Bull CaseWhat could make this work?

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?

Margins are being competed away
EBITDA margin has fallen from 34.9% to 11.3%. If the trend continues, profit falls even on flat sales — and margin decline rarely reverses quickly.
Leverage amplifies any setback
Debt/Equity of 8.24x. Interest is payable whether or not the business has a good year.
Sales are being booked faster than collected
Receivables are up 17% against revenue up -13%. If customers keep taking longer to pay, reported profit will not turn into cash — and write-offs follow if some never do.
The price already assumes success
The stock trades 343% above its own median multiple. At this level the business has to deliver just to stand still, and a stumble is repriced twice — lower earnings on a lower multiple.
Returns on shareholder capital are falling
ROE has dropped from 36.5% to 4.2%. Each rupee of equity earns less than it did, so profit growth increasingly depends on raising more capital rather than on the existing base working harder.

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

1EBITDA margin holds above 9%✓ 11.3%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Free cash flow remains positive✓ ₹19 Cr
Profit that never becomes cash eventually stops being profit.
3Debt / EBITDA stays below 2x✓ 0.7x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
4ROCE stays above 8%✗ 5.9%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.
5Interest cover stays above 4x✓ 7.0x
How much operating profit can fall before interest stops being comfortably covered.

Investment Checklist

7 / 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

4 good · 4 neutral · 3 weak

Market Cap

₹5,534 Cr

Small Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

24.1x

Fair

Fairly valued against the generic band

P/B Ratio

1.53x

Fair

Moderate premium to the company's book value

EPS (TTM)

₹34.78

Profitable

Profitable on a per-share basis

ROE

4.2%

Weak

Weak capital efficiency

ROCE

5.9%

Weak

Low return on total capital employed

Debt/Equity

8.24x

High

High leverage

Revenue Growth (YoY)

10.1%

Healthy

Healthy top-line growth

Profit Growth (YoY)

145.3%

Healthy

Profits growing at a healthy clip

Dividend Yield

0.36%

Modest

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

Free Cash Flow

₹19 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

CMP

₹837.9

Operating Margin

13.7%

Average

Average margins

Net Margin

5.3%

Average

Average bottom-line conversion

Current Ratio

3.42

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.03

Defensive

Steadier than the market

52W Range Position

77%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

766.7 / 690.3

Bullish alignment (short > long)

Price vs SMA 200

Above

Long-term uptrend

RSI (14)

58.9

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹4,895 Cr	₹4,422 Cr	₹4,034 Cr	₹4,263 Cr	-4.5%
EBITDA	₹1,710 Cr	₹1,195 Cr	₹596 Cr	₹483 Cr	-34.4%
EBITDA Margin	34.9%	27.0%	14.8%	11.3%	—
PAT (Net Profit)	₹942 Cr	₹692 Cr	₹311 Cr	₹151 Cr	-45.7%
EPS	₹142.62	₹104.77	₹47.11	₹22.8	-45.7%
ROE	36.5%	21.3%	8.9%	4.2%	—
ROCE	44.5%	25.0%	10.3%	5.9%	—
Total Debt	₹231 Cr	₹276 Cr	₹456 Cr	₹345 Cr	+14.3%
Free Cash Flow	₹1,075 Cr	₹239 Cr	-₹351 Cr	₹19 Cr	-73.9%

🔴 Revenue has shrunk at 4.5% a year over 3 years.

🔴 EBITDA has shrunk at 34.4% a year over 3 years.

🔴 EBITDA Margin has fallen from 34.9% to 11.3% over 3 years (-23.6 pts).

🔴 PAT (Net Profit) has shrunk at 45.7% a year over 3 years.

🔴 EPS has shrunk at 45.7% a year over 3 years.

🔴 ROE has fallen from 36.5% to 4.2% over 3 years (-32.3 pts).

🔴 ROCE has fallen from 44.5% to 5.9% over 3 years (-38.6 pts).

🔴 Total Debt has grown at 14.3% a year over 3 years.

🔴 Free Cash Flow has shrunk at 73.9% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹5,455 Cr

Total Liabilities

₹1,268 Cr

Total Debt

₹345 Cr

Cash & Equivalents

₹32 Cr

Operating Cash Flow

₹400 Cr

Capex

-₹381 Cr

Shareholding (proxy)

Institutional Holding

15.6%

Insider Holding

60.3%

Corporate Actions

Dividend Rate

₹3

Ex-Dividend Date

10 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

1 positive2 mixed3 general

West Coast Paper Mills Share Price Rise: Key Market View

Univest, 16 OctPrice move

🟡Mixed / dependsA price move, which is not by itself a change in the business. Worth finding the cause before reading it as either good or bad.

Mukul Agrawal portfolio stock: West Coast Paper up 10%; adds 133% in 7 mths

Business Standard, 14 Oct

West Coast Paper Mills (NSE:WSTCSTPAPR): What Triggered the Price Movement Clarification?

Kalkine India, 16 Oct

We Wouldn't Be Too Quick To Buy West Coast Paper Mills Limited (NSE:WSTCSTPAPR) Before It Goes Ex-Dividend

Simply Wall Street, 06 AugCapital return

🟢Potentially positiveCash or shares returned to holders. A buyback is only good value if the shares were cheap when bought.

West Coast Paper Mills announces 71st AGM details

scanx.trade, 17 Aug

West Coast Paper Mills Reports 17.7% Net Profit Growth to ₹51.8 Cr in Q4

Sahi, 27 MayResults

🟡Mixed / dependsA results event. The figures on this page update once the new statements reach the data feed, which usually lags the announcement.

Watch Items

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

DalalBaazaar Thesis

🔴Business QualityWeak5.9/20

🟢Financial HealthStrong13.9/20

🔴GrowthWeak2.4/20

🔴ProfitabilityWeak5.8/15

🟡ValuationFair7.3/15

🟡RiskModerate4.8/10

Weak on the fundamentals

Poor scores on business quality without a price low enough to compensate. There is no obvious argument for owning this over a stronger company at a similar valuation. 3 high-severity red flags sit above this conclusion and should be read first.

This thesis breaks if

✓EBITDA margin holds above 9%11.3%
✓Free cash flow remains positive₹19 Cr
✓Debt / EBITDA stays below 2x0.7x
✗ROCE stays above 8%5.9%
✓Interest cover stays above 4x7.0x