INSUBCONTINENT EXCLUSIVE:
The plastic ban in Maharashtra is likely to boost prospects of some paper companies as industries which use plastic move to
alternatives.
The state-wide ban which came into effect on Saturday has had everyone from large companies to restaurateurs to shopkeepers in
a fix, and paper bags, bubble wraps, jute bags and tin foils are coming up as alternatives
These businesses risk a fall in sales unless they make the transition
paperboard units in Maharashtra, also other adjoining states would meet the demand
Mackertich Wealth Management
ET takes a look at companies that are likely to benefit from the move.
JK PaperCMP (In Rs): 110.1 YTD Change (per cent): -22
Stewart
Mackertich said in a recent note that market leadership in branded copier paper, focus on value-added products, improving profitability,
implementation of GST, and robust outlook for the Indian paper industry bodes well for the company
favourable pricing environment in the global market and sharp rupee depreciation in the past few months whereas rawmaterial cost is expected
to remain well under control
Technical analysts said buying support may come in for the stock near Rs 102.
Tamil Nadu Newsprint PapersCMP (In Rs): 260.05 YTD Change
(per cent): -40
Way 2 Wealth Brokers said the company has faced many headwinds in the year gone by given the rising prices of raw material
and plant shutdown impacting volumes, with higher capital and fixed costs weighing down on profitability
The brokerage believes that in the next two years the company will witness improvement in performance given the resumption of its production
facility leading to ramp-up in volume and stability in raw material costs.
NR Agarwal IndustriesCMP (In Rs): 375 YTD Change (per cent):
-17.3
The company, which manufactures recycled paper, gets around 40 per cent of revenues from Western India and realisation may go up from
Rs 37-38 per kg to Rs 40-41 per kg, said Rabindra Nath Nayak, research analyst at Sunidhi Securities
Prabhudas Lilladher, in a note on the company, in April said it sees significant headroom for growth in paper, going ahead, given the low
per capita consumption in India as well as higher demand due to rising literacy rates, burgeoning FMCG and packaged food industry, and rise
