Kanpur Plastipack Limited — Q4 FY26 earnings call

Call held 4 May 2026

Management summary

Kanpur Plastipack reported strong full-year FY26 results with significant revenue and PAT growth, driven by improved realizations and a focus on value-added products. The company is strategically expanding into non-woven technical textiles and premium yarns, with new capacity coming online. However, raw material price volatility and geopolitical tensions led to a temporary slowdown in order cycles and a reversal of DFIA income in Q4, posing short-term challenges to the order book.

Highlights

  • Full year FY26 total income increased 26.26% YoY to INR726.67 crores, reflecting strong growth.

  • Full year FY26 PAT grew significantly by 68% to INR38.19 crores, driven by improved realizations and value-added products.

  • Q4 FY26 EBITDA margin was healthy at 13.69%, with EBITDA of INR25.06 crores.

  • Strategic shift towards value-added segments like premium polypropylene yarns and non-woven fabrics is progressing, with commercial production for non-woven expected by September.

  • Strong long-term relationships with global customers and diversified export presence (Europe 56.5%, South America 21.8%, North America 16.9%) provide stability.

Concerns

  • Q4 FY26 was impacted by a reversal of DFIA income amounting to INR3.65 crores due to government's decision to suspend import duty on key petrochemical products.

  • Raw material prices, particularly polypropylene, increased sharply from USD1,000 to USD1,700 per ton due to geopolitical developments and supply chain disruptions.

  • Moderation in order cycles and reduced lead times (from 6-8 weeks to 3-4 weeks) due to raw material volatility and cautious customer procurement.

  • Order book is expected to remain a challenge in the current and next quarter due to inventory adjustments and cautious buying.

Key financials

2 periods

Q4 FY26

  • Total Income
    ₹183.1 Cr
    YoY +6.2%
  • EBITDA
    ₹25.06 Cr
  • EBITDA Margin
    13.7%
  • PAT
    ₹14.53 Cr
    YoY +14%
  • EPS
    ₹6.04

FY26

  • Total Income
    ₹726.67 Cr
    YoY +26.3%
  • EBITDA
    ₹74.75 Cr
  • EBITDA Margin
    10.3%
  • PAT
    ₹38.19 Cr
    YoY +68%

What they filed

Q1 FY27: revenue up 12.8%, net profit up 100.0% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue152 161 168 180 165 +9%192 +19%179 +7%203 +13%
EBITDA9 15 17 13 15 +67%14 −7%21 +24%18 +38%
Net profit1 7 3 6 7 +600%9 +29%15 +400%12 +100%
How to read this

₹ crore, as filed. The percentage beside a figure is the change against the same quarter a year earlier — never the quarter before, which would make every seasonal business look like it collapses and booms each year.

Segment breakdown

  • Manufacturing
    ₹143.62 Cr Revenue (Q4 FY26)

Order book

medium confidence

Total value

15,000 tons

as of 2026-03-31 quantified

Composition

  • FIBC (product) 15,000 tons
Order cycles have moderated with lead times reducing from 6-8 weeks to 3-4 weeks due to raw material volatility and cautious customer procurement. The order book is expected to remain challenging in the current and next quarter due to inventory adjustments.

Source: Q&A

Capital allocation

high confidence
  • Capex Capex disclosed
    • Capital advances for non-woven machinery and FIBC building ₹12.3 Cr
    • ESSEKAN JV (premium polypropylene yarn) capex ₹3 Cr
    So, there is an increase of capital advances by about 12 points. So, it's basically capital advances of INR12.3 crores, the non-woven machinery that is there, the FIBC building that is being made, other machinery that is coming. So, there is a total increase of -- the increase is from INR1.46 crores to INR13.75 crores. ... The capex is about INR3 crores.
  • Debt Net ₹112 Cr
    On the debt side, the net debt on 31st March '26 stood at INR112 crores. The breakup of which is INR78 crores in short-term borrowing, INR 23.8 crores of GECL loans and INR 9.01 crores of long-term loans.
  • M&A Valex Ventures Acquisition · Closed

    Strengthened global presence and leveraged India as a high-growth market.

    On the strategic front, we have strengthened our global presence through the acquisition of Valex Ventures in the UK.
  • M&A Essegomma Joint venture · Ongoing

    Provides support and technology roadmap in high-performance yarns, moving towards specialized higher value-added applications.

    Our joint venture with Essegomma continues to provide support and technology roadmap in high-performance yarns. Initiatives are aligned with objectives of moving towards specialized higher value-added applications.

Guidance & targets

Revenue Growth

  • Overall Revenue Growth Revenue Growth · FY27 · Medium confidence 10% to 15%
    It should we should be able to offer steady growth. I mean, I'm not in a position to give exact numbers, but we should look at about 10% to 15% growth.

    — Shashank Agarwal

EBITDA Margins

  • Overall EBITDA Margins EBITDA Margins · FY27 · Medium confidence similar to current
    As I said, the margins would remain similar, and we should expect about a 10% increase in the top line.

    — Shashank Agarwal

FIBC Capacity Utilization

  • FIBC Capacity Utilization (Unit 2) FIBC Capacity Utilization · Current · High confidence 85%
    Yes, so the 18,000 tons capacity and the 85% capacity utilization is at Unit 2.

    — Shashank Agarwal

FIBC Expansion (Unit 3)

  • FIBC Production (Unit 3) FIBC Expansion (Unit 3) · End of FY27 · High confidence 1,800 tons
    So, in this year we should expect about 1,800 tons and we should end the year with a run rate of 2,400 tons.

    — Shashank Agarwal

  • FIBC Production Run Rate (Unit 3) FIBC Expansion (Unit 3) · End of FY27 · High confidence 2,400 tons
    By end of '26-'27, we should be at a run rate of 2,400 tons because I had mentioned previously that over the next 5 years, we will go from 1,200 to 2,400 to 3,600 to 4,800 to 6,000 tons.

    — Shashank Agarwal

  • FIBC Production (Unit 3) FIBC Expansion (Unit 3) · Next 4 years · High confidence 6,000 tons
    By end of this year, we should be able to produce about 1,800 tons of that targeted capacity, of which 6,000 tons will be reached over the next 4 years.

    — Shashank Agarwal

  • FIBC Revenue Potential (Unit 3) FIBC Expansion (Unit 3) · Full capacity (6,000 tons) · High confidence INR130 crores
    So, 6,000 tons should be about INR130 crores. The incremental revenue would be about INR40 crores because this would be fabric capacity getting converted to FIBC capacity.

    — Shashank Agarwal

Non-woven Facility

  • Non-woven Revenue Non-woven Facility · FY27 · High confidence INR20 crores to INR25 crores
    So, we should expect about INR20 crores to INR25 crores revenue only because the first machine would get commissioned by September and the next one by December. So, we will only see partial revenue this year.

    — Shashank Agarwal

  • Non-woven Revenue Non-woven Facility · FY28 · High confidence INR100 crores to INR120 crores
    '27-'28, we should be looking at a revenue of between INR100 crores to INR120 crores depending on the raw material and the capacity utilization.

    — Shashank Agarwal

  • Non-woven EBITDA Margin Non-woven Facility · FY28 · High confidence 15% to 16%
    On a revenue of INR100 crores to INR120 crores, we should look at an EBITDA of 15% to 16%.

    — Shashank Agarwal

  • Non-woven Capacity Non-woven Facility · Future · High confidence 10,000 tons
    So, the capacity would be about 10,000 tons and yarns will never be used in this.

    — Shashank Agarwal

  • Non-woven Volume Non-woven Facility · FY28 · High confidence 8,000 to 9,000 tons
    About 8,000, 9,000 tons.

    — Shashank Agarwal

Raw Material Prices

  • Polypropylene Price Raw Material Prices · Medium term · Medium confidence USD1,200 and USD1,350 per ton

    Previously USD1,000 per ton → USD1,200 and USD1,350 per ton

    So, the new normal could be anywhere between USD1,200 and USD1,350 for us as our raw material. ... So, we will not look at USD1,000 in this year touching again.

    — Shashank Agarwal

Gross Margins

  • Manufacturing Gross Margins Gross Margins · Future · Medium confidence 45% to 47%
    So, I would say that if we are able to with the increased FIBC volume and improvement in margins, if we are able to still maintain 45% to 47% gross margins, it would be a good goal and a good success to have.

    — Shashank Agarwal

ESSEKAN JV

  • ESSEKAN Revenue ESSEKAN JV · FY27 · High confidence INR20 crores to INR25 crores
    So, we're talking about ESSEKAN, which is the joint venture between Kanpur Plastipack and Essegomma. We should expect about INR20 crores to INR25 crores.

    — Shashank Agarwal

  • ESSEKAN EBITDA Margin (Marketing & Manufacturing) ESSEKAN JV · Future · High confidence 15%
    Marketing JV we should look at 15% and for manufacturing also we should look at 15%.

    — Shashank Agarwal

What to watch in Q1 FY27

FIBC Unit 3 building completion

May 2026
Current In progress
Target Complete

Why it matters

Completion of the building is a prerequisite for the ramp-up of new FIBC capacity, crucial for future growth.

The FIBC expansion project at Unit 3 is progress as per plan, of which the building will be complete by May '26.

Risks & concerns

  • Raw material price volatility

    high

    Polypropylene prices increased sharply from USD1,000 to USD1,700 per ton due to geopolitical developments (Iran conflict) and supply chain disruptions.

    Management acknowledged

  • Temporary demand slowdown and inventory correction

    medium

    Moderation in order cycles and reduced lead times (from 6-8 weeks to 3-4 weeks) due to raw material volatility and cautious customer procurement.

    Management acknowledged

  • Order book challenge in short term

    medium

    Order book will remain a challenge in the current and next quarter due to cautious purchasing by buyers, though no structural change in consumption pattern is foreseen.

    Management acknowledged

  • Competitive Japan market

    medium

    Japan is a price-competitive market, and during recent disruptions, China's raw material was cheaper, making market penetration difficult for Indian suppliers.

    Management acknowledged

  • DFIA income reversal

    low

    Reversal of INR3.65 crores DFIA income in Q4 due to government's temporary suspension of import duty on petrochemicals, impacting other operating income.

    Management acknowledged

Q&A highlights

6 direct
Non-woven facility commercial production and revenue potential Direct
By end of '26-'27, we should be at a run rate of 2,400 tons because I had mentioned previously that over the next 5 years, we will go from 1,200 to 2,400 to 3,600 to 4,800 to 6,000 tons. So, in this year we should expect about 1,800 tons and we should end the year with a run rate of 2,400 tons. ... 6,000 tons should be about INR130 crores.

Clarifies the phased ramp-up and long-term revenue potential of the new non-woven capacity.

Asked by Disha

Non-woven facility FY27 revenue and EBITDA margins Direct
So, we should expect about INR20 crores to INR25 crores revenue only because the first machine would get commissioned by September and the next one by December. So, we will only see partial revenue this year. '27-'28, we should be looking at a revenue of between INR100 crores to INR120 crores depending on the raw material and the capacity utilization. On a revenue of INR100 crores to INR120 crores, we should look at an EBITDA of 15% to 16%.

Provides specific short-term and medium-term financial targets for the new non-woven business.

Asked by Disha

Sustainability of 11% Q4 margins and FY27 growth outlook Direct
I think the margins will sustain. The year does not look bad because overall the global economy is in a good shape. It is highly consumption driven. ... Margins should remain under the similar what it has been. There should be a revenue increase because of the non-woven because of ESSEKAN and other measures that are being taken. ... we should look at about 10% to 15% growth.

Management expresses confidence in margin sustainability and provides a revenue growth outlook for FY27 despite current challenges.

Asked by Disha

Impact of geopolitical tensions on raw material sourcing and prices Direct
On the medium-term angle, the prices will remain high. That is given because there is certain capacity that has become defunct and it will not come online in the next 3 years. So, because of shortage of gas and oil and problems on the shipping routes, the prices will remain high. So, we will not look at USD1,000 in this year touching again. So, the new normal could be anywhere between USD1,200 and USD1,350 for us as our raw material.

Highlights the expected 'new normal' for raw material prices, indicating a structural shift rather than a temporary blip, and the company's ability to pass on costs.

Asked by Rohan Mehta

DFIA income reversal and its impact on EBITDA Partial
So basically so we use a scheme of the Ministry of Commerce which is DFIA. So, it allows us to buy domestic material and then we avail the license, which is then sold in the market, which is almost equivalent to the customs duty of the import. Now when the customs duty has been suspended by the government for 3 months, the value of that license has become 0. We are unable to sell it in the market. Whenever this reversal of the government will happen, this revival will also happen.

Explains the reason for the negative other operating income in Q4 and clarifies that it's a temporary issue linked to government policy, with potential for reversal.

Asked by Saket Kapoor

Order book challenge and impact of cautious buying Direct
So, I would say capacity contraction is not on the cards right now. We do not expect that we have to reduce our capacity. Having said that, order book will remain a challenge in this quarter and the next quarter, but we do not see that there is a structural change in the consumption pattern. ... if somebody needs to order 1,000 pieces, he will order 500 pieces right now and another 500 pieces maybe in the next month instead of ordering 1,000 pieces together.

Reveals that while demand is intact, cautious buying due to high prices is impacting order book visibility and lead times in the short term.

Asked by Urmish Shah

Japan market penetration and challenges Direct
Japan is never on the back burner. It is still in the focus. Efforts are still there. It is a market to be very patient. It is a very price-competitive market. Given this disruption, China's raw material was cheaper than India's raw material. So again, the switch from China to India couldn't happen in this time because it is largely serviced by China and Vietnam where the polypropylene price was much lower than India during February, March, April.

Explains the competitive dynamics and raw material price disparities that make penetrating the Japanese market challenging, despite it remaining a focus area.

Asked by Urmish Shah

2 min read 6 chapters

Detailed narrative

Q4 & FY26 Financial Performance Overview

Kanpur Plastipack reported a total income of INR183.1 crores for Q4 FY26, marking a 6.16% year-on-year growth. EBITDA for the quarter stood at INR25.06 crores with a margin of 13.69%, while PAT reached INR14.53 crores, growing approximately 14% year-on-year. For the full year FY26, the company achieved a total income of INR726.67 crores, representing a 26.26% year-on-year growth, and PAT grew by 68% to INR38.19 crores, with EBITDA margins improving to 10.29%.

Strategic Shift & Product Diversification

The company is transitioning towards a more balanced mix of scale and specialization, strengthening its core industrial packaging presence while building capabilities in value-added segments like premium polypropylene yarns and non-woven fabrics. This shift is expected to improve margin visibility and earnings quality. Non-woven technical textiles are identified as a strategic growth area, with applications across automotive interiors, geo-textiles, artificial leather, carpets, and footwear, and commercial production expected by September.

Capacity Expansion & Project Timelines

The existing FIBC capacity of 18,000 tons per annum is currently utilized at 85%. An expansion project at Unit 3, aimed at 6,000 tons, is underway, with the building expected to be complete by May '26. The company anticipates producing 1,800 tons from this new capacity by the end of FY27, reaching a run rate of 2,400 tons, and eventually 6,000 tons over the next four years, which could generate INR130 crores in revenue. The non-woven facility's first machine is expected to be commissioned by September, contributing INR20-25 crores in FY27 and INR100-120 crores by FY28 with 15-16% EBITDA margins.

Raw Material Volatility & Geopolitical Impact

The latter part of FY26 saw significant volatility in raw material prices, particularly polypropylene, which increased sharply from USD1,000 to USD1,700 per ton due to geopolitical developments like the Iran conflict. This led to supply chain disruptions and input cost fluctuations. Management expects a 'new normal' for polypropylene prices between USD1,200 and USD1,350 per ton in the medium term, and aims to maintain manufacturing gross margins at 45-47% by effectively managing price risk and prioritizing margin-attractive segments.

Market & Customer Relationships

Exports remain a key driver, with a diversified geographical presence: Europe accounts for 56.5%, South America 21.8%, and North America 16.9%. The company emphasizes its long-standing customer relationships, with many clients associated for over 20 years, providing stability and repeat business. While demand saw some moderation due to inventory correction and cautious customer procurement, underlying demand remains intact, especially in essential segments like food and agriculture (52% of end-user revenue).

Capital Allocation & Debt Profile

Net debt as of March 31, 2026, stood at INR112 crores, comprising INR78 crores in short-term borrowing, INR23.8 crores in GECL loans, and INR9.01 crores in long-term loans. The company has made capital advances of INR12.3 crores for non-woven machinery and the FIBC building. Strategic initiatives include the acquisition of Valex Ventures in the UK to strengthen global presence and a joint venture with Essegomma for high-performance yarns, with a capex of INR3 crores for the JV.

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