JK Paper

A Project on One of The Largest Firm in Indian Paper

Industry. 1

The history of paper began in Ancient Egypt approx. 3,700 BC – 3,200 BC (approx. 5,200 years before present) with the use of ‘Papyrus’ as a medium for written records.

The word paper is derived from the Greek term for the ancient Egyptian writing material called ‘Papyrus’, a reedy plant papyrus, which grows abundantly along the Nile River in Egypt. It was formed from beaten strips of ‘Papyrus plants’.

Paper was invented by Cai Lun a Chinese person in 105 AD by using mulberry and other bast fibers along with fishnets, old rags, and hemp waste in the ‘Han Dynasty (202 BC-220 AD) and spread slowly to the west via Samarkand and Baghdad. Later on papermaking started in Italy and Germany. 2

History Of Paper

Greek Parchment Paper

3

One Of The First Ever Made Greek Parchment Paper

Paper is a versatile material with many uses. paper is a thin material mainly used for writing upon, drawing upon, printing upon or for packaging. It is produced by pressing together moist fibers, typically cellulose pulp derived from wood, rags or grasses, and drying them into flexible sheets.

Paper is the most important material for the art and craft industry and must needed in painting.

4

Uses Of Paper

Industry Overview

5

Paper And Pulp

At present, there are about 666 units engaged in the manufacture of paper and paperboard out of which nearly 568 are in operation.

The per capita consumption of paper in India is estimated at 8 kg, which is far lower than the world average of 55 kg.

The total installed capacity of pulp & paper mills in the country are estimated to be over 7.5 million tones which is likely to increase to 8.3 million tones by 2010 & over 14 million tones by the year 2020.

Maximum number of agro residues based mills are located in Uttar Pradesh, Maharashtra, Punjab & Andhra Pradesh while maximum mills based on Recycled fibers are located in Gujarat, followed by Maharashtra, Uttar Pradesh & Punjab.

It is estimated that the paper industry would be growing at the present rate of 7-8%. 6

Paper And Pulp Industry Overview

Company Present Capacity(TPA)

Bilt (Ballarpur Industries Ltd.) 465,000

ITC Ltd. 352,500

Khanna Paper Mills Pvt. Ltd. 350,000

HPC (Hindustan Paper Corporation) 300,000

TNPL (Tamil Nadu Paper Mills) 230,000

JK Paper Mills 180,000

Abhishek Industries Ltd. 175,000

WCPM (West Coast Paper Mills Ltd.) 163,700

APPM (Andhra Pradesh Paper Mills) 153,500

Century Pulp & Paper Mills 153,170

Emami Paper Mills Ltd. 145,000

Rama Pulp and Paper Mills 132,000

SPB (Seshasayee Paper and Boards Ltd.) 115,000

Sirpur Paper Mills Ltd. 85,550

Orient Paper Mills 85,000

Pudumjee Pulp and Paper Mills 60,000 7

Major Paper And Pulp Companies And Their Capacity

JK OrganizationSince 1938 …

8

9

Founder the visionary

The foundation of J.K. Organization was laid when the nation was passing through turbulent times. It was the time when Indians were discriminated against, in their own homeland. Born on 7th November 1884, Lala Kamlapatji, the worthy son of Lala Juggilal Singhania, had the determination to fight against this discrimination and a vision to make Indian business self reliant. With this inspiration he set up the first cotton mill in northern India JK Cotton Spinning Mill in 1921, exclusively using Indian capital, management and labour.

The Visionary personality had strong nationalist fervour. Responding to the Mahatma’s call for ‘Swadeshi’ in 1930, he burnt his whole stock of imported cloth and decided not to import any further. He organised and led a boycott week with a protest march in Kanpur in a procession on August 10, 1930, which was more than three miles long – a reflection of his awakened conscience. 10

Founder the Visionary

11

Overview of JK Organization

Overview of JK Organization

12

Hari Shankar Singhania, The President of J.K. Organization being bestowed the honour of Padma Bhushan

by the Honorable President of India, Shri A.P.J. Abdul Kalam

Over 100 years in business:Total Assets Rs 42 billion, No of employees over 2,50,000

(Approx.)

Major share is owned by singhania family.

Multi-business, multi-product, multi-location.

Pioneers to introduce several new products in India:Aluminum, Nylon, Radial Tyres, etc.

Strong brands and market leadership in quality.

High capacity utilization and operating efficiencies.

Extensive distribution network – Customer focus.13

Overview of JK Organization

JK PAPERCreating lasting

impressionsSince 1962

14

Incorporation :1961 Commencement : 1962 Parent Company : JK Organization Group : Singhania (HS) Group Current Market Capital : Rs.423 Crores Workforce : (<) 20000 employees (Approx.) Auditors : Lodha & Co. Company Secretary : S C Gupta Bankers : Axis, Canara, IDBI, SBI Listed on : The Stock Exchange, Mumbai,

National Stock Exchange of India Ltd., Luxembourg Stock Exchange.

Future Plan : Expansion of plants with investment of Rs.1500 Crores.

15

Overview of JK Paper

1962 - JK Paper Mills (JKPM) commences operations with 18,000 t.p.a capacity as a division of Straw Products Ltd (renamed JK Corp Limited).

1992 - Installed capacity grew to 75,000 t.p.a. 1992 - Acquired a BIFR company ‘The Central Pulp Mills Limited’ (CPML) 47,000

t.p.a capacity and turned it into a profitable company. 1997 - JKPM capacity increased to 90,000 t.p.a. 1998 - State-of-art Pulp Mill of 127,000 t.p.a capacity installed at JKPM. 2000 - JKPM transferred from JK Corp to CPML in April 2000 under Business and Financial restructuring of JK Corp.

- CPML became second largest paper company in private sector. 2001 - CPML name changed to JK paper Ltd. In November 2001. 2003 - Commenced outsourcing operations of coated paper. 2004 - Combined capacity of 180,000 t.p.a of Paper and Pulp. 2005 - Commissioned 46000 t.p.a coated paper capacity.

16

History of JK Paper

17

To be amongst the best and the ever most admired companies in India, committed to the ultimate excellence.

To be a Dynamic Benchmark and Leader in the Indian Paper Industry.

18

Vision of JK Paper

Be a Customer Obsessed Company - Customer First 24x7 Motivated and Committed team for excellence in

performance Be a Green Company Deliver Enhanced Value to all stakeholders Enhance global presence through Acquisition / JV /

Strategic Partnerships To be a World Class Company by achieving Growth and

Leadership through; JK Brand Equity, customer obsession, technological innovation, cost competitiveness, environmental & social care. 19

Mission of JK Paper

• JK Paper passionately believes in Environment and Safety and has been introducing cleaner and environment-friendly technologies. JK Paper Mills has been adjudged as the Greenest Paper Mills in India. Both the units of the Company are ISO 14001 certified for their eco-friendly operations and OHSAS-18001 Certified for Health, Safety and Security.

• The Company’s plantation, driven by in-house research programme, has coverage of more than 70,000 hectares with 7,000 hectares of plantation being added every year. By providing farmers high quality plant species through the Company’s plantation research centre, it helps farmers to improve their economic well being. A large number of farmers in the state of Orissa, Andhra Pradesh, Chhattisgarh, West Bengal, Gujarat and Maharashtra are benefited from the programme. These plantations with their superior quality plants contribute towards a strong base for high quality raw materials for the Company. 20

Social Responsibility

21

Management of JK Paper

Managing Director Chairman

Name Designation

Hari Shankar Singhania Chairman / Chair Person

Harsh Pati Singhania Managing Director

Om Prakash Goyal Whole Time Director

Dhirendra Kumar Director

R V Kanoria Director

Shailesh Haribhakti Director

Udayan Bose Director

Arun Bharat Ram Director

M H Dalmia Director

Shailendra Swarup Director

S K Pathak Director

Vinita Singhania Director 22

Management of JK Paper

23

Products of JK Paper

1. JK Copier A4 size double Sided

Copying. Sharp, Crisp Copies. Usable in all Standard

Speed Copiers. Controlled Moisture

Content Curling. Typing, Printing and

General Office Use.

Products of JK Paper

24

2. JK Copier Plus A4 size coated paper. Used for printing

colourful copies. Best suitable for

printing presentations. Used mainly in colour

printers. Controlled Moisture

Content Curling.

Products of JK Paper

25

3. JK Easy CopierIncreases Copier Efficiency.

Excellent Runnability.

Good Printability.

Suitable For Double- Sided Printing.

Products of JK Paper

26

4. JK Excel Bond Mainly used for project

reporting. Controlled Moisture

Content Curling. Sharp, Crisp Copies. Usable with standard

printing device. Used largely for office

works.

Products of JK Paper

27

5. JK Maplitho• Mainly used in Portable

printing machines.• Easy to use paper

instant handy prints.• Used mainly in STD

booths.

Products of JK Paper

28

Achievements

29

First Indian Paper Company to• Introduce surface sized maplitho in the Indian market• Introduce copier paper in India.• Produce airmail paper from bamboo pulp.• Be awarded sword of honour by the British Safety Council.

--- 1992.• First Paper Mill Certified ISO 9001 (DNV) --- 1995.• Be accredited IS0 9001 and ISO 14001 standard --- 1998.• Get adjudged as greenest paper mill by centre for science

& environment (CSE) --- 2003.• Export branded photocopier paper.• Certified OHSAS 18001 (DNV) --- 2007 30

Achievements

Strategic Geographical Presence

• Strategic location– JKPM located close to raw-material sources– CPM located close to large end customers and

raw material source .

• Strong distribution reach– 4 regional offices– 11 warehouses– 102 distributors– over 2,500 dealers 31

Achievements

32

Performance of JK Paper

Dividends DeclaredAnnounce-ment

DateEffective

DateDividend Type Dividend (%)

18-05-10 16-07-10 Final 20.00

14-05-09 17-07-09 Final 17.50

27-06-08 13-08-08 Final 15.00

29-10-07 29-11-07 Final 22.50

26-09-06 10-11-06 Final 6.00

27-02-06 10-03-06 Interim 14.00

12-08-05 25-08-05 Final 20.0033

Performance of JK Paper

Cash Flow of JK Paper (in Rs. Cr.) Particulars Jun

'06Jun '07

Mar '08

Mar '09

Mar '10

12 months

12 months

9 months

12 months

12 months

Net Profit Before Tax 54.33 71.69 34.92 54.09 126.93

Net Cash From Operating Activities 119.03 146.85 93.67 202.77 243.83

Net Cash (used in)/fromInvesting Activities -127.93 -204.18 -93.67 -25.18 -66.13

Net Cash (used in)/from Financing Activities 11.06 55.40 -1.32 -146.87 -204.05

Net (decrease)/increase In Cash and Cash Equivalents 2.16 -1.92 -1.33 30.72 -26.35

Opening Cash & Cash Equivalents 4.59 6.75 4.83 3.50 34.22

Closing Cash & Cash Equivalents 6.75 4.83 3.50 34.22 7.8734

Performance of JK Paper

Key Financial Ratios of JK PaperParticulars Jun '06 Jun '07 Mar '08 Mar '09 Mar '10

Face Value (Rs) 10.00 10.00 10.00 10.00 10.00

Dividend Per Share (Rs) 2.00 2.25 1.50 1.75 2.00

Operating Profit Per Share (Rs) 17.63 19.94 14.01 23.22 31.23

Net Operating Profit Per Share (Rs) 97.11 108.78 87.86 154.37 160.69

Free Reserves Per Share (Rs) 34.39 36.64 38.68 41.03 -0.03

Current Ratio 1.34 0.77 0.73 0.88 1.26

Debt Equity Ratio 1.72 1.89 1.87 1.73 1.15

Long Term Debt Equity Ratio 1.63 1.57 1.36 1.36 1.15

Debtors Turnover Ratio 7.28 7.58 6.30 11.07 11.87

Gross Profit Margin(%) 13.69 14.40 9.26 9.26 13.86

Net Profit Margin(%) 4.64 5.35 4.97 3.12 7.24

Earnings Per Share 4.26 5.86 4.43 4.86 11.65

Book Value 45.35 47.54 49.30 51.54 60.8535

Performance of JK Paper

Yearly Results of JK Paper (in Rs. Cr.) Particulars Jun '06 Jun '07 Mar '08 Mar '09 Mar '10

Sales Turnover 732.96 759.48 606.72 1,077.18 1,106.49

Other Income 1.37 3.72 7.87 4.92 0.39

Total Income 734.33 763.20 614.59 1,082.10 1,106.88

Total Expenses 598.86 606.85 498.52 899.86 861.42

Operating Profit 134.10 152.63 108.20 177.32 245.07

Gross Profit 135.47 156.35 116.07 182.24 245.46

Interest 33.84 34.37 35.29 58.47 48.49

Depreciation 47.14 50.48 45.86 69.69 70.04

Tax 18.69 25.40 0.21 16.07 35.90

Net Profit 35.80 46.10 34.71 38.01 91.03

Earnings Per Share 4.58 5.90 4.44 4.86 11.65

Equity 78.15 78.15 78.15 78.15 78.15

Reserves -- -- 307.12 -- 391.99

Face Value 10.00 10.00 10.00 10.00 10.0036

Performance of JK Paper

Firm Share Price(Rs.)

Market Cap.(in Rs. Cr.)

SalesTurnover(in Rs. Cr.)

Net Profit(in Rs.

Cr.)

Total Assets(in Rs.

Cr.)

Ballarpur Industries 33.45 2,008.75 1,002.54 125.39 2,239.40

Tamil Newsprint 119.70 828.45 1,068.66 126.06 1,470.77

West Coast Paper 90.45 567.56 623.57 90.54 1,836.05

AP Paper Mills 127.75 418.40 650.42 54.19 996.30

Seshasayee Paper 215.80 242.78 517.27 39.93 549.98

Pudumjee Pulp 25.75 105.58 218.41 10.28 166.56

Rama Newsprint 17.70 102.94 314.53 -56.65 500.79

Sirpur Paper 59.10 93.90 340.04 -11.16 554.30

Star Paper 39.60 61.81 260.91 8.33 165.4537

Competitors of JK Paper

38

Accolades

( Consisting of the largest 500 Indian Companies amongst the 28 sectors and 6 of these companies were belonging to the

paper and pulp industry.)

This was the first time that a CSR Rating for companies were declared in India or anywhere in the world.

www.karmayog.org/csr39

Accolades

Karmayog Corporate Social Responsibility

Rating - 2007

Ratings for the Paper Industry

* Note : Karmayog recommends that Companies spend a minimum of 0.2 % of sales on CSR activities annually

Accolades

Karmayog CSR Rating of Largest 500 Indian Companies - Extract of Paper Sector

No Company Net Profit Rs. Cr.

CSR Rs. Cr.

CSR Rating

CSR Activities

1Andhra Pradesh Paper

Mills 25 0.9 2/5education, healthcare

2 Ballarpur Industries 150 3.6 2/5community,

environment

3 JK Paper 15 1.3 2/5education,

health

4Rama Newsprint &

Papers 20 0.6 1/5community

development

5Tamil Nadu Newsprint &

Papers 35 1.4 1/5 environment

6 West Coast Paper Mills 30 0.7 1/5 environment

National Energy Conservation Award

- 2008

41

Accolades

PULP & PAPER

Bilt Graphic Paper Products Ltd. Unit: Bhigwan, Dist. Pune

MAHARASHTRA

1st Prize

Energy Savings

9.22%

42

Accolades

PULP & PAPER

Century Pulp and Paper Lalkua, Dist. Nainital

UTTARAKHAND

2nd Prize

Rs. 6.71 Crores

Energy Savings 43

Accolades

PULP & PAPER

JK Paper Mills (A Unit of JK Paper Ltd.)

Jaykaypur, Dist. Rayagada ORISSA

Certificate of Merit

44

Accolades

Rs. 1.2 Crores

Energy Savings

45

National Safety Award for Longest Accident Free Period (National Safety Council) --- 1980-87.

National Safety Award for Longest Average Frequency Rate (National Safety Council) --- 1980-87.

Safety Performance Citation at Gold Grade (British Safety Council) --- 1990.

Sword of Honour (British Safety Council) --- 1992. Award of Honour for Outstanding Safety Performance (NSC,

USA) --- 1996. Certificate of Appreciation in Commendable Efforts in the field

of Safety Management (CIIER) --- 1997. Significant Improvement Award – NSC,USA. --- 1999. TPM Award – 1st Category --- 2006.

Other AwardsAccolades

46

SWOT Analysis

Strength• Has a rapid development.• More and better chances of expansion as it is

enjoying (90 – 100)% subsidy.• Very big market share is already captured.• Very few companies appear in near

competition with it.

47

SWOT Analysis

Weakness• It does not take active part in any promotional

events.• It does not promote its product on large scale.• It is not much advanced in technology compared

to others though has a large market share.• It has now just started its expansion and is

moving towards modernization so it will take time to become more advanced and other may take benefits of this opportunity.

48

SWOT Analysis

Opportunity• It has an opportunity to capture market of

notebooks as education in India is Expanding.• It has an opportunity to perform much better

by adopting latest technology.• It has an opportunity to capture the markets

of other developing nations.

49

SWOT Analysis

Threats• Major threats of companies are its

competitors as they have entered in all kinds of paper markets. Its major competitors are:

1) Bilt (Ballarpur Industries Ltd.) 2) ITC Ltd. 3) Khanna Paper Mills Pvt. Ltd. 4) HPC (Hindustan Paper Corporation) 5) TNPL (Tamil Nadu Paper Mills)

50

SWOT Analysis

51

Email : [email protected] : http://www.jkpaper.comGroup : Singhania (HS) Group

Contact InfoAdministrative Office Plant Location Registered Office

Nehru House , 4 Bahadur Shah Zafar Marg ,New Delhi.

Tel : 91-011-41011116Fax : 91-011-23712680

JK Paper Mills , Jaykaypur ,Rayagada,Orissa.

P O Central Pulp Mills , Fort Songadh ,Surat,Gujarat.

P O Central Pulp Mills , Fort Songadh ,Tapi,Gujarat.

Tel : 91-02624-221228 / 221278-80Fax : 91-02624-221138

52

!!!!!!!!!!!!!!!!!!!!

Ideas /*#@*/

Suggestions …

Queries ? ?

53

Thank You …