With Project Jagriti, strong exports, and evolution in the compostables vertical, Pakka eyes USD 250 Mn revenue, FY25–26 marks strategic, tech-driven transformation

With Project Jagriti, strong exports, and evolution in the compostables vertical, Pakka eyes USD 250 Mn revenue, FY25–26 marks strategic, tech-driven transformation

- Moulded fibres business ran into an expected headwind: increased competition, especially from the unorganised sector.

The Pulp and Paper Times

Pakka Limited has emerged as a global contributor to sustainable packaging solutions, particularly within the FMCG sector. The company specialises in producing biodegradable and compostable materials derived from agricultural waste. Pakka partners leading FMCG brands to offer custom sustainable packaging solutions that meet environmental standards.

Pakka is at the forefront of creating sustainable, compostable, and paper-based alternatives aligned around global environmental goals and evolving consumer preferences. With manufacturing roots grounded in India and a growing international footprint, the company continues to drive innovation, operational excellence, and circular practices. The year FY24-25 exemplified Pakka’s commitment to purposeful growth - anchored in discipline, powered by intelligent systems, and driven by a clear direction towards a cleaner, more resilient future.

Guided by circular economy principles, Pakka drives innovation in plant-based materials, programs and responsible disposal practices. Its commitment to sustainability positions the company at the forefront of the sustainable packaging movement, accelerating the industry’s shift towards environmentally conscious solutions.

“As we navigate an evolving economic landscape, our focus will continue to be on building a stronger, leaner and more competitive Pakka that is responsive to opportunities whenever our market recovers. In this context, the management is redoubling its efforts to execute the major initiatives of Project Jagriti at Ayodhya and the subsidiary’s Project Kawok in Gautemala with a minimum impact of global uncertainties on time and cost lines. The innovation team is being strengthened, bringing it geographically closer to the sources of relevant knowledge. The conclusion of funding arrangements, debt and equity, has paved the way for the accelerated execution of strategic investments,” Mr. Pradeep Vasant Dhobale, Chairman- Pakka said in the annual report for FY 24-25.

“During the last financial year, we had expressed confidence that we had developed a biodegradable substrate for our flexible packaging for the first time ever: an achievement that we were proud of. We believed that this development would open doors for our flexible packaging business within India and the world over, especially among FMCG food brands. However, the initial developments could not be sustained. Even though our biodegradable material was anyway expensive over conventional alternatives, the product evolution could not be taken ahead and we ended the financial year under review by returning to square one,” Mr. Ved Krishna, Managing Director (KMP), stated in the report.

Mr. Krishna added, that, the other under-delivery was in the area of our moulded fibres business. Even though the business had been a pioneer in the country’s organised sector, it ran into an expected headwind: increased competition, especially from the unorganised sector. This affected the company’s capacity utilisation and corresponding economies, affecting our overall competitiveness. The revenues we had targeted from this business during the last financial year did not materialise.

“The company had expected that this setback would be cushioned by attractive revenues from the export of packaging paper to the US. A large customer to whom we had contracted to sell an attractive part of our output delayed purchases, affecting our performance” he informed.

On the financial goal in FY 25-26, Mr. Ved stated that “I do not see any increase in pulp or packaging paper costs during the current financial year. Considering that the company’s manufacturing capacities are being sweated to their maximum, I do not see any appreciable increase in output either. Even with these two realities, I expect the company to report just about the same financials as it did in FY24-25. If there is to be any improvement in manufactured volumes, it is likely to be derived from the capacity expansion that we intend to commission by the end of 2025. This indicates that we could get the benefit of improved volumes during the last quarter. There has been a marginal cost overrun in the project on account of material inflation and a weakening of the Indian rupee. However, I am optimistic that from the next financial, year the company should be able to resume its growth journey”

FY24-25 marked another transformative year for Pakka, building on the foundation of the previous two years. The operational strides of FY23-24 were enhanced, affirming that the performance gains are now embedded in the company’s mindset. The shift from reactive functioning to strategic execution matured into an organisation-wide discipline, supported by empowered teams and technology-driven process.

PERFORMANCE REVIEW: CONSOLIDATED:

The Operative Revenue stood at Rs. 40,604.08 lakhs in FY25 compared to Rs. 40,474.29 lakhs in FY24 on a consolidated basis. Operative Revenue increased by 0.32% in comparison to the last financial year. The Consolidated Profit after tax in FY25 was at Rs. 3,751.97 lakhs compared to Rs. 4,080.73 lakhs in FY24. The consolidated profit after tax decreased by 8.76%.

Project Jagriti: 

In line with Pakka’s vision to become a global regenerative packaging leader, Project Jagriti represents a leap in expanding Pakka’s capacity and capability in recyclable and compostable food-grade flexible packaging. The project is centered around the installation of a new Paper Machine (PM-4), substantial upgrades to the pulp mill, modernisation of PM#3 and the addition of a 15 MW power plant to support enhanced production needs.

The primary objective of Project Jagriti is to offer quality, recyclable and compostable packaging alternatives to traditional plastic-based materials. These new paper-based solutions are designed to meet demanding requirements such as grease-proof performance and flexibility - crucial for food-grade applications.

These initiatives are expected to generate annual revenues of ~USD 250 Million. With significant progress in Project Jagriti, strong export momentum, and evolution in the compostables vertical, FY25–26 promises to be a year of strategic transformation — anchored in operational discipline, powered by smart technology, and aligned with global sustainability goals.

As Pakka expands globally, there is a need streamline the financial strategy and direction for the group. It was felt that the appointment of Americas Lead would not only emphasise this point but also focus completely on building Pakka Inc.

Pakka Inc. will manage the Americas operation (USA and Guatemala); Pakka Limited will manufacture within India and market products within India and global countries.

“At Pakka Inc., our objective is to extend the competitive sole position that Pakka enjoys in India to its American presence. We are the lowest cost producers of environment friendly food packaging in India; we seek to emerge as the lowest cost producer of environment friendly food packaging in the Americas. We will need to build on our recent Group knowledge by mobilising investable funds at the lowest cost, accessing the finished product from near-shore countries (Guatemala in this instance), buying bagasse (our principal raw material) from next to our manufacturing facility and creating a sustainably low cost of doing business. We are centralising our long-term research capabilities in Portland, capitalising on customer proximity and productivity.,”Mr Rolando Yon, Americas Lead, Pakka Inc. stated in the report.

Pakka aims to position itself as a responsible and innovative player. By being focused on sustainability, it will ensure that its products and operations are environmentally responsible. By participating in global trade shows and strengthening its brand in the US, the company hopes to establish itself as a trusted player in flexible packaging and food services.

By 2030, Pakka’s objective is to account for an attractive share of the US flexible packaging and food service markets. These are large and growing segments, where even a moderate share can translate into a large increase in volume for our company. The flexible packaging market is expected to reach USD 84 Billion by 2030 and the food service market is estimated at USD 3.5-4 Billion. Our goal is to become a global leader in regenerative packaging solutions at scale by then in terms of overall revenues, with the US market accounting for a sizable revenue share.

In the short term, Pakka does not expect significant US revenue generation as it is still seeding the market. In the next few months, Pakka will set up distribution networks, sharpening product offerings and gaining traction with US-based converters and customers. it will streamline production and distribution processes. As the market matures, Pakka hope to carve out an attractive market share of the compostable and recyclable flexible packaging sector. The company anticipates stronger growth in the fiscal years 2026 and 2027.
 

Web Title: With Project Jagriti, strong exports, and evolution in the compostables vertical, Pakka eyes USD 250 Mn revenue, FY25–26 marks strategic, tech-driven transformation