JK Paper acquires Borkar to enhance packaging portfolio amid profit challenges

INDIA – Indian paper and packaging board manufacturer, JK Paper, has announced its acquisition of a 72% stake in Borkar Packaging for US$26.8 million (Rs2.35 billion), a strategic move to fortify its position in the competitive packaging sector. 

The announcement comes as the company grapples with an eighth consecutive quarter of profit decline, driven by soaring wood costs and pressure from low-cost imports.

For the quarter ending June 30, 2025, JK Paper reported a consolidated net profit of Rs812.3 million, marking a steep 42% year-on-year decline. 

Gross revenues from operations stood at Rs14.71 billion, with net revenue dipping 2.3% to Rs16.74 billion. 

According to the company, raw material costs surged by 9.2%, exacerbating financial strain. In a statement, JK Paper attributed the downturn to “lower volume and sales realization due to cheap imports, coupled with sustained high wood costs.” 

The company also noted that its Sirpur Paper Mills underwent a planned annual shutdown, further impacting performance.

The acquisition of Borkar Packaging, a key supplier to industry giants like Unilever and Nestlé, is poised to enhance JK Paper’s footprint in the folding cartons market. 

Borkar operates eight facilities across India, including in Goa, Pune, and Kolkata, and reported a turnover of Rs393.2 crore in FY24.

 “This acquisition aligns with our long-term vision to offer comprehensive packaging solutions,” said Harsh Pati Singhania, Chairman and Managing Director of JK Paper. 

“It positions us to become a top-tier player in the folding cartons segment, catering to the growing demand in consumer goods, pharmaceuticals, and electronics.”

The Indian paper industry faces significant headwinds, with cheap imports from countries like Indonesia, Chile, and China disrupting local markets. 

In response, India has launched antidumping investigations to address concerns over paperboard imports, a critical material for packaging.

 These challenges have squeezed profit margins across the sector, with Singhania noting, “The sharp rise in imports at low prices, combined with high domestic wood costs, has significantly impacted our profitability.”

Recent developments indicate JK Paper is also exploring further financial strategies to bolster its operations. 

According to a report by a leading business news outlet, the company’s board has proposed raising Rs500 crore through non-convertible debentures to support its expansion plans. 

Despite the profit slump, JK Paper’s focus on sustainable practices remains strong. The company’s farm forestry initiatives, spanning over 692,000 acres, aim to secure raw materials while promoting environmental sustainability. 

As the packaging industry continues to grow, JK Paper’s acquisition of Borkar signals a proactive step toward resilience and market leadership.

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