Orient Paper commits INR 40-crore to new projects

Orient Paper and Industries faced a severe operating environment in the second quarter of fiscal year 2026 (Q2 FY26), reporting a net loss after tax (PAT) that deepened by over 55% year-over-year to INR 30.60-crore (INR 3,059.62-lakh). This decline was largely driven by a massive increase in losses within the company's primary paper and tissue segment, which saw its loss before tax surge by more than 88% to INR 43.84-crore (INR 4,383.92-lakh) during the quarter. The company’s factories, including its main registered works at Unit VIII in Bhubaneswar, battled industry headwinds marked by a persistent rise in input costs, with the cost of materials consumed jumping to INR 100.03-crore and power and fuel expenses also increasing significantly during the period.

Despite the dire profitability of its main factories, Orient Paper demonstrated a tangible commitment to future modernisation and product development through substantial capital investment. The company dramatically ramped up its spending on new projects, evidenced by a sharp increase in capital work-in-progress (CWIP), which grew by nearly INR 40-crore (INR 4,000 lakh) over the half-year period to reach INR 10,478.78-lakh as of 30 September 2025. This capital expenditure signals the company’s intent to upgrade its machinery and infrastructure to improve efficiencies and eventually introduce new grades to combat the current market stagnation.

The core paper and tissue division struggled, the smaller chemicals segment delivered a positive segment result of INR 5.74-crore (INR 573.84-lakh). This internal stability underscores the importance of the company's dual-product focus, allowing the profitable segment to partially mitigate the losses incurred by its paper factories and providing a platform for developing higher-margin speciality products.