Orient Paper Q2 losses deepen by 55.65% YoY

Orient Paper and Industries reported a challenging second quarter for fiscal year 2026 (Q2 FY26), with its net loss after tax (PAT) for the period deepening by 55.65% year-over-year (YoY) to INR 30.60-crore (INR 3,059.62-lakh), compared to a loss of INR 19.66-crore (INR 1,965.95-lakh) in the corresponding quarter last year. The overall revenue from operations for the quarter stood at INR 199.75-crore (INR 19,975.25-lakh), a modest decline from INR 208.13-crore (INR 20,812.50-lakh) in Q2 FY25.

The core of the company's financial strain was concentrated in its main operation, the paper and tissue segment, which saw its segment loss nearly double. The loss before tax for the paper and tissue division ballooned by over 88% YoY, reaching INR 43.84-crore (INR 4,383.92-lakh) in Q2 FY26, up from a loss of INR 23.31-crore (INR 2,331.03-lakh) in Q2 FY25. This decline occurred even as segment revenue for the paper and tissue business slightly dropped to INR 159.81-crore (INR 15,980.52-lakh) from INR 175.76-crore (INR 17,575.70-lakh) a year ago.

The operational struggles were exacerbated by rising expenditures across several major line items. The cost of materials consumed increased to INR 100.03-crore (INR 10,002.69-lakh) in the current quarter, up from INR 90.00-crore (INR 8,996.43-lakh) in Q2 FY25. Similarly, power and fuel expenses also rose to INR 51.04-crore (INR 5,103.98-lakh) from INR 47.81-crore (INR 4,781.05-lakh) in the previous year. This combination of mounting costs and subdued realisations in the paper market severely constrained profitability.

Despite the severe pressure on the paper division, the company’s chemicals segment delivered a positive segment result of INR 5.74-crore (INR 573.84-lakh) in Q2 FY26, providing a partial buffer to the overall result. Furthermore, the performance was relatively better over the six months, as the half-year (H1 FY26) PAT stood at an INR 3.40-crore profit (INR 339.67-lakh), representing a significant recovery compared to the H1 FY25 loss of INR 26.08-crore (INR 2,607.53-lakh).