Pakka Q2FY27 revenue rose 64% as EBITDA margin reached 14.2%

Pakka reported Q2FY27 revenue of Rs 124.0 crore, up 64% year on year from Rs 75.8 crore, while earnings before interest, tax, depreciation and amortisation (EBITDA) margin rose to 14.2% from 6.1% and EBITDA reached Rs 17.6 crore. Profit before tax (PBT) was Rs 4.2 crore after a one-time Rs 4.7 crore loss on disposal of property, plant and equipment.

How did Pakka perform in Q2FY27?

Pakka delivered higher revenue, EBITDA and PBT in Q2FY27 than in Q2FY26, with revenue increasing by Rs 48.2 crore and EBITDA increasing by Rs 12.9 crore. The company reports these figures on a standalone basis, and defines EBITDA as excluding other income.

Pakka's first-half figures also show an improvement over the corresponding prior-year period. H1FY27 revenue was Rs 241.2 crore, compared with Rs 158.1 crore in H1FY26, while EBITDA increased to Rs 33.0 crore from Rs 16.2 crore and the EBITDA margin rose to 13.7% from 10.3%.

The quarterly margin outcome also extended the sequential improvement shown in the presentation. EBITDA was Rs 15.4 crore with a 13.2% margin in Q1FY27, compared with Rs 17.6 crore and a 14.2% margin in Q2FY27; both measures remained below the Rs 25.90 crore EBITDA and 24.50% margin Pakka recorded in Q1FY24.

Why did Pakka's EBITDA margin increase in Q2FY27?

Pakka's EBITDA margin increased by 8.1 percentage points year on year to 14.2% in Q2FY27 as EBITDA rose faster than revenue, reaching Rs 17.6 crore on Rs 124.0 crore of revenue. The presentation does not break the company-wide margin movement into individual cost lines, so it does not quantify the contribution of raw materials, energy, pricing or other operating costs.

The Q2FY27 margin was above the 10.0% reported in Q4FY26 and the 13.2% reported in Q1FY27. Pakka's presentation compares the 14.2% quarter with approximate average EBITDA margins of 14% for global specialty-paper companies and 15% for global food-service-packaging companies, based on simple averages of selected companies' latest full-year consolidated results.

Pakka said in the presentation that the Q2 margin was back in line with those global peer averages, while its best quarter had been above them. That comparison is the company's stated framing rather than a like-for-like operating measure: the cited peer figures use EBITDA as reported, including underlying or adjusted EBITDA where the companies provided it, whereas Pakka's EBITDA excludes other income.

How did the asset disposal affect Pakka's Q2FY27 profit?

A one-time Rs 4.7 crore loss on disposal of property, plant and equipment reduced Pakka's Q2FY27 reported PBT to Rs 4.2 crore from adjusted PBT of Rs 8.9 crore. Reported PBT margin was therefore 3.4%, while the adjusted PBT margin before that disposal loss was 7.2%.

The distinction matters because the Q2FY27 reported PBT increase of Rs 3.8 crore from Rs 0.4 crore in Q2FY26 does not show the full pre-disposal comparison. On the adjusted basis used by Pakka, PBT rose by Rs 8.5 crore from Rs 0.4 crore, and the margin increased by 6.7 percentage points from 0.5%.

The same item affected the first-half presentation. H1FY27 reported PBT was Rs 13.0 crore, compared with Rs 6.9 crore in H1FY26, while adjusted PBT before the Rs 4.7 crore disposal loss was Rs 17.7 crore and adjusted PBT margin was 7.3%, versus 4.4% in the prior-year half.

Which Pakka segment drove Q2FY27 growth?

Pakka's Wrap & Carry segment generated Rs 105.28 crore of revenue in Q2FY27, compared with Rs 60.06 crore in Q2FY26, making it the largest disclosed business line within the company's Rs 124.0 crore quarterly revenue. Its segment PBT rose to Rs 10.11 crore from Rs 1.46 crore, and its PBT margin increased to 9.6% from 2.4%.

Wrap & Carry volumes increased to 10,722 tonnes in Q2FY27 from 7,659 tonnes in Q2FY26. Pakka also reported an increase in net sales realisation (NSR) versus the prior-year quarter, better contribution from dry-pulp sales, and exports maintained at 30% of sales despite geopolitical challenges; the presentation does not assign rupee amounts to those individual factors.

The business added an interleaving-paper deal with Reliance's solar-glass facility, which Pakka describes as India's largest. Separately, Food Service revenue was Rs 18.77 crore in Q2FY27, up 19% year on year, while flexC base had completed European pilot trials and was already selling more than 500 tonnes a month before the planned paper machine 4 start-up.

What is Pakka planning after Q2FY27?

Pakka's stated Pakka 2.0 plan is to stabilise Project Jagriti, improve operating efficiency, commercialise higher-value flexC base and speciality papers, expand CHUK through partners, and strengthen cash generation and returns on capital. These are management plans rather than financial forecasts, and the presentation gives no revenue, margin or earnings target for FY27.

Project Jagriti had reached key commissioning milestones in October, when the recovery boiler, power boiler and turbine started up. Pakka said paper machine 4 was scheduled to start in December, providing a disclosed next operating event for the flexC base product, which was already selling at more than 500 tonnes a month.

Commercial execution remains central to the plan because flexC base is intended to scale through customer adoption and CHUK is intended to scale through an asset-light partner model. In Q2FY27, the presentation paired that strategy with the Rs 105.28 crore Wrap & Carry revenue base and Food Service revenue of Rs 18.77 crore, but it did not disclose segment profitability for Food Service or CHUK.

Conclusion

Pakka's Q2FY27 results show a substantial operating recovery: revenue rose to Rs 124.0 crore, EBITDA more than tripled to Rs 17.6 crore, and the EBITDA margin rose to 14.2% from 6.1%. The reported PBT figure of Rs 4.2 crore understates the pre-disposal result because it includes a Rs 4.7 crore one-time loss, leaving adjusted PBT at Rs 8.9 crore.

Next, investors can watch the December start-up of paper machine 4 after the October commissioning of Project Jagriti's recovery boiler, power boiler and turbine. Pakka's disclosed plan is to stabilise that project, grow flexC base and speciality-paper adoption, and broaden CHUK through partners, while exports remained 30% of Wrap & Carry sales in Q2FY27.