JK Paper, a leading Indian paper and packaging company, reported its seventh consecutive quarter of falling profits on Monday, mainly impacted by rising wood prices that squeezed profit margins.

Significant Profit Drop

For the quarter ending March 31, the company’s consolidated net profit fell sharply by 72.4% compared to the previous year, reaching 762 million rupees (approximately $8.9 million).

Industry Challenges: High Raw Material Costs and Imports

The Indian paper industry is facing pressure from two key issues: increasing prices of wood, an essential raw material, and competition from cheaper imports. Manufacturers have urged the government to impose restrictions on low-quality imports and offer support amid rising global tariff tensions, especially involving the United States.

JK Paper’s Managing Director, Harsh Pati Singhania, acknowledged these challenges, saying, “Profits have been significantly affected by the surge in low-priced imports and the high cost of wood.”

Revenue and Expense Changes

The company’s net revenue slightly declined by 1.7% to 16.90 billion rupees. However, expenses grew by 10.4% to 16.09 billion rupees, largely due to increased raw material costs. This imbalance caused operating margins to shrink drastically from 15.2% to 4.7%.

Dividend Announcement

JK Paper declared a dividend payout of five rupees per share despite the profit pressures.

Industry-Wide Impact

Similarly, smaller competitor Andhra Paper reported nearly an 80% drop in quarterly profit earlier this month. Other players like West Coast Paper Mills and Emami Paper Mills are yet to release their financial results.