Tamil Nadu Newsprint and Papers Limited (TNPL) 43rd AGM Summary
Meeting Details
• Date: September 25, 2023
• Format: Video conference
• Chairman: Dr. M. Sai Kumar
• Quorum: 89 shareholders present
Chairman's Speech Highlights
• Operational Performance:
• Paper production capacity increased to 480,000 Metric Tonnes per annum.
• New Modern Pulp Mill launched, pulping capacity at 1,580 tonnes per day.
• Financial Performance:
• Record revenue and profitability.
• Profit Before Tax: Rs. 602.76 crore.
• Profit After Tax: Rs. 387.87 crore.
• Recommended dividend: Rs. 5 per share.
• Inventory Management:
• Zero stock of paper for the second consecutive year.
• Minimal inventory in Paper Board Plant.
Strategic Focus
• Demand Stabilization:
• Shift towards industrial applications to address cyclic paper demand.
• Development of new grades of industrial paper.
• Market Outlook:
• Optimism despite slowdown in Printing & Writing segment and increased imports.
• Low per capita paper consumption in India presents growth opportunities.
Key Projects and Sustainability Initiatives
• New Developments:
• Commissioning of a new pulp mill.
• Environmental initiatives: waste water treatment plant, solar energy projects.
• Community and Environmental Commitment:
• Significant investments in community development.
• Recognition through multiple awards for sustainability efforts.
Financial Governance
• Audit Reports: Unqualified auditor reports indicating strong governance.
• Stakeholder Engagement: Expression of gratitude to stakeholders for support.
AGM Voting and Resolutions
• Voting Process: Remote e-voting allowed; in-person voting permitted for non-participants.
• Resolutions Proposed:
• Adoption of financial statements.
• Declaration of Rs. 5 dividend per share.
• Reappointment of a director.
• Approval of auditor remuneration.
Shareholder Engagement
• Q&A Session: Positive atmosphere with shareholders expressing confidence.
• Future Vision Inquiry: Questions about the company's direction for the next 3 to 5 years.
Recent Conference Call Insights
• Record Profit: Rs. 602 crores achieved for the first time since 1985.
• Expansion Plans: Discussion on ongoing projects, loan status, and potential tissue paper production.
• Current Loan: Rs. 2000 crores, with repayments until 2026-27.
Conclusion
• Call to Action: Encouragement for shareholder participation in voting.
• Closing: Meeting concluded with a request for all to stand for the National Anthem.

Key Management Participants
• Executive Director of Marketing and Chief Risk Officer
• Chief General Manager of Operations
• Chief Financial Officer (CFO) Sathya Ananth
Financial Performance
• Record Performance in FY23
• Highest turnover, EBITDA, and PAT in history
• Turnover exceeded INR 5,000 crores
• Q1 FY24 Results
• Revenue: INR 1,273 crores (12% increase YoY)
• EBITDA: INR 325 crores (84% increase YoY)
• Debt-equity ratio reduced to 0.93
Market Outlook
• Strong paper market despite recent price drops
• Anticipated recovery in packaging board sector
• Target to increase paper production by 10% in FY24
Raw Material Prices
• Current state: Q2 challenging, Q3 expected improvement
• Stable prices for key raw materials (wood, bagasse, deinked pulp)
• Raw material mix: 40% wood, 40% bagasse, 20% recycled fiber
Expansion and Debt Management
• Assessing market for smaller capital expenditures
• Debt repayment plan to clear all debts by 2029-30 (INR 250 crores annually)
Pricing and Taxation
• Decline in realizations expected to normalize in Q3
• Currently under Minimum Alternate Tax (MAT) regime, transitioning to lower rate by FY26
Pulp Capacity and Costs
• Current pulp capacity: 200,000 tons for folding box board
• Need for 100,000 tons for new pulp mill deemed unfeasible
• Higher power and fuel costs attributed to imported coal
Packaging Board Margins
• Decline due to excess supply, not demand drop
• Optimism for market normalization and improved profitability
Raw Material Costs
• Similar costs for bagasse, deinked, and wood pulp
• Preference for imported wastepaper due to quality
Production Capacity and Future Plans
• Current production capacity: 4.4 lakh tons for paper, 2 lakh tons for packaging board
• Projected combined output: 6-6.2 lakh tons for the year
• Focus on sustaining capital expenditures, revamping steam and power sector
Export and Market Dynamics
• Expected export volumes: 18-20% of total production
• Chinese imports affecting pricing dynamics but not flooding the market
Conclusion
• Management expressed optimism for future performance despite challenges.