Balkrishna Paper Mills Ltd received an interim order from the National Company Law Tribunal (NCLT) admitting its petition for a Scheme of Reduction of Share Capital. The tribunal heard the matter on October 14, 2026, and set January 21, 2027, as the next date of hearing.

The company clarified that the order is procedural and does not constitute a material development in itself. It was issued under Section 66 read with Section 52 of the Companies Act, 2013, directing the company to issue notices and publish advertisements as required by law.

Details of the Capital Reduction Scheme

The proposed scheme involves two primary adjustments to rationalize the company's capital structure and reflect its true financial position:

1. Equity Share Capital Adjustment: The company plans to write off accumulated losses amounting to ₹52.28 crore. This will be done first by utilizing the Securities Premium Reserve of ₹23.29 crore, with the remaining balance adjusted by reducing the face value of equity shares from ₹10 to ₹1 per share.
2. Preference Share Capital Reduction: The entire issued and paid-up preference share capital of ₹110 crore, comprising 6.5% Non-Cumulative Redeemable Preference Shares, will be reduced. The consideration payable to preference shareholders will be discharged as funds become available and treated as an unsecured non-interest-bearing loan until then.

Financial Position and Rationale

The rationale for the reduction stems from significant accumulated losses that have eroded the company's net worth. As per limited reviewed financial statements for the six months ended September 30, 2025, accumulated losses stood at ₹278.39 crore. The company currently has no major business operations and is evaluating new opportunities, including real estate-related activities.

Regulatory Compliance and Clarification

Balkrishna Paper Mills initially filed the intimation under Regulation 30 of SEBI (LODR) Regulations as an 'Announcement'. Following a query from BSE regarding the classification and timing, the company submitted a fresh announcement under the head 'General Update'. The company stated that the inadvertent misclassification occurred because the NCLT order was interim and procedural.

What the Numbers Show

The proposed reduction highlights a severe disconnect between the company's book value and its operational reality. While the equity face value is being slashed by 90% (from ₹10 to ₹1), this adjustment only covers a fraction of the total accumulated losses of ₹278.39 crore. Even after utilizing the full Securities Premium Reserve and the equity capital reduction, over ₹226 crore in losses remains unadjusted. Furthermore, the conversion of ₹110 crore in preference shares into an unsecured loan signals a lack of immediate liquidity to meet redemption obligations, shifting these liabilities from equity instruments to debt without interest accrual.

Shareholders of Balkrishna Paper Mills have approved the reappointment of key leadership roles, including Chairman and Managing Director Anuraag Poddar and Whole-Time Director Manish Malpani, at the company’s 13th Annual General Meeting held on September 18, 2026.

The meeting, conducted via Video Conferencing and Other Audio Visual Means, saw all five resolutions passed with requisite or special majority. The agenda included ordinary business items such as the adoption of audited financial statements for FY26 and special business items concerning board appointments.

Key Resolutions Passed

The shareholders voted on the following resolutions:

• Adoption of the audited financial statements for the financial year ended March 31, 2026.
• Reappointment of Anuraag Poddar as a director liable to retire by rotation.
• Reappointment of Anuraag Poddar as Chairman and Managing Director for a three-year term from February 11, 2027, to February 10, 2030.
• Reappointment of Manish Malpani as Whole-Time Director and Chief Financial Officer for a three-year term from December 9, 2026, to December 8, 2029.
• Reappointment of Prof. (Dr.) Mangesh D. Teli as a Non-Executive Independent Director for a second term of five years, effective December 9, 2026.

Voting Participation and Results

A total of 68 shareholders attended the meeting through video conferencing, comprising 14 from the promoter group and 54 from the public category. The promoter group holds 19,315,802 shares, while public non-institutional investors hold 12,903,703 shares.

The voting results for each resolution are detailed below:

What the Numbers Show

The promoter group demonstrated unanimous support for all agenda items, casting 18,203,720 votes in favour with zero votes against across all resolutions. This represents a participation rate of 94.24% of their total holding. In contrast, public non-institutional shareholders showed minimal dissent, with only 1,588 votes cast against the CFO’s reappointment out of 1,396,127 total votes polled in that category. The near-unanimous approval underscores strong alignment between the promoter group and the broader shareholder base regarding the current leadership structure.