Neeraj Paper Marketing has submitted its 31st Annual General Meeting report for the financial year ended March 31, 2026. The company reported a significant improvement in profitability, with net profit after tax rising 108% year-on-year to ₹51.45 lakh from ₹24.66 lakh in the previous year.

The profit growth occurred despite a 15% decline in revenue from operations, which fell to ₹16,722.80 lakh from ₹19,686.63 lakh in FY25. The primary driver for the bottom-line expansion was a sharp reduction in finance costs, which dropped by 71% to ₹73.89 lakh from ₹254.62 lakh in the prior year.

Financial Performance

The company’s operating profit margin contracted to 0.80% from 1.38% in FY25, reflecting lower operating profits amid reduced turnover and higher operating expenses. However, the interest coverage ratio improved significantly to 1.98 times from 1.17 times, driven by the substantial decrease in interest expenses.

Balance Sheet and Debt Reduction

Neeraj Paper Marketing strengthened its balance sheet through aggressive debt repayment. Long-term borrowings decreased by 47% to ₹309.49 lakh from ₹588.34 lakh in FY25. Consequently, the debt-to-equity ratio halved to 0.27 times from 0.54 times.

Trade receivables stood at ₹3,901.86 lakh as of March 31, 2026, down from ₹4,373.12 lakh in the previous year. The debtors’ turnover period increased slightly to 90.31 days from 78.10 days. Cash and cash equivalents remained low at ₹115.25 lakh, while other current assets rose to ₹1,010.57 lakh.

AGM and Corporate Governance

The company will hold its 31st Annual General Meeting on September 28, 2026, via Video Conferencing or Other Audio Visual Means. Shareholders on record as of September 21, 2026, are eligible to vote. The register of members will remain closed from September 22 to September 28, 2026.

Key agenda items include:

• Adoption of audited financial statements for FY26.
• Reappointment of Mr. Praveen Kumar Goel as a director, who retires by rotation.

Mr. Goel, a Whole Time Director with 33 years of experience in the paper industry, holds 117,000 equity shares. His remuneration for FY26 was ₹18.00 lakh. The Board also noted that no dividend is recommended for the current year as funds are required for business growth.

Regulatory Developments

The Income Tax Department conducted a search operation at the company’s registered office between March 18 and March 20, 2026. Management stated that no assessment order or demand has been received as of the report date, and no adjustments are currently required in the financial statements based on available facts.

What the Numbers Show

The divergence between declining revenue and surging net profit highlights the impact of financial engineering over operational growth. With finance costs dropping from ₹254.62 lakh to ₹73.89 lakh, the company effectively converted high interest burdens into retained earnings. This suggests a strategic deleveraging phase rather than an operational turnaround, as operating margins continued to compress.

Neeraj Paper Marketing has received an order from the Commissioner of Income Tax (Appeals) granting relief of ₹54.41 lakh in its ongoing income tax litigation for Assessment Year 2019-20. The company filed the appeal against an earlier assessment order that had raised a demand of ₹77.56 lakh.

The appellate authority passed the order on August 17, 2026, which the company received on August 26, 2026. The relief was granted by deleting certain additions and disallowances made by the assessing officer.

Litigation Details

The dispute originated from an assessment order dated March 25, 2026, issued by the Deputy Commissioner of Income Tax under Section 143(3) read with Section 147 of the Income-Tax Act, 1961. Neeraj Paper Marketing challenged this order before the Commissioner of Income Tax (Appeals).

In its order under Section 250 of the Income-Tax Act, 1961, the CIT(A) restricted the addition under Section 69C to only ₹6.59 lakh. This decision significantly reduced the disputed amount from the initial demand.

Financial Implications

The company stated that it does not expect any material impact on its financial position or operations arising from this order. However, the final quantum of tax demand remains unascertained as it will be decided by the assessing officer based on the appellate order.

Regulatory Disclosure

Neeraj Paper Marketing made this disclosure pursuant to Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The company will provide further updates once the assessing officer ascertains the final tax demand.