Pakka Limited released its financial performance for the fourth quarter and financial year ended March 31, 2026, highlighting mixed results across its business segments. The India Business reported a revenue of ₹104.49 Cr in Q4FY26, an 8% increase compared to ₹96.21 Cr in Q4FY25. However, Profit Before Tax (PBT) for this segment declined by 55% year-on-year to ₹5.52 Cr from ₹12.16 Cr in the same period last year. For the full financial year FY26, India Business revenue stood at ₹366.78 Cr, a 13% decrease from ₹423.17 Cr in FY25, with PBT falling by 62% to ₹25.20 Cr.

The Wrap & Carry segment showed resilience with revenue rising to ₹87.61 Cr in Q4FY26, up 4% from ₹84.63 Cr in Q4FY25. Despite the revenue growth, PBT for the segment dropped 16% year-on-year to ₹12.42 Cr. On an annual basis, Wrap & Carry revenue for FY26 was ₹303.54 Cr, a 17% decline from ₹366.56 Cr in FY25, while PBT decreased by 50% to ₹36.05 Cr.

The Food Services division reported a significant revenue surge of 46% in Q4FY26 to ₹16.87 Cr from ₹11.58 Cr in Q4FY25. However, the segment continued to incur losses, with a PBT of -₹6.91 Cr for the quarter, widening from -₹2.68 Cr in Q4FY25. For the full year FY26, Food Services revenue grew by 12% to ₹63.23 Cr, but the PBT loss expanded to -₹10.84 Cr compared to -₹4.58 Cr in FY25.

The company attributed the elevated losses in the Food Services division to manufacturing and plant-related costs amounting to ₹3 Cr, as well as one-time non-recurring items totaling ₹3 Cr. These included inventory write-offs and project development costs. Management noted that these factors are largely one-time or plant-related rather than indicative of core demand issues.

Financial Performance Summary

Strategic Outlook and Funding

Pakka Limited outlined its plan for FY26-27, focusing on the effective commissioning of Project Jagriti, building an asset-light model, and transforming the food service business. The company aims to diversify into new product categories, including delivery ranges and cutlery, and tap into the US market opportunity. Innovation highlights include a base paper pilot and NM flexibles pilot scheduled for July 2026.

Regarding funding efficacy, the company detailed a refinancing arrangement where the Neo Group replaced existing banks. The revised terms include a 4-month moratorium followed by a 12% interest rate for the next 20 months, with no principal repayment for 16 months. The effective rate of interest is 16.95%. The facilities drawn include NCDs worth ₹500 Crores, Neos equity of ₹30 Crores, and promoter equity of ₹85 Crores.

Pakka Limited reported a 68% decline in net profit to ₹1,814.88 lakh for the financial year ended March 31, 2026, compared to ₹5,669.79 lakh in the previous year. Revenue from operations for FY26 stood at ₹35,579.54 lakh, down from ₹40,604.09 lakh in FY25. The Board of Directors approved the audited standalone financial results for the fourth quarter and financial year ended March 31, 2026, during a meeting held on May 30, 2026. The company also conducted an investor call on June 2, 2026, to discuss the financial performance under Regulation 30 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

The company's statutory auditors, C N K & Associates LLP, issued an audit report with an unmodified opinion on the standalone financial results. However, the consolidated audited financial results could not be finalized due to pending audit of Pakka Inc., a USA-based wholly owned subsidiary. The Board decided to retain funds for major capacity expansion and consequently did not recommend any dividend for the financial year.

Financial Performance

For the quarter ended March 31, 2026, the company reported a profit of ₹384.47 lakh, a significant decrease from ₹1,257.21 lakh in the same quarter of the previous year. Revenue for Q4FY26 was ₹10,154.06 lakh, compared to ₹9,215.71 lakh in Q4FY25. Total expenses for the year increased to ₹34,157.37 lakh from ₹35,602.35 lakh in the prior year.

Segment Reporting

The company operates in two primary segments: Paper & Pulp and Moulded Products. The Paper & Pulp segment generated revenue of ₹30,354.72 lakh for the year, while the Moulded Products segment contributed ₹6,323.13 lakh. The Paper & Pulp segment reported a profit before tax of ₹3,836.51 lakh, whereas the Moulded Products segment recorded a loss before tax of ₹1,084.24 lakh.

Operational Updates

The plant was shut from June 16, 2025, to July 26, 2025, for the expansion of production facilities under Project Jagriti. Additionally, the Board approved the extension of the validity period of outstanding warrants from 12 months to 18 months. The company also issued Tranche IV under the Pakka Team Stock Option Plan, 2021, comprising 1,24,500 ESOPs with an exercise price of ₹152.31 per option.