Kuantum Papers Limited announced its Q3FY26 unaudited financial results for the quarter ended December 31, 2025, following a board meeting held on February 7, 2026. The company reported a net profit of ₹9.78 crore, representing a sharp decline of 53.38% compared to ₹20.98 crore in the corresponding quarter of the previous year, despite achieving revenue growth.

Q3FY26 Financial Performance

The company's financial performance for Q3FY26 showed mixed results across key metrics:

For the nine months ended December 31, 2025, the company reported total income of ₹797.45 crore compared to ₹834.37 crore in the previous year, while net profit stood at ₹27.62 crore against ₹89.06 crore in the corresponding period.

Cost Structure and Margin Pressures

The company faced significant cost pressures during the quarter, impacting profitability:

The substantial increase in material costs by 17.8% was the primary factor contributing to margin compression, with EBITDA margins declining to 13.55% from 18.66% in the previous year quarter.

Board Meeting Outcomes and Director Changes

The board meeting held on February 7, 2026, transacted several key business items beyond financial results approval:

The board approved a postal ballot notice for obtaining shareholder consent for the director appointments. Both newly appointed directors have been confirmed as not being debarred from holding director positions by any regulatory authority.

Tax and Profitability Analysis

The company's tax structure showed notable changes during the quarter:

The company reported no current tax liability for Q3FY26, with only deferred tax expenses of ₹3.56 crore compared to total tax expenses of ₹7.18 crore in the corresponding previous quarter.

Earnings Conference Call Recording Available

Following the announcement of Q3FY26 results, Kuantum Papers Limited conducted an earnings conference call on February 9, 2026, to discuss the unaudited financial results and performance for the quarter and nine months ended December 31, 2025. The company has made the audio recording of this investor and analyst call available on its website at www.kuantumpapers.com .

The audio recording provides detailed insights into the company's performance and management commentary on the quarterly results, accessible through the direct link provided on the company's official website.

Regulatory Compliance and Governance

The unaudited financial results were approved by the Board of Directors and subjected to limited review by statutory auditors O P Bagla & Co LLP. The board meeting commenced at 12:15 PM and concluded at 3:50 PM on February 7, 2026. The company maintains compliance with SEBI Listing Obligations and Disclosure Requirements Regulations, 2015, with detailed financial results available on the company website and stock exchange portals.

The company noted the implementation of New Labour Codes effective from November 21, 2025, with the incremental impact assessed as not material for the current quarter. Additionally, the board decided to present financial statements rounded off to the nearest crore rupees from FY 2025-26 onwards.

Kuantum Papers Limited , a key player in the Indian paper industry, has reported a significant 25.5% sequential growth in operational income for Q2 FY26, despite facing challenges in maintaining profit margins. The company's performance reflects both its strategic initiatives and the impact of external factors on its operations.

Revenue Growth and Production Milestones

Kuantum Papers achieved an operational income of Rs. 280.00 crores in Q2 FY26, marking a substantial increase from the previous quarter. This growth was primarily driven by higher paper production following the upgradation of paper machine 4. The company reached new production milestones, including:

• Highest ever monthly production of 8,303 metric tons in September
• Highest daily production of 360 tons in July 2025

These achievements underscore the company's efforts to enhance its production capabilities and meet market demand.

Margin Pressure and Challenges

Despite the impressive revenue growth, Kuantum Papers faced significant margin pressure during the quarter:

• EBITDA margins contracted to 12.3% from the previous quarter
• Net sales realization declined by Rs. 3,200.00 per ton
• Production costs increased by Rs. 1,300.00 per ton

The margin contraction was largely attributed to higher agro and wood-based raw material prices, exacerbated by floods in Punjab. Additionally, the company is grappling with challenges arising from recent GST rate changes, which have created an inverted duty structure in the paper industry.

GST Impact and Strategic Shift

The recent changes in GST rates have introduced complexities for Kuantum Papers:

• Paper and boards: GST increased from 12% to 18%
• Converted products: GST reduced to 5%
• Notebooks: Made nil-rated

In response to these changes and market dynamics, Kuantum Papers is strategically moving away from the notebook segment. Instead, the company is focusing on higher value-added Maplitho grades and specialty papers, aiming to optimize its product mix and profitability.

Future Outlook and Expansion Plans

Kuantum Papers has outlined plans for growth and margin improvement:

• Capacity expansion: From current 450 tons per day to 650 tons per day
• Target volume growth: 30-40% in FY27
• Expected EBITDA margins: 18-20% post-expansion

Management expects these initiatives to boost the company's performance and profitability in the coming years.

Financial Performance Overview

To provide a clearer picture of Kuantum Papers' financial performance, here's a comparison of key metrics for Q2 FY26 against the previous quarter:

The table highlights the company's strong revenue growth, but also illustrates the significant impact on profitability due to the challenges faced during the quarter.

In conclusion, while Kuantum Papers has demonstrated robust growth in production and revenue, it faces near-term challenges in maintaining profitability. The company's strategic shift towards higher-value products and its capacity expansion plans indicate a focus on long-term growth and margin improvement.