Pakka Limited has received approval from the National Company Law Tribunal (NCLT), Allahabad for the first motion petition regarding the merger of its wholly-owned subsidiary Pakka Impact Limited. The judgment was pronounced on December 9, 2025, and subsequently uploaded on the NCLT website on December 11, 2025.

NCLT Approval Details

The tribunal allowed the first motion application filed jointly by both companies for the scheme of amalgamation under Sections 230-232 of the Companies Act, 2013. The appointed date for the scheme is April 1, 2025, as mentioned in the amalgamation proposal.

Company Structure and Capital Details

Pakka Impact Limited, the transferor company, is an unlisted public limited company incorporated on February 27, 2014. The company is engaged in global impact assessment, research, data analytics, and technology innovation, particularly related to compostable packaging and its ecosystem.

Meeting Dispensations Granted

The NCLT dispensed with the requirement of convening meetings for various stakeholder groups, recognizing the parent-subsidiary relationship between the companies. Since Pakka Impact Limited is a wholly-owned subsidiary, no new shares will be issued pursuant to the merger.

Dispensations granted for:

• Equity shareholders meetings for both companies
• Secured and unsecured creditors meetings for both companies
• Individual notices to be served to creditors of the transferee company

Financial Position and Rationale

The merger aims to eliminate inter-corporate dependencies, reduce managerial expenditure, and achieve organizational efficiency. The transferor company has incurred losses with a negative net worth of ₹3.10 crores as of March 31, 2025, while the transferee company maintains a strong net worth of ₹489.43 crores.

Next Steps and Compliance

The company will now initiate subsequent steps required for obtaining final approval from NCLT. The transferee company must serve individual notices to its secured and unsecured creditors, inviting objections within 30 days. The second motion petition must include notices to statutory authorities including the Central Government, Registrar of Companies, Official Liquidator, BSE Limited, NSE Limited, and the Income Tax Department.

Strategic Benefits

The merger is expected to provide several strategic advantages including better leveraging of facilities and infrastructure, reduction in regulatory compliance requirements, and enhanced ability for business development and fund raising. The combined entity will benefit from economies of scale and improved operational efficiency while maximizing shareholder value.

Pakka Limited has reported a decline in revenue and a loss for the second quarter, while also announcing significant expansion plans in the US market.

Financial Performance

Pakka's financial results for Q2 show:

All figures in crores

The company experienced a slight year-on-year revenue decline in Q2, along with a shift from profit to loss compared to the same quarter in the previous year.

Project Updates

Project Jagriti

Initially planned for commissioning within the current financial year, this project has been optimized with a new target date of July 2026.

US Market Expansion

Pakka is developing a 40 TPD moulded product facility in Guatemala:

• Total investment: USD 55 million
• Target stabilized turnover: USD 36 million by 2028
• Target EBITDA: USD 12 million by 2028
• Planned equity investment: USD 16.5 million
• Debt financing: Letter of intent received for USD 38.5 million

Business Segment Performance

Food Services Division

• B2C revenue doubled in the last 6 months
• Successful launch of clamshells, generating ₹20 lakh in sales in the first month

Market Positioning

Despite the short-term financial challenges, Pakka continues to focus on growth and expansion, particularly in international markets. The company's investment in Guatemala demonstrates its commitment to expanding its global footprint in the sustainable packaging sector.

Conclusion

While Pakka faces some financial headwinds in the short term, its strategic investments and expansion plans, particularly in the US market, suggest a focus on long-term growth. The company's progress in the food services division and its planned facility in Guatemala indicate potential for future revenue growth and market expansion.

Investors and market watchers will likely monitor Pakka's ability to execute its expansion plans and return to profitability in the coming quarters.