Star Paper Mills Ltd. (STARPAPER) AI Stock Analysis

• Market Cap: ₹2.17B
• Dividend Yield: 2.15%
• Average Volume (3M): 521.00
• Price to Earnings (P/E): 5.5
• Beta (1Y): 1.20
• Revenue Growth: -5.21%
• EPS Growth: -32.96%
• Country: IN
• Employees: 380
• Sector: Basic Materials
• Sector Strength: 58
• Industry: Paper, Lumber & Forest Products
• EPS (TTM): 5.26
• Shares Outstanding: 15,608,350
• 10 Day Avg. Volume: 785
• 30 Day Avg. Volume: 521
• PEG Ratio: -0.17
• Price to Book (P/B): 0.37
• Price to Sales (P/S): 0.57
• P/FCF Ratio: 22.60
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 74 Outperform
• Price Target: ₹155.00 ▼(-4.94% Downside)
• Action: Reiterated Date: 10/08/25
• Date: Action: Reiterated 10/08/25

Star Paper Mills Ltd. scores well due to its strong financial performance and attractive valuation, despite technical indicators suggesting a bearish trend. The company's robust balance sheet and low P/E ratio are significant strengths, while the lack of upward momentum in technical indicators is a concern. The absence of earnings call data and corporate events did not impact the score.

Positive Factors

Balance sheet strength

Extremely low leverage (D/E 0.01) and an 82.78% equity ratio provide durable capitalization. This financial flexibility lowers default risk, lets the company withstand cyclical volume weakness, and enables funding of capex or strategic moves without heavy external borrowing.

Margin sustainability

High gross (49.63%) and EBITDA (13.93%) margins reflect efficient manufacturing and cost control in core paper operations. These structural margins offer a buffer versus volume volatility, supporting sustained profitability and the ability to finance investments or dividends over the medium term.

Operating cash generation

Positive operating cash flow with an OCF/Net Income of 0.36 shows the business converts accounting profits into real cash. Consistent cash generation supports working capital, routine capex and shareholder distributions without immediate reliance on new financing, enhancing resilience.

Negative Factors

Top-line weakening

A year-over-year revenue decline (-1.83% and RevenueGrowth -2.66%) signals weakening demand or market share pressure. Sustained top-line erosion reduces scale advantages, strains fixed-cost absorption, and limits internal funding for growth or margin improvement over the medium term.

Declining free cash flow

A 24.49% drop in free cash flow and FCF/Net Income of 0.27 indicate less cash remains after investments. Lower FCF constrains the company's ability to fund capex, pay dividends, reduce leverage, or pursue strategic investments without tapping reserves or external financing, limiting flexibility.

Modest return on equity

ROE of 6.04% is modest relative to typical corporate targets, suggesting limited efficiency in converting equity into earnings. Over time this can restrain shareholder returns and reflect constrained reinvestment returns or competitive pressures that limit the firm's ability to scale profitably.

Star Paper Mills Ltd. Business Overview & Revenue Model

Company Description

Star Paper Mills Limited manufactures and supplies paper and paper boards in India and internationally. It offers a range of industrial packaging and cultural papers. The company was incorporated in 1936 and is based in Kolkata, India.

How the Company Makes Money

Star Paper Mills Ltd. generates revenue primarily through the sale of its diverse paper products to wholesalers, retailers, and direct customers across different sectors. Key revenue streams include the production and distribution of newsprint and various grades of writing paper, which are sold to publishing houses and educational institutions. Additionally, STARPAPER produces packaging materials that cater to the consumer goods sector. The company may also engage in partnerships with distributors and suppliers to enhance its market reach and product offerings. Factors contributing to its earnings include operational efficiency, product quality, and the ability to adapt to market trends and customer demands.

Star Paper Mills Ltd. Financial Statement Overview

Summary

Star Paper Mills Ltd. demonstrates strong profitability and a robust balance sheet with minimal debt, positioning it well in the industry. However, the recent decline in revenue and free cash flow growth suggests challenges in maintaining growth momentum. The company's financial stability is underpinned by strong equity proportions, though cash flow management requires attention to support future growth.

Income Statement

Star Paper Mills Ltd. shows strong profitability with a gross profit margin of 49.63% and a net profit margin of 9.43% for the latest year. However, revenue has declined by 1.83% compared to the previous year, indicating potential challenges in growth. The EBIT margin stands at 6.98%, and the EBITDA margin is 13.93%, reflecting efficient operational management despite the revenue decrease.

Balance Sheet

The company maintains a solid financial position with a low debt-to-equity ratio of 0.01, indicating minimal leverage. The return on equity (ROE) is 6.04%, which is modest but stable. Furthermore, the equity ratio of 82.78% highlights a strong capitalization structure, ensuring financial stability and low risk.

Cash Flow

Operating cash flow is positive, with an operating cash flow to net income ratio of 0.36, suggesting adequate cash generation. However, the free cash flow has decreased from the previous year, resulting in a negative free cash flow growth rate of -24.49%. The free cash flow to net income ratio is 0.27, indicating some reliance on cash reserves for operations.

Breakdown	TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	4.24B	4.36B	4.44B	4.93B	3.31B	2.33B
Gross Profit	2.11B	2.17B	2.38B	1.07B	515.05M	394.16M
EBITDA	608.75M	607.97M	871.83M	891.78M	500.32M	306.95M
Net Income	400.48M	411.46M	640.03M	656.73M	366.48M	175.16M
Balance Sheet
Total Assets	0.00	8.23B	7.90B	7.28B	6.72B	6.50B
Cash, Cash Equivalents and Short-Term Investments	2.19B	2.19B	1.88B	1.68B	987.16M	791.60M
Total Debt	0.00	46.68M	50.05M	1.36M	6.72M	11.89M
Total Liabilities	-6.81B	1.42B	1.42B	1.34B	1.37B	1.48B
Stockholders Equity	6.81B	6.81B	6.47B	5.94B	5.35B	5.02B
Cash Flow
Free Cash Flow	0.00	110.57M	146.45M	420.19M	163.47M	223.86M
Operating Cash Flow	0.00	148.39M	258.38M	467.66M	186.72M	285.44M
Investing Cash Flow	0.00	44.83M	-94.84M	-411.24M	-134.56M	-252.40M
Financing Cash Flow	0.00	-75.39M	-89.58M	-65.03M	-48.92M	-49.58M

Star Paper Mills Ltd. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 163.05
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For IN:STARPAPER, the sentiment is Negative. The current price of 163.05 is above the 20-day moving average (MA) of 144.89, above the 50-day MA of 152.57, and below the 200-day MA of 165.61, indicating a bearish trend. The MACD of -3.01 indicates Positive momentum. The RSI at 30.76 is Neutral, neither overbought nor oversold. The STOCH value of 21.09 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for IN:STARPAPER.

Star Paper Mills Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
STARPAPER	74 Outperform	₹2.17B	5.55	―	2.15%	-5.21%	-32.96%
RUCHIRA	74 Outperform	₹3.18B	5.99	―	4.14%	2.56%	36.81%
Sector *	61 Neutral	$10.43B	7.12	-0.05%	2.87%	2.86%	-36.73%
GENUSPAPER	50 Neutral	₹3.15B	33.46	―	―	23.58%	154.81%
RAMANEWS	46 Neutral	₹4.89B	-13.59	―	―	―	―
MALUPAPER	45 Neutral	₹569.61M	-2.90	―	―	18.31%	-251.78%
BALKRISHNA	42 Neutral	₹504.24M	15.73	―	―	19.95%	―

Star Paper Mills Ltd. Corporate Events

Star Paper Mills Opens Special Window for Re‑lodgement of Share Transfer Requests

Star Paper Mills Ltd has notified the stock exchange that it has published a newspaper notice regarding a special window for re‑lodgement of share transfer requests, indicating compliance with regulatory requirements governing the transfer of physical securities. The announcement signals an administrative step to facilitate investors who may have pending or previously rejected transfer requests, potentially improving shareholder record accuracy and ensuring adherence to evolving securities transfer norms, though it does not directly address changes to the company’s operations or financial outlook.