Rama Paper Mills Limited was incorporated as a Public Limited Company in the year 1985 to manufacture Newsprint, Duplex Board and Writing and Printing paper by recycling waste paper. Company commissioned its duplex manufacturing unit with an installed capacity of 3300 TPA in the year 1988. It then diversified into writing and printing / newsprint paper in 1992-93. The company is professionally managed by well-qualified, highly motivated and experienced personnel. It employs more than 500 people including skilled, semi skilled and unskilled workforce. It has 12 acres of land that is fully developed and in actual use of company for its industrial activities. All the essential facilities like internal roads, water supply, electricity, pollution control equipments etc. are fully installed and functional at the factory site. The company has built a residential colony for its employees that have 36 livable units for its executive and 100 units for workers.

Products & services:

Company has the total installed capacity of 3 units is 39,500 TPA, located at Kiratpur, Distt Bijnor in Uttar Pradesh. The site of unit is well located; excellent connectivity by road and rail transport makes availability of raw materials and inputs easy and also brings finished products markets in close proximity. Company has following products range-

Unit-I: - A multi-cylinder mould plant to manufacture coated/uncoated varieties of Duplex board of medium quality. This is used t make small packaging / small cartoons used by pharmaceuticals, soaps, paste, apparels, tea and other similar industries.

UNIT-II: - A Fourdinier wire part M. F machine to manufacture Writing/Printing, Newsprint and Kraft grades of paper.

UNIT-III: - A high speed M. F machine to manufacture Newsprint and also capable of making other varieties of paper such as writing / printing paper. The plant has been imported from Germany through Bon Engineering-Sweden.

India is a highly important market for the paper industry. The demand for paper in India is rising by nearly 7 per cent every year. In 2000, the paper consumption in India amounted to 4.2 million tones; by 2010 it will have reached 8 million tones. The annual per capita consumption of approximately 4 kilograms at the end of the last millennium will have grown to nearly 7 kilograms by 2010. By 2010, the import volume is expected to have more than tripled, with an estimated amount of 1.7 million tones. At present, there are 540 paper mills in India, with more than 300,000 people working.

Valuation:

At current market price, stock is trading at 2.46 P/E multiple of its FY2010 estimated earnings. We recommend investors to buy “Rama paper mills limited” with medium to long term investment horizon.