Kanpur Plastipack Limited has informed the Exchange about Closure of Cast Polypropylene Film (CPP) unit consequent to the sale of plant and machineries.
KANPRPLA · price
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Kanpur Plastipack has closed its CPP (Cast Polypropylene Film) division effective May 7, 2025, after selling the plant and machinery to M/s SRF Limited on an 'as is where is' basis. The CPP division, commissioned only in 2023, contributed just 4.08% of total turnover (₹20.13 crore) in FY24 and had a negative net worth contribution of ₹6.33 crore. The sale proceeds will be used to repay the outstanding term loan on these assets, and combined with a recent ₹20 crore promoter infusion via warrants, the company expects a significant reduction in debt. Management estimates annual interest cost savings of around ₹10 crore, and plans to focus on its core Raffia, FIBC, and PP Fabric businesses going forward.
This is a positive, deleveraging move for shareholders. By exiting a loss-making, recently-diversified business, the company reduces its debt burden by roughly ₹10 crore per year in interest costs and stops CPP losses from weighing on the profitable Raffia division. The stock may react favourably on improved profitability outlook, though the lost ~4% of revenue base is a minor headwind.