Paper Boat parent reports Rs 760 Cr revenue in FY26; profit shrinks 96%

Paper Boat maker Hector Beverages reported a steady increase in revenue during the fiscal year ended March 2026, but a sharp rise in operating expenses eroded profitability. According to its annual financial statements sourced from the Registrar of Companies (RoC), the company's operating revenue increased 13.8% year-on-year to Rs 760 crore in FY26 from Rs 668 crore in FY25. Hector Beverages sells beverages under the Paper Boat brand and competes with established players such as Dabur, PepsiCo, Coca-Cola and several regional juice and traditional beverage brands in India. Including Rs 18 crore in other income, Hector Beverages' total income stood at Rs 778 crore in FY26, compared to Rs 682 crore in the previous fiscal year. A shift in product mix drove the company's top line during the year. Revenue from traded goods rose 30.2% to Rs 574 crore in FY26 from Rs 441 crore in FY25 and contributed over 75% of the operating revenue. In contrast, revenue from manufactured goods declined 18.6% to Rs 184 crore from Rs 226 crore a year earlier. The company's expenses grew at a faster pace than revenue. Total expenditure increased 22% to Rs 776 crore in FY26 from Rs 636 crore in FY25. Consumption of materials remained the largest cost head at Rs 485 crore, accounting for 62.5% of the total expenditure, compared to Rs 447 crore in the previous year. Employee benefit expenses declined marginally to Rs 88 crore from Rs 90 crore. The company also ramped up spending on growth and operations. Advertising and promotional expenses jumped 55.6% to Rs 28 crore, while selling and distribution expenses increased 15.5% to Rs 67 crore. Job work charges more than doubled to Rs 25 crore during the year. Other operating expenses like legal & professional, travelling expenses, rent added another Rs 83 crore in the last fiscal year. As expenditure outpaced revenue growth, EBITDA declined 39.7% to Rs 41.4 crore in FY26 from Rs 68.6 crore in FY25. Consequently, the EBITDA margin narrowed to 5.4% from 10.3%. The higher cost weighed heavily on the bottom line. Hector Beverages' profit after tax fell 96% to Rs 2 crore in FY26 from Rs 46 crore in the previous fiscal. On the balance sheet, the company reported total assets of Rs 522.5 crore at the end of FY26. Its cash and bank balance declined 29% to Rs 101 crore, while current assets stood at Rs 365 crore.