The Paper Products Ltd

H1 Performance

Net Sales up by 12.4%

Mumbai, July 27, 2007: The Paper Products Limited (HUHTAMAKI-PPL), India's leading flexible packaging company, today announced its Unaudited Financial Results for the second quarter & the first half year ended June 30, 2007. The company achieved Net Sales of Rs.271.55 crores during the half year, representing a growth of 12.4% over Net Sales of Rs.241.65 crores in the H1-2006. The profit before tax (PBT) & extraordinary & exceptional items is Rs.18.08 crores as compared to Rs.21.94 crores in the H1-2006.

Shareholders had approved subdivision of euity shares in the AGM held on 27th April 2007 which has been completed during the quarter & consequently number of outstanding shares & EPS have been recast.

The basic and diluted earnings per share (EPS) excluding extraordinary & exceptional items is Rs.2.24 for the half year as compared to Rs.2.55 in the H1-2006. Basic & diluted earnings per share (EPS) including extraordinary & exceptional items for the half year is Rs.1.87 as compared to Rs.2.55 in the H1-2006.

Rudrapur plant is now fully operational & production is being ramped up. Other key projects which will be commissioned during the current year are specialized pouching project & specialized labels & carton production line.

High raw material prices has lead to margin pressure. The company is implementing strategies to recover margins & with the growth in the consumer economy believes the medium to longer term outlook to be positive.

An exceptional charge of Rs.318 Lacs has been taken during the Q2-2007 arising out of the Supreme Court judgement received by the Company on a contested matter on excise duty which was shown as contingent liability in past years' financial statements. The company intends to file a review petition with the Supreme Court.

In comparison between quarters, the company achieved sales of Rs.141.29 crores during Q2-2007 representing a growth of 12.50%, over sales of Rs.125.58 crores in Q2-2006. The profit before tax & extraordinary & exceptional items is Rs.8.73 crores as compared to Rs.10.89 crores in Q2-2006. The baisc & diluted earnings per share excluding extraordinary & exceptional items is Rs.1.01 as compared to Rs.1.30 in Q2-2006.

About The Paper Products Limited (HUHTAMAKI-PPL):

PPL is India's leading manufacturer of primary consumer packaging with annual gross sales of about Rs.580 crores, and net capital employed of about Rs.266 crores.

Since 1999, PPL is a joint venture with the global packaging major, Huhtamaki Oyj, Finland who hold about 59% of the equity capital. Huhtamaki is one of the world's top ten consumer packaging multinationals.

PPL is a pioneer and the technology and market leader in flexible packaging in India with manufacturing facilities at Thane, Silvassa, Hyderabad and Rudrapur. It meets the packaging needs of almost the entire range of FMCG segments including personal products, personal wash, laundry, foods, sauces, beverages, bakery products, spices, chocolates and confectionery, dairy and also for seeds, specialized chemicals, electronics and many other specific specialized uses including anti-spurious packaging.

The Package Protection and Decoration products range includes latest leading edge technologies - shrink sleeves, wrap-arounds, heat transfers, pressure sensitives and metallised paper labels.

Manufacturing of specialized cartons and cartoning systems, manufacture of poly films, specialized barrier metallising and high-end application extrusion coating are also part of PPL's product offerings. The company's packaging machines division offers complete packaging solutions to customers.

PPL mainly caters to the premium segment of packaging and its clients include Amul, Britannia, Cadbury, Castrol, Coca Cola, Dabur, DS Group, Emami, Eveready, GSK, Godrej, Hindustan Latex, HLL, HPCL, Marico, MICO, Nestle, Pepsi, Perfetti, P&G, Tata Tea, TTK-LIG, Wipro and may more.

More at our website : www.pplpack.com

Mr. Ravi Chidambaram Controller - Finance & Joint CFO The Paper Products Limited Tel: +91 - 22 - 2534 5024 (D) Board: +91 - 22 - 2534 3691- Ext. 172 Mobile +91 - 98216 04825