Operational Disruption
Andhra Paper Reports Continued Production Disruption at Kadiam Unit Due to Workmen Strike
NSE
andhrapap
BSE
502330
Andhra Paper Limited has informed stock exchanges that manufacturing operations at its Kadiam Unit in East Godavari, Andhra Pradesh, continue to remain disrupted despite revocation of the lockout. Workmen have not resumed duties, resulting in an estimated production loss of approximately 205 metric tonnes per day and a daily revenue impact of around ₹143 lakh.
PRICE-SENSITIVE TRIGGER
Event: Continued disruption of manufacturing operations at Kadiam Unit.
Type: Operational Disruption
Impact: Negative
Immediate Effect: Production remains suspended at the Kadiam manufacturing facility, causing ongoing output loss and revenue impact while management continues discussions with workmen representatives and authorities.
Key Metrics:
- Estimated Production Loss: 205 MT per day
- Estimated Revenue Loss: ₹143 lakh per day
- Expected Asset Damage: Nil
- Insurance Coverage: All assets covered under insurance
Highlight:
- Operational disruption is causing an estimated revenue loss of approximately ₹143 lakh per day due to non-resumption of work by employees at the Kadiam Unit.
What Happened ?
Andhra Paper Limited provided an update on the operational status of its Kadiam manufacturing unit following the revocation of the lockout effective May 29, 2026.
Although the company arranged for immediate resumption of operations, workmen have not returned to duty. As a result, production continues to remain disrupted. The company disclosed that the cumulative financial impact arising from the continued disruption has become a material event under SEBI disclosure regulations.
Management stated that discussions with worker representatives and relevant authorities are ongoing to resolve the impasse and restore normal operations.
Key Details
Kadiam Unit Production Disruption Update:
- Manufacturing unit affected: Kadiam Unit, East Godavari District, Andhra Pradesh.
- Lockout was revoked effective May 29, 2026.
- Production operations have not resumed due to non-reporting of workmen.
- Estimated production loss stands at approximately 205 MT per day.
- Estimated revenue impact is approximately ₹143 lakh per day.
- Disruption is linked to demands raised by contract workmen regarding revision of certain contractual terms.
- Management expects ongoing discussions to reach resolution within a short timeframe.
- Company anticipates phased restoration toward full operational capacity once the issue is resolved.
- No physical asset damage has been reported.
- All assets remain adequately insured.
Note:
- The event highlights labour-related operational risks at a key manufacturing facility and may continue to impact near-term production volumes until normal operations are restored.
Risk Analysis
Summary:
- The disruption poses operational and revenue risks due to the temporary halt in production. While no asset damage has occurred, prolonged delays in resolving the labour issue could increase the financial impact.
Key Risks:
- Continued production loss at the Kadiam manufacturing facility.
- Daily revenue erosion of approximately ₹143 lakh.
- Uncertainty regarding the timeline for complete restoration of operations.
- Potential impact on customer deliveries if disruption persists.
- Dependence on successful negotiations with workmen representatives.
Worst Case Scenario:
- A prolonged strike could materially affect production volumes, revenues, customer servicing, and operating performance until the dispute is resolved.
Risk Level: Medium
Company Commentary
- The company made all necessary arrangements for immediate resumption of operations after revocation of the lockout.
- Management is actively engaging with workmen representatives and concerned authorities.
- The company expects discussions to conclude within a short timeframe.
- A phased restoration to full operating capacity is anticipated upon resolution.
- The company is closely monitoring developments and will continue updating stock exchanges.
- Appropriate legal recourse will be pursued where necessary.
- Business impact is currently limited to operational disruption and there is no reported asset damage.
Official Exchange Filing: Andhra Paper Limited