Maharashtra plastic ban: Jute, paper stocks rally up to 5%

Shares of companies dealing in alternative to plastics were trading higher in early trade on Wednesday.

Shares of Ludlow Jute & Specialities were trading over 5 per cent higher at Rs 89.50 at around 10.05 am (IST), whereas Cheviot Company was trading 2.05 per cent up at Rs 1,289.90 at around the same time.

JK Paper and NR Aggarwal were up 0.45 per cent and 0.24 per cent, respectively.


“This is an opportunity for paper and paperboard units in Maharashtra, also other adjoining states to meet the demand. Production capacity may increase and it is likey to positively affect the industry,” told Ajay Srivastava, associate VP-research at Stewart & Mackertich Wealth Management to ET.

Papers, as well as jute companies are on investors’ radar since the beginning of the week.

There are expectations that plastic ban in Maharashtra is likely to boost prospects of some paper as well as jute companies as industries which use plastic move to alternatives.

The state-wide ban which came into effect on Saturday has had everyone from large companies to restaurateurs to shopkeepers in a fix, and paper bags, bubble wraps, jute bags and tin foils are coming up as alternatives. These businesses risk a fall in sales unless they make the transition.

The Brihanmumbai Municipal Corporation (BMC) on Tuesday seized 255.400 kilogram of plastic and collected Rs 3,90,000 in fine. The BMC's plastic ban team visited a total of 5,440 shops across the city and found 94 shops in possession of banned plastic. Of those, 78 paid the fine, while 16 refused to pay, according to a report by ANI.

The mentioned fine was collected till 6:00 pm.