Interview with MR. ABHISHEK AGARWAL Executive Director & CEO Kempt Tissues Private Limited
India’s tissue consumption is steadily rising, with retail providing volume stability while HoReCa and AfH segments emerge as the key growth drivers.
Paperdesk: How do you assess current tissue consumption trends in India, and which segments, among retail, HoReCa, and AfH, are driving demand growth?
Abhishek Agarwal: At Kempt Tissues Pvt. Ltd., we see India’s tissue consumption steadily rising, driven by growing hygiene awareness, urbanization, and lifestyle changes. Tissue products are increasingly becoming everyday essentials rather than discretionary items, with per-capita usage gradually improving across the country.
Among the segments, retail remains the foundation of demand, supported by household adoption of toilet rolls, kitchen towels and facial tissues, aided by modern trade and e-commerce penetration. However, the strongest growth momentum is coming from the AfH segment, particularly HoReCa, as hotels, restaurants and cafés place greater emphasis on hygiene standards and customer experience. Institutional and commercial spaces such as offices, healthcare and public facilities are also contributing significantly through bulk tissue consumption.
Overall, while retail provides volume stability, HoReCa and AfH are the key growth drivers, shaping the next phase of expansion for India’s tissue market.
PD : What is your mill’s installed tissue-production capacity, and what has been your actual output over the last year? What factors influence the gap between capacity and utilisation?
AA : At Kempt Tissues Pvt. Ltd., our mill currently has an installed tissue production capacity of 18,000 metric tonnes per annum, reflecting our strategic investment in modern, scalable manufacturing lines designed to meet both current demand and future growth.
Over the past year, our actual output reached approximately 15,300 metric tonnes, which translates to a utilisation rate of roughly 85%. This performance underscores strong market demand and operational consistency, while also leaving healthy headroom to support new business opportunities and seasonal peaks.
The main factors influencing the gap between installed capacity and utilisation include:
- Seasonal Demand Fluctuations: Tissue consumption varies monthto-month, with off-peak periods in the first and fourth quarters typically lowering short-term plant loading.
- Product Mix Dynamics: Shifts in customer requirements — for example, towards specialty AfH formats or premium multi-ply retail products — require periodic line changeovers, which can affect continuous volume output.
- Maintenance & Upgrades: Planned shutdowns for preventive maintenance and capacity enhancements are essential for long-term efficiency but result in temporary production downtime.
- Supply-Chain Variability: Occasional raw-material supply delays or logistics challenges can influence short-term throughput, although we actively manage inventory and vendor partnerships to minimize impact. throughput, although we actively manage inventory and vendor partnerships to minimize impact.
PD: What is your mill’s installed tissue production capacity, and what has been your actual output over the last year? What factors influence the gap between capacity and utilization?
AA: At Kempt Tissues Pvt. Ltd., our mill currently has an installed tissue production capacity of 18,000 metric tonnes per annum, reflecting our strategic investment in modern, scalable manufacturing lines designed to meet both current demand and future growth.
Over the past year, our actual output reached approximately 15,300 metric tonnes, which translates to a utilisation rate of roughly 85%. This performance underscores strong market demand and operational consistency, while also leaving healthy headroom to support new business opportunities and seasonal peaks.
The main factors influencing the gap between installed capacity and utilisation include:
- Seasonal Demand Fluctuations: Tissue consumption varies monthto-month, with off-peak periods in the first and fourth quarters typically lowering short-term plant loading.
- Product Mix Dynamics: Shifts in customer requirements for example, towards specialty AfH formats or premium multi-ply retail products — require periodic line changeovers, which can affect continuous volume output.
- Maintenance & Upgrades: Planned shutdowns for preventive maintenance and capacity enhancements are essential for long-term efficiency but result in temporary production downtime.
- Supply-Chain Variability: Occasional raw-material supply delays or logistics challenges can influence short-term throughput, although we actively manage inventory and vendor partnerships to minimise impact.
PD : What recent capacity additions, technology upgrades, or automation initiatives have you undertaken to enhance production efficiency and quality?
AA : Over the past two years, we have focused on targeted capacity expansion, technology upgrades and automation to enhance efficiency and quality. Investments in highperformance equipment’s for advanced process controls and automated quality inspection have strengthened consistency and reduced downtime.
In parallel, we are installing a 4 MW captive solar power project to improve energy efficiency and sustainability, reinforcing our commitment to responsible growth while supporting long-term cost and operational stability.”
PD : How are global pulp price fluctuations and currency volatility shaping your raw-material procurement strategy and cost structure?
AA : Global pulp price fluctuations and currency volatility are key external factors influencing our rawmaterial procurement strategy and overall cost structure. As an integrated tissue manufacturer, we depend on pulp and import recovered fiber as a primary input, and swings in its global prices — often driven by supply tightness, energy costs and demand shifts — directly impact our input costs. To manage this effectively, we pursue a multi-pronged procurement approach:
- Diversified Sourcing: We maintain relationships with multiple international and domestic suppliers to mitigate the risk of dependence on a single source. This flexibility allows us to optimise supply against price movements and logistical constraints.
- Cost Pass-Through and Value Engineering: In phases of sustained cost pressure, we work closely with our sales and product teams to balance pricing adjustments with value engineering — optimising product specifications without compromising quality — while maintaining competitiveness.
- Inventory and Working Capital Optimisation: We adjust inventory levels strategically to balance carrying costs with supply security, particularly when market indicators suggest rising pulp prices or unfavourable currency trends.
By combining disciplined procurement, risk management tools and operational responsiveness, we strive to minimise the impact of global pulp price cycles and currency volatility on our cost structure, while continuing to deliver consistent quality and value to our customers.
PD : What steps has your mill taken to improve water efficiency, energy performance, and overall environmental sustainability in tissue production?
AA : At Kempt Tissues Pvt. Ltd., sustainability is a core part of our manufacturing strategy, and we have taken multiple steps to improve water efficiency, energy performance and environmental responsibility across our operations. We have strengthened water conservation and reuse systems, enabling higher recycling of process water and reducing overall freshwater intake.
On the energy front, regular audits, energy-efficient drives and process optimisation initiatives have helped lower specific energy consumption. In addition, we are in the process of installing a 4 MW captive solar power project, which will significantly reduce our dependence on grid power and lower our carbon footprint. From a raw-material sustainability perspective, we are increasingly focusing on semi-virgin tissue production, thereby reducing reliance on fully virgin pulp.
Currently, 50–60% of our furnish comprises imported recovered fiber, which helps conserve forest resources while maintaining consistent product quality through controlled sourcing and processing.
PD : How do imported tissue products from China, Indonesia, and GCC markets influence domestic pricing, competition, and positioning for Indian mills?
AA : Imported tissue and paper products from China and ASEAN markets such as Indonesia have increasingly shaped the competitive landscape for Indian tissue manufacturers. In recent years, imports of paper and tissue grades into India have risen significantly, with shipments from China and ASEAN countries growing sharply due in part to preferential tariff treatment under free-trade agreements. This has made certain imported products price-competitive compared to locally produced grades, increasing competitive pressure on domestic mills. Because producers in China and Southeast Asia benefit from larger scale, cost-efficient production and duty concessions under trade agreements like AITIGA and APTA, imported tissue and paper products often reach Indian markets at lower landed costs. This dynamic can compress pricing in segments where imports are prevalent, challenging domestic pricing power and contributing to under-utilisation of local capacity.
PD : The Indian market still has a significant presence of low-quality, cheaper, and largely unorganised tissue products. How is this affecting your brand positioning, pricing power, and investments in higherquality grades?
AA : “This is one of the key reasons we have consciously moved towards producing semi-virgin tissue paper rather than relying solely on 100% virgin pulp. By integrating 50–60% high-quality imported recovered fiber into our furnish, we are able to make our raw-material sourcing more sustainable, resilient and cost-competitive, while significantly reducing our dependence on virgin pulp. Importantly, this approach does not compromise product performance. Through careful fiber selection, advanced processing and strict quality controls, we are able to achieve softness, strength and absorbency levels that are very close to those of virgin tissue. At the same time, it allows us to offer a more competitively priced product in a market that is highly price-sensitive, while aligning with growing customer and regulatory expectations around sustainability.
PD : Are you seeing a clear shift among Indian consumers toward premium, softer, and more structured tissue grades, and how are you adapting your product mix accordingly?
AA : we are definitely witnessing a clear shift in Indian consumer preferences toward premium, softer and more structured tissue grades. As awareness of hygiene and comfort continues to grow, especially in urban and semi‑urban markets, consumers are increasingly willing to trade up from basic, low‑cost options to products that deliver better feel, strength and overall performance. This trend is evident both in organised retail and in Away‑From‑Home (AfH) demand, where end‑users value consistency and quality. In response, we have been strategically adapting our product mix to align with this evolving demand. Our portfolio now places stronger emphasis on premium and value‑added grades, including softer multi‑ply toilet tissues, structured facial tissues and enhanced napkin formats. We are also focusing on product differentiation through features like improved embossing, controlled softness profiles and packaging innovations that appeal to quality‑conscious shoppers.
By balancing this premium orientation with competitively priced core products, we ensure that Kempt Tissues remains relevant across consumer segments — from everyday household use to more discerning buyers who prioritise comfort and performance.
PD : What is your long-term outlook for India’s tissue industry by 2030, and what policy interventions or industry reforms would strengthen domestic competitiveness and quality standards?
AA : We are optimistic about India’s tissue industry through 2030, driven by rising hygiene awareness, growing organised retail, and increasing Away‑From‑Home (AfH) demand in hospitality, healthcare, and corporate sectors. Per-capita tissue consumption remains well below global averages, offering significant growth potential, especially in premium and value-added segments. To strengthen domestic competitiveness and quality, supportive measures could include:
- Standardised quality benchmarks to differentiate organised players from lowquality unorganised products.
- Incentives for sustainability and energy-efficient investments, including renewable energy and recycled fiber use.
- Technology and skill upgradation support to modernise mills and improve efficiency.
- Balanced import regulations to ensure a level playing field with duty-favoured foreign suppliers.
With these steps, India’s tissue market can achieve sustainable growth, higher quality standards, and stronger domestic value creation.