Purity Flexpack Limited is engaged in the field of Flexible Packaging. Our vision is to
be preferred supplier for flexible packaging to Customers across India and Overseas
maximizing value for all stakeholders This Management Discussion & Analysis Report
presents the key performance highlights of the year 2022-23 pertaining the Companys
business. This review should be read in conjunction with the Integrated Report presented
in the earlier sections of this Annual Report, the Companys financial statements, the
schedules and notes thereto and the other information included elsewhere in this Annual
Report. The Companys financial statements have been prepared accordance with Indian
Accounting Standards (Ind AS), complying with the requirements of the Companies Act 2013
and the guidelines issued by Securities and Exchange Board of India (SEBI). Our ultimate
objective is to meet Customer’s dynamic packaging needs and to achieve excellence in
all concerned areas produce cost effective flexible packaging with highest quality &
standards for our esteemed Customers.
Industry structure and developments
As one of the fastest growing segments of the packaging industry, flexible packaging
combines the best qualities of Plastic, Film, Paper and Aluminum Foil to deliver a broad
range of protective properties while employing a minimum of material. Flexible packaging
provides convenience to the consumer while ensuring product safety. There are ongoing
challenges, such as the lack of regulatory clarity across sectors and the growing need to
meet stricter packaging norms that have been established with the entry of global retail
companies. Additionally changing consumer values concerning sustainable packaging will
demand innovation and a shift to more sustainable materials, which would necessitate
investments in R&D and infrastructure.
The life cycle attributes of flexible packaging demonstrate many sustainable
advantages. It starts with less waste in the first place, greatly reducing landfill
discards. Innovation and technology have enabled flexible packaging manufacturers to use
fewer natural resources in the creation of their packaging, and improvements in production
processes have reduced water and energy consumption, greenhouse gas emissions and volatile
organic compounds. Even more, lighter-weight flexible packaging results in less
transportation related energy and fossil fuel consumption, and environmental pollution.
With its versatility, custom qualities, efficiency in conserving resources, and
sustainability, flexible packaging is considered most advantageous. As per the Flexible
Packaging Market Overview Global, various major players serving consumables and packaging
materials to the Inks, Coatings, Adhesives and Machinery sectors have announced price
hikes due to raw material inflation as well as cost pressures from packaging, freight, and
energy. Outlook
The companies are expected to ramp up output amid a strengthening demand scenario which
is expected to support manufacturing growth in the near term. Performance of the mining
sector is expected to pick up with the resumption of mining activities that were impacted
by extended monsoons. Thus, we could expect industrial output to gather momentum in the
coming months. However, it would continue to be subdued with the waning of base-effect.
Given the uncertainties associated with the scale of economic recovery, the RBI is
expected to maintain its focus on growth and continue with the accommodative monetary
policy stance, even as it moves towards gradual normalization of support. However, there
are certain risks associated with the emergence of the Omicron Variant and renewed surge
in COVID-19 infections across countries, globally. To add to this, there are headwinds
from elevated global commodity prices, potential volatility in global financial markets
with faster normalization of monetary policy in advanced economies and prolonged global
supply bottlenecks.
Risks & Concerns
The purpose of risk management is to identify potential events that may affect
achievement of organisational strategy, business objectives and management of associated
risks within the Companys risk appetite. The Board periodically assesses all facets of
risks in the Companys operating landscape. The key risks and opportunities arise from our
ability to manage prices effectively in the presence of aggressive competition, increased
raw material pricing, our capability to meet customer demand for technology and digital
solutions, and our ability to benefit from the Group in terms of sales and sourcing. To
manage threats and tap into opportunities, we execute involve cross-functional and
cross-segment collaboration and active dialogue with the customers to develop ways to
increase value and understand our competitive position.
Internal Control Systems
The Company has a proper and adequate Internal Financial Control System, to ensure that
all its assets are safeguarded and protected against loss from unauthorized use or
disposition. The Control System enables the management to focus on growth and achieve
excellence in all aspects of operations. The Company has an internal audit system, which
carries out independent periodic reviews. The prime objective of such audit is to evaluate
the functioning and quality of internal controls and provide assurance of its adequacy and
effectiveness. The scope of internal audit covers a wide variety of operational and
financial matters and includes a follow-up review of corrective actions agreed for
implementation. During the year under review, no material or serious observation has been
received from the Statutory Auditors and the Internal Auditors of the Company on the
inefficiency or inadequacy of such controls. Further, One of the most important aspects in
business growth is customer retention. Maintaining brand loyalty and reputation through a
strong cyber security position is paramount for customers today. Our strong policies on
data privacy and cyber security ensures protection against internal and external threats.
Financial performance with respect to operational performance The summarized financial
results are given hereunder: Highlights of results:
(Rs. in lakhs)
| Particulars |
2022-23 |
2021-22 |
| Total Income |
11568.37 |
10427.33 |
| Profit Before Financial Cost, Depreciation & Tax |
707.94 |
515.16 |
| Interest and Finance expenses |
220.98 |
139.81 |
| Depreciation and Amortization expenses |
366.70 |
313.70 |
| Profit Before Tax |
120.26 |
61.65 |
| Profit For The Year |
96.66 |
34.77 |
Total Income
Sales/ Income from operation increase by 10.95% from Rs. 10427.33 Lakhs in 2022 to Rs.
11568.37 Lakhs in 2023.
Interest and Finance charges
The financial expenses has increased to Rs. 220.98 Lakhs in 2023 from Rs. 139.81 Lakhs
in 2022.
Depreciation and amortization expenses
The depreciation charged to revenue has increased to Rs. 366.70 Lakhs in 2023 as
against Rs.313.70 in 2022.
Profit Before Tax
Your Company has made a profit of Rs.120.26 Lakhs for the year 2022-23 as against the
previous year’s Profit Before Tax of Rs. 61.65 Lakhs.
Profit After Tax
The Companys profit during the year under review is Rs. 96.66 lakhs as against the
last year Rs.34.77 lakhs which shows almost three times growth as compared to previous
year. As always, your Company looks forward to do well in the year ahead and is optimistic
of its abilities to address the set of opportunities and challenges that the coming year
will present.
Opportunities and Threats
The Company is in the business of manufacturing of customized packaging materials. That
flexible packaging is one of the rapidly growing segments of the packaging industry. It
requires lower energy of producing product, offers convenience to the consumers as it is
light-weight, easy to open, carry and store. Additionally, cost of production can be
reduced by producing customizes products. One of the important factors driving the growth
of flexible packaging market is the growing inclination of consumers towards convenience
products. As per recent research, there is heavier consumer demand for more biodegradable
products means more potential interest from manufacturers who choose to come into
compliance with their customer requirements. The government is promoting the use of
biodegradable packaging, thus there is always a threat in the market to obstruct the
plastic packaging.
Key Financial Ratios
In accordance with the SEBI (Listing Obligations and Disclosure Requirements)
(Amendment) Regulations, 2018, the Company is required to give details of significant
changes (change of 25% or more as compared to the immediately previous financial year) in
key sector-specific financial ratios. The same has been mentioned under the table given
below:
| Particulars |
2022-23 |
2021-22 |
| Debt Equity Ratio (times) |
0.31 |
0.44 |
| Net Capital Turnover Ratio (times) |
59.97 |
23.70 |
| Operating Profit Margin |
6.14% |
4.92% |
| Net Profit Margin |
0.84% |
0.33% |
| Return on net worth |
2.98% |
0.58% |
Environment, Occupational Health & Safety
Your Company is committed to conducting its operations with utmost concern towards the
environment and ensuring a safe and healthy workplace for all employees. The collective
endeavor of the Companys employees at all levels is directed towards sustaining and
continuously improving standards of environment management, and occupational health &
safety in an endeavor to meet and exceed international benchmarks.
Developments in Human Resources /Industrial Relations
The Company continues to lay emphasis on qualitative growth of its human resources by
providing congenial and constructive work environment, in consonance with its strong
belief that the real strength of its organization lies in its employees. In addition to
this, formal training through external & internal faculty is also conducted from time
to time in acquiring domain knowledge and imbibing the corporate quality culture. None of
the Senior Management Personnel have any material, financial and/or commercial
transaction, where they have personal interest that may have potential conflict with the
interest of the Company at large.
Capital Investment
The Company has already installed Printing Machine in the last year to achieve the
targets set of the Company which has resulted into increase in turnover of the Company.
Cautionary Statement
The statements in the "Management Discussion and Analysis Report" section
describes the Companys objectives, projections, estimates, expectations and predictions,
which may be "forward looking statements" within the meaning of the applicable
laws and regulations. The annual results can differ materially from those expressed or
implied, depending upon the economic and climatic conditions, Government policies and
other incidental factors.
For and on behalf of the Board For Purity Flexpack Limited
Anil Patel
Place: Vanseti
Chairman & Managing Director
Date: 26" July, 2023
DIN : 00006904
+91-9892691696
