Cosmo First Ltd Management Discussions

1. COMPANY OVERVIEW

Cosmo First, originally established as Cosmo Films in 1981, pioneered the introduction of BOPP films in India. Today, the Company stands as the world?s largest producer of thermal lamination films and the second-largest producer of specialty label films globally. It is also a leading player in the Indian BOPP films market. Cosmo First?s commitment to innovation is underscored by its advanced R&D center in Aurangabad, which has secured five patents, with twelve in the pipeline - seven in India and five overseas. The Company prides itself on practicing excellent corporate governance and maintaining a culture of professional management, which provides a long-term competitive advantage.

Cosmo First had developed a well-diversified business model that caters to the evolving needs of its customers. The Company combines specialty and commodity films, specialty chemicals, rigid plastics, window films brand Cosmo Sushield and Cosmo Paint Protection Film and its pet care brand, Zigly, under one umbrella.

Cosmo has maintained a consistent strategy and business model. We have a unique combination of widest product portfolio under one roof, customised innovation, always ahead in product development curve, allocation flexibility in job line, scale, global reach and global warehousing facility. By remaining focused on our strategy and our unique value proposition for customers, the Company will continue to grow and drive long term value creation for shareholders and other stakeholders.

Despite changing market conditions, Cosmo First?s long-term value-generating potential remains robust. The Company?s diversification into new product segments, such as Cosmo Sunshield Window Films, Transparent CPP film especially developed for chocolate sealant layer , Graphic films PVC free , High shrink label films, Chemically recycled PCR BOPP film, Holographic Lamination Films, Capacitor Grade MPP Film reflects the Company?s dedication to innovation and broadening its market reach. Moreover, the promising opportunities in specialty chemicals and the pet care segment further strengthen the robust local demand for packaging products.

With plans to invest in enhancing capabilities, Cosmo First is poised for a bright future of growth, greater value, innovative products, and sustainable profitability. The Company?s strategic investments and a focus on customer needs, combined with a capable and experienced team and a people-first approach, ensure that Cosmo First will continue to thrive and create value for all stakeholders.

2. MACROECONOMIC OVERVIEW AND OUTLOOK 2.1 Global Economy

According to the latest projections of International Monetary Fund, in the near term, global growth is projected to fall from an estimated 3.3% in 2024 to 2.8% in 2025, before recovering to 3% in 2026. This is lower than the projections in the January 2025 of World Economic Outlook Update by 0.5% point for 2025 and 0.3% point for 2026, with downward revisions for nearly all countries.¹

For advanced economies, growth forecast is projected to drop from an estimated 1.8% in 2024 to 1.4% in 2025 and 1.5% in 2026.

WORLD ECONOMIC OUTLOOK APRIL 2025 GROWTH PROECTION BY REGION

World

Global growth is set to weaken to an average annual rate of 2.9% this year (or 2.5% in the fourth quarter), as U.S. declaration weighs on the rest of the world.² Inflation is likely to slow in most countries, except in the U.S., where tariffs may increase consumer prices to a peak in the third quarter. Central banks could react to lower growth and inflation with rate cuts, except for the U.S., where rates are likely to remain steady until March 2026. Governments in the U.S, Europe and China may spend more to stimulate growth, increasing their deficits.

2.2 Indian economy

Despite a challenging global landscape, Indias economy demonstrated remarkable resilience. The country solidified its position as the worlds fifth-largest economy, showcasing its significant economic strength and establishing itself as one of the fastest-growing major economies.

As per Ministry of Finance, despite global uncertainty, India has displayed steady economic growth. Indias real GDP growth of 6.4 per cent in FY25 remains close to the decadal average. From an aggregate demand perspective, private final consumption expenditure at constant prices is estimated to grow by 7.3 per cent, driven by a rebound in rural demand. On the supply side, the real gross value added (GVA) is estimated to grow by 6.4 per cent. The agriculture sector is expected to rebound to a growth of 3.8 per cent in FY25. The industrial sector is estimated to grow by 6.2 per cent in FY25. Strong growth rates in construction activities and electricity, gas, water supply and other utility services are expected to support industrial expansion. Growth in the services sector is expected to remain robust at 7.2 per cent, driven by healthy activity in financial, real estate, professional services, public administration, defence, and other services.³

Looking ahead, India?s economic prospects for FY26 are balanced. Headwinds to growth include elevated geopolitical and trade uncertainties and possible commodity price shocks. Domestically, the translation of order books of private capital goods sector into sustained investment pick-up, improvements in consumer confidence, and corporate wage pickup will be key to promoting growth. Rural demand backed by a rebound in agricultural production, an anticipated easing of food inflation and a stable macro-economic environment provide an upside to near-term growth. Overall, India will need to improve its global competitiveness through grassroots-level structural reforms and deregulation to reinforce its medium-term growth potential.

3. INDUSTRY OVERVIEW

Cosmo First, a prominent leader in the flexible packaging industry has established a robust presence worldwide. With an expansive product portfolio encompassing BOPP films, BOPET films, thermal films, coated and other specialty films, the company effectively serves diverse packaging requirements across various industries.

Over last few years, the Company has diversified into various other business verticals-Speciality Chemicals, Rigid Packaging, Sun Control Films and Petcare.

Cosmo Specialty Chemicals, launched in 2020, aims to revolutionize the coating chemicals, masterbatch and adhesive segments through sustainable technology.

Additionally, our comprehensive rigid packaging solutions launched in FY?24 are designed to craft customized packaging for a wide range of FMCG products. Utilizing advanced injection molding and thermoforming techniques, we ensure our packaging is made from premium materials for exceptional durability and reliability.

Cosmo Sunshield specializes in premium window film solutions designed for commercial buildings, residential spaces and automotives with a wide range of Sun Protection Film, Safety Films and Privacy Films.

Furthermore, Cosmo First addresses the needs of the pet care industry through its rapidly growing brand, Zigly.

Driven by innovation, a customer-centric approach, and a commitment to sustainability, Cosmo First continues to drive growth and deliver significant value to its stakeholders across these dynamic industries.

3.1. Flexible packaging industry overview

The global packaging industry has not only experienced robust growth over the past few decades but has thrived, driven by demographic shifts like population growth, rapid urbanization, increased trade, and heightened demand for packaging solutions. Sustainability and digitalization are increasingly popular trends that not only pose challenges but also offer significant opportunities for innovation within the industry. Furthermore, changing consumer preferences, margin pressures, and heightened focus on food safety have stimulated demand for new packaging products and advancements.

The Global Flexible Packaging Market is estimated to be valued at $ 315 billion in 2025 and is expected to reach $ 458 billion by 2032, growing at compound annual growth rate (CAGR) of 5.5% from 2025 to 2032.⁴

The India Flexible packaging market is worth $ 20 billion in 2025, growing at an 11.46% CAGR and is forecast to hit $ 35 billion by 2030.⁵

Several factors propeling the packaging industrys growth are increased demand in food and beverage sectors, regulatory pressures for recyclable materials, light weighting in transport logistics, rising disposable incomes and improved living standards of people.

Other factors driving the growth of packaging industry includes the burgeoning e-commerce sector, evolving consumer preferences favoring customization, convenience, health, and affordability, and increasing global demand for processed foods.

Domestic demand and supply scenario is expected to be favourable for coming years.

3.2. Speciality Chemicals Industry overview

The speciality chemicals market plays a critical role in many sectors of the global economy, including construction, automotive, electronics, textiles, and healthcare. Speciality chemicals are designed to perform specific functions and add value to enduse products. They are used in a wide range of applications from adhesives, coatings, and polymers to agrochemicals, food additives, and personal care products. In recent years, the speciality chemicals market has experienced steady growth, driven by the increasing demand for high-performance and sustainable products.

The specialty chemicals market size has grown steadily in recent years. It will grow from $770 billion in 2024 to $804 billion in 2025 at a compound annual growth rate (CAGR) of 4.4%.⁶ The growth in the historic period can be attributed to supply chain optimization, focus on sustainability, globalization and market expansion, consumer demand and lifestyle changes, customization and tailored solutions, industry diversification.

The India speciality chemicals market reached $ 64 billion in 2024 and is expected to reach $ 92 billion by 2033 exhibiting a CAGR of 3.80%.⁷

Masterbatches, which enhance plastic properties and provide color variations, globally will grow from $ 9 billion in 2024 to $ 10 billion in 2025 at compound annual growth rate (CAGR) of 6.6%. Meanwhile, the adhesives and coating market within specialty chemicals is forecasted to grow globally at a CAGR of 8.7% till 2029 and 4.80 % during 20252033 respectively.

3.3. Rigid Packaging

The Global Rigid packing market is estimated to be valued at $ 238 billion in 2025 and is expected to reach $ 331 billion by 2032 exhibiting a compound annual growth rate (CAGR) of 4.8% from 2025 to 2032.⁸

The India rigid plastic packaging market size is valued at $ 14 billion in 2025 and is forecast to reach $ 19 billion by 2030, advancing at a 6.32% CAGR over the period.⁹

The market is experiencing positive growth due to increasing demand for packaged goods and beverages globally. Rising preference of consumers towards packages products due to lifestyle and growing busy schedules has propelled the sales of rigid packaging.

3.4. Sun Control Films

The global market for sun control films in the year 2024 was valued at $ 6 billion. The size of this market is expected to increase to $ 8 billion by the year 2031, while growing at a CAGR of 5.6%.¹⁰

The India sun control films market is valued at I 3K Cr growing at 10% per annum. This growth is driven by increasing awareness of energy efficiency and rising demand for sustainable building materials.

3.5. Pet care industry

The global trend towards urbanization, nuclear families, double-income households, and evolving lifestyles, coupled with the growing phenomenon of pet humanization, has significantly bolstered the global population of pet owners. India, in particular, has seen a remarkable surge in pet ownership, boasting a thriving pet population of 32 million that is expanding annually by over 12%. This rise has spurred the development of a robust pet-care ecosystem encompassing retail chains, pet nutrition and services, and pet care services. Additionally, the advent of e-commerce has facilitated widespread access to pet products.

Source:6) httDs://www.thebusinessresearchcomDanv.com/reDort/sDecialitv-chemicals-alobal-market-reDort

7) https://www.imarcgroup.com/india-specialty-chemicals-market

8) httDs://www.coherentmarketinsiahts.com/market-insiaht

9) httDs://www.mordorintelliaence.com/industrv-reDorts/india-riaid-Dlastic-Dackaaina-market

10) httDs://www.reanin.com/reDorts/global-sun-control-films-market

The global per acre market size accounted for $ 346 billion in 2025 and is forecasted to hit around $ 643 billion by 2034 representing a CAGR of 7.10% from 2025-2034.¹¹

The global trend of embracing companion animals such as cats, dogs, fish, and birds is experiencing a rapid upsurge. Pet ownership offers a myriad of benefits including enhanced confidence, stress reduction, improved cardiovascular health, and better blood pressure management, supported by scientific evidence. This growing awareness of the positive impact of pets is fueling a surge in pet adoption rates, particularly among millennials and Generation Z, amplified by the pervasive influence of social media.

Pet penetration in developed markets like US & UK is more then 68% and is further growing.

The Pet care market in India is booming with 25% Projected Annual Growth, 35MM pets and 1MM annual adoptions. 4. BUSINESS SEGMENTS AND PERFORMANCE

Cosmo First, a prominent leader in the flexible packaging industry, has established a robust presence worldwide. It has developed a well-diversified business model that caters to the evolving needs of its customers. The Company combines specialty and commodity films, specialty chemicals, rigid plastics, window films brand Cosmo Sushield and Cosmo Paint Protection Film and its pet care brand, Zigly, under one umbrella.

4.1. Flexible packaging

Cosmo First offers a comprehensive range of packaging films, all conveniently available in one place. Our comprehensive portfolio of BOPP Films caters to various applications such as flexible packaging, lamination, labeling, and industrial uses. This range features innovative specialty films like high barrier films, velvet thermal lamination films, and direct thermal printable films.

As a market leader in the BOPP sector, Cosmo First excels in delivering high-quality films and provides additional value-added services. We are among the top four global players in BOPP specialty films and rank as the second-largest player in the world for specialty label films. Additionally, Cosmo First is the largest supplier of thermal lamination films worldwide.

The Company operates state-of-the-art manufacturing facilities with a combined annual installed capacity of:

• BOPP Films: 1,96,000 MT (Additional 81,200 MT launched in Q1 FY26)

• BOPET Films: 30,000 MT

• Thermal Lamination Films: 26,000 MT

• Coated Specialty Films: 36,000 MT

• Metalised Films: 40,000 MT

• CPP Films: 30,000 MT

4.2. Speciality chemicals

Cosmo Speciality Chemicals excels with three distinct verticals: coating chemicals, masterbatches and adhesives. Each segment focuses on niche specialties, addressing current industry challenges or providing significantly superior products compared to those currently available.

Our annual capacities are impressive with 5KMT for coating chemicals, 10KMT for masterbatch and 2.5KMT for adhesives.

In the Specialty Chemicals segment, Cosmo First has achieved high teens EBITDA, with sales revenue of H 187 crore in FY?25. This business verticals should continue to grow backed by new innovative products and specialty film sales. We aim to achieve 10% of the company?s consolidated revenue from specialty chemicals within the next 3-5 years, targeting a 25% ROCE.

4.3. Rigid Packaging (Plastech)

Our comprehensive rigid packaging solutions are designed to craft customized packaging for a wide range of FMCG products. Utilizing advanced injection molding and thermoforming techniques, we ensure our packaging is made from premium materials for exceptional durability and reliability. We are proud to have achieved the globally recognized FSSC 22000 food safety certification, reflecting our commitment to the highest standards. Cosmo State-of-the-art machineries and R&D team makes our products moisture resistance tamper proof and gives excellent clarity which makes it a popular choice for packaging applications.

The annual capacity of the Company for rigid packaging is 8KMT. With a target ROCE in the teens and operating in an industry growing at over 10%, we are focused on establishing direct partnerships with leading brands. Our dedication to quality and innovation positions us as a trusted partner in the FMCG sector, ensuring we consistently meet and exceed the expectations of our clients.

4.4. Cosmo Consumer

Cosmo Consumer, a business unit of Cosmo First, delivers advanced surface protection and enhancement solutions across automotive and architectural segments. Its portfolio includes -

• Cosmo Sunshield for high-performance window films,

• Cosmo PPF for durable paint protection film, and

• Cosmo Guard for innovative surface protection.

Together, these brands combine technology and design to elevate comfort and aesthetics in everyday environments. The commercial production of these films started in May 2025.

4.5. Pet care

The companys direct-to-consumer vertical, launched under the brand Zigly in September 2021, is progressing well as per plan following an Omni Channel Approach. With 30 experience centers operational as of March 2025, the Company is on targetting to achieve 50+ experience centre in next couple of years.

Ziglys current monthly Gross Merchandise Value (GMV) is approximately H 15 Crore, and the Company aims to achieve tenfold growth in the coming years. In FY25, Ziglys division GMV reached H 42 Crore, marking a remarkable threefold increase from the previous years sales. Zigly has already served over 60,000+ customers, with a significant portion being repeat customers.

The Company had recently launched the private labels in name of Zigly Lifestyle, applod and Fur Pro. The Companys focus is to further amplify Ziglys growth in the coming years, both organically and through potential acquisitions.

5. GROWTH

The Company is in significant expansion mode. The Company has invested 1,180 crores in the last 3 years (including 502 crores in last year) in multiple growth projects including BOPP, CPP & Polyester lines, Metallizers, Coating lines, Window / PPF films, Zigly and Rigid Packaging. These investments will position the Company for significant revenue as well as profitability ramp up in the coming years.

The CPP line with annual capaicty of 22000 MT has started operations in March 2025. The BOPP line having an annual capacity of 81,200 metric ton, is expected to commence commercial production in Q1 FY?26. The new film lines are the most cost- efficient and should make Cosmo more competitive in the market.

Cosmo Sunshield has also started commerical production from May 2025, the company has successfully done pilot runs for Sunshield with (+50) distributors who will be distributing both Sunshield film and Paint Protection films.

The Company has also launched the Cosmo PPF (Paint Protection Film) which delivers premium, high performance paint protection for vehicles, enginnered with cutting edge technology, these films preserve original paint finish, shield against environment damage and ensure long lasting showroom fresh and flawless look.

For Petcare Vertical ‘Zigly?, Company has 30 experience centres operational as on March 2025, the Company targets to have 50+ experience centres in next couple of years.

These initiatives will ramp up in revenue as well as profitability in next two to three years.

The companys focus will be on taking full leverage of the new investments, grow specialty film sales, expand in international geographies, and further push down the cost.

6. FINANCIAL PERFORMANCE

During the financial year 2025, Cosmo First achieved consolidated sales of H 2,895 crores. Consolidated EBITDA for the year stood at H 362 crores, compared to H 251 crores in the previous financial year, primarily due to higher specialty sales, which has grown by 10% compared to last year, Cost rationalization and better BOPP and BOPET film margin and improved performance of the Specialty Chemical subsidiary.

On a standalone basis, the Company recorded sales of H 2,736 crores. Standalone EBITDA was H 301 crores, compared to H 213 crores in the previous year, primarily for the same reasons as mentioned above.

Net Worth and Book Value/share

The financial strength of Cosmo First is further highlighted by a healthy Net Debt/Equity ratio of 0.7 and a Net Debt/EBITDA ratio of 2.7.

During this year, Cosmo First incurred capital expenditure of H 502 crores, compared to H 297 crores in the previous financial year. This expenditure is set to enhance the sale of specialty films, support sustainability initiatives, and sourcing solar power as an energy source. Continuous investment in R&D,

sales and marketing, employee practices, quality, and customer satisfaction has reaffirmed the Companys growth strategy, as evidenced by the year-on-year growth in specialty films sales.

The Company has made concerted efforts to enhance brand visibility. Exports for the financial year amounted to H 1,506 crores, representing 52% of total sales. Cosmo First exports to over 80+ countries across the globe.

The Company maintains a robust financial position, evidenced by its substantial cash and cash equivalents, including liquid investments of H383 Crore as of 31^st March 2025 at the consolidated level.

These strategic initiatives and strong financial performance highlight Cosmo First?s resilience

and commitment to sustainable growth and industry leadership.

The performance of the overseas subsidiaries remained broadly consistent with that of the previous year. However, an improvement is anticipated in FY26.

7. KEY FINANCIAL INDICATORS

I n accordance with SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (‘Listing Regulations?) the Company is required to give details of significant changes (i.e. changes of 25% or more as compared to the immediately previous financial year) in key financial ratios.

There is no significant changes (i.e. 25% or more) in Current Ratio, Total Debt/Equity, Inventory and Trade Receivable Turnover Ratios.

>Ratio	FY25	FY24	% Change	Explanation
Total Debt to equity Ratio	92.56%	69.77%	32.68%	Increase is primarily due to higher growth debt caused by growth capex during FY 24-25
Net Debt to equity Ratio	65.98%	41.74%	58.08%	Increase is primarily increase due to higher net debt caused by growth capex during FY 24-25
Net profit ratio	4.61%	2.55%	80.59%	Increase is primarily die to increase in operating income caused by higher speciality film sale, enhanced volume and better margin.
Interest coverage Ratio	3.64	2.81	29.54%	Increase is primarily due to increase in operating income caused by higher speciality film sale, enhanced volume and better margin.

8. CHANGE IN RETURN ON NET WORTH

During the financial year 2024-25, despite a reduction in PAT, Cosmo First maintained a positive return on net worth of 9.48%.

9. R&D AND NEW PRODUCT DEVELOPMENT

Cosmo First takes immense pride in its continuous investment in research and development, focusing on delivering innovative solutions that drive accelerated growth and spearhead new product development globally. The Company spends 0.5% of its revenue on Research and Development.

Our state-of-the-art R&D labs, located in India and the USA, are equipped with cutting-edge equipment and instruments. These facilities are at the heart of our innovation efforts, where our dedicated R&D team actively pursues several sustainability projects, ensuring that Cosmo First remains a leader in sustainable film solutions.

Cosmo First has an impressive track record in product development, with five registered patents and twelve in the pipeline- seven in India and five overseas Our dedicated R&D team, consisting of more than 30 scientists and technologists from prestigious universities in the USA and Europe, brings extensive global experience in packaging,

polymer engineering, and biopolymers. This team plays a crucial role in maintaining our competitive edge through continuous innovation.

Our relentless focus on R&D enables us to stay ahead of industry trends and meet evolving market demands. Throughout the year, our R&D efforts have resulted in the development of several new and sustainable products, significantly contributing to our growth and success.

The Company launched Cosmo Sunshield in May 2025 that specializes in premium window film solutions designed for commercial buildings, residential spaces and automotives with a wide range of Sun Protection Film, Safety Films and Privacy Films. Cosmo also launched Cosmo PPF (Paint Protection Film) which delivers premium, high-performance paint protection for vehicles. engineered with cutting-edge technology, these films preserve the original paint finish, shield against environmental damage and ensure a long- lasting, showroom-fresh and flawless look. Other new product segments includes Transparent CPP film especially developed for chocolate sealant layer, Graphic films PVC free, High shrink label films, Chemically recycled PCR BOPP film, Holographic Lamination Films, Capacitor Grade MPP Film.

Cosmo First?s commitment to research and development not only drives our current success but also positions us for a bright future of growth, innovation, and sustainable profitability. By continually enhancing our R&D capabilities, we are well-equipped to deliver cutting-edge solutions that meet the needs of our customers and contribute to a sustainable future.

10. SUSTAINABILITY AND ESG INITIATIVES

Cosmo First is deeply committed to sustainability, continuously enhancing the environmental performance of its products, operations, and supply chain. By prioritizing product efficiency and eliminating high-impact gases, the Company has significantly reduced its carbon footprint. Recognizing that sustainability not only benefits the environment but also enhances business performance, Cosmo First stays ahead of customer demand for sustainable products and practices. This

commitment positions the Company as an industry leader, dedicated to protecting the planet while driving innovation.

10.1 Environment

Cosmo First actively promotes sustainable practices and contributes to the circular economy. The Company offers mono-layered film structures to facilitate recycling and collaborates with renowned global brands to provide structure rationalization and recyclability solutions. Its R&D efforts have led to the development of Oxo-Biodegradable Films, Water-Based Coatings, and heat-resistant BOPP films, all designed to enhance recyclability. By improving the yield of BOPP and CPP films, Cosmo First reduces plastic usage without compromising product integrity.

Beyond film production, Cosmo First explores alternatives to harmful materials, such as replacing PVC with UV-stabilized Synthetic Paper for outdoor promotional applications. The Companys Ultra-High Barrier Films serve as a suitable replacement for aluminum foil, reducing reliance on non-recyclable materials. To further minimize environmental impact, Cosmo First implements green energy practices, waste reduction, and water treatment initiatives, including rainwater harvesting and the reuse of treated effluent water.

Renewable Energy usage has been close to 50% for FY25. The Company expects to increase its usage to more than 2/3^rd of total consumption over the next 1-2 years. The Company expects power cost rationalization (incremental) of about H 20-25 Crore per annum.

Cosmo Firsts dedication to environmental responsibility extends to its manufacturing processes, where it reuses reprocessed granules from waste materials in film production. By adhering to the principles of reducing waste, reusing resources, and recycling, the Company aims to manufacture sustainable polymers that can be easily recycled and reused in various applications.

In partnership with Army, BSF, farmers and experts in the field, Cosmo has worked on a variety of Tree plantation projects in the past 3 years such as Miyawaki, Biodiversity and agroforestry. Plantation of 1,11,000 saplings across Gujarat, Maharashtra and Delhi have added to a green cover of 169 acres. During FY25, Cosmo planted 15,000 saplings and created Miyawaki Forest in collaboration with BSF at Gurugram and Delhi. As part of green beautification, a green space was created at Jasola and the archaeological monument was lit up.

In collaboration with INTACH, revitalization and revival of the heritage handmade paper mill in village Kagzipura, near Chhatrapati Sambhajinagar has been underway. Machinery is upgraded and artisan?s livelihood is being restored. As a step towards clean and efficient energy, installation of 8KW State-of-the-art solar panels have been incorporated, ensuring that the paper mills run on 100% solar energy. A chemical free water filtration plant, separate washing ghats, green plantation has all been undertaken to ensure a holistic clean and green environment.

10.2 Social

The Cosmo Foundation, the Companys CSR arm, reflects its commitment to giving back to the community. In alignment with the government?s vision of Digital India, a network of 29 computer labs is set up in schools across Gujarat and Maharashtra. Through these initiatives we reached out to 8105 students. 2 new schools were added this year. The English learning program is operational in 15 rural schools, benefiting 6146 students. Our online English learning modules on YouTube in Gujarati and Marathi has achieved 2.9k subscribers and 36000 plus viewership.

Through

11 Rainwater Harvesting systems

constructed and maintained in schools, 68,72,000 litres of water per year is being conserved in

addition to increasing the water tables of the surrounding areas. Likewise, robust systems to maintain the 200 toilets constructed across different rural schools over the years have been developed which have ensured clean and hygienic sanitation practices, having a direct impact on girls? attendance in schools.

Establishment of E-service and E-Resource centre

at villages in Karjan block has become a hub for the rural population to avail a range of digital services (such as PAN/ Adhar applications, bill payments, PF registration, government scheme benefits, admissions, driving license processes etc.) at their doorsteps without losing workdays and subsequent wages. 1300+ villagers have availed these services.

Cosmo First is proud of its unwavering commitment to sustainability. Our efforts to enhance product efficiency, reduce emissions, and optimize operations not only benefit the environment but also strengthen our business. We have implemented initiatives such as rainwater harvesting (accounts for 28% of total water consumption for FY?25), reusing treated effluent water (reused 45% of wastewater and are working towards achieving Zero Liquid Discharge.), increasing renewable energy usage by 15 %, and adopting water-based coatings.

10.3 Governance

Cosmo First is deeply committed to ethical and responsible business practices, not just to ensure fairness but because it is the right thing to do. The Company integrates economic, social, and environmental considerations into its strategic planning, risk management, and governance approach.

Governance and Responsibility

The Board of Directors bears the overall responsibility for upholding the highest standards of corporate governance. Supported by senior management, the Board ensures best practices are followed consistently. This is achieved through a consultative approach, seeking input from all stakeholders, including shareholders, employees, vendors, suppliers, customers, community representatives, government authorities, and industry representatives.

Philosophy of Corporate Governance

For Cosmo First, maintaining top-tier corporate governance is a fundamental principle and an integral part of its core values. The Companys corporate governance philosophy aims to achieve business excellence by enhancing shareholder value. Transparency and ethical business practices are essential in fulfilling corporate responsibilities and achieving this goal.

By adhering to these principles, Cosmo First strives to foster trust and confidence among its stakeholders, ensuring long-term sustainable growth and a positive impact on society and the environment.

11. QUALITY PERFORMANCE

Cosmo First takes pride in its quality systems and the continuous improvements implemented throughout the year. Here are some of the key initiatives undertaken:

• Six Sigma Implementation: The Company has adopted the Six Sigma System at the organizational level to foster a culture of quality improvement.

• 5S Methodology: The 5S methodology has been implemented on the shop floors to establish world-class standards and enhance operational efficiency.

• Enhanced Shop Floor Operations: Measures such as double door systems and automated door closures have been introduced to improve shop floor operations.

• Sustainability Recognition: Cosmo First has been awarded a green rating by EcoVadis Sustainability Ratings in recognition of its green practices.

• Quality Improvement Projects: The Company collaborates with cross-functional teams to initiate small-scale quality improvement projects aimed at reducing customer quality complaints.

• Technical Training for Sales and Marketing:

Shop floor technical training has been provided to the sales and marketing team to enhance their understanding of product applications and manufacturing processes.

• Weekly Quality Assurance Meetings: A weekly Quality Assurance meeting for customer complaints has been established, contributing to the continuous improvement of the quality management system.

• Success Stories Sharing: The Company shares success stories of its products through social media platforms to highlight achievements and build brand reputation.

• Online Certificate of Analysis (COA) Application:

An online COA generation application has been developed in SAP for all three units, providing customers with system-generated COAs, enhancing transparency and efficiency.

These initiatives underscore Cosmo First?s commitment to maintaining and improving the quality standards of its products and operations, ensuring customer satisfaction and operational excellence.

12. I INTERNAL CONTROL SYSTEMS, RISKS AND MITIGATION STRATEGY

At Cosmo First, the Risk Management, Internal Control Systems, and Internal Audit functions collaborate to form a comprehensive risk management framework. This framework is designed to effectively identify and mitigate risks across the organization.

Internal control systems

The Company has implemented comprehensive systems and controls across its operations, covering various financial and operational functions. These measures ensure:

• Efficient execution of operations

• Safeguarding of assets

• Prevention and detection of fraud and errors

• Accuracy and completeness of accounting records

• Timely preparation of reliable financial reports

The Internal Audit Department plays a crucial role in ensuring compliance with operating procedures, internal policies, and legal requirements, while also providing recommendations for system and process improvements. Additionally, Cosmo

First has identified and documented key internal financial controls for critical processes across all plants, warehouses, and offices involved in financial transactions. These controls are regularly evaluated through ongoing monitoring and review processes by management and independent assessments by the internal audit team.

Risks & mitigation strategy

The Company has in place a robust risk management framework that identifies and evaluates business risks and opportunities. Cosmo recognises that the risks need to be handled effectively and mitigated to protect the interests of the shareholders and stakeholders, to achieve business objectives and create sustainable value and growth.

Few factors have been identified that could potentially have an adverse impact on the Companys consolidated financial position, results of operations, or cash flows.

1. Market Demand and Supply Gap:

The addition of capacity in the industry in short time gap may temporarily impact margins. To mitigate this, Cosmo First has taken steps to increase resistance to market fluctuations by shifting its product mix to specialty products. We expect favourable domestic demand and supply scenario for coming years.

2. Economic slowdown

A global economic slowdown due to current developments could impact growth in the short term. However, the flexible packaging industry, being part of the essential commodities sector, is expected to experience minimal impact.

3. Strategic risks

Strategic risks include shifts in consumer demand, competition, intellectual property issues, and potential loss of key customers. To mitigate these risks, the Company focuses on:

• Staying ahead in new product development

• Leveraging patent, trademark, copyright, and trade secret protections

• Implementing non-disclosure agreements Fostering strong customer relationships through a dedicated Key Account Team

4. Operational risks

Operational risks involve attracting and retaining key personnel, global health outbreaks, and information technology vulnerabilities. Cosmo First addresses these risks by:

• Creating a supportive work environment that promotes personal and professional growth

• Implementing measures to mitigate IT risks, although acknowledging the susceptibility to advanced threats that could disrupt operations and compromise sensitive data

5. Financial risks

Financial risks include exchange rate risks, interest rate risks, and internal control risks. To manage these risks, the Company uses various derivative contracts, such as foreign exchange forward contracts, currency options, cross-currency swaps, and interest rate swaps. Additionally, the Company:

• Follows a policy to minimize exposure to longterm financing interest rate fluctuations

• Maintains adequate internal financial controls, adhering to criteria established by the Institute of Chartered Accountants of India (ICAI)

6. Legal and compliance risks

I n response to regulations concerning safety, greenhouse gas emissions, climate change, and plastic recycling, Cosmo First takes proactive measures to ensure compliance with all safety, health, and environmental regulations. The Companys legal and R&D functions work diligently to protect its patents and proprietary technology across different regions. Robust systems and processes are in place to monitor and ensure compliance with relevant laws, rules, regulations, and guidelines, thereby upholding legal and regulatory compliance at all levels of the organization.

13. OPPORTUNITIES

1. Innovative packages

Marketers understand the significant value and perception associated with brands. In the FMCG industry, many companies are embracing the idea of refreshing their packaging designs to align with their brands core values. Packaging not only safeguards the product but also protects and enhances the brand. Cosmo First is dedicated to creating inventive packaging solutions that attract customers and drive sales. The Company focuses on developing packages that captivate consumers and effectively communicate the essence of its brands.

2. E-commerce

The growth of e-commerce has heightened the demand for packaging, especially for new products, and has spurred innovations in last-mile delivery solutions to meet the evolving requirements. Cosmo First is well-positioned to capitalise on the trend by

offering advanced packaging solutions that meet the needs of the e-commerce sector.

3. Digitisation and Internet of Things (IoT)

Companies are leveraging digital initiatives to reduce expenses and gain a competitive advantage. One such example is the integration of technology in packaging, enhancing customer value and service. With the rise of IoT (Internet of Things), packaging is becoming more intuitive, providing instant information to consumers about the products they purchase. This evolution positions packaging as an enabler, facilitating seamless communication and interaction between products and consumers. Cosmo First is at the forefront of this digital transformation, developing smart packaging solutions that enhance consumer engagement and satisfaction.

4. Sustainable packaging solutions

Sustainable packaging solutions represent a significant opportunity for Cosmo First, and the Company is committed to leading in this area. As awareness of sustainable packaging requirements grows, Cosmo First sees this as an opportunity to meet these demands through its products and manufacturing processes. Consumers increasingly seek sustainable packaging options, and Cosmo First collaborates closely with its customers to ensure its products meet their sustainability needs.

Through partnerships with leading global brands, Cosmo First offers structure rationalisation and recyclability solutions in various categories such as biscuits, noodles, tea and coffee sachets, and soap wrappers, among others. With a dedicated team of over 30 researchers, we proudly lead the way as one of the few packaging companies globally with such a robust R&D structure. Our relentless focus on R&D enables us to continuously innovate, staying ahead of industry trends and market demands. Throughout the year, our R&D endeavours have borne fruit, resulting in the development of several new and sustainable products that have significantly contributed to our growth and success.

In FY25, we launched sun control film, Cosmo Sunshield. This innovative product blends technology and innovation, redefining window films as a sustainability-driven and energy-saving solution.

14. HUMAN RESOURCES AND INDUSTRIAL RELATIONS

Cosmo First recognises that its people are its greatest assets, and the belief in people is central to its human resource strategy. The Company places a strong emphasis on talent management, succession planning, performance management,

and learning and development initiatives to foster inspiring, strong, and trustworthy leadership. By promoting knowledge, entrepreneurship and creativity, Cosmo First leverages its human capital to drive competitiveness. The Company also embraces workforce diversity and is committed to building employees careers through targeted interventions. Learning opportunities enhance employee engagement, boost productivity, reduce turnover, and cultivate a positive culture.

Labour relations across all India operations remained favourable. The Company?s plants in India provided various opportunities to encourage an open and supportive work environment, promoting participative decision-making. Cosmo First continued to provide its workers with teambuilding and collaboration training to strengthen team cohesiveness.

As of 31^st March 2025, the total employee strength stood at 1367.

15. CAUTIONARY STATEMENT

This report will include ‘Forward-Looking Statements,? such as statements about the implementation of strategic plans and other statements about Cosmo First?s potential business developments and financial results. While these statements reflect the Company?s current assessments and future expectations, several risks, uncertainties, and unknown factors could cause actual results to differ significantly from those anticipated. General market, macroeconomic, governmental, and regulatory patterns, changes in currency exchange and interest rates, competitive pressures, technical advances, changes in the financial conditions of third parties doing business with the Company, regulatory developments, and other main factors that may have an effect on the Company?s business and financial results. The Company does not undertake any obligation to update or revise forward-looking statements to reflect new information, future events, or circumstances that may arise.