g m polyplast ltd share price Management discussions



The recovery of global trade was astonishingly quick post the upliftment of restrictions and lockdown(s) imposed to curtail the spread of COVID 19. The recovery was neither delayed or slowed down if such recovery was to be compared with other global recessions or global financial crises. However, the recovery of global trade could not be stable due to further disruptions like the war in Ukraine. The disruptions in seaborne trade remained elevated and the overall trade was sluggish. The IMF has further reported that a tentative recovery in 2021 has been followed by increasingly gloomy developments in 2022 as the risks began to materialize.

According to IMF, the baseline forecast is for growth to slow from 6.1 percent last year to 3.2 percent in 2022, 0.4 percentage point lower than in the April 2022. The "World Economic Outlook" issued by the International Monetary Fund has depicted that Inflations shall remain elevated for longer, driven by war-induced commodity price increases and broadening price pressures. For 2022, inflation is projected at 5.7 percent in advanced economies and 8.7 percent in emerging market and developing economies—1.8 and 2.8 percentage points higher than projected in January. However, considering the long-term goals and the immediate challenges, it shall be necessary to prepare for tomorrows economy. COVID 19 has highlighted productive ways to execute the task and challenges we face embracing the digital transformation and retooling and reskilling workers. Governments and World Forums have thrived to implement positive structural changes to have a fulfilling economy and market transformation(s).


The faith and unity India depicted during the crises after the outburst of COVID 19 and to deal with its aftermath has let India out of a sluggish economy and has been on the path of recovery during the Financial Year 2021-2022. The responses and policies imposed during such crises has supported its recovery along-with other government reforms that motivated a positive outcome and helped to mitigate probable adverse impact.

India, with its tremendous skilled human resource, is a fast-growing economy, having its footprint on various other major economies in this planet. With an optimistic approach India was looking forward to a strong economic recovery. Forums like the International Monetary Fund had forecasted growth to exceed 9% this financial Year. However, the Omicron Virus had an impact throughout the country sparing less time to recovery as it was followed by an international crisis, wherein there was a war in Ukraine. Surging commodity prices, disruption in trade and financial transactions, surging inflation and supply shortage were some of the challenges that disturbed the basics of economics. However, it is believed that India shall emerge through these crises and its risks taken shall be positively materialized. The policies and the regulatory framework enabling India to focus on being a domestic demand driven nation shall play an important role in strengthening the Indian Economy.

Multinational forums have expected India to grow by 7.1% to 7.6% in Financial Year 2022-2023 and 6% to 6.7% in the Financial Year 2023-2024. According to the Reserve Bank of India (RBI) analysis of 10,000 listed companies, businesses have seen a steady net profit-to-sales growth over the past year and are cash rich in nature. It cant be denied that the supply chain has been disrupted due to occurrence of international events and the return to investments are affected for companies heavily relying on international logistics.

A recovery towards the expansionary zone can be categorically seen in the Purchase Managers Index as reported by the Centre for Monitoring Indian Economy. The upliftment of mobility restriction is improving the consumers confidence.

It has been observed that there has been decline in Government Revenue expenditures which has enabled the government to invest and incur capital expenditures. Higher capital spending on infrastructure and asset-building projects is likely to boost growth multipliers in the medium term.


The financial year 2021-2022 has started with an optimistic approach with the markets opening up and the upliftments of the lockdowns. The company has seen an increased demand during the first six months of the financial year which was depicted in the half yearly financial Results as compared to the previous half year March 2021 or the corresponding previous half year i.e., September 2020 such surge in demand was further observed by the Company until the end of the Financial Year 2022.

Due to Covid-19 and the Ukraine-Russia war, fluctuation in crude oil prices was persistent throughout the year. It impacted the import prices of raw materials for India. Our company follows a practice for maintaining a safety stock for approximately 2 months over and above the minimum stock of raw material quantity which is required for smooth functioning thus minimizing the market risk. This gave our company an edge over the competitors as we were able to meet the market demands on time. During such challenging times our company was able to maintain a constant output ratio by balancing its market position.


With the Global and Indian market projected to rise until 2029 an optimistic approach was seen in the industry. However various factors including COVID 19 had been unprecedent and staggering, affecting the plastic industry globally. Plastic is used to manufacture a wide variety of products with applicability of such products in various sectors and different industries. However, the trade of plastics was disturbed because of the disrupted flow of and hinderances in the supply chain management.

The plastic industry in India will further be disturbed because of the ban introduced by the Government of India. The government has been proactive in introducing and implementing legislation which shall curb the application of single use of plastic which were in use in multiple industries and such industries substituting plastics with the available alternatives.

Starting June 2022, the government of India has imposed a ban on (production/sale) of single use plastic items like straws, carry bags etc. Our company is engaged in manufacturing and supply of granules, plastic sheets to manufacturers who are engaged in further production of plastic items which arent banned by the Government of India. Hence we do not suffer from negative impact of plastic ban.

Our demand size has improved after the import of machine for production in August 2022. The machine was put to use by September 2022 which accelerated our production. The machine proved to be a boon as it has helped us in seizing opportunities in new markets with new clientele. Due to increase in our productivity, we have been able to match the pace of competitive market rates as a result the clients have started to prefer us over our competitors.

Certain countries have started preferring Indian market over foreign markets for importing plastic due to lower cost advantage. Since we have purchased the machine of foreign technology the quality of our products has improved. Despite of hindering market conditions we are able to attract large base of customers as we are supplying the products at constant prices amid fluctuating rates but with improved quality.


The financial year 2021-2022 had observed a slowdown due to disruptions in International Markets caused by War in Ukraine and the supply chain management. The cost of credit was at a higher rate. The COVID 19 disturbing the economy worldwide and affecting liquidity at large, increased finance cost and credits not being made easily available, the reduced customer demand and allied factors were observed. Also, the disruption in supply chain management has widely affected the Imports and Exports and the International Trade at large. Though after the overwhelming response of the markets post COVID 19, international trade and supply chain was bothered by the war in Ukraine. With the ban on plastics introduced by the Government of India, the use of alternatives to plastics shall get an overwhelming response and increase in demand of such products can be observed. Competitive products substituting plastics can experience massive growth in market share compromising the position of plastic industry

With fluctuation in crude oil prices round-the-clock its predicted that raw material prices will also fluctuate. Our companys operations largely depend upon the import of raw materials. If this continues there is a high possibility of dollar rates getting affected which will also affect foreign currencies. Thus upsetting our import prices.

With rich experience and expertise of the team the company has gained trust in the International Market and have made way to become a world class supplier with high quality products. The Company is committed to work with the highest effort and satisfy the very needs of its valuable clients. The Company searches and embraces different ways to improve quality and productivity. It welcomes new technology for manufacturing products practicing environmental policy. It also gives high priority to maximize the shareholder profits by practicing responsible management strategies and making the best use of available resources.


The Company has a documented internal control policy. In line with the Internal Control policy, the Company prepares annual business plan and detailed budgets for revenue and the capital for each quarter is determined. The actual performance is reviewed in comparison with the budget and deviations, if any, are addressed adequately. The Company has appointed a firm of Independent Chartered Accountants who conducts internal audit. The internal audit program covers all the functions and activities of the Company. The Internal Audit Reports are submitted every half yearly to the Audit Committee of the Board of directors for review and ensuring compliance.


The Directors confirm that there have been no events or circumstances since the date of the last financial statements which materially or adversely affect or are likely to affect the profitability of our Company, or the value of our assets, or our ability to pay liabilities within next twelve months except as below: The company achieved Net revenues for the year 2021-22 at Rs. 73.86 crores 2020-21 at crores as against Rs. 52.14 during the previous year.

The company has sold 1262.29 tonnes of plastic sheets and rolls and 1128.92 tonnes of plastic granules as against 4,240 tonnes and 819.34 tonnes respectively in previous year, reflecting a de-growth in product turnover by volume. The Profits before interest, depreciation, exceptional items and taxes during the year under review have been at Rs. 6.91 crores as against 5.76 crores in previous year. Net Profit, after setting aside aggregate Tax provisions of Rs. 1.40 crore (previous year 1.37 crores) stood at Rs. 4.19 Crores in 2021-22 as against Rs. 3.51 crores in 2020-21. The Board of directors had earlier recommended and the Company had paid an interim dividend during the year @10% i.e. Re.1/- per share. The same will be considered as final dividend. Total dividend payout for 2021-22 amounts to Rs.19.22 lacs


The Company believes that its intellectual capital represents its most valuable asset. The Companys knowledge enhancement focus has helped create an organisation which is recognised as a centre of learning and excellence. The Company has consistently worked on not only increasing its workforce but ensuring that its people competencies are enhanced in line with changing business needs. As a result, the Company enjoys the support of a committed and well satisfied human capital. Compensation packages offered by the Company, best-of-class methods in recruitment, training, motivation, and performance appraisal, attract and retain the best talents. Thus, there are 50 employees in our Company as on March 31, 2022.

Details of Significant Changes in key financial ratios, along with detailed explanations therefore, including:

There are no significant changes in the following ratio during the year under review

(i) Debtors Turnover - 4.80

(ii) Inventory Turnover - 10.16

(iii) Interest Coverage Ratio - 12.9%

(iv) Debt Service Coverage Ratio - 15

(iv) Current Ratio - 1.70

(v) Debt Equity Ratio - 0.01

(vi) Operating Profit Margin (%) - 8.17%

(vii) Net Profit Margin (%) - 5.61%

Details of any change in Return on Net Worth as compared to the immediately previous financial year along with a detailed explanation thereof

- Current year RONW is 28.87% as compared to previous year 29.98%.

Cautionary Statement

Statement in the Management Discussion and Analysis and Boards Report describing the Companies Strengths strategies projection and estimate are forward looking and progressive within the meaning of all applicable laws and regulation. Actual results may vary depending upon the various aspects of the economic such as Government policies Rules and Regulations economic conditions and other incidental factors. Important factors that could make a difference to our Companys operations include raw material availability and prices cyclical demand and pricing in our principal markets changes in government regulations, tax regimes, economic developments within India and other incidental factors Management will not be in any way responsible for the actions taken based on such statements.

For and on behalf of the Board of Directors
G M Polyplast Limited
(Formerly known as G M Polyplast Private Limited)
Dinesh Sharma Sarita Sharma
Managing Director Director
DIN:00418667 DIN:00128337
Date: Mumbai
Place: August 12, 2022