Ganga Papers India Ltd Management Discussions

TO THE MEMBERS,

The Directors are pleased to present the Management Discussion and Analysis Report for the financial year ended 31st March, 2026, pursuant to Regulation 34(2) read with Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

1. OVERVIEW & OUTLOOK

1.1 Global and Indian Economy

Ganga Papers India Limited (GPIL) is engaged in the manufacturing of kraft paper, newsprint, and writing and printing paper, catering to varied requirements of customers in the paper industry. The Company is committed to maintaining high standards of quality and operational efficiency and has undertaken investments in modern machinery, advanced manufacturing technologies, and Enterprise Resource Planning (ERP) systems to strengthen its manufacturing capabilities and enhance overall operational effectiveness. The equity shares of the Company are listed on the Bombay Stock Exchange.

The Company recognizes its employees as an integral part of its continued growth and success and is committed to fostering a professional and performance-oriented work environment. The Company promotes continuous learning and development through appropriate training and skill enhancement initiatives and provides employee welfare measures in accordance with its policies and applicable requirements.

The Company is also committed to conducting its business in a responsible and sustainable manner. In furtherance of this commitment, the Company undertakes appropriate initiatives relating to environmental protection and contributes towards community welfare and social development activities, as considered appropriate from time to time.

The Companys business philosophy is centered on customer satisfaction, consistent product quality, timely delivery, and development of long-term business relationships. Through a customer-focused approach, adherence to quality standards, and responsiveness to market requirements, the Company endeavors to strengthen its market presence and create sustainable value for its customers and other stakeholders.

1.2 INDUSTRY STRUCTURE AND DEVELOPMENTS

Industry Structure

The Indian paper industry is a diversified and increasingly integrated manufacturing sector comprising Packaging Paper & Paperboard, Writing & Printing Paper, Newsprint and Specialty Paper. During FY 2025-26, the industry continued to witness steady demand, with Packaging Paper & Paperboard remaining the largest segment, accounting for approximately 65% of the industrys finished-product mix, followed by Writing & Printing Paper at around 23% and Newsprint at around 5%. Overall domestic paper demand continues to grow at approximately 6-7% annually, supported by expanding consumption across packaging, education, publishing, retail and industrial applications.

During FY 2025-26, Indias paper industry also remained strongly integrated with international markets. Imports of major paper, paperboard and newsprint grades reached approximately 2.553 million tonnes, while exports stood at approximately 1.537 million tonnes. Imports included significant quantities of coated paper and paperboard, newsprint and uncoated kraft paper and paperboard, while exports included coated paper and paperboard, writing and printing paper and other uncoated grades.

However, the industry continues to face challenges including rising imports, particularly from China and ASEAN countries, competition arising from Free Trade Agreements, raw material and energy cost pressures, currency volatility and declining demand for newsprint. Despite these challenges, the long-term outlook remains positive, with improving demand for packaging and specialty paper, coupled with continued focus on capacity expansion and sustainability, expected to support industry growth and margins.

Despite these challenges, the long-term outlook for the industry remains positive. Packaging and Kraft Paper are expected to remain the principal growth engines, supported by e-commerce, organised retail, FMCG and the increasing adoption of sustainable packaging. Writing & Printing Paper is expected to maintain relatively stable demand from education and institutional applications, while Newsprint is likely to remain a mature and competitive segment.

Overall, the Companys presence across Kraft Paper, Newsprint and Writing & Printing Paper provides exposure to both growth-oriented and established segments of the Indian paper industry. The Companys focus on operational efficiency, product quality, sustainable manufacturing and optimum utilisation of its manufacturing capacities will remain important in navigating the evolving industry environment and improving long-term competitiveness.

Government Initiatives

The Government of India continues to support the development of the Indian paper and pulp industry through measures aimed at promoting domestic manufacturing, improving environmental sustainability, strengthening quality standards and enhancing the competitiveness of Indian paper manufacturers. The Department for Promotion of Industry and Internal Trade (DPIIT) continues to administer and monitor the paper and newsprint sector at the central level.

The Governments continued implementation of measures relating to plastic waste management and the elimination of identified single-use plastic items has supported the transition towards sustainable and recyclable alternatives. During FY 2025-26, enforcement of the identified single-use plastic restrictions continued across States and Union Territories, while the Government also strengthened mechanisms for monitoring plastic waste management and Extended Producer Responsibility (EPR). This policy direction continues to create opportunities for paper-based packaging solutions, including kraft paper and paperboard, particularly in consumer and industrial packaging applications.

During the year, the Government also introduced revised environmental standards for the pulp and paper industry, with greater emphasis on resource efficiency, including norms relating to freshwater consumption. These measures are expected to encourage paper manufacturers to adopt cleaner production technologies, improve water and energy efficiency and strengthen environmentally sustainable manufacturing practices.

The Government continued to promote domestic manufacturing, technological development, sustainability and recycling in the paper sector. These initiatives, along with measures to reduce plastic pollution and encourage recyclable packaging, are expected to support the growth of kraft paper and other paper-based packaging products.

Overall, Government initiatives during FY 2025-26 are expected to strengthen resource efficiency, environmental sustainability and competitiveness in the paper industry.

New Development

The Indian paper industry continued to evolve during FY 2025-26, driven by growing demand for sustainable packaging, technological modernization and resource-efficient manufacturing. The packaging and kraft paper segment remained a key growth area, supported by expansion in e-commerce, FMCG, food processing, retail and logistics.

The industry is witnessing increased emphasis on recycled fiber, waste-paper recovery, energy efficiency and water conservation, in line with evolving environmental standards and the growing preference for recyclable paper-based products. Manufacturers are also focusing on improving process efficiency, product quality and capacity utilization through modernization and automation.

At the same time, import competition, raw-material price volatility, energy costs and changing environmental requirements continue to influence the operating environment. The increasing availability of imported paper and paperboard, particularly from Asian markets, has further encouraged domestic manufacturers to strengthen their cost competitiveness and product differentiation.

Going forward, capacity expansion, technological upgradation, sustainable manufacturing and greater value addition are expected to remain important areas of development. The continued shift towards recyclable packaging, coupled with Indias relatively low per-capita paper consumption, provides a favorable long-term opportunity for the industry, particularly in kraft paper and packaging applications.

Overall, the industry is moving towards a more sustainable, technology-enabled and efficiency-driven operating model, with innovation and responsible resource utilization expected to remain key factors supporting its long-term competitiveness.

a) Rising Literacy and Education: Improving literacy levels, wider access to education, and implementation of the National Education Policy (NEP) are expected to support sustained demand for writing, printing, and educational paper products.

b) Growing Demand for Packaging Paper: The rapid growth of e-commerce, FMCG, organised retail, and the increasing preference for sustainable alternatives to single-use plastics are driving demand for packaging, specialty, and printing papers.

c) Increasing Household and Hygiene Consumption: Rising health and hygiene awareness, coupled with increasing disposable incomes and changing lifestyles, is contributing to higher consumption of household and hygiene paper products.

d) Sustainability and Circular Economy: Greater regulatory emphasis on environmentally sustainable packaging, recycling, resource conservation, and adoption of biodegradable and recyclable materials is creating new opportunities for the paper industry.

e) Technological Advancement: The adoption of automation, digitalisation, Artificial Intelligence (AI), Internet of Things (IoT), and advanced analytics is improving productivity, operational efficiency, quality control, and manufacturing flexibility.

f) Domestic Raw Material Availability: Expansion of agro-forestry initiatives in various states is supporting domestic availability of raw materials and reducing dependence on imported wood pulp, thereby strengthening the industrys raw-material security.

g) Low Per Capita Consumption: Indias relatively low per-capita paper consumption, as compared with the global average, provides substantial scope for future growth, supported by economic development, urbanisation, and rising consumption.

h) Export Opportunities: Increasing global demand and improving competitiveness of Indian paper manufacturers are creating opportunities for higher exports and expansion into international markets.

2. GANGA PAPERS INDIA LIMITED - MARKET POSITION AND PRODUCT LEADERSHIP

Ganga Papers India Limited ("GPIL") has established a diversified presence across the Indian paper industry, with its product portfolio spanning Newsprint, Writing & Printing Paper and Industrial Packaging Paper/Kraft Paper. This diversified product mix enables the Company to serve a broad customer base across publishing, education, commercial printing and industrial packaging, while positioning it to participate in the continued shift towards sustainable paper-based packaging solutions.

The Companys competitive strength is underpinned by its focus on product quality, manufacturing efficiency, responsible resource utilization and customer-centric operations. By leveraging recycled raw materials and continuously improving its manufacturing processes, GPIL remains focused on delivering consistent products while responding to changing market requirements and the growing emphasis on environmentally responsible production.

GPIL continues to strengthen its market position through operational discipline, quality enhancement, customer relationships and continuous improvement. Its presence across multiple paper segments provides resilience and enables the Company to address both established and emerging demand opportunities, particularly in the growing packaging and recyclable paper segments.

Going forward, the Company remains focused on capacity optimisation, technological advancement, sustainable manufacturing and product development, with the objective of enhancing competitiveness, deepening customer relationships and creating sustainable long-term value for its stakeholders.

With a balanced product portfolio, established manufacturing capabilities and a clear focus on quality, efficiency and sustainability, GPIL is well positioned to participate in the evolving opportunities within Indias paper and packaging industry.

3. FINANCIAL PERFORMANCE & HIGHLIGHTS

Table 4.1: The financial performance of our Company for the financial year ended 31 March, 2026 is summarized below:

(Rs. In Lakh)

PARTICULARS	FY 2025-26	FY 2024-25
Revenue from operations	28023.60	25769.13
Other Income	17.16	38.08
Total Income	28040.76	25807.21
Total Expenses	27815.17	25602.40
Profit Before Tax	225.59	204.82
Add/less: Exceptional items	--	--
Tax expense	65.72	49.55
Profit After Tax	159.87	155.27

For the year ended 31st March 2026, the Company demonstrated steady growth in its core operations and overall financial performance. Revenue from operations increased by 8.75% to 28,023.60 lakh, compared to 25,769.13 lakh in the previous year. The Companys Other Income declined by 54.94% to 17.16 lakh, as against 38.08 lakh recorded in the preceding financial year. However, the overall financial performance remained positive, with Total Income increasing by 8.65% to 28,040.76 lakh as compared to 25,807.21 lakh in the previous financial year.

Total expenses also increased by 8.64% to 27,815.17 lakh, compared to 25,602.40 lakh in the preceding year, broadly in line with the growth in Total Income. Despite this, the Company maintained efficient cost management, as evidenced by the close alignment between expenses and revenue.

Profitability improved modestly, with profit before tax rising by 10.14% to 225.59 lakh, from 204.82 lakhs in the previous fiscal year. The Companys tax expense stood at 65.72 lakh, as against 49.55 lakh in the previous fiscal year, representing an increase of 32.63%. As a result, profit after tax increased by 2.96% to 159.87 lakh, compared to 155.27 lakh recorded in FY 2024-25.

No exceptional items were recorded during the year, and the financial results reflect the Companys core business performance. The Companys prudent financial management and stable profitability continue to support its sustainable growth.

4. OPERATIONAL PERFORMANCE HIGHLIGHTS

During the financial year ended 31st March 2026, Ganga Papers India Limited demonstrated steady operational performance despite a challenging industry environment. The Company achieved an 8.75% increase in revenue from operations, reaching 28,023.60 lakh compared to 25,769.13 lakhs in the previous year. This growth was supported by efficient capacity utilization, a well-diversified product portfolio, and a strong distribution network that enabled our company to meet evolving customer demands across multiple market segments.

Operational efficiency initiatives, including investments in modern machinery and process automation, contributed to improved productivity and cost management. The Company maintained stable production levels and ensured consistent product quality, which helped strengthen its market position. Total expenses increased in line with revenue growth, reflecting prudent cost control measures and effective resource allocation.

Furthermore, our company continued to prioritize workplace safety, employee training, and environmental sustainability as integral parts of its operational strategy. These efforts not only enhanced operational reliability but also reinforced the Companys commitment to responsible manufacturing practices. Overall, the operational performance for the year underscores our ability to adapt to market changes, optimize resources, and deliver value to its stakeholders.

5. SEGMENT WISE PERFORMANCE

Ganga Papers India Limited operates primarily in the paper industry and is engaged in the manufacturing and sale of kraft paper, newsprint, and writing and printing paper. During the financial year ended 31st March, 2026, the paper segment continued to constitute the principal business segment of the Company and remained a key contributor to its revenue and overall performance.

During the year under review, demand for paper products remained steady, with increased requirements for packaging paper and paperboard supported by the growth of e-commerce, FMCG, organized retail, and the increasing preference for sustainable packaging solutions. Despite challenges relating to raw material costs and competitive pressures, the Company continued to focus on maintaining production efficiency, optimizing operations, and meeting customer requirements.

The Company remains committed to maintaining product quality, strengthening customer relationships, and pursuing operational and technological improvements. Going forward, GPIL intends to leverage emerging opportunities in sustainable, eco-friendly, and value-added paper products to strengthen its market presence, improve operational performance, and create sustainable value for its stakeholders.

6. SWOT ANALYSIS

STRENGTHS	WEAKNESSES
• Diversified Product Portfolio: Presence across Kraft Paper, Newsprint and Writing & Printing Paper provides exposure to multiple paper segments.	• Competitive Pressure: Intense competition from larger paper manufacturers may impact pricing, margins and market share.
• Established Capabilities: Continuous investments in automation, modern machinery, and ERP systems enhance operational efficiency and quality.	• No Dividend Distribution: No dividend was declared during FY 2025-26, which may limit the Companys appeal to income-focused investors.
• Strong Revenue Growth: Increase in net sales from ?257.69 crore in FY 2024-25 to ?280.24 crore in FY 2025-26, reflecting growth in the Companys operating scale, with marginal improvement in Profit After Tax (PAT).	• Exposure to Commodity Cycles: Realisations and margins can be affected by fluctuations in paper prices and market demand.
• Quality & Efficiency: Continued emphasis on product quality, process efficiency and customer relationships supports competitiveness.

OPPORTUNITIES

OPPORTUNITIES	THREATS
• Growing Sustainable Packaging Demand: Increasing preference for recyclable and paper-based packaging creates significant opportunities for Kraft Paper.	• Rising Imports: Increasing imports from China, ASEAN and other markets may intensify pricing pressure on domestic manufacturers.
• E-commerce & FMCG Growth: Expansion of e-commerce, organised retail, food processing and FMCG is expected to support sustained packaging demand.	• Environmental Regulations: Increasing environmental standards may require additional investment in pollution control, water conservation and cleaner technologies.
• Low Per-Capita Consumption: Indias relatively low paper consumption compared with global markets provides substantial long-term growth potential.	• Currency & Global Market Volatility: Exchange-rate movements and global paper-price fluctuations can affect input costs and competitiveness.
• Technology & Modernisation: Automation, process optimisation and technology upgrades can improve productivity, quality and resource efficiency.
• Value-Added Products: Development of higher-quality and specialised paper products can improve customer retention and reduce dependence on purely price-based competition.

Strategic Outlook Based on SWOT Analysis

Ganga Papers India Limited remains focused on strengthening its market position through operational efficiency, product quality and sustainable growth. The Companys diversified presence across Kraft Paper, Newsprint and Writing & Printing Paper provides a balanced platform to address evolving market opportunities.

Going forward, the Company will focus on optimising manufacturing capabilities, adopting modern technologies, improving productivity and strengthening customer relationships. The growing demand for sustainable and recyclable packaging, particularly from e-commerce, FMCG and organised retail, presents significant opportunities for expanding the Companys presence in the Kraft Paper segment.

At the same time, GPIL will continue to adopt a disciplined approach towards costs and resource utilisation to manage volatility in raw-material and energy prices. The Company will also remain focused on maintaining product quality and operational efficiency to mitigate competitive pressures and import-related challenges.

The Company recognises the increasing importance of environmental sustainability and regulatory compliance and will continue to pursue responsible manufacturing practices, efficient resource utilisation and appropriate technological improvements.

Overall, GPILs strategic focus will be on converting market opportunities into sustainable growth while strengthening operational resilience, managing industry risks and creating long-term value for its stakeholders.

7. RISKS & CONCERNS

The paper industry is cyclical in nature and is influenced by global demand and supply conditions, pulp and paper prices, and broader economic trends. Periods of subdued demand may result in pricing volatility and pressure on operating margins. The Companys diversified product portfolio, comprising kraft paper, newsprint, and writing and printing paper, provides a degree of resilience by enabling it to cater to different market segments and demand drivers.

The increasing adoption of digital media, including e-books and online content platforms, continues to impact demand for traditional writing, printing, and newsprint products. However, the evolving digital landscape is also creating opportunities in packaging and specialty paper segments, particularly due to the growth of e-commerce and increasing preference for sustainable alternatives. The Company continues to focus on operational efficiency, technology adoption, and innovation to respond effectively to these changing market dynamics.

The Company is exposed to various business and operational risks, including fluctuations in raw material prices, intense competition, supply chain disruptions, evolving environmental regulations, workforce-related challenges, and changes in government policies. Increasing sustainability requirements and regulatory compliance may also have an impact on operating costs and business processes. The Company remains focused on maintaining appropriate quality and compliance standards while strengthening its risk management framework.

To address these challenges, the Company continues to pursue measures aimed at improving productivity, optimising costs, strengthening supply chain management, and adopting appropriate technological solutions. Through continuous improvement, operational discipline, and innovation, the Company seeks to mitigate identified risks, adapt to changing industry conditions, and support sustainable long-term growth.

8. INTERNAL CONTROL SYSTEM & ITS ADEQUACY

Ganga Papers India Limited is committed to maintaining a sound and effective internal control framework to support operational efficiency, transparency, accountability, and good corporate governance. The internal control systems are designed to ensure adherence to the Companys policies, applicable laws and regulatory requirements, while promoting ethical conduct and responsible business practices across the organisation.

The Company periodically reviews and strengthens its internal control mechanisms in line with changing business requirements and emerging risks. Appropriate monitoring systems, process improvements, and technology-enabled controls are implemented, wherever considered necessary, to identify potential risks, strengthen operational processes, safeguard the Companys assets, and ensure continuity of business operations. The effectiveness of the internal control framework is also supported through appropriate review and oversight mechanisms.

The internal control systems are designed to ensure the accuracy, completeness, reliability, and timely recording of financial and operational information. These controls provide a sound basis for the preparation of reliable financial information and facilitate effective decision-making by the management and other stakeholders. The Company remains committed to continuously improving its internal control environment and maintaining appropriate standards of governance, compliance, and operational effectiveness.

9. HUMAN RESOURCE DEVELOPMENT

Ganga Papers India Limited recognises its human resources as an important contributor to its operational efficiency and long-term growth. The Company continues to focus on developing the skills and capabilities of its workforce through appropriate training and development initiatives, with emphasis on productivity, technical knowledge, operational efficiency, and workplace safety. These measures are aimed at strengthening employee capabilities and enabling the workforce to effectively respond to evolving business requirements.

The Company promotes a work environment based on communication, cooperation, and mutual respect. Regular interaction among the management, employees, and workers representatives facilitates timely resolution of workplace matters, strengthens employee engagement, and contributes towards maintaining a healthy and harmonious industrial environment.

As at 31st March, 2026, the Company had 164 employees. The Company remains committed to strengthening its human capital through continuous learning, skill development, employee engagement, and appropriate welfare measures, with a view to building a motivated and capable workforce that contributes effectively to the Companys operational performance and long-term objectives.

10. KEY FINANCIAL RATIOS

PARTICULARS	31.03.2026	31.03.2025
Current Ratio (times)	1.25	1.13
Debt-Equity Ratio (times)	1.37	1.16
Debt Service Coverage Ratio (times)	33.02	16.11
Return on Equity Ratio (%)	5.08	5.20
Inventory Turnover Ratio (days)	26.67	25.41
Trade Receivables Turnover Ratio (days)	52.24	53.10
Trade Payables Turnover Ratio (days)	21.22	19.93
Net Capital Turnover Ratio (times)	25.26	29.03
Net Profit Ratio (%)	0.57	0.60
Return on Capital Employed (%)	13.26	11.87
Return on Investment	--	--

11. BUSINESS OUTLOOK

During the year under review, Ganga Papers India Limited continued to focus on meeting evolving customer requirements through consistent product quality, innovation, and customer-oriented business practices. The Company remains committed to strengthening its market position by enhancing its product portfolio, improving operational efficiencies, and adopting appropriate technologies to respond effectively to changing market conditions.

The Companys long-term objective is to establish itself as a leading and trusted player in the Indian paper industry. In pursuit of this objective, the Company will continue to focus on modernisation of its manufacturing facilities, adoption of sustainable production practices, efficient utilisation of resources, and development of its human capital. The Company believes that continuous innovation, operational excellence, and responsible business practices are essential for achieving sustainable growth and creating long-term value for its stakeholders.

Going forward, the Company will continue to strive towards efficient utilisation of its manufacturing capacities, maintaining consistent quality standards, strengthening customer relationships, and promoting a culture of continuous improvement. With the continued support of its stakeholders and the commitment of its employees, the Company remains focused on pursuing sustainable growth, strengthening its competitive position, and achieving its long-term business objectives.

12. ACCOUNTING TREATMENT

The financial statements of the Company have been prepared in accordance with the applicable Indian Accounting Standards (Ind AS) notified under the Companies (Indian Accounting Standards) Rules, 2015 (as amended), and other relevant provisions of the Companies Act, 2013, as applicable. There has been no deviation in the accounting treatment prescribed under the applicable Accounting Standards during the year under review.

13. CAUTIONARY STATEMENTS

The management of Ganga Papers India Limited has prepared this report and is responsible for the same. Statements in this Management Discussion and Analysis, describing the Companys objectives, projections, estimates and expectations may be "forward looking statements" within the meaning of applicable laws and regulation and the management has based them on its current expectations and its projection about future events. Actual result might differ materially from those expressed or implied.

Place: Pune

Date: 31.08.2026

By Order of the Board of Directors

Sd/- Ramesh Kumar Chaudhary

(Chairman & Director)

DIN: 00080136