Garware Technical Fibres Ltd Management Discussions

Overview of Company

Established in 1976, Garware Technical Fibres Limited (GTFL) is a leading manufacturer of technical textiles and a pioneer in the industry, holding ISO 14001:2015 certification. The Company delivers innovative, value-added solutions across diverse sectors – from food production to infrastructure development – with a strong presence in domestic and international markets. Its products are manufactured at state-of-the-art facilities in Wai and Pune, Maharashtra, and marketed in over 75 countries worldwide. GTFL commands significant market share and brand visibility in diverse segments such as domestic fisheries, shipping, international aquaculture, geosynthetic solutions, and sports products.

GTFLs sustained focus on innovation, backed by robust research capabilities and process excellence, has enabled it to address evolving market demands while consistently enhancing customer value. With 28 patents and a dedicated R&D team of 22 scientists, the Company offers a portfolio of over 20,000 SKUs. Its operations are guided by a culture that embraces bold ideas and rapid execution – driving operational efficiency, consistent profitability, and high levels of customer satisfaction.

Business Environment in FY 2024-25

In the financial year 2024-25, the global economy navigated a phase of cautious optimism amid lingering uncertainties. Growth remained modest yet stable, supported by easing inflation. Across advanced economies, consumer spending supported moderate GDP growth, though central banks remained cautious, prioritising inflation containment through tight monetary policies. In Europe, the geopolitical tensions continued to cast a shadow over recovery efforts. Investment activity remained subdued in several regions, and despite signs of stabilisation, overall growth prospects were tempered by monetary tightening and ongoing external uncertainties.

The Indian economy maintained its steady growth trajectory. A favourable monsoon, a continued emphasis on infrastructure development, and robust domestic consumption contributed to economic resilience. Increased public investment further bolstered growth, even as global uncertainties and supply chain disruptions posed external challenges.

As a company focused on the food sector, GTFL continued to experience strong demand for its technology solutions. Customers showed growing interest in its value-added offerings, particularly in segments promoting efficiency and sustainability. The aquaculture industry saw sustained global demand, along with a shift towards more sustainable practices and technological advancements aimed at enhancing productivity.

Demand for geosynthetics also grew, driven by their increasing use in civil engineering, construction, and environmental protection. Major infrastructure projects – such as railways, and landfills – served as key growth drivers for this segment. The geosynthetics business is also growing its presence in the international market with higher penetration in niche applications.

The global shipping industry faced ongoing logistical challenges, including supply chain disruptions, vessel availability issues, freight cost fluctuations, and geopolitical tensions all of which affected shipping schedules and delivery costs.

Opportunities and Threats

Deepening customer engagements and expanding globally remains a strategic priority for the Company. Strengthening market presence through digital initiatives, enhanced service offerings, and region-specific solutions provide opportunities for building stronger relationships with customers and tapping into emerging international markets. In aquaculture, a clear shift is emerging as the industry diversifies beyond salmon. This offers the Company new avenues for customised, species-specific solutions aligned with sustainability and productivity goals.

The Indian governments strategic push for infrastructure development through programmes such as PM Gati Shakti, Bharatmala, and the upgradation of border infrastructure has created strong momentum for the geosynthetics industry. With increased attention to railways, coastal protection, and riverbank stabilization, there is growing demand for sustainable and durable construction materials. The Companys geosynthetics division, which play a key role in soil reinforcement, drainage, and erosion control, is positioned to benefit significantly from this trend.

Tariff disruptions and shifting trade policies pose uncertainty around pricing and cross-border operations. Geopolitical instability has impacted the availability of materials, raised freight costs, and disrupted shipping schedules. In the aquaculture sector, rising consolidation and acquisitions are reshaping the competitive landscapes. Domestically, there is increased competition from local players, The Companys strategy is to stay focused on value addition, innovation and differentiation.

Performance in FY 2024-25

The Company registered total consolidated revenue of

1540.11 crores for the year ended 31st March 2025, an increase of 16.20% over the previous years

consolidated revenue of Rs. 1325.61 crores. Consolidated operating EBITDA was Rs. 318.8 crores, increasing

by 17.36% compared to the previous financial year. Consolidated profit before tax in the year under review was Rs. 308.45 crores, an increase of 13.52% over the previous year.

Key Consolidated Financial Indicators

l Earning Before Interest, Taxes, Depreciations and Amortization (EBITDA) – 23.2%

l Net Profit Margin – 15.0% l *Earnings per share – Rs. 23.32 (previous year Rs. 21.07) l Interest Coverage – 16.40 l Current ratio of the Company – 1.88 l **Debt-equity ratio – 0.05 (previous year 0.10) l ***Return on average net worth – 18.7% (previous year 18.5%)

l ****Return on Invested Capital – Pre-tax (RoIC) 58.0% (previous year 55.5%)

Risks and Concerns

In the near term, the global environment presents a complex landscape, shaped by ongoing geopolitical tensions, volatile commodity and energy prices, and evolving trade dynamics. The resurgence of trade tariffs and protectionist policies in key markets threatens to disrupt global supply chains and increase operational costs. These pressures are compounded by logistical bottlenecks, regulatory uncertainty, and the impacts of climate change. Navigating this environment will demand heightened agility, strong risk mitigation frameworks, and a sustained focus on operational resilience.

Internal Control Systems

GTFL continues to operate within a robust internal control framework designed to support operational effectiveness, compliance obligations, and financial reporting accuracy. These controls are aligned with GTFLs strategic growth plans and are reviewed periodically to ensure they remain effective, relevant, and responsive to evolving business needs.

The Company utilizes a global-standard SAP ERP system to manage its day-to-day operations, enabling seamless integration with financial records. Ongoing investments in IT infrastructure have enhanced process automation and strengthened embedded controls across key functions. Additionally, GTFL has implemented a dedicated tool to monitor critical regulatory requirements. The Company remains proactive in aligning with changing policy landscapes, reinforcing its commitment to sound governance and risk management.

Human Resources Management

At GTFL, people are central to our purpose and performance – they are our most valuable asset and the foundation of our continued success. The Company remains deeply committed to the health, well-being, and holistic development of employees and their families. Grounded in the belief that every individual has untapped potential, GTFL invests significantly in capability-building initiatives that enhance current performance while equipping talent for future leadership.

Our organisational culture is built on trust, transparency, and empowerment. Open communication channels encourage employees to share ideas, voice concerns, and actively participate in collaborative problem-solving. Human resource practices are thoughtfully crafted to foster a high-performance environment that nurtures innovation and recognises excellence.

GTFLs sustained focus on building a people-first, values-driven culture was reaffirmed in the 2025 Great Place to Work? Survey, where the Company achieved an exceptional trust index score. Reinforcing this achievement, GTFL is proudly ranked Top 25 Indias Best Workplaces in Manufacturing – Large category, Top 50 Indias Best Workplaces Building a Culture of Innovation by All – Large category and Indias Best Workplaces in Textile and Textile products. These accolades reflect the strong alignment between leadership and employees in cultivating a workplace where talent thrives and innovation is a shared pursuit.

Cautionary Statement:

Statements in this Management Discussion and Analysis describing your Companys objectives, projections, estimates, and expectations may constitute forward-looking statements within the meaning of applicable laws and regulations. Actual results may differ materially from those expressed or implied. *On 6th January, 2025, the Company had issued 7,94,12,676 fully paid-up Bonus Shares of Rs. 10/- each in the ration of 4:1. In accordance with the "IND AS 33 (Earnings per Share)", the figures of Earnings per Share for the year ended March 31, 2024 have been restated to give effect to the allotment of the bonus shares.

**Primarily, due to discontinuation of 2% interest subvention on Rupee Packing Credit, working capital borrowing was reduced. ***There is no significant change in return on average net worth. ****RoIC = PBIT Less Other Income / (Average Capital Employed less Average Treasury Surplus Investment)