Greenlam Industr Management Discussions

Global economy

Overview: The global economy was estimated to have grown at a slower 3.2% in 2022, compared to 6% in 2021 (which was on a smaller base of 2020 on account of the pandemic effect). The relatively slow global growth of 2022 was marked by the Russian invasion of Ukraine, unprecedented inflation, pandemic-induced slowdown in China, higher interest rates, global liquidity squeeze and quantitative tightening by the US Federal Reserve.

The challenges of 2022 translated into moderated spending, disrupted trade and increased energy costs. Global inflation was 8.8% in 2022, among the highest in decades. US consumer prices increased about 6.5% in 2022, the highest in four decades. The Federal Reserve raised its benchmark interest rate to its highest in 15 years. The result is that the world ended in 2022 concerned that the following year would be slower.

Performance of major economies

United States: Reported GDP growth of 2.1% compared to 5.9% in 2021 China: GDP growth is expected to contract from 8% in 2021 to 3% in 2022.

United Kingdom: GDP is expected to grow 4.1% in 2022 compared to 7.6% in 2021 Japan: Reported growth of 1.7% in 2022 compared to 1.6% in 2021 Germany: Reported GDP growth of 1.8% compared to 2.6% in 2021 (Source: PWC report, EY report, IMF data, OECD data) Outlook: The global economy is projected to grow a weak 2.9% in 2023, marked by sustained Russia-Ukraine conflict and higher interest rates. Global inflation is projected to be 6.5% in 2023 (Source: IMF). On the positive side, the reopening of Chinas economy after the waning of the pandemic, the decline in the European energy crisis and robust US consumption outlook (despite high inflation) remain positives. Interestingly, even as the global economy is projected to grow less than 3% for five years, India and China are likely to account for half the global growth in 2023 (IMF).

Indian economy

Overview: Even as the global conflict remained geographically distant from India, ripples comprised increased oil import bills, inflation, cautious government and a sluggish equity market. India reported an economic growth of 7.2% in FY 2022-

23. India emerged as the second fastest-growing G20 economy in FY 2022-23. India had retained its position as the fifth-largest global economy and was seen as a principal driver of the global economy (with China).

Growth of the Indian economy

FY 20

FY 21

FY 22


Real GDP growth(%) 3.7 -6.6% 8.7 7.2

Growth of the Indian economy quarter by quarter, FY 2022-23









Real GDP growth (%) 13.1 6.3 4.4 6.1

(Source: Budget FY24; Economy Projections, RBI projections)

Indias exports (merchandise and services) in April-February 2022-23 were estimated to have grown 16.18 percent over the same period of the previous year. As Indias domestic demand remained steady amidst a global slowdown, imports in April-February 2022-23 were estimated to have grown 19.93 percent over the corresponding period of the previous year. Indias exports in FY2021-22 were $676 billion and likely to achieve a record $750 bn in FY23.

Till Q3, FY23, Indias current account deficit, a crucial indicator of the countrys balance of payments position, decreased to $18.2 billion, or 2.2% of GDP from $22.2 billion (2.7% of GDP) a year ago. Indias fiscal deficit was estimated in nominal terms at ~ Rs 17.55 lakh crore and 6.4% of GDP for the year ending March 31, 2023.

Indias currency weakened from H75.91 to a US dollar to H82.34 as on 31 March 2023 due to a stronger dollar and weaker current account deficit.

The countrys retail inflation, measured by the consumer price index (CPI) eased to 5.66% in March 2023. Infiation data on the wholesale Price Index (which calculates the overall prices of goods before selling at retail prices) eased to 4.73% during the period. In 2022, CPI hit its highest of 7.79% in April 2022; WPI reached its highest of 15.88% in May 2022. India moved up in the Ease of Doing Business (EoDB) rankings from 100th in 2017 to 63rd in 2022.

In 2022-23, total receipts (other than borrowings) were estimated at 6.5% higher than the Budget estimates. Tax-GDP ratio was estimated to have improved by 11.1 percent Y-o-Y in RE 2022-23. Per capita income almost doubled in nine years to Rs 172,000 during the year under review, a rise of 15.8 percent over the previous year. Indias GDP per capita was 2,320 USD (March 2023), close to the magic figure of $2500 when consumption spikes across countries. Outlook: India is expected to grow 6.8% in FY2024, catalysed by 35% capital expenditure growth by the government. The growth could also be driven by broad-based credit expansion, better capacity utilisation and improving trade deficits. Headline and core inflation rates could trend down. Private sector investments could revive.

According to the World Bank April 2024 projections, Indias GDP is projected to expand by 6.3 percent In FY24, supported by domestic demand and increased public investment. Indias retail inflation rate could decline from 6.6 percent to 5.2 percent in FY24. The global landscape favours India: Europe is moving towards a probable recession, the US economy is slowing, Chinas GDP growth forecast of 4.4% is less than Indias GDP estimate of 6.8% and America and Europe are experiencing their highest inflation in 40 years.

Indias production-linked incentive appeared to catalyse downstream sectors. Infiation was steady. India was at the cusp of making significant investments in renewable energy and other sectors and emerging as a suitable industrial supplement to China. India was poised to outpace Germany and Japan and emerge as the third-largest economy by the end of the decade.

Broad-based credit growth, improving capacity utilisation, governments thrust on capital spending and infrastructure should bolster investment activity. According to our surveys, manufacturing, services and infrastructure sector firms are optimistic about the business outlook. The protracted geopolitical tensions, tightening global financial conditions and slowing external demand are the downside risks.

Union Budget FY 2023-24 provisions

The Budget 2022-23 sought to lay the foundation for the future of the Indian economy through projects like PM GatiShakti, Inclusive Development, Productivity Enhancement & Investment, Sunrise Opportunities, Energy Transition and Climate Action, as well as Financing of Investments. The capital expenditure of the Indian government expanded 35.4% from H5.54 lakh crore to H7.50 lakh crore. An outlay of H5.25 lakh crore was made to the Ministry of Defence (13.31% of the total Budget outlay). An announcement of nearly H20,000 crores was made for the PM Gati Shakti National Master Plan to catalyse the infrastructure sector. An expansion of 25,000 km was initiated for the national highways network. An outlay of H1.97 lakh crore was announced for Production Linked Incentive schemes across 13 sectors.

Global furniture market overview

The global furniture market is expected to grow at a CAGR of 3.76% from 2022-27 and reach USD 505.13 Bn in 2027 from USD 420 Bn in 2022.

This growth is attributed to the increasing demand for homes and rise in disposable incomes, which is expected to enhance the demand for furniture. In addition to this, companies have started re-opening offices which has further contributed to the global demand.

The worldwide home furniture market size is expected to increase by USD 105.01 billion between 2022 and 2027, progressing at a CAGR of 5.34% during the period due to the global increase in internet penetration which spurred the popularity of e-commerce. A number of global entities have invested in their online channels on the back of the pandemic, revolutionizing the furniture industry. The increasing number of online startups for renting and retailing furniture is also expected to contribute to the growth of the furniture.

The global office furniture industry was valued at approximately $60.8 billion in 2022 and is projected to grow to $77.4 billion by 2028, growing at 4.05% annually from 2023 to 2028. The surge in new office constructions, expansion of IT parks and commercial areas are major factors contributing to the global demand for office furniture.

The furniture industry has seen substantial growth in Asia and North America over the past ten years. Exports have increased in tandem with production and imports have continued to rise, with the major importers being the United States, Germany, France, United Kingdom and Canada.

In the United States, online furniture sales only make up a small percentage of total sales. However, the pandemic resulted in a major increase in online sales as a portion of the physical supply chain was disrupted.

The United States accounts for the largest share of the global furniture market, estimated at USD 226.78 billion, followed by China and Germany followed in second and third place, respectively, with revenues of 72.5 billion and 53.5 billion dollars. (Source: Statista, Yahoo Finance, Globe News Wire,

Indian furniture industry overview

The Indian furniture market was pegged at US$ 55 billion in 2020 and is expected to grow at a CAGR of 12.91% between 2020-24.

The household furniture market has been thriving due to the growth of the middle-class, increased disposable income and a rising number of urban homes. The need for modern, adjustable furniture in urban areas, growing urbanization and the popularity of hybrid sealing furniture have been key drivers in the Indian furniture market. By 2031, it is estimated that 75 % of Indias population will be living in urban areas. The trend towards online and mobile shopping is expected to further drive demand, along with the tourism, hospitality and corporate sectors.

Indias first ever furniture park was inaugurated in Thoothukudi, Tamil Nadu with 33 companies signing the Memorandum of Understanding(MoU) with H4,755 crore investment.

This park expects to address 70-80 per cent of the raw material demand and effectively bring down production costs and enhance competitiveness. The first phase of the park, with H1,500-1,800 crore investment, generating employment for 1.1-1.5 lakh people, is expected to operational in the next four to five years, while the second phase is expected to be operational in eight to ten years with H3,500 crore-4,500 crore investment, generating employment for 3-3.50 lakh people. The Indian government has recognized the furniture industry as a significant player in promoting ‘Make in India products globally, with India emerging as one of the fastest growing economies of the world. The government is planning to bring the furniture industry under the PLI scheme, which is expected to boost further growth and play a vital role in India becoming the worlds largest furniture consumer market by 2030.

(Source:, Statista, The Hindu Businessline)

Global laminates market overview

The global decorative laminates market was US$ ~8 billion by revenue in 2021 and is expected to grow at a 4.55% CAGR to reach US$ ~10 billion in 2030. Decorative laminates, which are especially designed laminated sheets used for furniture surfaces and wall paneling, are growing in popularity due to their large variety, durability, a_ordability, long shelf life and aesthetic appeal. The rising standards of consumer living and growing demand for ready-to-assemble furniture and cabinets are driving the growth of this market. Moreover, there has been a marked shift in consumer behavior who are choosing quality over price sensitivity and are willing to pay extra bucks for. Laminates are a cost-e_ective option as they are moisture-proof, abrasion- and impact-resistant and require little to no maintenance.

Additionally, decorative laminates are widely used in various commercial spaces such as hotels, hospitals, shopping malls, airports and educational institutions due to their wide range of design options and versatility.

(Source:, Globalnewswire)

Global veneers market overview

Veneer is a durable and versatile material that can be used in numerous ways to give a natural and aesthetically pleasing look to surfaces of furniture, cabinets and walls. The market for decorative veneers reached a value of US$6,843 million in 2020 and is projected to reach US$7,545.8 million by 2027. The demand for decorative veneers is on the rise due to several factors including their wide range of available options, durability, and their eco-friendly nature as a sustainable alternative to hardwood. The Asia-Pacific is expected to dominate the veneer market in the coming years with India being at the forefront in terms of demand growth in residential, leisure parks, retail, office etc.

In the construction industry, veneer sheets find extensive applications for paneling, cladding, and furniture purposes. Therefore, traction in the construction industry will directly harness the demand for veneers. The global construction industry recorded a value of US$9.7 trillion in 2022, with a projected growth to US$13.9 trillion by 2037. This growth is driven by prominent countries such as China, the US, and India, among others.

(Source:, Data Bridge, Oxford Economics)

Global engineered wooden flooring market

The global engineered wooden flooring market was valued at US$ 6681.9 million in 2020 and expected to grow to US$ 9355.6 million by 2026, growing at a CAGR of 4.9% during 2021-2026. This growth is driven by large collection, dimensional stability, polished and attractive appearance, ease of installation and ability to with stand high volumes of foot tra_c in various settings.

The demand for flooring products is primarily centered in countries such as the US, Japan, China, the UK, Germany and France. The Asia-Pacific region is the quickest growing segment, influenced by urbanization, real estate growth and the growing demand for tropical wood flooring. There has been a rise in the usage of flooring products in developing Asian economies like India, due to the traction from industrial and residential sectors.

(Source: Mordor Intelligence, MarketWatch, globalnewswire)


Engineered doors are becoming increasingly popular worldwide, primarily because they can be produced in large quantities with factory finishes in a short amount of time. Additionally, they can be fabricated off-site and precisely machined to the required specifications. The use of engineered wood in the manufacturing of doors is on the rise, which is contributing to making home a_ordability, reconstruction, renovation and remodeling of older buildings more accessible.


Indian market overview


The Indian decorative laminates market is valued at 12,000 crore and is growing attractively. This growth is due to factors such as increasing urbanization, adoption of higher living standards and shifting preference for modern home furnishings. The possibility of the government of India bringing the laminates sector under the PLI scheme in the near future is further expected to contribute to its growth. (Source: The Hindu Business Line)

Decorative veneers

Consumers are increasingly opting for decorative veneers due to their durability, elegant finish and environmentally-friendly nature. sustainable nature. Going forward, the demand for veneers is expected to be propelled by the increasing demand for luxury homes, higher disposable income and the growth of upscale shopping malls, premium retail stores, hotels and other establishments arising from the increasing pace of urbanization.


Flooring and doors

The market demand for engineered wood flooring and doors is projected to grow due to their increasing popularity as an affordable alternative to hardwood flooring. Engineered woods high durability and low maintenance requirements are also significant factors contributing to its rising demand. Furthermore, the expanding population and the growing need for housing are expected to drive the demand for wooden flooring and doors even higher.


Growth drivers

Rising population: In April 2023, India has overtaken China as the worlds most populous country with a population of 1.4286 billion. This is expected to lead to a greater demand in the construction industry for the building of homes and public infrastructure. Urbanisation: As of 2020, around one-third of Indias population was likely living in cities. By 2031, 75% of Indias national income is expected to come from cities.

Growing middle class income: India is expected to form 23% of the global middle class, leading to an increase in households earning between USD10,000 and USD50,000 per year, expanding the wallet share for spending on home or office interiors

Demographic dividend: In 2022, the average age of an Indian was 28.7 years. More than half of Indias population is under 25 years of age, fostering demand for ready-made furniture compared to traditional carpentry

Rise in demand for houses: The Indian real estate market is expected to reach a value of US$ 30 trillion by 2030. This will, in turn, drive the demand for Indian furniture.

Medical tourism: The medical tourism sector is predicted to increase at a CAGR of 21.1% from 2020-27 with a greater number of people coming into India from foreign places to avail treatment of major diseases at a reasonable cost.

Hospitality sector demand: The travel market in India is projected to reach US$ 125 billion by FY27 from an estimated US$ 75 billion in FY20. International tourist arrivals are expected to reach 30.5 million by 2028.

Traction in commercial space: Over 60 million square feet of office space will be occupied in both metro and non-metro cities in 2023 with top occupants being consulting, e-commerce, business process management and IT.

(Source: Population U, Business Standard, Indian Retailer, Statista,, Business

Company overview

Greenlam Industries Limited is a comprehensive provider of surfacing products and has become the largest producer of laminates in Asia and one of the top three globally, as well as Indias leading decorative veneer brand. It is also the sole manufacturer of engineered wooden flooring and the first organized manufacturer of engineered wooden doors in India. With an annual production capacity of 19.2 million sheets for laminates, 4.20 million square meters for decorative veneer, 1.00 million square meters for engineered wooden flooring and 0.12 million doors and frames, the company operates cutting-edge manufacturing facilities in Behror, Rajasthan Nalagarh, Himachal Pradesh and Prantij, Gujarat. Greenlams products not only transform the spaces but also improve lifestyles.

Laminates and allied segment

Manufacturing facilities: Behror, Rajasthan, Nalagarh, Himachal Pradesh and Prantij, Gujarat Installed capacity: 19.02 million sheets per annum as on March 31, 2023 Leading brands: Greenlam, New Mika, Greenlam Clads and Greenlam Sturdo Production during FY2022-23: 17.40 million sheets Production growth over FY 2021-22: 3.7% Capacity utilisation: 99% Sales volume, FY2022-23: 17.03 million sheets Sales volume growth over FY2021-22: 3.2%

Revenues, FY2022-23: H1677.7 crore

Segment contribution to total revenues, FY2022-23: 90.6% Revenue growth, FY 2021-22: 18.6% 9000H cr, total size of the domestic market in India 3000H cr, total exports from India 3000 Hcr, share of the unorganized market in India 6000H cr, share of the organized market in India


Greenlam retained its position as the leading brand in the decorative laminates segment, recognised for its ability to bring a variety of best laminates to the market.


The Company plans to strengthen relationships with trade influencers such as carpenters, architects and interior designers, increase the percentage of premium laminates in its product portfolio, improve its visibility on social media platforms and enhance trade confidence through the use of QR codes on its products.

Decorative veneers business

Manufacturing facilities: Behror, Rajasthan

Installed capacity: 4.20 million square meters per annum Brand: Decowood Production during FY2022-23: 1.24 million square meters Production growth over FY2021-22: 11.5% Capacity utilisation: 29.0% Sales Volume, FY2022-23: 1.21 million square meters Sales volume growth over FY2021-22: 11.4% Revenues, FY2022-23: H106.7 crore Segment contribution to total revenues, FY2022-23: 5.8% Revenue growth, FY2022-23: 27.5%


Greenlam retained its position as the leading manufacturer of veneer in India with an installed capacity of 4.20 million square meters per annum. The market is being propelled by two main factors, namely the growth in afluence and income levels. Additionally, there is an increase in demand from the residential and hospitality segments, which is providing a further boost to this sector.


By utilizing its extensive product range, the Company is expecting to enhance its phygital (physical and digital) engagement and expand product access and demand. The Company has plans to grow its veneers business through retail and brand outreach programs, with the goal of achieving attractive growth in this segment.

Engineered wooden floors business

Manufacturing facilities: Behror, Rajasthan

Installed capacity: 1.00 million square meters per annum Brand: Mikasa Production during FY2022-23: 0.11 million square meters Production de-growth over FY2021-22: 4.5% Capacity utilisation: 11% Sales Volume, FY2022-23: 0.11 million square meters Sales volume de-growth over FY2021-22: 3.0% Revenues, FY2022-23: H42.4 crore Segment contribution to total revenues, FY2022-23: 2.3% Revenue growth, FY2022-23: 19.5%


Engineered wooden floors offer several advantages such as a premium aesthetic appeal and easy installation. Greenlam is the sole manufacturer of this product in India, with a manufacturing capacity of 1.00 million square meters per annum. The Company witnessed a value growth in terms of realisations even if there was a de-growth in terms of quantity. The Companys products are designed to withstand the typical climatic changes in the country. The Companys Mikasa brand provides customers with a unique selling proposition, a wide range of products, support with installation and warranties of up to 30 years, thereby offering peace of mind to consumers.


The Indian wooden flooring market is expected to witness significant growth, driven by the expansion of the hospitality sector in the country. Greenlam plans to introduce new products and collections while focusing on consistent communication about its offerings.

Engineered wooden doors business

Manufacturing facilities: Behror, Rajasthan Installed capacity: 0.12 million doors per annum Brand: Mikasa Production during FY2022-23: 18388 units Production de-growth over FY2021-22: 14.0% Capacity utilisation: 15% Sales Volume, FY2022-23: 16916 units Sales volume de-growth over FY2021-22: 22.1% Revenues, FY2022-23: H24.3 crore Segment contribution to total revenues, FY2022-23: 1.3% Revenue de-growth, FY2022-23: 4.9%


The Indian doors segment is experiencing significant growth, driven by factors such as increasing urbanization and growth in middle-class income. In a market dominated by traditional _ush doors, Greenlam introduced a revolutionary concept with its Mikasa doors and frames. These doors and frames are an upgraded version of traditional carpentry and they offer superior quality. Additionally, they are delivered in a ready-to-install integrated set, making them a convenient and efficient option for customers


The traction in the real estate sector is expected to boost the demand of this segment.

Financial overview

Revenue from operations of the Company grew 18.7% from H1559.2 crore in FY 2021-22 to H1851.1 crore in FY 2022-23. The EBITDA margin of the Company improved 20 basis point from 10.4% in FY2021-22 to 10.6% in FY2022-23.

Key ratios


FY 2022-23

FY 2021-22

Gross Debt-equity ratio1 0.35 0.52
Net Debt-equity ratio2 0.11 0.25
Return on net worth (%)3 13.1% 13.8%
Book value per share (Rs.) 73.63 51.36
Debtors Turnover (days) 25 29
Inventory Turnover (days) 89 104
Interest Coverage Ratio4 10.27 17.10
Current Ratio 1.61 1.66
Operating Profit Margin (%) 10.6% 10.4%
Net Profit Margin (%) 6.6% 5.5%


1. Decrease in Gross Debt-equity ratio was largely due to increase in equity base on account of increase in capital via preferential issue of equity shares.

2. Decrease in Net-Debt equity ratio was largely due to increase in equity base on account of increase in capital via preferential issue of equity shares and higher cash and cash equivalents.

3. Decrease in Return on Net worth was largely attributable to increase in equity base on account of increase in capital via preferential issue of equity shares.

4. Decrease in Interest coverage ratio was largely attributable to higher interest rates on account of increase in interest cost of borrowings and higher average debt during the year.

Risks and concerns

Competition risk: Increasing competition may lead to reduction in the Companys market share.

Mitigation: Greenlam has a vast network of distribution and a wide range of products such as laminates, veneers, engineered wooden floors and doors categories, allowing the Company in deepening its market penetration. Moreover, emphasis on product quality and innovation is expected to growth across the market cycle.

Product risk: The Companys products may become redundant and decelerating business growth, leading to an excess in the inventory and a revenue erosion. Mitigation: Greenlam considers not only current but also future trends while manufacturing its products. The company prioritizes product usability, quality, aesthetic appeal and price-value proposition. Furthermore, Greenlam offers a comprehensive range of products, including decorative laminates, veneers, engineered wooden floors and doors, positioning itself as a complete home decor solution provider. Finance risk: The Companys inability to manage its debt could have a negative impact on the sustainability of its operations.

Mitigation: With the help of a robust receivable and payable management mechanism, the Greenlams cash and liquid investment position as on 31 March, 2023 stood at H223.52 crore, ensuring an optimal financial stability. Moreover, the Company also benefits from a debt-service ratio of 4.55 and a healthy interest cover of 10.27 times.

Quality risk: Poor-quality product may have a severe impact on the products sales and brand image. Mitigation: The Company has state-of-the-art facilities manufacturing best quality products with national and international certification to ensure maximising of resource utilisation and minimisation of wastage. Distribution risk: An ine_cient distribution network may restrict the Companys geographical expansion. Mitigation: Greenlam has over 23,000 dealers, distributors and retailers spread throughout India, which helps in maintaining a wide and robust logistics network, further helping in addressing the customer needs faster. Besides, the Companys presence in over 100 countries across the globe allows it to cater to a wide customer base.

Technology risk: Redundancy of technology could end up being a major bottleneck to the Companys competitiveness.

Mitigation: Greenlam has upgraded its IT infrastructure to the latest edition of SAP HANA as well as CRM and DMS to help enhance decision-making, improving efficiencies and ensuring access to real-time information.

Human resources

Greenlam Industries Limiteds human resource policies have reinforced its market leadership. The company invests in formal and informal training, on-the-job learning and creates a positive work environment with challenging job profiles and open communication with management. This has led to a high employee retention rate, promoting internal leadership and enhancing future prospects. As of March 31, 2023, the companys total number of payroll employees was 2249.


Greenlam Industries Limited is expected to benefit from the change in consumer behavior where there is a greater preference for superior quality rather than lowest price available. This is expected to drive consumers from the unorganized sector to the organized sector. With its commitment to quality, innovation and customer satisfaction, Greenlam is well-positioned to emerge as a leading player in the industry, both locally and internationally.


Imports raw materials from neighboring countries may face regulatory restrictions, which could pose a challenge in a deeply price-competitive market and passing the entire increased costs to consumers may not be feasible.

Internal control systems and their adequacy

The Company has strong internal control procedures in place that are commensurate with its size and operations. The Board of Directors, responsible for the internal control system, sets the guidelines and verifies its adequacy, effectiveness and application. The Companys internal control system is designed to ensure management efficiency, measurability and verifiability, reliability of accounting and management information, compliance with all applicable laws and regulations and the protection of the Companys assets. This is to timely identify and manage the Companys risks (operational, compliance-related, economic and financial).

Cautionary statement

This statement made in this section describes the Companys objectives, projections, expectation and estimations which may be ‘forward-looking statements within the meaning of applicable securities laws and regulations.