Ideal Technoplast Industries Ltd Management Discussions

(Annexure-C to the Directors Report)

The global plastics market is projected to grow from approximately USD 769 billion in 2025 to over USD 1.13 trillion by 2035, at a CAGR of around 4%. Key growth sectors include packaging, automotive, construction, electronics, and healthcare, with packaging accounting for nearly 41% of the market in 2025. Asia-Pacific continues to dominate production and consumption, driven by industrial expansion and infrastructure investment, especially in India and China. Major trends shaping the industry include the rise of biodegradable and recyclable plastics; the adoption of smart manufacturing and Al-driven automation; a growing regulatory focus on recycling and the circular economy; and ongoing supply-chain adjustments driven by geopolitics and raw-material price volatility.

The Indian rigid plastic packaging market continues to expand at a double-digit CAGR, supported by urbanisation, rising disposable incomes, the growth of organised retail and e-commerce, and the "Make in India" push for local manufacturing. Expanding lubricant, agrochemical, food-processing, and industrial-chemical sectors continue to drive demand for the specialised rigid containers the Company manufactures.

For FY 2025-26, the Companys revenue from operations reached Rs.3,462.43 lakhs, a growth of approximately 22% over the previous year (T2,847.95 lakhs). Operating profit (EBITDA) rose to T682.71 lakhs, up 28%, with an EBITDA margin of approximately 19.7%. Profit after tax was Rs.277.72 lakhs (previous year Rs.288.06 lakhs). The marginal moderation in the bottom line, notwithstanding strong revenue and EBITDA growth, is a direct consequence of the capacity-expansion cycle: with the commissioning of the new facility, depreciation more than doubled to Rs.157.21 lakhs and finance costs more than doubled to Rs.1162.44 lakhs, as newly capitalised assets and associated borrowings began to be charged to the profit and loss account ahead of the facility reaching full utilisation.

The significant improvement in operating cash flow to Rs.505.63 lakhs (from Rs.38.45 lakhs) reflects a return to a normalised working-capital cycle following the prior years expansion-related build-up, and underpins the Boards confidence in recommending a bonus issue of equity shares during the year.

Total borrowings rose to Rs.2,412.20 lakhs (from Rs.1,198.03 lakhs) and net worth strengthened to T2,651.18 lakhs, as the Company funded T1,856.69 lakhs of capital expenditure ? predominantly the completion and capitalisation of the new facility. Capital Work-in-Progress of Rs.2,409.32 lakhs was capitalised to Property, Plant and Equipment during the year on commencement of commercial operations. Even amid this heightened investment activity, operating expenses were well contained and the Company maintained a healthy gross margin.

• Capacity Expansion ? The new 92,500 sq. ft. facility at Olpad GIDC, Surat is now operational, enhancing monthly capacity by 150-175 tonnes and complementing the existing plant at Madhav Industrial Estate.

• Product Portfolio Diversification ? A broad range of SKUs across round, square, hexagonal, twist-open, and food-grade formats, with industrial design registrations secured for high-impact products.

• Technology & Quality ? High-tonnage injection machines integrated with robotics (IML, pick-and-place), and touch-free material mixing for food-grade compliance.

• Market Development ? Expansion into agrochemicals, lubricants, and specialised industrial fluids, alongside selective export partnerships targeting the Middle East and Southeast Asia.

• Sustainability & Compliance ? Adoption of resource-efficient processes and commissioning of a rooftop solar power system.

• Talent & Welfare ? Workforce expansion across production, engineering, and quality functions, supported by an on-site canteen and skill-development initiatives.

The Board has confirmed that proper internal controls and compliance systems are in place and operating effectively. Key risks

? including raw-material price volatility, interest-rate exposure on the expanded borrowing base, and customer-concentration and receivables risk ? are monitored on an ongoing basis, with mitigating actions overseen by the Audit Committee. Having commissioned its new facility and strengthened its balance sheet, Ideal Technoplast Industries Limited is well-positioned to convert its enhanced scale into sustainable, profitable growth, and to reinforce its position in the rigid plastic packaging sector

? thereby creating enduring value for all stakeholders.

Cautionary Statement: Statements in this Management Discussion & Analysis describing the Companys objectives, expectations, or forecasts may be forward-looking within the meaning of applicable securities laws and regulations. Actual results may differ materially from those expressed or implied.