Innovative Tech Pack Ltd Management Discussions

I. Global Economy

he baseline forecast is for growth to fall from 3.4 percent in 2022 to 2.8 percent in 2023, before settling at 3.0 percent in 2024. Advanced economies are expected to see an especially pronounced growth slowdown, from 2.7 percent in 2022 to 1.3 percent in 2023. In a plausible alternative scenario with further financial sector stress, global growth declines to about 2.5 percent in 2023 with advanced economy growth falling below 1 percent. Global headline inflation in the baseline is set to fall from 8.7 percent in 2022 to 7.0 percent in 2023 on the back of lower commodity prices but underlying (core) inflation is likely to decline more slowly. Inflations return to target is unl ikely before 2025 in most cases.

Global growth is projected to be in line with the April 2024 World Economic Outlook (WEO) forecast, at 3.2 percent in 2024 and 3.3 percent in 2025. Services inflation is holding up progress on disinflation, which is complicating monetary policy normalization. Upside risks to inflation have thus increased, raising the prospect of higher for even longer interest rates, in the context of escalating trade tensions and increased policy uncertainty. The policy mix should thus be sequenced carefully to achieve price stability and replenish diminished buffers.

The latest round of FICCIs Economic Outlook Survey projects an annual median GDP growth for 2024-25 at 7.0%, with estimates ranging from 6.6% to 7.5%. Despite ongoing challenges, Indias economic growth remains strong, positioning it among the fastest-growing economies globally.Conducted in July 2024, the FICCI survey gathered insights from leading economists representing industry, banking, and financial services sector.

Economists anticipate the industry and services sectors to achieve growth rates of 6.7% and 7.4%, respectively, during the current fiscal, compared to 9.5 percent and 7.6% in the last fiscal year. They expect investments to remain strong, driven by the momentum in government capital expenditure and the crowding-in of private investments.

In this document, the terms ‘Company, ‘ITPL refer to the consolidated operations of Innovative Tech Pack Limited. Innovative offers a wide range of plastic jars, bottles, caps, closures and dispensers in PET, PP, HDPE and PCTA. As a pioneer in the Indian plastics industry, ITPL has been at the forefront of technology since the 1990s. We put out an elaborate, diverse portfolio of quality products in the market backed by innovative processes, advanced single-stage machinery and trusted raw material. This allows us to cater to both single-product clients as well as large clients with multiple product segments.

Innovation is at the core of our philosophy and we imbibe that into every aspect of our manufacturing technique and infrastructure. We collaborate closely with our customers to ensure that we are upping our game with every new product we produce.

With 40 top-of-the-line machines from global machinery giants, modern air-conditioned infrastructure, established in strategic locations which make business sense for our clients, our manufacturing facilities are the best in the business. These facilities are complete with air conditioned production and packing rooms, tool rooms and an innovation centre for R&D.

Our three plants in Rudrapur, Baddi and Guwahati allow a fantastic span across northern and eastern India for distribution and regional sales support. We are now looking to move to southern India with an upcoming manufacturing facility on the eastern coast. Our clients prefer working with us due to the competitive and cost advantage that our strategic plant locations offer them due to proximity to their own production units. Just-in-time inventory combined with lower fuel costs are propelling our clients to do more business with us.

Quality is the utmost business priority for us and this extends all the way from the top to the grassroots of our organization. We practice quality as a value in everything we do - right from the raw materials we use to the product we deliver. Our long term relationship with existing clients is support to this.

We invest our time and effort in achieving quality standard certifications and continue to constantly upgrade them.

In line with our clients expectations especially in the food, beverage and pharmaceutical sectors, all our plants are ISO: 22000-2005 and following the standard manufacturing processes as prescribed. Also, we are currently in pursuit of BRC certification to further upgrade our facilities for food and pharma clients. We are proud to announce that we have recently achieved the prestigious SEDEX certification recently.

Plastic bottles have become way of life and are in all sectors such as food and beverages, oil, pharma, drinking water and all other sectors. They do not fall into single use plastic as, they are environment-friendly and can be recycled repeatedly which further reduces there manufacturing cost. Hence their volume has reached around 20 million tons/pa globally Polyethylene terephthalate (PET) refers to a thermoplastic polymer resin of the polyester family which is widely used for manufacturing plastic bottles. In comparison with PP, HDPE and PVC bottles, PET bottles are more durable, transparent, lightweight, non-reactive, cost-effective and thermally stable.

• To change the face of plastics packaging in India.

• To exceed our clients expectations with packaging innovation, cutting-edge technology, proximal manufacturing units, operational excellence and passion for quality.

• To exceed our shareholders expectations with sustainable growth in profitability and building the company brand in existing and newer markets.

• To exceed our peoples expectations with an exciting work environment, continuous learning and room for career growth.

Growth of pet industry is key to our success more and more product segments are shifting to pet bottles/jar in spite of all efforts there shall be no replacement of pet bottles/jars as all others like glass etc. are not cost competitive

However more and more players are entering this industry resulting in cut throat competition and substantial depletion in margins

1. Cost competitiveness, low manpower, efficient machinery in terms of power consumption, and judicious use of labor and using automated machines is key to survival

2. To reduce debt burden so as to reduce financial cost. Optimize working capital requirement

3. Reduce non-essential administrative cost

4. Better product mix with focus on customers giving higher value additions

1. Competition resulting in price cutting and consequently reduction of margins.

2. Hike in US $ rate and prices of petroleum products has resulted in upsurge in prices of PET/PP.

Hence PET bottles/Jars companies have to focus on cost reduction strategies/ economic of scale and bring efficacies so that in manufacturer of PET bottles/Jars continues to remain as best option.

Human Resources are considered to be a form of capital and wealth of the Company. The growth of the Company and improvement in the systems has been sustained by the active involvement of the employees with the Management. It has been the focus of the management to improve and expand the contribution of its human resources towards attainment of organizational goals and values. The technical expertise of the Management has been shared with the employees at the works, which keeps them motivated to meet and surpass the set targets.

The Company has an adequate system of internal control relating to purchase of stores, raw materials including components, plant & machinery, equipment and other similar assets and for the sale of goods commensurate with the size of the Company and nature of its business.

The Company also has Internal Control System for speedy compilation of Accounts and Management Information Reports and to comply with applicable laws and regulations.

The Company has an effective Budgetary Control System. The Management reviews the actual performance with reference to budgets periodically. The Company has a well-defined organizational structure, authority levels and internal rules and regulations for conducting business transactions.

The Company has already formed an Audit Committee and has met four times in the year. Audit Committee ensures proper compliance with the provisions of the Listing Agreement with Stock Exchanges, Companies Act,

reviews the adequacy and effectiveness of the internal control environment and monitors implementation of internal audit recommendations. Besides the above, Audit Committee is actively engaged in overseeing financial disclosures and in reviewing your Companys risk management policies.

The Company believes that a clean environment in and around the workplace fosters health and prosperity for the individual, the group and the larger community to which they belong.

Environmental protection is an integral part of the planning, design, construction, operation and maintenance of all our projects.

Further, the Company has developed technology for reprocessing mixed plastic waste and converts them into usable products. In addition to this, the Company constantly works to reduce consumption of energy, water and petroleum based products and works with its customers to develop more sustainable and ‘green film and laminate structure.

The overall emphasis is on reducing the carbon footprint and be more environment friendly and sustainable. All the products of the company are eco-friendly.

The Company is an equal opportunity employer offering best in industry career growth prospects and has taken a step ahead to make a positive difference by aligning its vision of offering equal opportunities of skill and career enhancement to underprivileged sections of the society; specifically, the youth.

Macro economic conditions do affect the Companys operations. Low demand, economic slowdown, political instability, higher inflation, natural calamities may affect the business. Business therefore cannot be risk free. What is therefore important is to correctly assess the risk area wise and to take steps to mitigate the risk before it becomes a potential threat. General risk areas are statutory compliances, economy, financial, government regulations and policies, market related, operational, products and technology, intellectual property etc.

With the changing and turbulent business scenario, our basic focus is to upgrade the skill and knowledge level of the existing human assets to the required level by providing appropriate leadership at all levels, motivating them to face the hard facts of business, inculcating the attitude for speed of action and taking responsibilities.

The Company has identified potential risks such as business portfolio risk, financial risk, legal & statutory risk and internal process risk including ERP and IT and has put in place appropriate measures for their mitigation.

The Companys Human Resources philosophy is to establish and build a strong performance and competency driven culture with greater sense of accountability and responsibility. The Company has taken pragmatic steps for strengthening organizational competency through involvement and development of employees as well as installing effective systems for improving the productivity, quality and accountability at functional levels.

Your Company is committed to conducting its operations with due regard to the environment and providing a safe and healthy workplace for employees. The collective endeavor of your Companys employees at all levels is directed towards sustaining and continuously improving standards of environment, occupational health and safety in a bid to attain and exceed international benchmarks.