Jindal Poly Films Ltd Management Discussions

COMPANY OVERVIEW

JindaL Poly Films Ltd (JPFL) was incorporated in 1974 and started production of polyester yarn in 1985 at Bulandshahr. The company started manufacturing polyester chips for captive use in 1993. In 1996, JPFL diversified into manufacturing of biaxally oriented polyethylene terephthalate (BOPET) film and in 2003 into BOPP Films.

Jindal Poly Films Limited ("the Company) through its subsidiaries boasts a diverse portfolio across sectors such as Packaging Films, Non-Woven Fabrics and Labelling Industry.

Your company through its subsidiaries maintained its leadership position in the Indian Flexble Packaging Industry with its dominant product portfolio, huge production capacity , vast market reach and continuous product innovations in the films and labelling space . The superior value proposition delivered by your company is unparalleled in the industry.

Your company continued its tradition of pioneering product, process and service innovations founded on the pillars of customer centricity, equity, transparency and competitiveness. The objective being to keep the customer ahead, always.

The current year witnessed further capacity addition in the Indian film industry. Despite the increased competition, your company maintained its market share due to its loyal customer franchise.

Additionally, we excel in producing PP-based Spunmelt and Spunbond Nonwoven Fabric, showcasing our adaptability to evolving market needs. Through our subsidiary, SMI Coated Products Private Limited, we offer more than 200 different products of self-adhesive labels required by the dynamic label industry.

Our company through its subsidiaries epitomizes innovation, quality, and reliability across packaging films, non-woven fabrics, and labelling solutions.

GLOBAL ECONOMY

The global economy continued facing headwinds resulting from high debt levels, weak productivity, climate risks and geopolitical tensions, and posted a modest growth of 3.1% according to the IMF. While advanced western economies slowed down, Asia, particularly India and parts of the Middle East, bucked the trend and demonstrated strong performances.

IMF data pointed to a global soft landing with easing inflation and structural resilience in key economies, even under tight monetary policies, avoiding a significant recession in many countries, including the US and China. Projection for the medium term suggest persistently low growth, around 3.1%, down from historical averages of 3.8%. Uncertainties stemming from geopolitical tensions, ongoing conflicts in Ukraine and escalation in the Middle East, and a broad array of elections in over 70 countries impacted global policy decisions and economic stability. Without productivity-enhancing reforms and tech adoption (especially AI), there is risk of long term growth stagnating. Overall supply chain fragility, geopolitical instability and tightening credit threaten future growth. International organizations emphasized the need for strengthened global cooperation to address challenges like climate change, sustainable development financing, and debt sustainability.

Early 2025 witnessed a change of Government in the worlds largest economy , the US. The new administrations economic policies, characterized by protectionism and tariff imposition, introduced significant uncertainty and potential disruptions to the global economy. The extent of the impact depends on various factors, including the responses of other nations and the long-term adjustments within global trade and financial systems.

INDIAN ECONOMY

In 2024, the Indian economy exhibited strong and steady growth, emerging as the worlds fastest-growing major economy, with real GDP growth estimated at around 6.5% for FY 2024-25, fueled by a recovery in private consumption and robust services sector performance. Key drivers included increasing employment, expanding economic activity, and strong private consumption, particularly in the rural sector. The government also achieved record tax revenues, particularly through GST collections, and implemented effective direct benefit transfer schemes to boost fiscal efficiency. Strong domestic demand, a vibrant startup ecosystem, robust digital infrastructure and financial sector stability were the drivers of growth.

The Countrys attractiveness as an investment destination remains robust, given the size and scale of operations it has to offer to global companies, abundant skilled talent pool, and prowess in technology and innovation. According to provisional data for the financial year (FY) 2024-25, Indias foreign direct investment (FDI) inflows continued their robust upward trend, largely driven by strong performance in gross inflows despite a notable decline in net FDI. Key highlights for 2024 include growth in FDI equity inflows, continued dominance of the services sector, and a significant rise in manufacturing investments.

Indias economic outlook for 2025 is largely positive, with major institutions forecasting strong and stable growth, driven primarily by robust domestic demand and significant government capital expenditure. However, the forecast is tempered by persistent global headwinds, including geopolitical tensions and trade uncertainties.

INDUSTRY OVERVIEW

Your company through its subsidiaries is always at the forefront of product and service innovations, driving growth and enhancing stakeholder value within the Packaging Films, Non-Woven Fabrics and Labelling Solutions.

Packaging Films Industry

The demand for flexible packaging maintained its growth trajectory. The Indian demand has been consistently in double digits against a global average in the mid-single digits. The low per capita consumption of flexible packaging in India and other South Asian countries compared to the Western World makes it one of the most potential markets with sustained long-term growth outlook for flexible packaging manufacturers. Growing per capita GDP, urbanisation, organised retail penetration, and burgeoning middle class with higher disposable income is driving the demand for packaged goods.

The adoption of sustainable packaging gained momentum with brand owners accelerating the transition from conventional packaging. Packaging film manufacturers continued its R&D in process and investment in hardware to provide brand owners with sustainable packaging options.

Nonwovens Fabrics Industry

The nonwoven fabric industry is among the fastest-growing segments of the global textile sector, supported by its versatility, cost-efficiency, and ability to deliver properties like absorbency, durability, softness, and filtration. Demand is rising strongly in hygiene and healthcare applications such as diapers, sanitary napkins, PPE kits, masks, and gowns, while adoption is also expanding in automotive, construction, packaging, and filtration. Growth is particularly strong in Asia-Pacific, led by China and India, driven by urbanization, higher healthcare spending, and greater awareness of hygiene. Looking ahead, sustainability will be a key growth driver, with increasing focus on biodegradable and recyclable nonwovens. With ongoing innovation, the industry is set to remain a vital enabler of modern industrial and consumer applications.

Labelling Solutions

Indian label industry has witnessed a very robust demand and is growing steadily at a CAGR of nearly 9%. Large number of new product launches in PS amenable formats resulting in sectors like food, beverage, wines and spirits, pharma and personal care driving demand growth and innovation in the Indian label industry.

In the complex supply chain environment, we have steadily been able foster strong relationship with our European and Asian suppliers as strategically minimized impact of higher pulp and film resins. The outlook for 2025 remains very outbound and expect to maintain strategy to see any downturn in volatile pricing.

BUSINESS OVERVIEW (Segment wise/Product wise performance)

Our company boasts a diverse portfolio across sectors such as Packaging Films, Non-Woven Fabrics and Labelling Industry.

Packaging Films: The company through its subsidiary is engaged in manufacturing a comprehensive range of products. This includes BOPP, BOPET (Thick and Thin), CPP, Lamination, Metallized Films, Coated Films, Thermal Lamination Films, and Capacitor Films.

JPFL Films Private Limited ("JFPL") is a subsidiary of the Company, which has been offering a wide range of products and solutions. It is a leading Indian manufacturer with a mission to transform the packaging industry. Specializing in BOPP, BOPET, CPP films, and more, it has established ourselves as a global powerhouse known for top-notch quality and cutting-edge technology. Our diverse film range forms the basis of modern packaging solutions, offering durability and superior barrier properties.

This strategic manufacturing facility is situated in Nashik, Maharashtra. It boasts a substantial production capacity for BOPP total capacity 2,94,200 TPA, for BOPET total capacity 1,70,000 TPA, for CPP total capacity 33,600 TPA, exemplifying the operational magnitude and its dedication to fulfilling customer requirements.

On 21^st May, 2025, an unfortunate fire accident took place at above said subsidiary Companys plant situated at 28th Km Stone, Nashik lgatpuri Road NH-3, Village Mundhegaon, Taluka Igatpuri, Distt. Nashik, Maharashtra, India. The fire has resulted in a substantial loss of stock, fixed assets and infrastructure of the Company. Approximately 70% of the assets were affected. The Company is making efforts to revive its operations. The Company is in process to lodge claim with the insurance company.

Strategically with a state of art facility in Nasik, Maharashtra, which grants us efficient market access. Backed by an experienced senior management team, we drive innovation with deep industry insights. Leveraging our geographical advantage, we ensure seamless imports and exports for global distribution.

Nonwovens Fabrics: Global Nonwovens is Indias premier spunmelt nonwoven manufacturer, equipped with three advanced Reicofil? R5 & R4S multi-beam composite spunmelt lines (SSMMS) from Germany. With a production capacity of 60,000 MT, the company caters to global sectors including hygiene, medical, and industrial, serving numerous multinational entities in the personal care domain.

The Company has established unparalleled standards in process efficiency, product quality, and traceability, all while using premium raw materials and emphasizing continuous R&D. Noteworthy international certifications include ISO 9001:2005, ISO 14001:2015, ISO 45001:2018, ISO 13485:2016, SEDEX SMETA, Eco-Vadis and CYBER VADIS.

Jindal SMI Coated Products Ltd. wholly owned subsidiary of Jindal Poly Films Limited, ventured into the labelling solutions business, signifying a notable diversification. Committing to a sustainable future, it stands at the vanguard of innovating products championing carbon neutrality for brands. Emphasizing its eco-centric approach, the Ambernath

MIDC Plant under Jindal SMI Coated Products Ltd has integrated a solar setup, projected to counter balance its energy consumption. Labelling Solutions business recorded revenue of Rs. 344.20 cr. in F. Y. 2024-25.

Product Development and Quality Enhancement

In the relentless pursuit of innovation, Jindal Poly consistently advances and refines its product portfolio. This involves developing new products and enhancing the quality across key divisions, such as Packaging Films, Non-Woven Fabrics and Labelling Solutions. As it navigates the future, there remains an unwavering commitment to evolve, striving to deliver increasingly efficient and reliable solutions.

FINANCIAL PERFORMANCE

The following are the key financial highlights for the period ended 31^st March 2025. (Rs. in Lakh, except EPS)

Particulars	Standalone		Consolidated
	Year Ended		Year Ended
	31st March 2025	31st March 2024	31st March 2025	31st March 2024
Total Income from Operations	67,122	54,317	5,33,494	3,92,557
Other income	46,016	49,642	40,743	47,793
Profit before finance cost, depreciation and tax	45,457	52,402	67,573	47,610
Finance Cost	4,462	5,007	36,049	17,100
Depreciation	5,239	6,000	22,278	21,416
Net Profit for the period (before Tax, Exceptional and Extraordinary Items)	35,756	41395	9,246	9,094
Exceptional Items gain / (loss)	11,046	-	5 ,474	-
Net Profit for the period before Tax	46,803	41,395	14,720	9,094
Total Tax (including Current Tax, current tax adjustment and Deferred Tax)	8,478	10,195	3,219	1,945
Net Profit for the period	38,324	31,200	10,979	7,150
Total Comprehensive Income for the period (Comprising Profit for the period (after Tax) and Other Comprehensive Income (after Tax) attributable to Equity Holders of the parent	38,347	31,216	12,308	6,737
Paid up Equity Share Capital (Face Value of Rs.10/- each)	4,379	4,379	4,379	4,379
Earnings Per Share (EPS) (of INR. 10/- each) on Net Profit (Not annualised)- Basic and Diluted	87.53	71.25	25.08	16.33

Change in Key Financial Ratios (subject to confirmation):

The changes in key financial ratios provide valuable insights into the performance and efficiency our company during the fiscal year. These ratios reflect the companys ability to manage various aspects of its operations. Here are some not able observations:

Sr. No. Particulars	2024-2025 Standalone	2023-2024 Standalone	Change %
1 Trade Receivable Turnover Ratio	3.91	3.72	4.97
2 Current Ratio	9.65	11.28	(14.44)
3 Inventory Turnover Ratio	4.66	5.39	(13.64)
4 Net Profit Ratio (%)	57.10	57.44	(0.60)
5 Return on Capital Employed (%)	5.82	7.01	(17.03)
6 Operating Profit Margin (%)	30.09	15.00	15.09
7 Interest Coverage Ratio	16.92	10.25	39.42
8 Debt Equity Ratio	0.10	0.12	(14.36)

STRENGTHS:

Holding the title as Indias preeminent producer of Poly Films, with state-of-the-art facility and advanced technologies, exemplifying cost-efficiency, meticulously designed to guarantee optimal production efficacy, setting a benchmark in the industry.

OPPORTUNITIES AND THREATS Opportunities:

Consumer demand for eco-friendly packaging presents opportunities for manufacturers to offer sustainable solutions.

Embracing advanced production processes and printing techniques enables companies to provide cutting-edge products.

Tailoring packaging films to specific industry needs and collaborating closely with clients can drive market expansion.

Leveraging competitive pricing and strong distribution networks, Indian manufacturers can explore international markets growing demand.

E-commerce boom presents an opportunity for the flexible packaging industry to innovate and tap into new revenue streams in this growing market.

Threats:

Market fluctuations in raw material prices, such as polypropylene and polyethylene terephthalate, impact profitability.

Rapid changes in consumer preferences, economic conditions, and global trade dynamics require adaptability for sustained growth.

Stringent environmental regulations may impose further costs, making it even more challenging for the flexible packaging industry to maintain profitability amid escalating operational expenses.

Rise in consumer preference for eco-friendly alternatives could erode market share, adding to the operational and strategic challenges faced by the traditional flexible packaging industry.

Over capacity in Packaging Films Industry.

By addressing these threats and capitalizing on opportunities, our company can leverage its market presence, diverse product range, and strategic focus on key growth areas.

SUSTAINABILITY INITIATIVES AND CORPORATE SOCIAL RESPONSIBILITY

Emphasizing environmental stewardship, our company implements sustainable practices in its operations, including energy conservation, waste reduction, and water management strategies. Beyond internal operations, the company engages with local communities through social development programs, focusing on education, healthcare, and environmental awareness. Through the integration of sustainability into business practices, the company creates enduring value for stakeholders and contributes to a greener, more socially responsible future. This approach underscores the companys belief in the essential role of sustainable businesses in nurturing a sustainable society.

RISK MANAGEMENT

The company operates with a proactive stance towards risk identification, assessment, and mitigation, which may potentially impact operations, financial performance, or reputation. A robust risk management framework is utilized to anticipate and address various types of risks, such as market volatility, supply chain disruptions, regulatory changes, and competitive pressures. Emerging risks are continually monitored, and mitigation strategies are adopted to minimize potential impacts. By placing a high priority on risk management, the company strives to ensure long-term sustainability and resilience in an ever-evolving market environment.

CORPORATE GOVERNANCE

Our companys Board of Directors comprises experienced professionals who bring diverse expertise and perspectives to

the table. We adhere to rigorous governance policies and procedures that ensure accountability, integrity, and fairness in our decision-making processes. We maintain open and transparent communication channels with our shareholders, provding them with timely and accurate information about our performance, strategies, and risks. Additionally, we have established committees to oversee key areas such as audit, risk management, and corporate social responsibility, further strengthening our governance framework. By nurturing a culture of ethical conduct and responsible business practices, we aim to maintain the trust and confidence of our stakeholders.

HUMAN RESOURCES AND TALENT MANAGEMENT

Our company foster a culture of inclusivty, collaboration, and continuous learning, where every employee is encouraged to reach their full potential. Our talent management initiatives focus on attracting and retaining top talent in the industry, nurturing their skills through training and development programs, and provding growth opportunities within the organization. We also emphasize employee engagement and work-life balance, ensuring a healthy and supportive work envronment. By investing in our employees professional growth and well-being, we build a motivated and high - performing workforce that drives our success. Total number of employees in the Company stands at 159.

INDUSTRIAL RELATIONS

During the year under revew, harmonious industrial relations were maintained in your Company.

INTERNAL CONTROL SYSTEM

Our internal control framework encompasses policies, procedures, and monitoring mechanisms that promote adherence to regulatory requirements and ethical standards. We have established clear lines of authority, segregation of duties, and comprehensive risk assessment processes. Regular internal audits and revews are conducted to assess the effectiveness of our control systems and identify areas for improvement. By strengthening our internal control system, we enhance transparency, minimize the risk of fraud or errors, and protect the interests of our stakeholders. The Audit Committee regularly revews significant audit findings, adequacy and reliability of financial reporting and internal control and risk management frameworks.

Overall, our company is well-positioned in the industry, with a focus on strategic decisions, customer-centric approaches, innovation, and sustainable growth. The companys commitment to operational excellence, market expansion, and stakeholder engagement positions it for continued success in the ever-evolvng business landscape.

RESEARCH AND DEVELOPMENT

Research and development (R&D) play a crucial role in our companys growth and innovation. We have a dedicated R&D team that continuously explores new technologies, materials, and processes to enhance our product offerings. Our R&D initiatives focus on improvng product quality, developing new applications, products to address emerging market trends. Through collaboration with industry experts, academic institutions, and customers, we stay at the forefront of technological advancements. By investing in R&D, we aim to meet evolvng customer needs, drive product innovation, and maintain our competitive advantage in the market.

CAUTIONARY STATEMENT

This report contains forward-looking statements that reflect the Companys current expectations, projections, and intentions regarding its objectives, plans, or goals. These statements are subject to certain risks and uncertainties, including domestic and international economic conditions, change in Government regulations, tax regime and other factors that could cause actual results to differ materially. The Company cautions readers not to place undue reliance on these forward-looking statements, as they are based on information available at the time of the report and are subject to change. The Company undertakes no obligation to update or revse any forward-looking statements, and readers are advsed to carefully consider the risk factors and uncertainties discussed in the report.