Kshitij Polyline Ltd Management Discussions

Industry Structure and Development-

Our Company and its executives have developed the skill and expertise in designing and innovation in office stationery, calendar, dairy and student study materials of different variety colours, design and application. We have also developed the in house technical & Design team to provide stationery solution and implementation for calendar, diary, and book as replacement of traditional material with new and innovative PP material. Under the guidance of promoters, our company has successfully launched a wide products range, established goodwill for quality products and have the regular clients for the laminated, PP and PET sheet, Wiro, File and folders. Our company has developed and launched more than 250 products range in File, Folder & Diary under our Brand in Indian Market. Further our company has supply Make to order ID cards with ribbon, File & Folder, notebooks with client Logo and Info, Display materials for Education, Pharma, FMCG, Finance and Insurance sectors.

Management is planning for business expansion by having a state-of-the-art manufacturing facility and complying with international standards. This shall also support for E commerce and Online marketing of companys products.

We are equipped with all facilities to execute all types of manufacturing activities from granule to PP sheet with colours, PP sheet to finished products, QC & packaging, etc. Our Company is consistent in supplying quality products round the year as customized products are made available to them as per the market 42 demand. Our products comply with requisite safety standards. As a quality conscious company, we provide a high performance-oriented range of products. We undertake extremely stringent quality checks at every level of the manufacturing processes. We are constantly striving to expand our line of products, and we are always on the lookout for complementary products that will add to our solution bouquet. We would seek product lines which have better scope for value addition and therefore offer us higher than average margins.

Currently, we have a head office, and a sales office located in Mumbai, Maharashtra. The company establishes a long-term relationship with their clients by providing good quality products, which will surely go a long way and benefit the company. The company is backed by a team of highly creative and experienced professionals who have an affinity for creating innovative designs. The companys team has been a major strength as it understands the varied needs of the clients and works accordingly. From processing to finish, the company tries its best to ensure the quality of every single product delivered by the company.

Opportunities s Threats-

Company in new geographies with increasing economy and industrial growth augur well for the companys products in the near short-term. The company has migrated from MSME platform to Main Board, which increases the investors reliability and company is in position to get more funds based on its performance. The company is trying to increase company turnover by increasing its sales and providing better quality.

Segment wise performance-

The business activities of the Company comprise in the business segments of Stationery Plastic Products.

Market and Outlook:

The Global Stationery market is anticipated to rise at a considerable rate during the forecast period, between 2024 and 2031. In 2025, the market is growing at a steady rate and with the rising adoption of strategies by key players, the market is expected to rise over the projected horizon.

Risks and concerns-

The company makes responsible approaches towards Risk Management on an integrated basis to cover all aspects of operations to diminish each or a combination of known risks that could affect its business. The company has a comprehensive insurance coverage and breakdown coverage for all its electronic equipment to protect all its assets from such damages. Apart from the above, the Company has a well-documented Risk Management System. The Company does identify a few risks, which are purely routine in nature and none of any significant impact. There is a mitigation system in place which addresses these risks.

Industry structure and development opportunities, threats, risks, concerns and outlook:

Due to COVID-19 pandemic and nationwide lockdown all industry and everyone business segment has face major setback. Slowly Indian economy moved on a recovery path which is a good indicator. Going forward, it is our conviction that the transparent policies will further help the growth of organized sector due to reduction of unethical practices which had led to unfair and unjust competition in the past.

During the financial year, 2024-2025, the Stationery Manufacturing Business recorded moderate growth, and revenue is increasing accordingly. (Rs. In Lakhs)

In the coming year, Company wants to introduce several new products & introduce standardize product portfolio to stay ahead of the curve in the highly competitive Stationery domain, the objective clearly being to provide innovative products which will enhance the offerings and also improve the top and bottom line of both the channel partners and the Company. These innovations were basically centered around better aesthetics, innovative designs and space-saving attributes. The strong network of office staff, sales staff assisted by a robust SCM system which links the multi-location production facilities to deliver our products efficiently helped us in not only enhancing the market penetration further but also improved our timely fill rate to the general trade, modern trade and E-commerce portals across the country. This will continue to be our focus area in the coming period.

In the coming year the Company is geared up to improve the indigenization initiative through local sourcing and selective backward integration especially in the New Imported machinery, New Designing Product with Better Technology.

KPL focus on Better Stationery Product has helped us to develop a unique business model in the country as it essentially serves the same network of distributors and retailers thus making it easier for them to source all types of stationery requirements of their customer in the Printing & Stationery domain through one major principal. This in a way is a winning solution for the channel partners as this takes care of their aspiration of both top line growth and profitability.

We are also investing in machineries to increase our production capacities in PPE Sheet / PET Sheet and Varieties in Lamination Pouches, Injection moulding and moulds of growth segments for wider range of pallets and waste management products based on a focused market research and product development program to add value to our product offerings, strengthening our brand positioning as a "One Stop Shop for Material Handling

Solutions".

Our ‘Go to Market through our direct sales model, with 50 plus Pan India sales force has been further strengthened by increased usage of technological customer relationship solutions (CRM Software. We have implemented key account management to deepen customer penetration and capture a larger share of their purchases in our product segments and also started use of data analytics to identify and tap into expanded markets to broaden our customer base. We have expanded our use of BI (Business Intelligence), machine learning tools to help us increase efficiency in warehouse stocking, logistics and accounts receivables management. Efficiencies in these will directly lead to better cash flows and a reduction in related costs.

Most importantly, a program "Fit for growth" has been instituted as a comprehensive manpower productivity improvement exercise to map and improve our processes by reducing complexities and use of technology with an aim to improve manpower productivity.

Immediate to medium term concerns are rising crude price, impacting raw material prices and disruptions in agriculture sector due to climatic changes which pose as challenge to revenue growth and profitability.

Discussion on Financial Performance with respect to operational performance FINANCIAL REVIEW: Revenue from Operations:

During the year 2024-25, the total revenue of our company is Rs. 3238.00 lacs as against Rs. 3421.98 lacs in year 2023-24.

Mainly this revenue earned from sales of wiro products having vast application, Lamination sheet, PP and PET Sheet suitable for stationery, dairy, folders & files and notebooks and calendar. With introduction of GST and rationalize rate structure, our companys products become cheaper, and company has pass on these benefits to end users. Even increase the strength of dealers and sales team to cater the E commerce and Dealers.

The operating cost consists of Material used & consumed, direct expenses to manufacture the products, Employee Benefit Expenses, Finance cost, Depreciation and Administration, Rent & Selling Expenses. During the year 2024-25, the cost of material consumed was consists of PP Granule, wiro, fabric, chemical and allied materials. The material consumed was Rs. 2056.86 lacs from Rs.3168.50 lacs as compared to year 2023-24 showing decrease of 35.08%.

Expenses incurred on staff and executives and its welfare during the financial year 2024-25 was Rs. 524.56 Lacs and in 2023-24 it was Rs. 573.91 lacs. During the year increment was given in range of 10% - 20%. This show decreases in employees expenses by 8.60%.

Expenses incurred on finance and interest cost during the financial year 2024-25 increase to Rs. 224.74 lacs from Rs. 178.18 Lacs in fiscal year 2023-24, showing increase in expenditure by 26.13 %.

Depreciation and amortization expense:

During the year 2024-25, depreciation and amortization expense of our company has increased to Rs. 165.69 lacs as against Rs. 116.97 lacs in year 2023-24 showing a increase by 41.65%.

Administrative and Selling expenses for the year 2024-25 decreased to Rs. 311.18 lacs from Rs. 329.73 lacs in F.Y. 2023-24. The expenses had been decreased as still exhibitions and business fairs is not permitted by various Government department. This show decrease in expenses by 5.63 % as compared to previous year.

The Loss for Financial Year 2024-25 is Rs. 930.11 lacs as compared to Loss of Rs. 56.23 lacs in Financial Year 2023- 24.

INTERNAL CONTROL SYSTEM AND THEIR ADEQUACY:

The Management of our Company has put in place adequate Internal Controls that are commensurate with the size and nature of its Business. The Internal financial controls placed also ensures that executed transactions are recorded in all material respects to permit preparation of financial statements in conformity with established accounting principles. Internal Audit Department along with the help of external professional agencies continuously monitors the effectiveness of the internal controls with an objective to provide to the Audit Committee and the Board of Directors, an independent, objective and reasonable assurance on the adequacy and effectiveness of the internal control. Based on their assessment, Management believes that your Company maintained effective internal control over financial reporting.

HUMAN RESOURCES AND INDUSTRIAL RELATIONS:

Your Company has built significant talent pool in the form of top and middle management. We have also created a performance-oriented work culture with focus on building long term talent pool. Also, we continuously endeavour to improve and enhance the work environment for our employees. Competitive compensation package, innovative and challenging environment to work, etc., are some of the steps taken by the Company for the welfare of its employees.

Key Financial Ratios:

CAUTIONARY STATEMENT:

The Management Discussions and Analysis Statement made above are on the basis of available data as well as certain assumptions as to the economic conditions, various factors affecting raw material prices, selling prices, trend and consumer demand and preference, governing and applicable laws and other economic and political factors. The Management cannot guarantee the accuracy of the assumptions and projected performance of the Company in future. It is therefore cautioned that the actual results may differ from those expressed and implied therein.