Kshitij Polyline Ltd Management Discussions

ANNEXURE-V

Industry Structure and Development

Our Company and its executives have established skills and knowledge in the creation and innovation of office stationery, calendars, diaries, and student study materials in a wide range of colours, designs, and applications. We have also established an in-house technical and design team to provide stationery solutions and implementation for calendars, diaries, and books by replacing old materials with new and revolutionary PP materials. Our company has successfully introduced a diverse product line, built a reputation for quality, and has regular clients for laminated PP and PET sheets, Wiro, Files, and Folders. Over 250 products in the file, folder, and diary categories have been created and introduced by our company under our brand in the Indian market. In addition to this, our company provides customised ID cards with ribbon, file & folders, notebooks with client logo and information, and display materials for the education, pharmaceutical, FMCG, finance, and insurance industries.

The Management is planning to expand the business by setting up a state-of-the-art manufacturing facility that meets international standards. This development will also support the companys e-commerce initiatives and online marketing efforts.

We are fully equipped with comprehensive facilities to carry out a wide range of manufacturing processes - from converting granules into colored PP sheets, to producing finished products, conducting quality control, and handling packaging. Our company consistently delivers high-quality products throughout the year, offering customized solutions based on market demand. All our products adhere to the necessary safety standards. As a quality-driven organization, we offer a high-performance range and implement stringent quality checks at every stage of the manufacturing process.

We are continuously working to expand our product portfolio and actively explore complementary product lines that enhance our overall offerings. We prioritize products with strong potential for value addition, aiming for those that can deliver above-average profit margins.

Our corporate presence includes a head office and a dedicated sales office located in Mumbai, Maharashtra. The company focuses on building long-term relationships with clients by consistently delivering high-quality products, which is expected to contribute significantly to sustained growth and success. Our team comprises highly creative and experienced professionals with a strong passion for innovative design. This team has been a key strength, as they understand the diverse needs of our clients and tailor their approach accordingly. From initial processing to the final finish, we are.....committed to maintaining the highest standards of quality in every product we deliver.

Expanding into new geographies with growing economies and industrial development indicates positive prospects for the companys products in the near term. The recent migration from the MSME platform to the Main Board enhances investor confidence and positions the company to attract greater funding based on its performance. The company is focused on increasing its turnover by boosting sales and consistently delivering superior quality products.

The Companys business activities cover multiple segments, including Stationery and Plastic Products.

The global stationery market is expected to grow at a significant rate during the forecast period from 2024 to 2031. In 2026, the market is expanding steadily, and with the increasing adoption of strategic initiatives by key players, it is projected to continue rising throughout the forecast horizon.

The company adopts a responsible and integrated approach to risk management, covering all aspects of its operations to minimize individual or combined risks that could impact the business. It maintains comprehensive insurance coverage, including breakdown protection for all electronic equipment, to safeguard its assets against potential damage. In addition, the company has implemented a well-documented Risk Management System. While a few risks have been identified, they are routine in nature and do not pose any significant threat to the business. These risks are effectively managed through an established mitigation system.

During the financial year, 2025-2026, the Stationery Manufacturing Business recorded moderate growth, and revenue is increasing accordingly.

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.

KPLs 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 machinery to expand our production capacity in PPE sheets, PET sheets, and a variety of lamination pouches. Additionally, we are enhancing our capabilities in injection moulding and mould development to support growth segments, including a broader range of pallets and waste management products. These initiatives are guided by focused market research and a targeted product development program, aimed at adding value to our offerings and reinforcing our brand positioning as a "One-Stop Shop for Material Handling Solutions."

Our Go-to-Market strategy, driven by a direct sales model and a dedicated Pan-India sales force of over 50 professionals, has been further strengthened through the increased use of advanced customer relationship management (CRM) software. We have implemented key account management practices to deepen customer engagement and capture a larger share of their purchases across our product segments. Additionally, we have begun leveraging data analytics to identify new market opportunities and expand our customer base. The adoption of Business Intelligence (BI) and machine learning tools has also enhanced efficiency across key operational areas such as warehouse stocking, logistics, and accounts receivable management. These improvements are expected to directly contribute to stronger cash flows and reduced operational costs.

Most importantly, we have launched the "Fit for Growth" program—a comprehensive initiative focused on enhancing workforce productivity. This program aims to streamline processes, reduce complexities, and leverage technology to drive greater efficiency across the organization.

In the immediate to medium term, rising crude oil prices—leading to higher raw material costs—and disruptions in the agricultural sector due to climate change present significant challenges to revenue growth and profitability.

During the year 2025-26, the total revenue of our company is Rs. 4,475.05 Lakhs as against Rs 3,058.02 Lakhs in the year 2024-25.

The majority of our revenue is generated from the sale of wire products, which have a wide range of applications, as well as lamination sheets, and PP and PET sheets used in stationery items such as diaries, folders, files, notebooks, and calendars. With the introduction of GST and a more rationalized tax structure, our products have become more competitively priced, and we have passed these benefits on to end users. Additionally, we have strengthened our dealer network and expanded our sales team to better serve both e-commerce platforms and traditional dealer channels.

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 2025-26, the cost of material consumed was consists of PP Granule, wire, fabric, chemical and allied materials. The material consumed was Rs. 3,731.30 Lakhs from Rs. 2,056.86 Lakhs as compared to year 2024-25 showing an increase of 81.46%.

Expenses incurred on staff and executives and its welfare during the financial year 2025-26 was Rs. 639.37 Lakhs and in 2024-25 it was Rs. 524.56 Lakhs. During the year, increment was given in range of 21.89%.

Expenses incurred on finance and interest cost during the financial year 2025-26 increase to Rs. 142.70 Lakhs from Rs. 224.74 Lakhs in fiscal year 2024-25, showing an decrease in expenditure by 36.51%.

During the year 2025-26, depreciation and amortization expense of our company has increased to Rs.260.65 Lakhs as against Rs.165.69 Lakhs in the year 2024-25 showing an increase by 57.30%.

Administrative and Selling expenses for the year 2025-26 increased to Rs. 222.73 Lakhs from Rs. 311.18 Lakhs in F.Y. 2024-25. This shows a decrease in the expenses by 28.42% as compared to previous year.

The Company earned a profit of ?355.18 lakhs during the financial year 2025-26 as compared to a loss of ?928.42 lakhs during the financial year 2024-25. The significant improvement in profitability was primarily due to improved operational performance, better cost management and reduction in overall expenses during the year under review. This shows a decrease in the expenses by 28.42% as compared to previous year.

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

We have a significant talent pool in the form of top and middle management. We have also created a performance-oriented work culture with the aim of building a long term talent pool. In addition to this, we continuously endeavor to improve and enhance the work environment for our employees. The Company has implemented competitive compensation packages and fostered an innovative and challenging work environment, among other initiatives, to support the welfare of its employees.

Footer: Mfg. of: PP, PVC, HIPS/PS, ABS, HDPE, Sheets & Films, PVC Profiles & Other Stationery items. A WORLD OF PLASTIC SHEETS & FILM

The Management Discussions and Analysis Statement made above are on the basis of available data as well as certain assumptions with respect 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. 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.