Manilam Industries India Ltd Management Discussions

For the Financial Year 2025-26

Decorative laminates fall under the broad purview of the wooden panel industry. The Indian wooden furniture industry is a dynamic sector blending traditional craftsmanship with modern design aesthetics. Within this ecosystem, decorative laminates have gained prominence as versatile surfacing materials that enhance both the visual appeal and durability of wood-based furniture. They play a crucial role in enhancing both the aesthetic appeal and functional durability of modern furniture and interior spaces. Decorative lamination sheets are made from resin composed of polymer compounds and consist of three distinct layers: kraft paper coated with phenolic resin, the desired decorative paper, and a top layer of clean protective overlay sheet. These laminates are engineered through the high- pressure compression of resin-soaked papers, resulting in surfaces that not only mimic the richness of natural materials like wood, stone, and metal but also offer a wide array of colours and textures to suit various design preferences.

The decorative laminates market in India is witnessing steady growth, driven by rising consumer demand for aesthetically appealing and durable surfacing solutions in both residential and commercial spaces. The sector benefits from evolving interior design trends, increased urbanization, and the growing popularity of modular furniture. Advancements in manufacturing technology, design innovation, and a broader variety of textures and finishes have further enhanced the appeal of decorative laminates. Additionally, the shift towards organized retail and the expansion of distribution networks are enabling greater market penetration. Overall, the market presents a promising outlook, supported by lifestyle changes and increasing awareness of interior aesthetics.

The Indian decorative laminates market has crossed a structural inflection point, valued at approximately USD 1.39 Billion, and is projected to expand at a steady CAGR of 5.35% over the next five years. The sector is characterized by an accelerating shift from unorganized trade to organized, brand-led players, driven by the rapid institutionalization of real estate and a structural boom in the residential and premium commercial segments.

(Source: https://www.mordorintelligence.com/industry-reports/india-decorative laminates-market)

• Population Growth and Urbanization: This sheer demographic scale is being driven by a massive structural migration toward cities. Indias urban population - which stood at 31.1% of the total population in Census 2011 - has surpassed 37.6% in 2026 and is projected to steadily climb toward 40% by 2030. This rapid pace of urbanization is fundamentally reshaping Indias housing landscape, triggering an unprecedented demand for modern residential complexes, modular furnishings, and premium surface decors in expanding metropolitan hubs.

(Sources: United Nations Population Division - World Urbanization Prospects; State Bank of India Economic Research Department)

• Rising Disposable Incomes and Aspirational Demographics: Indias per capita disposable income continues to reflect positive momentum. While inflationary pressures have periodically impacted short-term real wage growth, the size of Indias middle class is projected to nearly double to 60% of the total population by 2047 (up from 31% in 202021). This macro shift creates a massive, long-term demand for stylish, affordable building materials, including decorative laminates, across both urban and rural markets.

• Refurbishment Plans for Existing Coach: Indian Railways is investing significantly in refurbishing and modernizing its coaches to improve passenger experience and safety. Despite budgetary constraints and shifts in priorities, the ongoing efforts under various projects reflect a strong commitment to enhancing the quality of rail travel in India.

• Hospitality sector growth: The travel market in India is projected to reach USD 125 billion by FY 2026-27, with the hotel market expanding from USD 32 billion in FY 2019-20 to USD 52 billion in FY 2026-27. International tourist arrivals are expected to reach 30.5 million by 2028, indicating a thriving hospitality industry that requires frequent interior fit-outs and renovations.

• Commercial space utilization: Indias office market is anticipated to witness accelerated growth, with significant occupancy in both metro and non-metro cities. Key sectors driving this demand include consulting, e-commerce, business process management, and IT. (Source: Macrotrends, Press Information Bureau, Skift, Tourism Breaking News)

• Medical tourism: Indias medical tourism industry is experiencing robust growth, with projections estimating the market will reach USD 18 billion by 2027, growing at a CAGR of 19%. This influx of international patients is driving a premium infrastructure upgrade across private healthcare and ancillary hospitality projects.

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The Company operates predominantly within a single primary business segment: Decorative Laminates and Industrial Laminates. Our core revenue stream comprises designer collections of high-pressure decorative laminates ranging in thickness from 0.7 mm to 1.0 mm, including texturized, ultra-matte, suede, and high-gloss variants optimized for premium residential and commercial applications. This segment is driven by our flagship collections, notably Artistica, Vogue, Dwar, Magnificent, and Chromatic Tales.

This core manufacturing stream continues to be the dominant driver of the Companys operational profitability, backed by our proprietary OCTA technology platform and asset machinery (one 16-Delite press and three 18-Delite presses). Volume throughput expanded systematically following optimized capacity utilization at the Bareilly plant. The nationwide network of over 50+ distributors and 7,000+ retail dealers ensuring wide market reach, deep brand engagement, and real-time product fulfilment.

The laminate and allied wood-products sector is expected to witness steady growth, supported by sustained urbanization, rising demand in housing and infrastructure, and increasing consumer preference for branded and quality-certified products. The recent tightening of BIS licensing norms is likely to constrain supply from unorganized and unlicensed players, creating opportunities for established manufacturers like Manilam Industries India Limited.

The successful IPO has further strengthened the capital base, enabling enhanced working capital, operational efficiency, production capabilities, product development, and wider distribution reach. While near-term challenges such as raw material volatility and competitive intensity may persist, the Company remains confident that its strategic shift toward premium, in-house manufacturing will deliver strong long-term value to its stakeholders.

Risk is inherent in every business and Laminate Industry is no exception. The Laminate industry displays strong commodity characteristics and is subject to cyclical price movements in business cycles.

The Company addresses its primary vulnerabilities through the following matrices:

The Company has implemented robust internal control systems tailored to its scale and operations. The Board of Directors oversees these systems, ensuring their adequacy, effectiveness, and consistent application. The controls aim to enhance operational efficiency, ensure accurate, verifiable, and transparent reporting, comply with relevant laws and regulations, and safeguard Company assets, all while proactively identifying and mitigating business risks.

Certain highlights of the Companys financial performance during the financial year ended 31^st March, 2026, as compared to the previous financial year are summarized below:

During FY 2025-26, the Company achieved revenue from operations of Rs.10,415.97 lacs, marking a fall of 25.61% over FY 2024-25 ( Rs.14,002.65 lacs), profit for the year net of tax changed 68.13% to Rs.199.95 lacs, primarily due to strategic rationalization of low-margin traded product lines to focus on premium in-house manufacturing and the ongoing geopolitical conflicts and war situation severely disrupting the sales of the Company, which heavily impacted our high-value laminate portfolios.

During the year, the Company strengthened its employee capabilities to enhance quality human force, focused training, skill enhancement, and career development programs supported capability building at all levels. Employee engagement initiatives and welfare measures for labour and contractual workers to improve workplace satisfaction. Manilam continues to foster an engaged, high-performing workplace and is committed to building an aspirational employer brand by continuously refining its appointment processes and adopting contemporary best practices. As of March 31, 2026, the company employed a total of 140 personnel on its payroll.

Recognizing our environmental obligations, the Company continues to transition toward sustainable production models. Key initiatives include purchase and installation of a captive solar power plant at our manufacturing facility in Bareilly, Uttar Pradesh. This clean energy transition reduces reliance on traditional fossil-fuel-based grid electricity, minimizes greenhouse gas emissions, and provides a structural buffer against industrial energy tariff shocks/hikes.

Statements in this section, describing the Companys objectives, projections, expectations, or estimates, may be forward-looking statements under applicable securities laws and regulations. Actual results, performance or achievements could differ materially from those expressed or implied. Important factors that could make a difference to the Companys operations include demand and supply conditions, competitors pricing, changes in government regulations, tax regimes, and economic conditions within India. The Company assumes no responsibility to publicly update, amend, modify or revise any forward-looking statements, based on any subsequent development, new information or future events or otherwise except as required by applicable law. Unless the context otherwise requires, references in this document to the Company, we, us or our refers to Manilam Industries India Limited.