Mitsu Chem Plast Ltd Management Discussions

ECONOMIC OVERVIEW GLOBAL ECONOMY

The baseline forecast for the global economy to continue growing at 3.2% percent during 2024 and 2025. The global economy exhibited continued resilience in 2024 25, despite facing challenges including persistent inflationary pressures, geopolitical unrest, and supply chain vulnerabilities. According to the International Monetary Fund (IMF), global growth moderated slightly to an estimated 2.7% in 2024, down from 3.2% in 2023. However, emerging and developing economies continued to anchor global expansion, compensating for the slower pace in advanced economies.

The United States maintained moderate growth amid falling inflation and low unemployment, supported by strong household consumption and recovering business investment. However, high public debt and restrictive monetary policies posed constraints.

In contrast, the Asia-Pacific region led by India, China, and Southeast Asia emerged as a key growth engine. The regions robust manufacturing base, improving domestic consumption, and policy reforms helped counterbalance the economic deceleration in the West. The global outlook for 2025 shows signs of recovery. With inflation declining across most regions, central banks are expected to initiate interest rate cuts, supporting liquidity and investment. The probability of a global recession remains low, and the easing of monetary policy is anticipated to fuel broader growth in the latter part of 2025.

Outlook

Global GDP growth for 2025 is projected to rebound modestly to approximately 3.0%, contingent upon stability in financial markets, easing inflation, and recovering demand in advanced economies. The normalization of monetary policies and increased investments in emerging economies are expected to stimulate global economic recovery.

Source: IMF World Economic Outlook, April 2024 Steady But Slow: Global Recovery in Progress https://www.imf.org/en/Publicatio ns/WEO/Issues/2024/04/16/world -economic-outlook-april-2024

Indian Economy

India remained one of the worlds fastest-growing major economies in FY 2024 25. Real GDP growth is estimated at 7.6%, fuelled by resilient domestic demand, strong capex by the government, and stable private consumption trends. Sectors like infrastructure, digital services, and manufacturing witnessed robust performance. The growth momentum was also reflected in high-frequency indicators such as GST collections, power demand, e-way bills, and credit growth. Strategic public investments, particularly under the Gati Shakti and PLI schemes, played a key role in boosting economic activity.

Inflation averaged 5.1% during the year, within the RBIs upper tolerance band, despite volatile commodity prices and weather-related disruptions.

Outlook

Indias economic outlook for FY 2025 26 remains optimistic, with GDP projected to grow at 7.2%, supported by: Continued infrastructure push Strong digital adoption Manufacturing scale-up through PLI schemes FDI inflows and policy reforms Challenges such as fiscal consolidation, geopolitical volatility, and inflation management may persist, but Indias macroeconomic stability remains strong.

(Sources: Ministry of Statistics and Programme Implementation (MoSPI), PIB Press Release (Feb 2025):https://pib.gov.in/PressRele asePage.aspx?PRID=2010223 Reserve Bank of India Monetary Policy Report (April 2025): https://www.rbi.org.in/ World Bank India Development Update (April 2024): https://www.worldbank.org/en/co untry/india)

Industry Overview

Plastic & Packaging Industry Global Overview

In 2025, the global plastic packaging market is projected to reach approximately 107.06 million tonnes, with expectations to grow to 125.99 million tonnes by 2030, reflecting a CAGR of 3.31% during the forecast period . This growth is driven by the expansion of key application industries such as food and beverages, healthcare, personal care, and industrial sectors. Additionally, the surge in e-commerce activities worldwide has amplified the demand for efficient and durable packaging solutions. The Asia-Pacific region continues to dominate the global plastic packaging market, accounting for the largest market share in 2025. This dominance is attributed to robust manufacturing capabilities, rising consumer demand, and expanding industries in countries like China and India . Innovative packaging solutions are gaining traction, including active packaging, modified environment packaging, edible packaging, and bioplastic packaging. These innovations aim to enhance product shelf life, reduce environmental impact, and meet evolving consumer preferences . However, the industry faces challenges due to increasing sustainability awareness and stringent regulations aimed at reducing plastic pollution. Over 120 countries have implemented bans and taxes on single-use plastics, prompting companies to invest in sustainable packaging alternatives and recycling infrastructure .

Outlook

The global plastic packaging market is on an upward trajectory, adapting to changes in market dynamics, consumer behavior, and demand patterns. Companies are investing in research and development, exploring new market initiatives, and expanding their global presence to capitalize on the growing demand for plastic packaging. Emphasis on sustainability, innovation, and compliance with environmental regulations will be pivotal in shaping the future of the industry . (Sources:ttps://www.mordorintellig ence.com/industry-reports/ecommerce-plastic-packaging-market)

Indian Overview Market Size & Growth

In 2025, Indias plastic packaging market is projected to reach USD 22.44 billion, with expectations to grow at a CAGR of 3.09% to reach USD 26.13 billion by 2030. This growth is driven by increasing demand in sectors such as food and beverages, personal care, and pharmaceuticals .

The rigid plastic packaging segment is also experiencing significant growth. In terms of shipment volume, it is expected to reach 5.27 million tonnes in 2025, growing at a CAGR of 5.83% to reach 7.00 million tonnes by 2030. Mordor Intelligence Key Growth Drivers E-commerce Expansion: The surge in online shopping has amplified the demand for efficient and durable packaging solutions. Urbanization and Lifestyle Changes: Rapid urbanization and changing consumer lifestyles are increasing the demand for convenient and portable packaging, especially in the food and personal care sectors.

Technological Advancements: Innovations in packaging technologies, such as active and intelligent packaging, are enhancing product shelf life and consumer engagement.

Sustainability Trends

Environmental concerns are prompting a shift towards sustainable packaging solutions. The biodegradable plastic packaging market in India is witnessing growth, driven by increasing consumer awareness and regulatory support. Companies are investing in research and development to create eco-friendly alternatives that align with evolving consumer preferences and regulatory requirements.

Outlook

Indias plastic packaging industry is poised for robust growth, supported by factors such as economic expansion, technological advancements, and increasing consumer demand. However, challenges related to sustainability and regulatory compliance will require ongoing innovation and adaptation by industry stakeholders.

(Sources:ttps://www.mordorintellig e n c e . c o m / i n d u s t r y -reports/ecommerce-plastic-packaging-market)

Indian Rigid Plastic Packaging Markets

In FY 2024 25, Indias rigid plastic packaging market continued to display strong momentum, driven by robust demand across sectors such as food & beverages, pharmaceuticals, personal care, and e-commerce. The global rigid plastic packaging market was valued at USD 139.83 billion in 2022, and is expected to reach USD 203.42 billion by 2030, growing at a CAGR of 5.5% during the forecast period (2023 2030). India and China are among the leading contributors to this growth in the Asia-Pacific region, owing to rapid industrialization, urbanization, and a rising middle-class population.

The Indian market has benefited from increased consumption of fast-moving consumer goods (FMCG), supported by digital transformation, enhanced retail infrastructure, and an expanding customer base. Notably, the food & beverage segment continues to hold the largest market share, owing to rising packaged food consumption, changing dietary habits, and increased demand for hygienic storage and transport solutions.

Population growth and heightened demand for food security and efficient distribution have contributed to an increased reliance on high-performance packaging solutions. Rigid plastics offer advantages like durability, recyclability, and versatility, which make them suitable for large-scale industrial packaging needs. Major global players, including fast food giants like McDonalds, continue to be large-scale users of plastic packaging for items like cups, lids, and containers, though there is a growing push to improve the percentage of recycled content used.

Outlook

The market outlook for FY 2025 26 remains positive, with continued growth expected in rigid plastic packaging, particularly in sectors such as healthcare, FMCG, and industrial logistics. Indias expanding manufacturing base, investments in automation and packaging technologies, and alignment with international standards are expected to further accelerate growth.

A major trend shaping the future of the industry is the increasing push towards sustainable packaging. Growing consumer awareness about environmental issues and stricter government regulations are propelling the adoption of reusable, recyclable, and biodegradable packaging materials. The push for a green supply chain is also influencing procurement and production practices across the value chain.

Personalised packaging is gaining ground as companies seek to create unique brand identities and enhance consumer experience. Advances in printing and molding technologies are making it easier for manufacturers to offer customized packaging solutions at scale.

Furthermore, convenience-driven consumption habits are driving demand for portable and resealable packaging options. User-friendly packaging that is easy to handle, store, and dispose of is increasingly being preferred by both urban and rural consumers.

Source:

BlueWeave Consulting India Rigid Plastic Packaging Market SkyQuest Global Rigid Plastic Packaging Market Insights 2023 2030

Opportunities

Sustainable Packaging Solutions: With growing environmental awareness and regulatory pressures, there is rising demand for biodegradable, compostable, and recyclable materials. Companies investing in eco- friendly R&D are well-positioned for long-term growth.

Export Readiness & Packaging

Standards: As India solidifies its role as a global manufacturing hub, packaging standards are improving to meet international expectations. This creates opportunities in blow molding, injection molding, roto molding, and advanced material technologies.

Healthcare Packaging: The Indian pharmaceutical sector is experiencing double-digit growth, generating increasing demand for high-quality, medical-grade packaging. This includes applications in drug delivery systems and hospital supply chains.

Technological Innovation : Innovations such as tamper- evident seals, high-barrier resins, smart labeling, and vacuum/retort pouches are transforming packaging functionality and appeal.

Challenges

Sustainability Pressures: The industry faces regulatory scrutiny over plastic waste. Companies must invest in eco-friendly alternatives, circular economy models, and waste management systems.

Cost Optimization: Sustainable materials often come with higher input costs. Balancing eco- consciousness with profitability demands investments in automation, lean production, and economies of scale.

Regulatory Compliance: Evolving global and domestic norms require packaging companies to stay vigilant. Proactive compliance, legal guidance, and transparent reporting are essential for uninterrupted operations.

Adaptation to Market Shifts: Rapidly changing consumer expectations necessitate agile innovation. Companies must prioritize R&D, invest in design capabilities, and embrace digital transformation to stay competitive.

Company Overview

Since its inception in 1990, Mitsu Chem Plast Limited (“Mitsu Chem Plast” or “the Company”) has established itself as a prominent manufacturer of high-quality plastic products, specializing in blow molding, injection molding, and customized molding solutions. The Company offers an extensive and diversified product portfolio that caters to key sectors such as packaging, healthcare, automotive, and infrastructure.

Driven by a strong commitment to innovation and technology, Mitsu Chem Plast continues to deliver industry-leading solutions tailored to meet evolving customer needs. Its unwavering dedication to core values, customer-centric philosophy, and quality excellence remains the foundation of its success.

Today, the Company supports over 500 Stock Keeping Units (SKUs) and serves more than 30 Fortune 500 clients across India. With a robust in-house R&D team, Mitsu Chem Plast is at the forefront of developing sustainable, import-substitute, and value-engineered products, actively contributing to the Government of Indias Make in India initiative.

The Company has significantly enhanced its manufacturing capabilities with new facilities at Tarapur and Khalapur, enabling it

Molded Industrial Packaging

Mitsu Chem Plast offers an extensive range of Molded industrial packaging products tailored to meet the unique requirements of its clients. The

Verticals	Products
Molded Industrial Packaging	Blow-Molded and injection- Molded items, such as containers, bottles, jars carboy, top-open drums from 100 ml to 250 litres, and injection-molded pails from 500 grams to 20 kgs
Hospital Furniture Parts Infrastructures and Others	Hospital-bed parts, hospital- bed accessories, side- trolleys, overbed tables, and spine boards, among others Plastic Parts of sturdy and well-built chairs, tables, and storage solutions and medical devices like pregnancy kits, malaria kits, HIV kits, and inhalers etc.

to deliver niche, high-performance solutions and scale efficiently. With its advanced infrastructure, skilled workforce, and focus on continuous improvement, Mitsu Chem Plast remains committed to offering innovative, reliable, and superior-quality plastic solutions to its diverse clientele.

Product Verticals

Company crafts packaging solutions by Molding top-quality materials, including plastics and composites, into various sizes and shapes suitable for industrial use. Its diverse product portfolio includes blow molding products like drums (wide-mouth, narrow-mouth and open-top), bottles, jars (ranging from 100 ml to 250 litres), jerry cans, and barrels. Additionally, the Company manufactures injection molded products such as caps, lids, closures, handles, measuring cups, and pails ranging from 500 grams to 20 kgs. All its products are designed to meet diverse industrial packaging needs, and ensure reliability and durability in storage and transportation.

Hospital Furniture Parts

Mitsu Chem Plast is a trusted manufacturer and supplier of furniture parts for hospitals, and is well-renowned for the superior quality and durability. The Company offers a wide range of products, including bedside-locker parts, spine boards, CPR boards, bed-head panels, footboards, side-rails, and IV stands, all among others.

Notably, all these products are made using robust materials such as ABS plastic and stainless steel. This ensures that they deliver a long-lasting and resilient performance. Furthermore, the products are renowned for their safety, reliability, and ergonomic design, and are favoured by healthcare facilities for their ease of installation and maintenance. On the whole, Mitsu Chem Plasts hospital furniture parts provide healthcare settings with dependable solutions that enhance patient care and comfort. Company has a dedicated brand names Furnastra fir its hospital furniture product vertical launched in FY 2024-25.

Infrastructures & Others

Mitsu Chem Plast specialises in manufacturing plastic parts to meet the polymer-based product needs of various industries, such as the infrastructure and medical sectors. These parts are applied for manufacturing a variety of items, ranging from school chairs and bus seats to stadium seats. Also includes, tables, and storage solutions and medical devices such as pregnancy kits, malaria kits, HIV kits, and inhalers.

Risk Management

At Mitsu Chem Plast Limited, effective risk management is a cornerstone of sustainable business growth. The Company proactively identifies, assesses, and mitigates key risks that could potentially impact its operations, profitability, and strategic objectives. A comprehensive risk management framework ensures business continuity, resilience, and the long-term protection of stakeholder value.

Key Risk Areas and Mitigation Strategies

Supply Chain Risk

To reduce dependency and enhance resilience, Mitsu Chem Plast has diversified its supplier base, implemented advanced demand forecasting tools, maintained strategic inventory buffers, and fostered transparent supplier relationships. These measures help minimise disruptions and ensure continuity in supply.

Concentration Risk

The Company recognises the risks arising from dependence on a limited number of customers or suppliers. To address this, Mitsu Chem Plast continues to expand its customer base, strengthen its supplier network, and pursue new market opportunities through product innovation and a robust go-to-market strategy.

Quality Risk

Delivering superior quality is central to the Companys ethos. To mitigate risks associated with product defects, safety concerns, or recalls, Mitsu Chem Plast follows rigorous quality assurance protocols, including ISO-certified processes, routine audits, and real-time customer feedback loops.

Human Resource Risk

The Company acknowledges that talent is critical to its success. To retain and attract skilled personnel, Mitsu Chem Plast invests in effective recruitment, employee engagement, competitive compensation, and structured career development initiatives aimed at reducing attrition and fostering leadership.

Compliance Risk

Non-compliance with applicable laws and regulations can result in financial and reputational damage. To ensure regulatory adherence, the Company maintains a robust compliance management system, conducts regular internal audits, and provides training programs to instill a strong culture of governance and accountability.

Environmental, Health & Safety (EHS) Risk Recognising the environmental impact of manufacturing operations, Mitsu Chem Plast has implemented sustainable practices across its facilities. The Company actively seeks to minimise emissions, waste, and energy consumption while exploring eco-friendly technologies. All operations are aligned with prevailing EHS norms and standards.

Human Resource

Mitsu Chem Plast regards human capital as a strategic asset integral to achieving its vision. The Company is committed to fostering a high-performance, inclusive, and value-driven culture. Its approach focuses on intellectual, emotional, and motivational development, ensuring that employees are aligned with the Companys values and strategic goals.

Training and development programs are conducted regularly to enhance employee skills, productivity, and awareness of emerging technologies. These initiatives drive continuous improvement and ensure workforce readiness for evolving business needs. A dedicated Human Resources department addresses employee concerns, encourages open communication, and nurtures a collaborative work environment.

The Companys core values employee welfare, quality consciousness, customer delight, innovation, cost efficiency, value engineering, and environmental responsibility are deeply embedded across the organization, guiding employee behaviour and performance.

As of March 31, 2025, the Company had a total workforce of 429 employees.

Internal Control Systems

Mitsu Chem Plast has instituted a robust internal control framework designed to ensure the orderly and efficient conduct of its business, safeguard assets, prevent and detect frauds and errors, and ensure the accuracy and completeness of accounting records.

The internal audit function operates independently and reviews the effectiveness of operational and financial controls. Audit findings are regularly reported to senior management and the Audit Committee, with timely corrective actions implemented. The Company ensures strict adherence to its internal policies, standard operating procedures, and applicable statutory regulations through well-documented control mechanisms and authorisation protocols.

Cautionary Statement

This Management Discussion and Analysis contains certain forward-looking statements, which reflect the Companys current views and assumptions with respect to future events and performance. These statements are based on available information and involve risks and uncertainties that may cause actual results to differ materially from those anticipated.

Factors that could influence performance include, but are not limited to: changes in raw material prices and availability, cyclical demand in key markets, changes in domestic and international regulations and tax policies, fluctuations in foreign exchange rates, and macroeconomic developments in India and other geographies where the Company operates.

Mitsu Chem Plast assumes no obligation to update or revise forward-looking statements, whether as a result of new information, future developments, or otherwise.