National Plastic Industries Ltd Management Discussions

OVERVIEW:

In 2024, the global economy experienced moderate growth of 3.3% (IMF World Economic Outlook, April 2025) amid a challenging macroeconomic environment. Persistent geopolitical tensions, disruptions in trade routes, and high interest rates in major economies created headwinds for global trade and consumption. A notable trend was the slowdown in global manufacturing, especially in Europe and parts of Asia, due to supply chain disruptions and weak external demand. In contrast, the services sector performed better, supporting growth in many economies. Inflationary pressures eased in most economies. However, services inflation has remained persistent, notes the Survey. despite global uncertainty, India has displayed steady economic growth. Indias real GDP growth of 6.4 per cent in FY25 remains close to the decadal average. driven by strong domestic consumption, infrastructure investments, and policy reforms. The Country continues to benefit from a growing middle class, rising disposable incomes, and increasing digital penetration, all of which are fueling demand for FMCG products. Keeping in mind the upsides and downsides to growth, the real GDP growth in FY26 to be between 6.3 and 6.8 per cent. To realize the aspirations of Viksit Bharat by 2047, it is important that the medium-term growth outlook of India be assessed in the context of emerging global realities of Geo-Economic Fragmentation (GEF), Chinese manufacturing prowess, and global dependency on China for energy transition efforts. The Economic Survey puts forth a way forward to reinvigorate the internal engines and domestic levers of growth by focusing on one central element of systemic deregulation, which will enable a paradigm of economic freedom to businesses of individuals and organizations to pursue legitimate economic activity with ease. The Survey stresses that the reforms and economic policy must now be on systematic deregulation under Ease of Doing Business 2.0 so that it encourages creation of a viable Mittelstand, i.e. Indias SME sector.

(Source: pib.gov.in)

INDIAN PLASTICS INDUSTRY STRUCTURE AND DEVELOPMENTS:

India, the worlds fourth largest economy is witnessing a remarkable transformation in its job landscape fuelled by a burgeoning manufacturing sector. India manufactures various products such as plastics and linoleum, houseware products, cordage, fishnets, floor coverings, medical items, packaging items, plastic films, pipes, raw materials, etc. The country majorly exports plastic raw materials, films, sheets, woven sacks, fabrics, and tarpaulin. The Government of India intends to take the plastic industry from a current level of Rs. 3,00,000 crore (US$ 37.8 billion) of economic activity to Rs. 10,00,000 crore (US$ 126 billion) in four-five years. Indias plastic trade (imports + exports) itself has witnessed a huge growth in the past ten years, rising from USD 19 billion in 2013-14 to USD 37 billion in FY 2022-23. Indias plastics exports have contributed to this growth witnessing a CAGR of 4.8%. In FY 2022-23, Indias plastics stood at USD 12 billion with potential to reach USD 25 billion by 2027. With import substitution pegged at Rs 37,500 crores and vast emerging opportunities, this implies not only immense potential for employment generation, but greater entrepreneurship opportunities. 10 Plastic Parks have been approved in the country by The Department of Chemicals and Petrochemicals. Among these, six plastic parks have received final approval from the following states – Madhya Pradesh (two parks), Assam (one park), Tamil Nadu (one park), Odisha (one park), and Jharkhand (one park). These parks are intended to boost employment and attain environmentally sustainable growth.

In FY25 (until January 2025), Indias plastic exports stood at Rs. 89,296 (US$ 10.34 billion). India exports plastic to more than 200 countries in the world. The top five consumer and houseware product importing countries are the USA, Germany Japan, the UK, and France. India largely exports plastic and related products to the USA, China, the UAE, the UK, Germany, Nepal, Italy, Bangladesh, etc. The total value of exports to the USA, the largest consumer of the Indian plastic industry, stood at US$ 12.5 billion in FY25, an increase of 8% YoY. China was the second largest consumer of plastic export products from India and the total value of exports stood at US$ 981 million. These figures underscore Indias growing significance as a key player in the global plastics market.

COMPANY OVERVIEW:

"National" a brand deals in various ranges of products that can suit all applications and different kinds of budgets. Consumers prefer National Moulded Furniture for its quality, colour, finishing and latest/ modular designs. "National Plastics Industries Ltd." with its constant Endeavour for innovation will continue to introduce many new and innovative products both for domestic as well as International markets and thereby will fulfil its commitment to the society as a whole by offering premium quality products at the most affordable prices.

FINANCIAL REVIEW:

During the financial year under review, the Company recorded a gross turnover of 97.57 crore as compared to 99.10 crore in the previous year, reflecting a marginal decline of approximately 1.55%. This decrease is primarily due to a significant reduction of 52.08% in export sales. The Profit Before Tax stood at 5.07 crore, as against 5.61 crore in the preceding year. However, the Net Profit After Tax increased to 3.75 crore from 1.61 crore in the previous year, indicating improved operational efficiency and cost management.

CHANGES IN KEY FINANCIAL RATIOS:

Pursuant to provisions of Regulation 34(3) of SEBI (LODR) Regulations 2015 read with Schedule V Part B(i) details of the change in key financial ratios is given hereunder:

Name	Category	Year Ended		Deviation in %
		31/03/2025	31/03/2024
Debtors Turnover	in Days	56.72	81.23	-30.18%
Inventory Turnover	in Days	153.48	159.05	-3.50%
Interest Coverage Ratio	Times	3.91	3.76	3.96%
Current Ratio	Times	1.73	1.56	10.66%
Debt Equity Ratio	Times	0.06	0.09	-26.10%
Operating Profit Margin	%	14.53	16.52	-12.00%
Net Profit Margin	%	3.99	1.64	143.18%
Return on Net Worth	%	10.21	8.85	113.19%
Debt Service Ratio	Times	2.77	1.49	51.79%
Trade Payables Turnover Ratio	in Days	28.75	40.86	-29.62%
Working (Net) Capital Turnover Ratio	Times	77.67	83.88	-7.27%
Return on Capital Employed Ratio	%	0.12	0.13	-3.96%
Return on Investment Ratio	%	0.25	0.28	-11.05%

BUSINESS OUTLOOK

The company has kept its commitment to improve and increase the overall business growth and added varieties of new products to supply industry and government. The Company is also making hard effort to increase export business in near future. The Company is in the process to manufacturing new range of plastic furnitures with modern design and best quality in line with consumer preferences and useful utilities in reasonable price. "National Plastics Industries Ltd." with its constant Endeavour for innovation will continue to introduce many new and innovative products both for domestic as well as International markets and thereby will fulfil its commitment to the society as a whole by offering premium quality products at the most affordable prices.

OPPORTUNITIES:

The Company is focussing to add new products for industrial sector and determined to emerge as a major player with its quality products and good corporate governance. The Honble Minister of Commerce and Industry, Government of India, Shri Piyush Goyal, during his meet at PLASTINDIA 2026 remarked that the industry expanded from a market size of USD 15 billion in 2010 to over USD 37 billion in 2023 and is projected to reach USD 50 billion by 2026. Employment in the sector currently stands at approximately 4 million people, expected to grow to 5.5 million by 2026. There are multiple plastic parks that are being set up in the country in a phased manner that will help improve the plastic manufacturing outputs of the country creating opportunities for the company to develop Industrial plastic products. Under the plastic park schemes, the Government of India provides funds of up to 50% of the project costs or a ceiling cost of Rs. 40 crore (US$ 5 million) per project. The company is focusing to imbibe these factors in its business.

THREAT:

The company are subject to rising rules and regulations that govern the production, disposal, and clean-up of hazardous chemicals, as plastic products usage contributes to environmental pollution. In addition, Product lifecycle has decreased from years to months, affecting the entire supply chain of plastic goods. Any major upward movement in the Crude Prices could change the inflationary scenario impacting on input prices and the margin of the Company.

RISK AND CONCERNS:

The company is exposed to several potential risks like technological changes, political risks, product distribution both from internal and external sources but the same can be anticipated and curbed by addressing them in its early stages for a long-term corporate success. The Company is of the opinion that recycling & reuse of plastics are expected to increase in our Industry, thus effecting the development innovation and sustainability too. The company maintains an inbuilt mechanism to track any suspicious events and frauds in the business. In addition, the Board and the Audit Committee of the Company periodically reviews the risk management procedures and takes various preventive measures to mitigate the risk factors.

INTERNAL CONTROL SYSTEM AND THEIR ADEQUACY

The Board has adopted policies and procedures for ensuring that all transactions are authorized, recorded and correctly reported, all assets are safeguarded and protected against loss from unauthorized use or disposition, reducing wastages and maintenance of proper accounting records for ensuring accuracy and reliability of its financial information. The Board has constituted an Audit Committee which meets periodically to review the financial performance and the accuracy of financial records and accordingly appropriate actions are taken by the management.

INDUSTRIAL RELATIONS AND HUMAN RESOURCE

Industrial relations continued to be harmonious both at manufacturing unit as well as in branches. Our employees are our greatest asset and we are committed to attract, retain and recognize talent. We encourage fresh minds and new ideas. The Company constantly facilitates and encourages its employees at all levels to enhance their knowledge and skills and continuously seeks to inculcate within its employees, The Company inculcates a strong sense of business ethics and social responsibility. The Company endeavors to create a challenging and favorable work environment that encourages entrepreneurial behavior, innovation and the drive towards business excellence.

POLLUTION AND ENVIRONMENT CONTROL:

Pollution control is an essential task and responsibility in the manufacturing industry. The management is assured that all the plants of the Company are under appropriate Waste Management Systems and operate in harmony with the surrounding ecosystem. Adequate pollution control amenities are established at all the plants as per guidelines of pollution control authority and as per set norms. For safety, the work force is provided with appropriate safety equipment and necessary training from time to time.

CAUTIONARY STATEMENT:

The Management Discussion and Analysis Statements made above are on the basis of the available data as well as certain assumptions as to the economic conditions, various factors affecting raw material prices and selling prices, trend and consumer demand and preferences, governing and applicable laws and other economical 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 or mplied therein.

For National Plastic Industries Limited	Sd/-
	Paresh Vinod Parekh
Date: 30th May 2025	Managing Director
Place: Mumbai	DIN: 00432673