Navneet Education Ltd Management Discussions

Indian Economy

India continues to maintain its trajectory as the worlds fastest-growing major economy, reinforcing its rising stature on the global stage. As per the IMFs April 2025 World Economic Outlook, the Indian economy is projected to grow at 6.5% in 2024-25, a notable performance against the backdrop of a subdued global environment. This performance is driven by a robust blend of structural reforms, accelerating digitalisation, and sustained infrastructure investments. Resilient domestic consumption and renewed momentum in private sector capital expenditure have further supported broad-based expansion. The Indian economy has continued to exhibit resilience, driven by proactive governmental measures and countrys intrinsic strengths as it aspires to become a developed nation by 2047.

Industry Overview

The education sector remains a foundational pillar for individual empowerment and societal advancement, playing a critical role in driving economic growth, fostering social equity, and enriching cultural identity. With the rapid pace of technological change and the emergence of new learning methodologies, the sector is undergoing a significant transformation. As efforts continue towards achieving inclusive and equitable education for all, strategic investment in quality infrastructure, teacher development, and curriculum modernisation will be essential to unlocking learner potential and supporting sustainable development objectives.

Indias education system has grown remarkably over the years, becoming one of the largest and most vibrant in the world. The school education sector continues to flourish, supported by Indias growing population, higher household incomes, and rising literacy levels. While the journey has not been without challenges, such as overcrowded classrooms, inadequate infrastructure, and traditional pedagogical approaches, positive shifts are now underway. Cities are growing, new schools and colleges are being built, and both government and private players are stepping up with significant investments and progressive reforms.

Today, classrooms are becoming more dynamic, teachers are better trained and resourced, and students are being equipped not only to succeed in examinations but also to adapt and excel in a rapidly evolving, interconnected world. Indias education landscape is entering a transformative phase, one that offers greater inclusion, innovation, and opportunity for learners across all segments of society.

Moreover, the digital education market in India has witnessed strong and sustained growth in recent years, driven by a number of transformative trends. The widespread adoption of digital devices and improved access to high-speed internet have enabled more seamless and inclusive online learning experiences. The increasing acceptance of online learning as a flexible and viable alternative to traditional classroom methods, combined with a rising demand for personalised and adaptive learning solutions has fuelled market momentum. Technological advances, particularly in Artificial Intelligence and machine learning, are now enabling highly individualised and data-driven learning pathways.

Content Publishing Sector

Driven by rapid socio-economic development and continuous technological innovation, the publishing industry remains a cornerstone of knowledge dissemination, educational progress, and personal enrichment. India holds the distinction of being the third-largest producer of English-language publications globally, reflecting its strong presence on the global stage. The digital revolution has brought sweeping changes to the industrys structure and dynamics. The text book segment has adapted more readily to digital platforms, demonstrating the sectors resilience and ability to evolve with changing consumer preferences.

The surge in digital publication consumption is closely linked to the growth of e-learning platforms, which have broadened readership and strengthened the markets online footprint. Moreover, rising demand for books in regional languages has enabled publishers to reach a wider and more diverse audience across India. Government initiatives promoting literacy and education have further boosted the demand for published content. Indias publishing market faces a range of challenges that impact its growth and sustainability. The fragmented structure of the market complicates efforts by publishers to adapt to rapidly evolving digital consumption habits. Further, synchronising content with NCERT mandate across multiple states adds further complexity and risk of inventory obsolescence. In addition, low levels of digital literacy in rural areas hinder the widespread adoption of e-publishing, highlighting the ongoing need for improved infrastructure. Despite these obstacles, the industrys growth remains remarkably resilient, supported by continued innovation and adaptive strategies.

EDTECH

EdTech, or education technology, involves using digital tools and platforms such as AI, VR, AR, and to enhance teaching, learning, and educational management. Despite challenges such as reduced funding in the post-pandemic period and heightened scrutiny around corporate governance, the sector has demonstrated consistent growth over the past decade. This resilience is underpinned by rising educational aspirations, the expansion of digital infrastructure, and a cultural shift towards online and blended learning formats. By 2029, the edtech sector is expected to contribute 0.4% to Indias GDP, up from 0.1% in 2020, driven by growing adoption of hybrid learning models, regional language content, and skill-based education. The Indian EdTech market is expanding at a rapid pace, driven by greater digital adoption, widespread smartphone usage, and increasing demand for personalised and flexible learning solutions. Government initiatives such as Digital India and the National Education Policy (NEP) 2020 are accelerating the integration of technology into the education ecosystem.

Evolution of Edtech

Indias EdTech sector is rapidly evolving, driven by open-source platforms, immersive technologies, and AI-powered personalisation. Open learning tools like YouTube and SWAYAM make education more accessible and flexible.

K12 Segment

Indias K12 education market reached USD 91.97 billion in 2024 and is projected to grow at a CAGR of 12.05%, reaching USD 256.03 billion by 2033. Serving over 261 million students across approximately

1.5 million schools, the segment reflects both scale and diversity. Notably, nearly 46% of students are enrolled in private institutions, underlining the expanding role of non-government education providers. The increasing integration of digital learning, supported by government initiatives such as PM e-VIDYA, DIKSHA, SWAYAM, and ePathshala, has significantly strengthened the K12 e-learning ecosystem. This digital transition has also contributed to a notable increase in EdTech startups across the country. By offering interactive and innovative learning experiences, K12 EdTech platforms are not only making education more accessible and engaging but are also driving measurable improvements in student learning outcomes.(Source: https://www.imarcgroup.com/india-k12-education-market)

Stationery Sector

The Global Stationery and Supplies Market size is estimated at USD 151.35 billion in 2025, and is expected to reach USD 186.19 billion by 2030, growing at a CAGR of 4.23% during the forecast period (2025 2030). The Asia-Pacific region has witnessed substantial economic growth over the years, leading to higher levels of disposable income. The education sector in many countries across the region, including India, China, and others, is expanding rapidly. There is a strong emphasis on education. This increased student enrollment drives the demand for stationery and supplies such as notebooks, pens, pencils, erasers, rulers, and other related items. Simultaneously, the corporate sector across Asia-

Pacific has experienced significant expansion, with new business establishments and corporate growth fuelling demand for office stationery. This includes items such as paper, folders, staplers, sticky notes, markers, and other essential supplies. The proliferation of online shopping platforms and e-commerce has facilitated customer access to a broad selection of stationery and supplies.

Government-led initiatives have contributed to a steady increase in the number of universities and colleges across both urban and rural areas, directly influencing market expansion. Moreover, the rapid rise in the number of start-ups is also propelling demand, as is the growth in employment across these sectors. The stationery and supplies market has been significantly impacted by the expansion of e-commerce. Many consumers now prefer to purchase stationery products online due to the convenience, competitive pricing, and extensive product variety offered by digital platforms. Online sales channels have gained substantial traction, enabling seamless interaction between retailers and consumers and further boosting market growth.

Outlook

According to the IMARC Group, the India school stationery supplies market is projected to grow from USD 2,504.0 million in 2024 to USD 3,982.0 million by 2033, at a CAGR of 5.03% during the forecast period of 2025 to 2033. This growth is driven by several factors, including increasing brand consciousness among consumers, the introduction of innovative and personalised stationery products, the expanding influence of social media platforms and OTT services and growing demand for sustainable and eco-friendly alternatives.

Company Overview

Driven by the belief that education is a fundamental human right, Navneet Education Limited (‘NEL, ‘We, or ‘the Company) is committed to making high-quality educational content accessible and affordable. Our dedication to this vision has empowered us to consistently deliver top-tier educational products at competitive prices. Building on our strong foundation in the educational books segment, we have also expanded into the education technology (EdTech) space, investing in cutting-edge technological solutions to enhance and enrich the learning experience.

NEL envisions delivering comprehensive ‘phygital education solutions that seamlessly integrate physical and digital learning formats. This vision supports the expansion of both our traditional publication portfolio and our digital product offerings. Alongside our core focus on publishing and EdTech, NEL has also established itself as a leading global supplier of scholastic and office stationery products, reinforcing our strong presence in both domestic and international markets. As part of our strategic initiatives, we maintain a minority stake in K12 Techno Services Private Limited.

Business Strategy

The rollout of the NEP is expected to serve as a significant driver of growth for our business, introducing transformative reforms across the primary, secondary, and higher education sectors, including technical education. The resulting curriculum revisions are anticipated to increase demand for updated learning resources, encouraging students to replace outdated or second-hand materials with new, curriculum-aligned supplementary content. This shift directly supports the growth of NELs publishing segment, where strategic priorities are well aligned with these developments. Additionally, the evolving educational landscape presents a timely opportunity within the EdTech space, enabling the company to innovate and deliver advanced, customised solutions tailored to the changing needs of educators and institutions.

Conversion of Schools

The growing shift of schools, particularly English-medium private schools, from state boards to the CBSE curriculum presents a notable growth opportunity for Navneet Education Limiteds content publishing business. With over 28,000

CBSE-affiliated schools across India and a steadily increasing adoption rate, this transition is being driven by the uniform curriculum framework under NEP 2020, a growing preference for English-medium education, and a focus on skill-based learning. Up to Grade 8, private schools continue to favour high-quality textbooks from private publishers, resulting in a significant increase in demand for supplementary educational content.

Stationery Domestic

As the Indian stationery market consolidates and organised players expand their share, NEL is well positioned to capitalise on these emerging opportunities. The company is focused on expanding its geographic footprint across India for its paper and non-paper -based stationery products to drive both volume and value growth. In line with evolving consumer needs, NEL has successfully launched a range of paper and non-paper stationery offerings in the domestic market.

Stationery Exports

NELs export strategy, driven by both vertical and lateral expansion and continuous product innovation in paper and non-paper categories, has significantly strengthened its global market presence. Renowned for product quality and reliable delivery, the company holds a distinct competitive advantage in the Indian stationery sector, establishing itself as a preferred partner internationally. With over three decades of experience, NEL continues to be the largest exporter in the Indian stationery category, with the United States accounting for a major share of its business. The company maintains an extensive global footprint, consistently expanding its export portfolio with new stationery products for the US as well as other key international markets. This resilient export business continues to be a critical growth engine for NEL, supported by the introduction of new product lines and expansion into additional geographies.

Operational and Financial Overview

Content Publishing Segment

The content publishing business experiences seasonal fluctuations, with peak sales aligning with the start of the academic year. Historically, periodic curriculum revisions mandated by state and national education boards have driven demand for updated textbooks. However, 2024-25 saw a subdued performance, with marginal growth of 3%, largely due to the absence of syllabus changes for the seventh consecutive year in both Maharashtra and Gujarat, combined with the growing second-hand book market impacting counter sales. Despite this temporary slowdown, Navneet remains optimistic about growth over the coming years, driven by the upcoming curriculum revision cycle beginning in 2025-26.

The Company continues to maintain a pan-India presence in the CBSE segment, drawing on over six decades of experience in delivering high-quality educational content. A key strategic focus is the expansion of CBSE offerings, where Navneet is enhancing its content portfolio and investing in digital integration across its products.

Digital enablement has become an intrinsic component of all new publications, with interactive features now considered part of the cost of production. These costs, currently absorbed by the Company, have impacted EBITDA margins compared to five years ago. As the digital user base continues to grow, Navneet intends to gradually pass on these costs.

In response to competitive pressures in the CBSE market, Navneet is focusing on long-term value creation. The Company has launched a free AI-driven solution for teachers, which has already been rolled out to more than 1,000 schools across SSC and CBSE boards. This initiative is expected to strengthen teacher engagement, improve retention, and embed Navneet more deeply within the school ecosystem.

Navneet AI

Navneet AI is a recent digital initiative launched by NEL as part of our ongoing commitment to innovation and digital transformation. Developed as an advanced classroom tool,

Navneet AI is designed to support and empower the teacher community by leveraging the companys vast content repository. The initiative aims to enrich teaching experiences in schools and enhance content delivery in classrooms.

The response to Navneet AI has been overwhelmingly positive, with expectations that its adoption will become widespread among educators. While the platform does not yet contribute to direct revenue and involves initial implementation costs, it is viewed as a strategic, long-term investment. Navneet anticipates that the use of this tool will indirectly boost demand for its physical books and digital content. This approach is seen as a more effective way to drive content usage than simply expanding sales teams.

Stationery Segment: Domestic and Exports

NEL, with a legacy of over six decades, continues to lead in both paper-based and evolving non-paper stationery categories. In 2024-25, the domestic stationery segment saw a 13% decline in revenue, driven by a 9% drop in realisation due to lower paper prices and a 4% decline in volumes, attributed to intensifying competition from the unorganised sector. With paper prices now stabilising, trade sentiment is showing signs of recovery. The company is currently focused on strengthening its distribution network and scaling up its non-paper stationery portfolio, which contributed 5% to domestic revenue in 2024-25. These newly designed products, launched over recent months, have received encouraging initial feedback from trade partners. Volume growth of 5-6% is projected for 2025-26, supported by new product introductions and improved market traction.

The export stationery segment grew 12% in 2024-25, aided by entry into new international markets, although this was slightly below the targeted 15%. While realisations for paper-based products declined by 8-9%, overall demand remained strong and order flow was not materially impacted. With the majority of exports destined for the US, the company is closely monitoring tariff-related uncertainties. Despite these external challenges, Navneet remains a preferred vendor for key global clients and is confident of gaining market share as sourcing continues to shift from China to India.

Plastic file folders now account for about 13% of total exports. Encouraged by strong customer response, we have initiated the development of new categories such as canvas and wooden stationery, which are expected to reach commercial maturity over the next 2-3 years. To support this momentum and meet rising demand, we have committed targeted investments towards capacity expansion. As part of this plan, a new manufacturing facility, outlined in our earlier capex commitments, is expected to become operational in 2025-26.

Overall, NELs stationery portfolio spans over 1,250 SKUs in India and 1,500 SKUs internationally. EBITDA margins are expected to stabilise at 12-13%, with exports delivering higher margins than domestic. The company will continue to invest about Rs 100 Crores annually in capacity expansion over the next three years, with Rs 50 Crores already deployed and expected to be operational by 2025-26. With stable input costs and growing demand, NEL is well-positioned for volume-led growth in 2025-26 across both domestic and export markets.

Indiannica Learning Private Limited

Indiannica Learning Private Limited, a wholly owned subsidiary of NEL, continues to strengthen our presence in the CBSE curriculum publishing segment. Known for its focus on exploratory learning and integrated digital content, Indiannica offers curriculum-based programmes and technology solutions for schools and individual learners.

NEL remains committed to this strategically important venture. The

CBSE market presents significant opportunities, especially as SSC schools increasingly shift to the CBSE board. Indiannica has approached nearly 10,000 schools during the year, focusing on deepening engagement through increased title penetration per school and value-added offerings. Together with sister brands like Grafalco and the RISE series, Indiannica plays a vital role in our goal of delivering high-quality, digitally enriched content to Indias evolving education landscape.

School Management through K12 Techno Services Private Limited (K12 Techno)

NEL has been associated with K12 Techno Services Private Limited, a prominent player in school management, offering comprehensive K12 education. Navneet divested a portion of its holding and now retains a 14.3% stake, which is treated as a financial asset. Operating under the Orchid International brand, K12 Techno delivers quality elementary education through its growing network of schools. It has emerged as a key player in school management services, with a strong focus on direct education. Embracing technological innovation, K12 Techno continues to expand its footprint while earning recognition within the EdTech landscape. K12 Techno network comprised 116 educational institutions (including schools and colleges) 20 locations in 9 States, serving nearly 86,704 students demonstrating the scale and effectiveness of its K12 education model.

Financial Review

( Rs in Crores)

Particulars	2024-25	2023-24	2022-23	2021-22	2020-21
Total Income	1,758	1,707	1,652	1,081	817
Operating Expenses	(1,413)	(1,394)	(1,346)	(890)	(692)
EBITDA	345	313	306	191	125
Depreciation	(64)	(59)	(53)	(33)	(35)
EBIT	281	254	253	158	90
Financial Cost	(17)	(17)	(9)	(4)	(7)
Exceptional Items	604	(19)	30	46	-
EBT Including Exceptional Items	868	218	274	200	83
EBT Excluding Exceptional Items	264	237	244	154	83
Tax	(67)	(30)	(81)	(53)	(23)

 

Particulars	2024-25	2023-24	2022-23	2021-22	2020-21
PAT Including Exceptional Items	801	188	193	147	60
PAT Excluding Exceptional Items	197	207	163	101	60
Tangible Capital Employed	2,086	1,567	1,460	1,217	1,065
Net Capital Employed	1,956	1,372	1,243	1,127	1,039
Return on Capital Employed Excluding Exceptional Items (%)	13.45	16.20	19	13	9
Return on Net Worth Excluding Exceptional	11.84	15.83	15.53	13	5.93

Items (%)

Ratios	2024-25	2023-24	2022-23	2021-22
Current Ratio (x)	3.80	2.86	2.48	3.47
Debt-to-Equity Ratio (x)	0.08	0.17	0.20	0.08
Debtors Turnover (x)	5.86	5.86	6.96	6.28
Operating Profit Margin (%)	14.79	14.15	14.07	12.92
Net Profit Margin (%)	46.22	11.10	11.86	13.87
Net Profit Margin (%) without exceptional items	11.37	12.23	10.01	9.53
Return on Net Worth (%)	48.13	14.38	15.53	13.00
Return on Net Worth (%) without exceptional item	11.84	15.83	15.53	13.00
EPS ( Rs )	35.86	8.33	8.53	6.45
EPS ( Rs ) without exceptional items	8.81	9.15	8.53	6.45
Fixed Asset Turnover Ratio (%)	11.99	10.73	10.55	6.63

Dividend History

Below is the dividend history for the last five financial years

Financial Year	Dividend Type	Dividend (%)
2024-25	Interim	75
	Final (proposed)	75
2023-24	Final	130
2022-23	Final	130
2021-22	Final	75
2020-21	Final	50

Risks and Concerns

Our risk management approach focuses on proactively identifying and addressing challenges that could impact the business. Seasonal variations and the increase in paper prices may put pressure on profit margins. Additionally, rising freight costs especially in export markets pose difficulties, as customers consider their total landed costs and might look for alternative suppliers if expenses increase.

Risk Mitigation Strategies

Risk	Mitigation Strategy
Enterprise Risk	NEL has adopted a comprehensive Enterprise Risk Management (ERM) framework, which serves as a structured approach to identifying, assessing, and addressing potential risks, disruptions, and losses that could impact the Companys structure and strategic objectives. Through the effective implementation of ERM, we proactively evaluate potential threats and apply targeted mitigation strategies to safeguard our operations and ensure business continuity.
Process Risk	The internal audit team plays a pivotal role in enhancing process and risk management by rigorously evaluating and strengthening commercial and investment controls across all critical operational areas, ensuring efficiency, compliance, and robust governance.

 

Risk	Mitigation Strategy
Compliance Risk / Integrity Risk	The Company ensures strict compliance with all applicable laws and regulations through a robust verification and reporting framework. This structure spans across all levels from business line executives to the Audit Committee and the Board of Directors. An experienced internal audit team conducts comprehensive annual audits, evaluating critical aspects of corporate operations. These audits are further reviewed by internal auditors, the Audit Committee, and the Board to en- sure transparency and governance. The Audit Committee regularly evaluates audit findings and recommends actionable measures to strengthen the Companys internal control systems.
Digital Risk	The Company has implemented a strong cloud application security solution to proactively identify and address potential vulnerabilities. In addition, we carry out continuous, round-the- clock security assessments to safeguard our digital infrastructure and ensure the integrity and confidentiality of our data assets.
Funding Risk	The Company has strategically relied on internal funding to support its various initiatives, thereby avoiding external financial risks commonly faced by peers in the sector. This prudent approach reflects our commitment to financial discipline and sustainable growth. By funding our ventures through internal resources with careful planning and diligence, we continue to drive expansion while ensuring consistent and favourable returns.
Raw Material Price Volatility Risk	NEL actively monitors raw material markets and maintains strong supplier relationships to negotiate better terms. Additionally, it leverages operational efficiencies and pricing strategies to absorb short-term cost fluctuations without severely impacting margins.
Content Digitisation and Market Shift Risk	Although physical content remains strong, Navneet is investing in digital innovations such as Navneet AI and digital content distribution to adapt to evolving market demands and comple- ment its physical product offerings. This hybrid approach mitigates the risk of declining print revenues.

Corporate Social Responsibility (CSR)

In line with our strong commitment to social responsibility, we have actively engaged in a wide range of CSR initiatives during 2024-25, with a significant contribution of Rs 4.70 Crores. Our efforts are focused on key areas such as education, healthcare, animal welfare, community development, and sports promotion. We ensure effective implementation and impact by closely monitoring resource utilisation at the grassroots level, thereby reaching the intended beneficiaries.

Additionally, as part of our commitment to environmental sustainability, we continue to prioritise the use of eco-friendly materials in the production of our core offerings.

Internal Control System and Its Adequacy

The Company continues to focus on enhancing operational efficiencies, optimising costs, refining pricing strategies, and strengthening its distribution and supply chain networks through the use of technology. The Company maintains an adequate internal control framework, designed to ensure the reliability of financial reporting, compliance with applicable laws and regulations, and the safeguarding of assets. These controls are periodically reviewed and strengthened to align with evolving business needs and regulatory requirements.

Cautionary Statement

This Report may contain forward-looking statements that reflect the Companys current expectations, beliefs, or projections regarding future performance, developments, or opportunities. These statements involve inherent risks and uncertainties both identified and unidentified that could cause actual results to differ materially from those expressed or implied.

External factors such as macroeconomic changes and unforeseen events, including global disruptions like the Covid-19 pandemic, may pose unpredictable and evolving challenges to the Company and the ecosystem in which it operates. The assumptions underlying forward-looking statements are based on available internal and external data at the time of reporting and are subject to change with evolving circumstances. Accordingly, any projections or forward-looking statements are valid only as of the date they are made. The Company does not undertake any obligation to revise or publicly update such statements in light of new information, future developments, or otherwise, unless required by applicable laws or regulations.