Global economic overview

Global economic growth remained steady at 3.5% in both 2024 and 2025. While geopolitical tensions and trade-related uncertainties continued to weigh on economic activity, demand associated with the technology cycle, particularly the rapid advancement and adoption of artificial intelligence (AI), provided support to growth in several economies. The impact varied across countries, with energy exporters benefiting from favourable terms of trade and economies integrated into technology value

Management discussion and analysis

Global economic overview

Global economic overviewGlobal economic growth remained steady at 3.5% in both 2024 and 2025. While geopolitical tensions and trade-related uncertainties continued to weigh on economic activity, demand associated with the technology cycle, particularly the rapid advancement and adoption of artificial intelligence (AI), provided support to growth in several economies. The impact varied across countries, with energy exporters benefiting from favourable terms of trade and economies integrated into technology value

chains experiencing relatively stronger activity.

Advanced economies remained broadly stable, recording growth of 1.9% in both 2024 and 2025. Emerging market and developing economies also remained resilient, with growth at 4.5% in both years.

Global inflation moderated sharply in 2025 to an estimated 4.1% compared with 5.8% in 2024, continuing the multi-year disinflation trend that had been underway since early 2024.

Performance of the major economies, 2025

United States	China	United Kingdom
GDP growth was 2.1% in 2025, compared with 2.8% in 2024.	GDP growth was 5.0% in 2025, unchanged from 2024.	GDP growth was 1.4% in 2025, compared with 1.0% in 2024.
Japan	Germany
GDP growth was 1.1% in 2025, compared with -0.2% in 2024.	GDP growth was 0.2% in 2025, compared with -0.5% in 2024.

Regional growth (%)

Region	2025	2024
World output	3.5	3.5
Advanced economies	1.9	1.9
Emerging market and developing economies	4.5	4.5

Source:IMF,United Nations

Outlook

The global outlook remains subject to significant uncertainty, particularly in relation to geopolitical developments, commodity prices, trade conditions and financial markets. The IMFs projections are based on assumptions regarding the duration and intensity of geopolitical disruptions and the gradual normalisation of economic conditions.

Under its April 2026 baseline scenario, the IMF projected global growth at 3.1% in 2026 and 3.2% in 2027. Global inflation is expected to increase modestly in 2026 before resuming its downward trajectory in 2027. The outlook remains vulnerable to a prolonged geopolitical conflict, renewed trade tensions, financial market volatility and weaker-than-expected productivity gains.

Source:IMF World Economic Outlook, April 2026;

Indian economic overview

The Indian economys real GDP grew by 7.7% in FY 25-26, compared with 7.1% in FY 24-25. Growth was supported by resilient domestic consumption and increasing investment activity, reinforcing Indias

position among the fastest-growing major economies.

Indias real GDP at constant prices was estimated at 323.12 Lakh Crore in FY 25-26, compared with 299.89 Lakh Crore in FY 24-25.

Growth of the Indian economy

Particulars	FY23*	FY24	FY25	FY26
Real GDP growth (%)	7.0*	7.2	7.1	7.7

E: Estimated. FY 23-24 has been restated under the new base-year series of FY 22-23. The FY 22-23 figure of 7.0% is based on the earlier FY 11-12 base-year series, as comparable back-series data under the revised methodology is yet to be released.

Source: Ministry of Statistics and Programme Implementation (MoSPI)

Growth of the Indian economy quarter by quarter, FY 25-26

Particulars	Q1FY26	Q2 FY26	Q3 FY26	Q4 FY26
Real GDP growth (%)	6.7	8.4	7.8	7.8

Note: Q2 and Q3 figures were revised under the new base-year series of FY 22-23. Q4 represents the latest available estimate.

Source: MoSPI

Inflation, policy and currency dynamics

Inflation remained benign through much of FY 25-26, with full-year CPI inflation estimated at approximately 2.1%. The easing inflation environment created room for cumulative policy rate reductions, supporting consumption and investment activity.

However, macroeconomic stability was accompanied by currency volatility. The Indian rupee depreciated sharply during FY 25-26, reflecting

global capital flows, a strong US dollar environment and geopolitical uncertainties.

Capital flows and market behaviour

Foreign portfolio investors remained risk-averse during FY 25-26, resulting in significant net outflows. However, strong domestic institutional participation provided an important counterbalance, highlighting the increasing depth and maturity of Indias domestic capital markets.

Indias equity markets also experienced volatility during the year. Market capitalisation declined, while both the BSE Sensex and Nifty 50 recorded declines during FY 25-26, compared with gains in the previous year. Investor sentiment was influenced by geopolitical developments, global risk aversion and concerns regarding international trade and tariff policies.

Gold prices rose sharply during FY 25-26, reflecting increased global risk aversion and demand for safe-haven assets.

Indias net direct tax collections rose by 5.12% year on year to 23.40 Lakh Crore in FY 25-26, although collections remained below the Revised Estimates. Corporate tax collections stood at 10.99 Lakh Crore, while personal income tax collections, including Securities Transaction Tax, amounted to 12.41 Lakh Crore. The shortfall partly reflected the tax relief measures extended to the middle class in the Union Budget FY 25-26.

Source: Ministry of Finance, Government of India, Reserve Bank of India

Banking sector

Indias banking sector continued to demonstrate improving financial health, supported by stronger asset quality, disciplined lending practices and healthy capitalisation. The gross non-performing asset ratio declined to a multi-decadal low, while profitability and capital adequacy remained robust. Scheduled commercial banks continued to report healthy returns,

supported by improved operational efficiency and stronger balance sheets. The sector also remained well capitalised, providing resilience against potential economic and financial shocks.

Source: Reserve Bank of India

Indias growth story

Real Gross Value Added (GVA) grew by 7.9% in FY 25-26, compared with 7.3% in FY 24-25. At current prices, nominal GVA increased by 9.1% to 314.87 Lakh Crore from 288.54 Lakh Crore in the previous year.

The tertiary services sector remained a key driver of growth, expanding by 9.0% during FY 25-26 and increasing its share of nominal GVA. Growth was broad-based across financial, real estate, IT and professional services, as well as trade, hotels, transport, communication and broadcasting.

The secondary sector grew by 9.1% accelerating from 8.0% in the previous year. Manufacturing and construction remained important contributors, with construction recording growth of 7.1%. Together, the continued strength of services and the acceleration in industrial activity contributed to a more balanced growth profile.

Consumption and investment

Private Final Consumption Expenditure (PFCE) and Gross Fixed Capital Formation (GFCF) both recorded growth of more than 7% during FY 25-26, reflecting a balanced contribution from household consumption and investment activity.

Growth catalysts

Policy-led consumption boost: Tax relief measures announced in the Union Budget FY 26-27, including revised income tax provisions, are expected to support disposable income and discretionary consumption.

Anticipatory Pay Commission impact: The proposed 8th Pay Commission is expected to influence consumer sentiment and may provide an additional consumption stimulus once implemented.

Monetary stability: The Reserve Bank of Indias calibrated monetary policy stance is expected to balance inflation management with growth requirements.

Credit expansion: Improved banking-sector health and liquidity conditions are expected to support credit growth across MSMEs, housing and retail segments.

Fiscal prudence with growth focus: Continued emphasis on infrastructure, MSME development, skilling and innovation is expected to support long-term productivity and economic expansion.

Outlook

The year under review highlighted a defining divergence between a global economy facing elevated uncertainty and an Indian economy supported by resilient domestic demand and improving structural fundamentals.

India remains well positioned to sustain relatively strong growth,

supported by private consumption, investment, policy reforms and favourable demographic trends. The World Bank has projected continued strong growth for India, supported primarily by domestic demand and investment.

While risks remain, particularly from elevated energy prices, geopolitical developments and uncertainty in global demand, Indias macroeconomic fundamentals remain comparatively resilient. Over the medium term, sustained consumption, continued investment activity and expanding global trade linkages are expected to reinforce Indias role as an important contributor to global economic growth.

Source: Ministry of Statistics and Programme Implementation, Reserve Bank of India, World Bank India Overview

Global packaging market overview

The global packaging market is estimated to grow from USD 1,180 Billion in 2025 to USD 1,220.36 Billion in 2026 and is projected to reach USD 1,443.9 Billion by 2031, representing a CAGR of 3.42% during 2026-2031. Demand is expected to remain resilient, supported by packagings critical role in product protection, brand differentiation and regulatory compliance across food and beverages, pharmaceuticals, consumer goods and e-commerce.

Rigid packaging accounted for a significant share of the global market in 2025, while flexible packaging is projected to grow at a faster pace.

E-commerce is expected to remain among the fastest-growing end-use segments, supported by rising parcel volumes and the continued expansion of digital commerce.

Sustainability and circular-economy requirements are increasingly influencing material selection and product development. Companies are investing in lightweight materials, mono-material solutions, recycled content, bio-based feedstocks and digital technologies that improve traceability and consumer engagement.

Regulatory requirements relating to recyclability, labelling and Extended Producer Responsibility (EPR) are also reshaping the packaging landscape. At the same time, e-commerce growth and rising consumer preference for convenience and sustainability are expanding demand for innovative and environmentally responsible packaging formats.

Source: Mordor Intelligence - Global Packaging Market

Indian paper and packaging market overview

In India, government initiatives to curb single-use plastics are encouraging businesses to transition towards sustainable packaging alternatives. The growth of e-commerce, supported by a young population, increasing internet penetration and rising consumption, continues to create demand for paper-based and recyclable packaging solutions.

The expansion of organised retail, modern trade and FMCG consumption is also supporting demand for paper and paperboard packaging. Papers recyclability and versatility continue to position it as an important alternative for several packaging applications.

Indias paper packaging market is estimated at USD 22.73 Billion in 2026, compared with USD 19.07 Billion in 2025, and is projected to reach USD 54.67 Billion by 2031, representing a CAGR of 19.16% during 2026-2031. Growth is being supported by e-commerce expansion, restrictions on selected single-use plastics and rising FMCG volumes.

Corrugated board accounted for a significant share of the market in 2025, while paperboard and flexible paper packaging are expected to record strong growth. Market participants are investing in coating technologies, moulded fibre solutions, smart packaging and other value-added applications to strengthen their product offerings.

However, the sector continues to face challenges arising from raw-material price volatility, recovered-fibre availability and competition from imports in certain grades. These factors are encouraging domestic manufacturers to improve scale, strengthen backward integration and enhance operational efficiency.

Indias green packaging market is also expected to witness strong growth, supported by government initiatives, increasing environmental awareness and rising adoption of recyclable,

biodegradable and compostable packaging solutions.

Source: Mordor Intelligence - India Paper Packaging Market, GII Research - India Paper Packaging Market, IBEF - Paper and Packaging Industry

Global compostable packaging market overview

The global compostable packaging market was valued at USD 85.43 Billion in 2025 and is projected to grow from USD 90.58 Billion in 2026 to USD 152.96 Billion by 2034, representing a CAGR of 6.77% during the forecast period. North America accounted for a 33.68% share of the global market in 2025.

Compostable packaging provides an environmentally responsible alternative to conventional single-use plastics. Such materials are designed to break down under appropriate composting conditions and are generally derived from renewable resources such as plant-based polymers, starches and cellulose.

Growing consumer awareness regarding plastic waste, increasing regulatory focus on sustainable materials and rising demand from the food and beverage, personal care and cosmetics sectors are supporting market growth.

A key challenge, however, remains the availability of adequate composting infrastructure. In several markets, insufficient collection and processing facilities can limit the environmental benefits of compostable products

if they are not disposed of through appropriate waste-management systems.

Continued advances in material science, including developments in polylactic acid (PLA) and other bio-based materials, are expected to improve the performance and commercial viability of compostable packaging.

Source: Fortune Business Insights - Compostable Packaging Market

Growth drivers: Indian paper industry

Rising disposable income: Rising disposable income continues to support consumption of packaged food, FMCG products and branded goods. The expansion of the middle class is also expected to increase demand for organised retail and e-commerce, supporting the consumption of paper and paperboard packaging.

Source: Business Standard - Indias Expanding Middle Class

Increase in population: Indias growing population, combined with increasing urbanisation, literacy and consumption, continues to support long-term demand for paper and packaging products. Relatively low per-capita paper consumption compared with developed markets also indicates potential for further growth as economic activity and consumption expand.

Source: Indian Paper Manufacturers Association

Urbanisation and lifestyle changes: Urbanisation and changing

lifestyle are increasing demand for convenience-oriented products, organised retail, e-commerce and sustainable packaging solutions. These trends are supporting demand for packaging paper, paperboard, tissue and other value-added paper products.

Source:IBEF-Paper and Packaging Industry

Retail sector expansion: The continued expansion of organised retail, e-commerce and FMCG is creating sustained demand for corrugated boxes, kraft paper and other packaging solutions. Growing focus on environmentally responsible materials is further strengthening the role of paper-based packaging.

Source:IBEF- Retail Industry in India

Consumer awareness and preferences: Increasing consumer awareness regarding sustainability and plastic waste is encouraging brand owners to explore recyclable, biodegradable and compostable alternatives. This transition, combined with growing demand from e-commerce and FMCG, is expected to support the long-term growth of paper-based packaging.

Source:Ministry of Environment, Forest and Climate Change

Growth in the Indian hospitality sector: The expansion of Indias hospitality and tourism sectors is supporting demand for foodservice packaging, tissue products and other paperbased consumables. Growth in travel, meetings and events, hotel occupancy and foodservice consumption is

expected to create additional demand for sustainable packaging solutions.

Source:Research and Markets- India Hospitality Market

Growth in the food packaging industry: Indias expanding food processing, FMCG and packagedfood sectors continue to support growth in the packaging industry. The increasing requirement for product protection, convenience, hygiene and extended shelf life is driving demand for innovative packaging formats, including sustainable paper-based alternatives.

Source:IBEF- Paper and Packaging Industry

Company overview

Pakkalimited, formerly known as Yash Pakka Limited, is an India-based manufacturer of sustainable paper and moulded packaging products. The Company operates across paper, pulp and moulded products, offering products that include agro-based pulp, compostable and recyclable flexible packaging, moulded foodservice ware, food wrap and carry papers, and tableware solutions.

The Company focuses on developing environmentally responsible packaging solutions using agricultural residue and renewable resources. Its product portfolio includes offerings marketed under the CHUK brand and is designed to address the growing demand for sustainable alternatives to conventional packaging materials.

Pakkalimited continues to focus on innovation in sustainable and regenerative packaging, including

compostable solutions intended to reduce dependence on conventional plastics and support the transition towards a circular economy.

The Companys financial performance

During the year under review, the Company generated revenue of 355.80 Crore, compared with 406.04 Crore in the previous year, representing a 12.37% decrease.

The Company reported a net profit of 18.15 Crore during FY 25-26, compared with a net profit of 56.70 Crore in FY 24-25.

The Company transitioned from Yash Papers to Yash Pakka in 2019 and subsequently adopted the name Pakka Limited in July 2023.

Details of significant changes in the key financial ratios

In accordance with the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended, details of significant changes in the key financial ratios and changes in the Return on Net Worth of the Company, along with explanations where applicable, are provided below:

Ratio	FY25	FY26
Current ratio	1.97	1.30
Debt-equity ratio	0.41	0.90
Return on Net Worth / Equity (%)	15.07	3.65
Net profit ratio (%)	13.96	5.10
Return on capital employed (%)	10.90	3.80

Source:SEBI Listing Obligations and Disclosure Requirements Regulations

Risk management

The Company operates in an evolving business environment and is exposed to risks arising from market conditions, customer concentration, operational processes, health and safety, information security, reputation and the acceptance of sustainable products.

The Companys Enterprise Risk Management (ERM) framework provides a structured and consistent approach for identifying, assessing, monitoring and mitigating risks that may affect its strategy, operations, financial performance and long-term value creation.

The principal risks and the Companys mitigation approach are outlined below.

Risk / uncertainty	Impact on capitals	Inherent risk	Mitigation strategy
Credit risk	Financial; Social and relationship	Credit risk represents the potential loss arising from customer defaults on trade receivables, particularly during periods of economic uncertainty or changes in business conditions.	The Company monitors receivables and customer creditworthiness and follows established processes for credit assessment and collection. As of 31st March, 2026, the Company reported total trade receivables of 48.91 Crore against revenue of 355.80 Crore.
Health and safety risk	Social and relationship; Human	Manufacturing operations involve exposure to industrial processes, chemicals, machinery and high-temperature environments, which may result in occupational health and safety incidents.	The Company maintains appropriate health and safety management systems and implements safety protocols, employee training, signage and protective equipment to minimise workplace risks.
Cybersecurity risk	Intellectual; Social and relationship; Financial	The increasing use of digital systems and the processing of business and operational information expose the Company to potential cyber breaches, data loss and system disruptions.	The Company has established controls and review mechanisms to safeguard IT infrastructure and data. Periodic technical assessments are undertaken to identify vulnerabilities, while employee awareness and information-security training are conducted regularly.
Reputational risk	Intellectual; Financial; Social and relationship; Human; Natural	Failure to effectively manage social, environmental, product-quality or stakeholder expectations may adversely affect the Companys reputation and stakeholder confidence.	The Company follows established codes of conduct, quality and environmental management practices and maintains engagement with employees, communities, customers and business partners.
Market volatility	Financial; Manufactured	Changes in raw-material prices, demand conditions, competition and broader market developments may affect margins and profitability.	The Company continues to focus on operational efficiency, product innovation, cost optimisation, customer diversification and value-added product development.
Market acceptance risk	Financial; Social and relationship; Intellectual	Sustainable and compostable products may face adoption barriers relating to pricing, consumer awareness, performance expectations and the availability of appropriate disposal infrastructure.	The Company continues to expand awareness of sustainable packaging solutions, strengthen product development and address growing demand for compostable flexible packaging and foodservice products. Supportive government initiatives and increasing environmental awareness are expected to broaden market opportunities.

Talent and culture management

The Company recognises that a skilled, capable and engaged workforce is fundamental to its long-term success. It remains committed to equipping employees with the competencies required to adapt to technological advancements and evolving business requirements.

During the year, the Company maintained healthy employee relations and continued to focus on training, skill development and capability enhancement. These initiatives are intended to support employee adaptability, strengthen organisational capabilities and contribute to long-term business performance.

As of 31st March, 2026, the Company had a permanent workforce of 565 employees.

Cautionary statement

Certain statements in this Management Discussion and Analysis describing the Companys objectives, outlook, expectations, estimates and projections may constitute forward-looking statements within the meaning of applicable laws and regulations.

Actual results may differ materially from those expressed or implied

Internal control systems and their adequacy

The Company has established an organisational structure, documented policies, defined authority matrix and internal control framework designed to support operational efficiency, compliance with applicable laws and regulations, and the protection of Company resources.

The internal control framework is supported by internal audits, periodic management reviews and established policies and procedures. These processes are intended to ensure the reliability of financial and operational information and support the preparation of financial statements and other disclosures.

The Company continues to review and strengthen its internal control systems in line with evolving business requirements and applicable best practices.

in such statements due to various factors, including changes in economic and market conditions, demand and supply dynamics, raw-material prices, government policies and regulations, taxation, geopolitical developments, climatic conditions, natural disasters and other factors beyond the Companys control.