Polylink Polymers India Ltd Management Discussions

Regulation 34 (2) (e) read with Schedule V (B) of SEBI (Listing Obligations and Disclosure Requirements) (Amendment) Regulations, 2018

Polylink Polymers (India) Limited is engaged in the manufacturing and marketing of specialty polymers, polymer compounds, and allied products catering to various industrial applications. Over the years, the Company has established itself as a reliable manufacturer by offering quality products, maintaining customer satisfaction, and adopting efficient manufacturing practices.

The Company primarily serves industries such as plastics, packaging, automotive, electrical and electronics, construction, consumer goods, and other industrial sectors. Through its commitment to innovation, product quality, and operational excellence, Polylink Polymers (India) Limited has developed long-term business relationships with its customers and continues to strengthen its position in the domestic market.

The Company focuses on delivering value through continuous improvement in manufacturing processes, efficient utilization of resources, and adherence to quality standards. It also emphasizes sustainable business practices, technological advancement, and customercentric solutions to meet the evolving demands of the polymer industry.

During the financial year 2025-26, the Company continued its efforts towards enhancing operational efficiency, optimizing costs, and expanding its market presence despite many dynamic business situations. The management remains committed to achieving sustainable growth by strengthening its product portfolio, improving operational performance, and creating long-term value for all stakeholders.

ECONOMIC OVERVIEW

GLOBAL ECONOMY

The global economy remained resilient during FY 2025-26 despite geopolitical tensions, evolving trade policies, tariff uncertainties and supply-chain disruptions. The IMF projected global GDP growth at 3.4% in 2026, compared with 3.2% in 2025, while global inflation continued to moderate.

Global trade remained stronger than initially anticipated, with world merchandise trade volume increasing by approximately 4.6% in 2025, supported by strong demand for AI-enabling products and front-loading of imports ahead of tariff changes. Chinas economy grew by 5.0% in 2025, although weak domestic demand, subdued inflation and property-sector challenges continued to weigh on its economic outlook.

The continued expansion of infrastructure, renewable energy, electrification, electric mobility and industrial manufacturing supported demand for polymers and specialty compounds. These trends, together with global supply-chain diversification and the "China Plus One" strategy, created opportunities for Indian manufacturers. At the same time, volatility in crude oil, petrochemical prices and trade policies continued to exert pressure on raw-material costs and margins.

Going forward, global merchandise trade growth is projected to moderate to around 1.9% in 2026, reflecting normalization of trade flows and continuing geopolitical and tariff-related uncertainties. The polymer industry is nevertheless expected to benefit from sustained investments in power infrastructure, renewable energy, automotive, electric mobility and industrial applications, supporting long-term demand for XLPE compounds, semiconductive compounds, masterbatches and other specialty polymer products.

INDIAN ECONOMY

India continued to remain one of the fastest-growing major economies during FY 2025-26, supported by resilient domestic demand, public infrastructure spending, private investment and sustained growth in the services sector. The IMF estimated Indias real GDP growth at approximately 6.5% in FY 2025-26, following growth of 6.5% in FY 2024-25. Inflationary pressures moderated during the year, with CPI inflation declining significantly from the levels witnessed in the previous year, providing greater support to household consumption and economic activity.

Indias external sector remained resilient amid global trade uncertainties. Merchandise exports continued to remain strong, while services exports benefited from Indias growing position in information technology, business services and other knowledge-intensive sectors. Government initiatives including Make in India, Production Linked Incentive (PLI), PM Gati Shakti, National Logistics Policy and Digital India continued to strengthen domestic manufacturing capabilities, improve infrastructure and enhance Indias integration with global supply chains.

India also continued its transition towards sustainable and technology-driven growth. Renewable energy capacity expanded significantly during the year, supported by investments in solar and wind energy, while the country remained committed to its target of 500 GW of non-fossil fuel capacity by 2030. Electric mobility, digital payments and digital public infrastructure continued to expand, with platforms such as UPI, Aadhaar and ONDC supporting greater digitalization and financial inclusion.

Despite geopolitical uncertainties, global trade disruptions and fluctuations in commodity prices, Indias strong domestic demand, improving manufacturing ecosystem, infrastructure investments and policy reforms provide a favorable foundation for sustained economic growth. These developments are expected to support demand across infrastructure, power, renewable energy, automotive and industrial sectors, thereby creating longterm opportunities for the polymer and specialty compounds industry.

INDUSTRY STRUCTURE AND DEVELOPMENTS

The Indian plastics industry continues to be a key and rapidly growing manufacturing sector, contributing significantly to packaging, automotive, electrical and electronics, agriculture, healthcare, infrastructure and consumer goods. India is among the worlds largest plastics consumers, with domestic consumption estimated at around 25-26 million tonnes annually and per capita consumption of approximately 18-20 kg, indicating substantial headroom for growth compared with developed markets. The sector is expected to expand at a CAGR of around 7-8% over the coming years, supported by urbanization, rising disposable incomes, infrastructure development and increasing industrialization. Demand for specialty polymers, XLPE and semi-conductive compounds, masterbatches and other value-added polymer products is further supported by investments in power transmission, renewable energy, electric mobility, automotive and electronics, while increasing emphasis on recycling and sustainability is shaping the industrys future growth.

Source: Statista - Plastics Industry in India: https://www.statista.com/topics/6902/plastic-industry-in- india/

The Indian plastics market continues to expand steadily, supported by rising demand from packaging, construction, automotive, electrical & electronics and consumer goods sectors. The Indian plastics market was valued at approximately US$ 43.68 billion in 2025 and is expected to grow at a CAGR of around 6.6% during 2026-2030, reaching approximately US$ 68.33 billion by 2030. Packaging remains the largest end-use segment, driven by increasing consumption in food processing, pharmaceuticals, FMCG and e-commerce sectors. Growing investments in infrastructure, renewable energy, electric vehicles, power transmission and industrial manufacturing are further expected to increase demand for specialty polymers, cable compounds and masterbatches.

Source: Maximize Market Research - India Plastics Market: Industry Analysis and Forecast (2026-2030) https://www.maximizemarketresearch.com/market- report/india-plastics-market/195702/

Indias petrochemical and polymer industry continues to provide strong support to the downstream plastics sector. The Indian petrochemical sector is valued at approximately US$ 220 billion and is expected to grow towards US$ 300 billion, supported by increasing domestic consumption and industrial expansion. India consumes around 25-30 million metric tones of petrochemical products annually, with demand expected to increase due to growth in electric vehicles, renewable energy, automobiles, household appliances and other industrial applications. The sector is also expected to attract investments of approximately US$ 87 billion over the next decade to enhance domestic production capacity and reduce dependence on imports. Source: Reuters - India to remain bright spot for petrochemical demand in 2026 https://www.reuters.com/markets/commodities/india- remain-bright-spot-petchem-demand-2025-2025-02-14/

The Indian plastics industry has also been strengthening its position in global markets. India exports plastic products to more than 200 countries, with key export destinations including the USA, UAE, Germany, the UK and other international markets. Plastic exports from India increased to approximately US$ 12.5 billion in FY 2025-26 compared with around US$ 11.5 billion in FY 2024-25, registering growth of nearly 8% year-on-year. The industry consists of more than 30,000 processing units and provides employment opportunities to around 4 million people, with MSMEs contributing significantly to the sector. Source: India Brand Equity Foundation (IBEF) -

https://www.ibef.org/exports/plastic-industry-india

The plastics industry is undergoing significant transformation with increasing focus on sustainability, recycling and development of value-added polymer solutions. Government initiatives such as Make in India, Production Linked Incentive (PLI) schemes, Plastic Parks and infrastructure development programs are supporting domestic manufacturing and improving Indias position in global supply chains. However, the industry continues to face challenges such as volatility in crude oil prices, fluctuations in polymer raw material costs, environmental regulations and global supply chain uncertainties. Despite these challenges, the long-term outlook for the Indian plastics industry remains positive, supported by rising domestic consumption, technological advancements and expanding applications across various industries.

Source: Department of Chemicals and Petrochemicals, Ministry of Chemicals & Fertilizers, Government of India https://chemicals.gov.in/

OPPORTUNITIES AND THREATS OPPORTUNITIES:

The polymer compound and masterbatch industry is expected to witness steady growth driven by increasing demand from sectors such as power transmission, renewable energy, infrastructure, automotive, electric vehicles, packaging and consumer goods. Rising investments in infrastructure development, electrification and clean energy projects are expected to create opportunities for high-performance polymer solutions, including cable compounds and specialty masterbatches. The growth of domestic manufacturing under initiatives such as Make in India and the diversification of global supply chains through the China Plus One strategy provide further opportunities for Indian manufacturers to expand their domestic and international presence. The Companys diversified product portfolio, manufacturing capabilities and focus on customized solutions position it well to benefit from these emerging opportunities.

THREATS:

The polymer industry remains exposed to fluctuations in raw material prices, as key inputs are linked to petrochemical derivatives and are influenced by changes in crude oil prices, global supply-demand conditions, exchange rates and geopolitical developments such as the Russia-Ukraine conflict. Rising freight costs, supply chain disruptions and changing trade policies may impact procurement costs and export competitiveness. Additionally, increasing environmental regulations related to plastic usage, recycling and sustainability, along with intense competition and pricing pressure, remain key challenges for the industry. Continuous focus on operational efficiency, innovation and sustainable solutions will be important to manage these challenges effectively

SEGMENT-WISE PERFORMANCE

During FY 2025-26, the Company continued to operate in a single reportable segment, i.e., manufacturing and supply of polymer compounds and masterbatches.

The global plastics industry continues to witness steady growth due to increasing applications across packaging, automotive, construction, electrical & electronics, healthcare and consumer goods sectors. The global plastics market is estimated to grow from approximately US$ 768.9 billion in 2025 to US$ 1,138.9 billion by 2035, registering a CAGR of around 4%, driven by the versatility, durability and cost-effectiveness of plastic materials across diverse industries. Increasing demand for specialty polymers, sustainable materials and high-performance compounds is expected to create growth opportunities for polymer manufacturers globally.

Source: Future Market Insights - Plastic Market Outlook https://www.futuremarketinsights.com/reports/plastic- market

The demand outlook for polymer compounds remains positive, supported by growth in key end-use sectors such as power transmission, renewable energy, electric vehicles, infrastructure development, packaging and industrial applications. Indias plastics market was valued at approximately US$ 43.68 billion in 2026 and is expected to reach around US$ 68.33 billion by 2030, growing at a CAGR of approximately 6.6% during 2026-2030. The increasing focus on domestic manufacturing, infrastructure expansion, renewable energy projects and electrification is expected to drive demand for XLPE compounds, cable materials and specialty masterbatches.

Source: Maximize Market Research - India Plastics Market: Industry Analysis and Forecast (2026-2030) https://www.maximizemarketresearch.com/market- report/india-plastics-market/195702/

The global economic environment continues to remain challenging due to geopolitical uncertainties, changing trade policies, inflationary pressures and fluctuations in commodity prices. Global GDP growth is projected at around 3.1% in 2026, while inflation is expected to moderate to approximately 4.4%, indicating gradual stabilization in global economic conditions. Indias economy continues to demonstrate resilience, with GDP growth estimated at around 6.5% in 2026, supported by domestic consumption, infrastructure investment and manufacturing growth. These factors are expected to support demand for polymer products, although businesses may continue to face challenges arising from raw material price volatility, currency fluctuations and global supply chain disruptions.

4/22/world-economic-outlook-april-2025

The polymer industry remains closely linked with petrochemical markets, where raw material prices are influenced by crude oil prices, global demand-supply conditions and geopolitical developments. Indias petrochemical sector, valued at approximately US$ 220 billion, is expected to grow towards US$ 300 billion, supported by increasing consumption across automotive, renewable energy, consumer goods and industrial sectors. India consumes around 25-30 million metric tons of petrochemical products annually, and significant investments are expected in the sector to enhance domestic production capabilities. These developments are expected to create favorable opportunities for downstream polymer manufacturers.

Source: Reuters - India to remain bright spot for petrochemical demand in 2026 https://www.reuters.com/markets/commodities/india- remain-bright-spot-petchem-demand-2025-2025-02-14/

Going forward, the Company remains focused on strengthening its product portfolio, improving operational efficiency and catering to evolving customer requirements through quality-driven polymer solutions. The increasing adoption of electric vehicles, renewable energy, power infrastructure and sustainable packaging solutions provides significant growth opportunities. However, volatility in petrochemical raw material prices, environmental regulations, competitive pressures and uncertainties in global trade remain key factors requiring continuous monitoring. The Company believes that its technical capabilities, diversified product applications and focus on customer relationships will support sustainable growth in the long term.

FUTURE OUTLOOK

The Company remains positive about its future prospects, supported by growing demand from the power, renewable energy, electrical, automotive and cable sectors. Recent investments towards strengthening the Companys manufacturing infrastructure and operational capabilities are expected to support improved efficiency and enable the Company to effectively cater to evolving customer requirements. The Company will continue to focus on product quality, value-added products, customer relationships and market expansion while closely monitoring raw material price volatility, foreign exchange movements, competition and regulatory developments to achieve sustainable long-term growth.

RISK IDENTIFICATION. RISK MITIGATION AND INTERNAL CONTROLS

The Company is engaged in manufacturing of polymer compounds, XLPE compounds, engineering plastics and masterbatches catering to power cable, telecommunication, packaging, agriculture, infrastructure and other industrial sectors

a) RISK OF COMPETITION AND PRICE PRESSURE

The polymer compound and masterbatch industry is highly competitive due to the presence of domestic and international players. Increasing competition and pricing pressure may impact margins. The Company focuses on improving product quality, developing new products, offering customized solutions and strengthening customer relationships to maintain its market position in both domestic and export markets.

b) RISK OF FOREIGN EXCHANGE FLUCTUATION AND GEOPOLITICAL RISK

The Company has export exposure and fluctuations in foreign exchange rates may impact revenue and profitability. Global uncertainties, geopolitical tensions, changes in trade policies and economic conditions in international markets may also affect business operations. The Company manages these risks through suitable forex facilities, including forward contracts and other banking arrangements, wherever required, and continuously monitors developments in export markets.

c) RISK OF FLUCTUATION IN RAW MATERIAL PRICES

The prices of key raw materials used by the Company are linked to petrochemical products and are influenced by crude oil prices, exchange rate movements, global demand-supply conditions and geopolitical factors. Events such as the Russia-Ukraine conflict, Middle East tensions and global supply chain disruptions may impact raw material availability and costs. The Company closely monitors market conditions, maintains effective procurement practices and takes suitable measures to minimize the impact of price volatility.

d) RISK MANAGEMENT AND INTERNAL CONTROL SYSTEM

The Company has established a structured risk management framework for identification, assessment and mitigation of various business risks.. The Company has an established internal audit mechanism carried out by an independent Chartered Accountant firm. The Audit Committee regularly reviews internal audit reports and recommends necessary improvements for strengthening the internal control framework.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Company has adequate internal control systems in place, which are appropriate to the size and nature of its business operations. These systems help in ensuring proper authorization, recording and reporting of transactions, efficient use of resources, safeguarding of assets and compliance with applicable laws and Company policies.

The Company has a well-defined internal audit process to regularly review the effectiveness of internal controls and identify areas for improvement. The internal audit reports, implementation of recommendations and adequacy of control systems are periodically reviewed by the Audit Committee of the Board. The Statutory Auditors also review these controls as part of their audit procedures. The Company continues to strengthen its internal control framework through regular monitoring and improvements.

DISCUSSION ON FINANCIAL PERFORMANCE WITH RESPECT TO OPERATIONAL PERFORMANCE

During the year under review for the financial year ended March 31, 2026, the Company recorded a total revenue of Rs. 8,510.39 Lakhs, compared to Rs. 9,151.04 Lakhs in the previous year ended March 31, 2025, representing a decline of 7.00%.

Furthermore, The Net Profit after Tax for the financial year ended March 31, 2026, stood at Rs. 122.34 Lakhs, down by 42.62% against Rs. 213.20 Lakhs reported in the preceding financial year ended March 31, 2025.

The retained earnings of the Company increased by 6.46% to Rs. 2,006.63 Lakhs as on March 31, 2026, from Rs. 1,884.75 Lakhs as on March 31, 2025, reflecting the Companys stable financial position.

INDUSTRIAL RELATIONS AND HUMAN RESOURCE DEVELOPMENT

The Company believes that a skilled, committed and motivated workforce is essential for achieving sustainable growth. The Company focuses on developing its employees through regular training, skill enhancement initiatives and performance evaluation systems. The principle of "Right Person for Right Job" is followed to ensure effective utilization of employee capabilities and to support organizational objectives.

During the year, the Company maintained healthy and cordial relations with its employees at the plant and head office. The contribution and support received from employees across all levels remained positive and valuable. The Company continues to encourage a supportive work environment and undertakes continuous efforts towards employee development, motivation and productivity improvement.

As on 31st March, 2026, the Company had 49 permanent employees. The management appreciates the dedication and commitment of its employees and remains focused on building a capable and engaged workforce to support the Companys future growth.

DISCLOSURE OF ACCOUNTING TREATMENT

The financial statements have been prepared in accordance with Ind AS notified under the Companies (Indian Accounting Standards) Rules, 2015 as amended by the companies (Indian Accounting Standards) (Amendment) Rules,2016 and notified under Section 133 of the Companies Act, 2013 ("the Act") and other relevant provisions of the Act and other accounting principles generally accepted in India.