RDB Rasayans Ltd Management Discussions

Industry Structure & Developments

The jumbo bags (also known as Flexible Intermediate Bulk Containers or FIBCs) industry is a dynamic and evolving sector of the packaging market. Its structure is defined by the manufacturing process, a wide range of product specializations, and a diverse customer base. The industrys development is driven by a combination of market trends, technological advancements, and a growing focus on sustainability.

Flexible Intermediate Bulk Containers (FIBCs), capable of carrying loads between 500 and 2,000 kilograms, are widely adopted for their cost efficiency in transportation and optimal use of storage space. Market growth is further supported by increasing demand for antistatic variants (Types C and D) in hazardous environments, along with advancements in liners offering UV resistance and barriers against moisture and oxygen.

The Asia-Pacific region remains at the forefront due to its robust industrial base and strong agri-export volumes, while Europe and North America continue to shift toward reusable bulk packaging solutions to streamline logistics and reduce warehousing overheads. The market accounts for varying shares across its parent markets, averaging between 3% and 12% depending on sector-specific integration and material handling intensity. Within the packaging industry, it contributes approximately 6%, largely confined to industrial and bulk-use applications. In the logistics and supply chain sector, its share is under 5%, as it caters to a specific niche in dry bulk transport. In the bulk material handling equipment market, jumbo bags represent around 10-12% of consumables linked to filling, unloading, and intermediate storage.Their use in the industrial chemicals sector holds a stronger share of 8-10%, due to stringent transport requirements. In agriculture packaging, the market accounts for nearly 7%, particularly in large-volume seed, grain, and fertilizer exports.

The Jumbo Bags Market is undergoing significant digital transformation as major economies adopt advanced production standards and smart manufacturing technologies. From IIoT-enabled predictive maintenance to robotics and cloud analytics, national strategies are shaping next-generation fiber-based packaging systems.

Global demand is forecast to grow at a 4.2% CAGR between 2025 and 2035. India leads the profiled countries with a 5.3% growth rate, delivering a +26% premium over the global baseline. China follows closely at 5.1% (+21%), supported by robust exports and domestic bulk packaging requirements.The United States posts a more modest 3.1% (-26%), while Canada (2.9%) and Germany (2.7%) record a -31% and - 36% gap, respectively. The divergence highlights the faster scale-up of industrial packaging infrastructure in BRICS nations, while OECD countries reflect demand saturation and tighter packaging regulations.

The jumbo bags market in India is forecast to register a CAGR of 5.3% between 2025 and 2035, led by rapid expansion in bulk commodity transport and agricultural exports. Increased adoption by fertilizer, cement, and food grain sectors is driving volume demand for 1-ton and 2-ton FIBCs.

Domestic manufacturers are scaling laminated, dust-proof bags for

weather-sensitive payloads. The automation in bag stitching and UV stabilization standards have become procurement benchmarks across port-based logistics hubs.

• Over 60% of bulk agro exports now utilize Type B and C FIBCs.

• Local suppliers have reported a rise in demand for loop-reinforced and conductive bags for chemical packaging.

• Tier-1 ports like Mundra and Kandla are emerging as core distribution points for reusable jumbo bag logistics.

Strengths and Opportunities:

Your Company is taking all efforts to improve the quality and productivity to get more orders at competitive rates. The strength of the business lies in the manufacture and supply of value added goods to reach the end users. The intense competition with many enterprises fighting for a share in market demands competitive pricing and quality in the product to survive and your company is able to grow under this challenging conditions as result of expertise from decades of experience in the market, quality improvements, innovation, better pricing and servicing of customers and the ability to meet the demand from market.

• Cost-Effectiveness: Jumbo bags are a highly economical packaging solution. They have a very low package-to-product weight ratio, meaning they can hold a large volume of material while being lightweight themselves. This reduces transportation costs and the need for expensive, rigid containers. Their reusability also provides significant long-term savings for businesses.

• Versatility and Customization: Jumbo bags are not a one-size-fits- all product. They can be customized in terms of size, capacity, design, and features to suit a vast array of materials and handling requirements. This includes different bag constructions (U-panel, circular, baffle bags), various lifting loops, and a wide range of filling and discharge spouts. This adaptability makes them suitable for use across diverse industries, from agriculture to chemicals.

• Durability and Protection: Made from woven polypropylene, jumbo bags are exceptionally strong and resistant to wear and tear. They are designed to withstand heavy loads, rough handling, and pressure without compromising the integrity of the contents. Many bags are also equipped with features like UV stabilizers, liners, and moisture-proof closures to protect products from environmental factors and contamination.

• Operational Efficiency: The use of jumbo bags streamlines logistics and material handling. Their design allows for easy loading and unloading using forklifts and cranes, minimizing manual labor and time. Their stackable nature also allows businesses to maximize warehouse space, leading to more organized and efficient storage.

• Safety: The industry offers specialized bags for safe handling of various materials. For instance, Type C and D bags are specifically designed to address static electricity risks, making them crucial for the safe transport of flammable and combustible powders in

sensitive environments. UN-certified bags are also available for the safe handling of hazardous materials.

• Sustainability: Jumbo bags are inherently a more sustainable option compared to many single-use packaging solutions. They are designed for multiple uses, which reduces waste. Moreover, the majority of jumbo bags are made from polypropylene, a recyclable material, aligning with the growing global push for eco-friendly practices.

Weaknesses and Threats:

• Dependence on Raw Material Costs: The primary raw material for jumbo bags is polypropylene (PP) resin, which is a polymer derived from crude oil. This makes the industry highly vulnerable to fluctuations in crude oil prices. Geopolitical tensions, supply chain disruptions, and changes in global oil demand can lead to price volatility, which in turn affects the production costs and profit margins of jumbo bag manufacturers.

• Lack of Standardization and Quality Control: While there are international standards (like ISO 21898 and UN certification) for jumbo bags, the industry can suffer from a lack of consistent quality, especially among smaller or less scrupulous manufacturers. The use of low-grade materials, such as excessive calcium carbonate or plastic regrind, can compromise a bags strength and safety. This can lead to product failure, material spills, and potential safety hazards for workers, which damages the industrys reputation.

• Risk of Damage and Contamination: Jumbo bags, by their nature, are susceptible to damage from sharp objects, rough handling, and prolonged exposure to UV light. A small tear or puncture can lead to product loss and contamination. Additionally, improper cleaning or reuse of bags can lead to cross-contamination, which is a significant weakness, particularly in the food and pharmaceutical sectors where hygiene is paramount.

• Handling and Safety Risks: While jumbo bags are designed for efficient handling, they still pose safety risks if not used correctly. Overloading, uneven filling, or improper lifting techniques can lead to bag failure, creating a dangerous situation for workers. The complexity of handling different bag types (A, B, C, and D) and the need for proper grounding for Type C bags require strict adherence to safety protocols and adequate training for personnel.

• Competition from Alternative Packaging Solutions: The jumbo bags industry faces competition from a variety of other bulk packaging solutions. This includes:

• Rigid Containers: Metal drums, intermediate bulk containers (IBCs), and reusable plastic totes offer greater structural integrity and long-term durability, which may be preferred for certain high-value or hazardous materials.

• Paper Sacks and Bags: For smaller-scale bulk packaging, multi-wall paper sacks can be a more environmentally friendly alternative for some applications, though they lack the capacity and strength of jumbo bags.

• New Innovations: The development of new, innovative, and sustainable packaging materials could disrupt the market. For

example, bio-based polymers and advanced composite materials could offer superior performance and environmental benefits in the future.

Risks and Concerns

Handling and Worker Safety: The size and weight of filled jumbo bags present significant risks during handling. Improper lifting, stacking, or transportation can lead to accidents. The Company has a well defined Policy for risk mitigation which is subject to change as and when required.

Static Electricity and Fire Hazards: Many materials transported in jumbo bags, such as fine powders, can generate static electricity during filling and discharging. In the presence of flammable gases or a combustible dust cloud, this static discharge can cause a fire or explosion.

New Innovations: The development of new, innovative, and sustainable packaging materials could disrupt the market. For example, bio-based polymers and advanced composite materials could offer superior performance and environmental benefits in the future.

Economic Downturns: As an industrial packaging product, the demand for jumbo bags is closely tied to the health of key sectors like construction, agriculture, and manufacturing. A global or regional economic downturn could lead to reduced activity in these industries, resulting in a decline in demand for bulk packaging and negatively impacting the jumbo bags market.

Raw Material Volatility: The cost of jumbo bags is directly tied to the price of polypropylene resin, a petrochemical product. This makes the industry vulnerable to volatility in global oil markets, which can impact pricing and production planning.

Quality Control: Not all jumbo bag manufacturers adhere to the same high standards. The proliferation of low-quality, inexpensive bags in the market poses a threat to user safety and the industrys reputation. Poor quality bags, often made with substandard materials, may not meet their stated SWL or safety certifications, leading to a higher risk of failure. Segment Wise Performance

The Company is engaged in the business of manufacture and sale of polymer-based FIBC/woven bags. It also deals in trading of raw materials to further enhance its performance.

Discussion on financial performance with respect to operational performance

During the year under review your Company has achieved revenue of Rs. 14,837.00 lakhs as against Rs. 10,320.20 lakhs in the previous year. PBIDT increase to Rs. 3,722.80 lakhs as compared to Rs. 3,365.55 lakhs in the previous year. PAT for the year under review was Rs. 2,647.12 lakhs which is almost 0.09% higher than that of previous years PAT of Rs. 2,423.12 lakhs.

Outlook

Driven by the requirement for FIBC bags your Company is aggressively making effort to expand business activities in West Bengal and also all over India. The Company will continue to tap new global prospects by leveraging its leadership position in the FIBC segment. The Company is optimistic of increasing its revenue by focusing on plastic processing solutions.

Significant Changes in Key Financial Ratios

Pursuant to the provisions of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, the details of key financial ratios along with the reasons for significant changes therein are given below

Note:

1. Above ratios are based on the standalone financial statements of the Company.

2. Significant change means a change of 25% or more as compared to the immediately preceding financial year. Details of Change in Return on Net Worth As Compared to the Immediately Preceding Financial Year

Internal Control Systems and their Adequacy

Your company has adequate Internal Audit and Control system across the Company. The internal control systems are competent and provide, among other things, reasonable assurance of recording transactions of operations in all material respects and of providing protection against significant misuse or loss of company assets. The internal processes have been designed to ensure adequate checks and balances at every stage. Internal audit is conducted to assess the adequacy of our internal controls, procedures and processes, and the Audit Committee of the Board reviews their reports. The management duly considers and takes appropriate action on the recommendations made by the Statutory Auditors, Internal Auditors and the Audit Committee of the Board of Directors.

Material developments in Human Resources / Industrial Relations front, including number of people employed

The unstinted effort and hard work of the employees has been the major factor for the growth of your Company. The Company had a total

of 90 employees as on 31st March, 2025. Your Company endeavors to maintain very cordial and harmonious relations with its employees.

Disclosure of Accounting Treatment

The Company has prepared its financial statement in accordance with the recognition and measurement principles laid down in Indian Accounting Standards (IND-AS) as prescribed under the Companies Act, 2013 and the rules made thereunder.

Cautionary Statement

Statements in the Management discussion and analysis, describing the Companys objectives, outlook, opportunities and expectations may constitute "Forward Looking Statements" within the meaning of applicable laws and regulations. The Actual result may vary materially from those expressed or implied in the statement. Several factors make a significant difference to the Companys operations including the government regulations, taxation and economic scenario affecting demand and supply condition and other such factors over which the Company does not have any direct control.