Responsive Industries Ltd Management Discussions

1. COMPANY PROFILE

Responsive Industries Limited ("RIL") or ("the Company") is primarily engaged in the business of manufacturing and selling of articles made out of PVC/ polymers. Your Company is a leading India-based manufacturer of polyvinyl chloride (PVC)-based products with the product verticals viz. Vinyl Flooring, Synthetic Leather, Luxury Vinyl Tile (LVT) and stone plastic composite (SPC), Synthetic ropes and Waterproof Membrane (PVC specialized covers).

Your Company has established itself as a leading player in India as well as in the world by completing more than 5,000 projects. RIL is Indias largest manufacturer, with a presence in all states through a network of over 100 distributors. Globally, your Company ranks as the 5^th largest manufacturer, with more than 300 international distributors across 70 countries. It is amongst the top 5 producers of vinyl flooring globally and has extensive retail presence across the developed markets of Europe and North America. Your Companys products are marketed both in India and outside such as Southeast Asia, Asia Pacific and South America.

Your Company has a state-of-the-art manufacturing factory and infrastructure set-up at Boisar in Palghar district in Thane, Maharashtra. This plant is currently catering to the domestic market along with the Middle East, Europe and North America

2. INDUSTRY STRUCTURE AND DEVELOPMENTS

The India vinyl flooring market forecast indicates a promising growth trajectory, with the expanding at a CAGR of 7.30% between 2025 and 2034. Growth will be driven by increasing replacement of traditional flooring solutions with vinyl, owing to its superior durability, aesthetic flexibility, and low maintenance benefits. Increasing investments in construction activities, growing demand for residential and commercial spaces, increasing disposable income levels, rising urbanization rate and increasing application scope are some of the key factors driving the growth of the industry Key Market Drivers

The factors such as durability, low maintenance cost, easy installation process, availability in a wide range of designs and colors, affordability and resistance to moisture are likely to drive the growth of India vinyl flooring market over the forecast period. In addition, companies are introducing innovative products with better performance features which will further propel market growth. Moreover, the rising development of modern housing facilities, along with the introduction of vinyl flooring with high aesthetic value and sharper textures, is currently driving the India vinyl flooring market. With the Indian government also imposing anti-dumping duty (ADD) on vinyl tiles imports (since Apr 2023), the domestic market which is at an inflection point also provides your Company with a large virgin market ($11.4 bn in CY23). Presently, your Company supplies vinyl flooring solutions to hospitality, medical facilities, and other commercial institutions and being recognized as a vendor of repute, your Company has aggressive plans to cater to the residential markets first via the B2B route and eventually by going retail.

3. OPPORTUNITIES AND THREATS

The Company is among the market leaders in PVC product segment. The consumption of PVC products like PVC leather cloth is increased with reasonable percentage in both commercial and household purposes and for other PVC products like PVC sheeting, flooring the consumption in commercial purposes has been increased. With this growing demand of PVC products in the domestic market as well as the overseas markets for commercial and household application, the Company is expecting several opportunities for profitable growth. The Company has all geared up to meet these challenges and continue to be among the leaders in this sector.

Opportunities

Growth of demand for Luxury Vinyl Tiles (LVT) and also sustainable flooring

Vinyl Flooring Market introduction of luxury vinyl tiles (LVT) and the rising preference for environmentally friendly flooring alternatives offer huge growth potential for the Vinyl Flooring Market. The market is ever-evolving with consumers and businesses turning to durable, beautiful, and affordable products, while the key growth driver, LVT (Luxury Vinyl Tiles), is well received by the consumers for its versatility and low maintenance.

Increasing product demand in the construction industry

The increasing utilization of vinyl flooring in the construction industry for residential and commercial applications due to its durability, versatility, and ease of maintenance is acting as a growth-inducing factor. The rising adoption of vinyl flooring in commercial spaces like offices, hospitals, and schools, due to its resilience and longevity, is providing an impetus to the market growth. In addition to this, the increasing investments in infrastructure and real estate, boosting the demand for vinyl flooring, is positively impacting the market growth.

Changing lifestyles and consumer preferences

The increasing interest in minimalist and modern interior designs, fueling the popularity of vinyl flooring, as it offers a clean, contemporary look, is stimulating the market growth. The flexibility of vinyl flooring in terms of design customization, allowing it to cater to a wide range of personal styles, is providing an impetus to the market growth. The rising product utilization for incorporating various trends in personal and commercial spaces due to the exposure to multiple cultures and design inspirations across the globe is strengthening the market growth. Besides this, vinyl flooring offers a balance of functionality and design, catering to various tastes and interior styles. Moreover, the increasing preference for do-it-yourself (DIY) home improvement projects, boosting the popularity of vinyl flooring, owing to its ease of installation and various design options, is positively influencing the market growth.

Threats

Certain aspects may impede the markets growth. The primary parameter restricting the markets growth is the high installation cost. There is a threat due to the change in the following that could impact the Companys operations in long run, these threats are change in government or regulatory policies, change in economic growth changes in physical infrastructure, changing laws, rules and regulations and legal uncertainties, etc.

Your Company continuously adopt the new change and environment in the organisation in order to efficiently run its business and adheres to the rules and regulations as applicable to the Company from time to time.

Challenges

Increasing Costs of Raw Materials and Environmental Regulations

The growth of the Vinyl Flooring Market is restrain by some challenges such as rising environmental issues and strict regulatory framework problematic and inconsistent raw material prices. The vast majority of vinyl flooring production is reliant on the raw materials such as polyvinyl chloride (PVC) and plasticizers which have volatile prices on account of global supply chain issues and arbitrary price fluctuations in petrochemical markets.

4. SEGMENT–WISE OR PRODUCT-WISE PERFORMANCE

The Company is engaged only in single segment of products i.e. PVC products. The Company produces various types, grades and form of PVC flooring, PVC leather cloth, and PVC sheeting. Your Company has achieved Revenue from Operations of Rs.55573.89 Lakhs for the year ended March 31, 2025 as compared to Rs.65494.71 Lakhs in the previous year. Further, your Company recorded net profit after tax of Rs.3172.18 Lakhs as compared to Rs.3163.22 Lakhs for the previous year.

In terms of geographical market, performance of the Company is as follows.

(Rs. in Lakhs)

Sales	Year ended 31.03.2025	Year ended 31.03.2024
Local	30905.75	26853.22
Export	24668.14	38641.49
Total	55573.89	65494.71

5. OUTLOOK

With Companys increased capacity utilization, strong product development, market efforts, the Company is optimistic about its growth in the coming years.

6. RISK AND CONCERNS

Your Company focuses on timely management of the key risks of your Company to prevent unfavourable circumstances as risks are unavoidable component of business. Your Company has in place a robust and efficient mechanism for the identification, assessment, quantification, control, mitigation and monitoring of the risks.

The risk management framework of your Company ensures identification of emerging risks and after assessing them, devises short-term and long-term actions to mitigate any risk which could materially impact the Companys long-term goals. The major risks are identified by the Board of Directors / Committees of the Board. The Risk Management Committee aids the Board by assessing and providing oversight to the management relating to identification and evaluation of the identified risks. The Committee is responsible for monitoring and reviewing the risk management plan and ensuring its effectiveness. The Audit Committee has additional oversight in the area of financial risks and controls The Audit Committee and the Board periodically review the risks and suggest steps to be taken to manage/ mitigate the same through a properly defined risk management framework in the Risk Management Policy.

7. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Companys internal controls are commensurate with the nature of its business, the size and complexity of its operations. These have been designed to provide reasonable assurance with regard to recording and providing reliable financial and operational information, complying with applicable statutes, safeguarding assets from unauthorized use or disposition, executing transactions with proper authorization and ensuring compliance with corporate policies. The system ensures appropriate information flow to facilitate effective monitoring. The internal audit system also ensures formation and implementation of corporate policies for financial, reporting, accounting and information security. The Internal Financial Control of the company is analyzed and audited for the compliances and accordingly the report under Section 143 of the Companies Act, 2013 is prepared and the report on internal control over financial reporting as issued by the statutory auditors of the Company for the year ended March 31, 2025.

The Companys internal auditors review business processes and controls. The audit committee reviews reports presented by the internal auditors on a periodic basis. The committee makes note of the audit observations and takes corrective actions, if necessary. It maintains a constant dialogue with the statutory and internal auditors to ensure effective operations of the internal control systems. The Audit Committee of the Board then discusses significant findings and corrective measures initiated. The Audit Committee of the Board of Directors periodically reviews the adequacy and effectiveness of internal control systems and suggests improvement for strengthening these systems.

8. DISCUSSION ON FINANCIAL PERFORMANCE WITH RESPECT TO OPERATIONAL PERFORMANCE

This has been explained in the Directors Report.

9. MATERIAL DEVELOPMENT IN HUMAN RESOURCES /INDUSTRIAL RELATIONS FRONT INCLUDING NUMBER OF PEOPLE EMPLOYED

Your Company endeavours to create a work environment which is collaborative and learning and growth oriented to enable employees to perform at their full potential.

Your Company believes that a motivated and empowered employee base is the key to our operations and business strategy, and has developed a large pool of skilled and experienced personnel. Your Company maintain a collaborative, inclusive, non-discriminative and safe work culture, and provide equal opportunities to all employees. It believes that such an enabling environment is essential for us to deliver value for our customers, shareholders and communities. The Company also takes various measures to keep its employees motivated and committed to their work by providing them a healthy work environment. The Industrial Relations at the Factory have remained cordial.

As on March 31, 2025, the Company had 358 employees (318 male employees and 40 female employees) (previous year 280 employees) on its roll. It includes the Whole-Time Director and the Executive Director.

10. HUMAN RESOURCE

Human Resource Management (HRM) plays a crucial role in ensuring smooth functioning of your Company industry. Human Resource is aligned with the organisations intended future direction. It is concerned with long term people issues and macro concerns about structure, quality, culture, values, commitment and matching resources to future need. The HR department closely monitors all ongoing activities, including recruitment. Your Company follows a rigorous and comprehensive recruitment process to ensure that it hires the best talent in the industry. The Company ensures diversity in its hiring practices and strives to create an inclusive and welcoming work environment for all its employees. The Company provides regular training and development programs to its employees at factory and corporate level to ensure that they are equipped with the necessary skills and knowledge to perform their roles efficiently.

11. OCCUPATIONAL HEALTH AND SAFETY

Your Company is committed to provide a safe and healthy workplace by minimizing the risk of accidents, injury and exposure to health risks and it complies with applicable laws and regulations with respect to safety at workplace. Various facilities are available at the Companys offices and at factory level such as proper ventilation, hygiene and sanitation, safety audit, emergency exits, first aid box, etc. The manufacturing unit are maintaining an occupational health and safety management system and environment management system based on the rigorous standards set forth by ISO 45001:2018 and ISO 14001:2015 respectively. The unit have designated safety personnel, safety committees, regular safety training, and they collaborate with external partners to ensure that health and safety standards are integrated in prevailing production processes.

Your Company believes in providing the best Health, Safety & Security measures to its employees and workers is its prime responsibility, and all employees are accountable for it. Your Company is committed to building an environment which is friendly, healthy, safe, and secure culture for its employees to make them comfortable at workplace which benefits them to deliver their work and results in increase in their performance more efficiently and productively.

Your Company is taking several strategic steps towards achieving safest operation in its manufacturing unit. A free health check-up services is provided by your Company to its permanent and contractual workers every year at the factory. Hospitals are one of the essential institutions that must continue to function when an emergency event occurs and your Company has tied up with one of the hospital which is located at the vicinity to the factory where the casualties are sent directly in case of any emergency. These health check-ups help to ensure occupational safety and health of factory workers and compliance with the mandatory laws and regulations framed by the Government from time to time.

12. DETAILS OF SIGNIFICANT CHANGES IN THE KEY FINANCIAL RATIOS (I.E. CHANGE OF 25% OR MORE AS COMPARED TO THE IMMEDIATELY PREVIOUS FINANCIAL YEAR):

In accordance with the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Company is required to give details of significant changes (change of 25% or more as compared to the immediately previous financial year) in key sector specific financial ratios. The Company has identified following ratios as key financial ratios:

Sr. No.	Particulars	FY 2024-25	FY 2023-24	Comments (If Change >25%)	% Changed (performance)
1.	Debtors Turnover (in days)	150	186	-	-19.48
2.	Inventory Turnover (in days)	73	66	-	10.22
3.	Interest Coverage Ratio (in times)	9.76	10.1	-	-3.43
4.	Current Ratio (in times)	3.48	1.96	The combination of increased current assets, a decrease in current liabilities, and improved efficiency in managing receivables and inventory are likely contributing factors to the high current ratio in FY 2025.	77.36
5.	Debt Equity Ratio (in times)	0.19	0.18	-	2.95
6.	Operating Profit Margin (%)	16.48	17.94	-	-8.12
7.	Net Profit Margin (%)	14.02	14.84	-	-5.47

13. DETAILS OF ANY CHANGE IN RETURN ON NET WORTH AS COMPARED TO THE IMMEDIATELY PREVIOUS FINANCIAL YEAR ALONG WITH A DETAILED EXPLANATION THEREOF

The return on net worth of your Company for the FY 2024-25 is 14.78% as against 14.18% in the previous financial year.

14. DISCLOSURE OF ACCOUNTING TREATMENT

In preparation of financial statements, the Company has not followed a treatment different from that prescribed in the Accounting Standards.

15. CAUTIONARY STATEMENT

The statements in this report on Management Discussion and Analysis describing the Companys objectives, projections, estimates, expectations or predictions may be "forward looking statements" within the meaning of applicable securities laws or regulations. These statements are based on certain assumptions and expectations of future events. Actual results could differ materially from those expressed or implied. Important factors that could make a difference to the Companys operations include global and domestic demand supply conditions, finished goods prices, raw material cost and availability, changes in Government regulations, tax regimes, economic developments within India and other factors such as litigation and industrial relations. The Company assumes no responsibility to publicly amend, modify or revise any forward looking statements, on the basis of any subsequent developments, information or events.

	For and on behalf of the Board of Directors
	Mehul Vala	Sadanand Morab
Place: Mumbai	Whole-Time Director & CEO	Executive Director
Date: May 14, 2025	DIN: 08361696	DIN: 09790817