Shaily Engineering Plastics Ltd Management Discussions

Global Economy

The global economy is at a critical juncture. Signs of stabilization were emerging through much of 2024, after a prolonged and challenging period of unprecedented shocks. Inflation, down from multidecade highs, followed a gradual though bumpy decline toward central bank targets. Labor markets normalized, with unemployment and vacancy rates returning to pre-pandemic levels. Growth hovered around 3% in the past few years.

Global Inflation Trend (% YoY)

However, major policy shifts are resetting the global trade system and giving rise to uncertainty that is once again testing the resilience of the global economy. The landscape has changed as governments around the world reorder policy priorities. A series of new tariff measures by the United States and countermeasures by its trading partners have been announced and implemented, ending up in near-universal US tariffs on 2^nd April and bringing effective tariff rates to levels not seen in a century. This on its own is a major negative shock to growth. The unpredictability with which these measures have been unfolding also has a negative impact on economic activity and the outlook and, at the same time, makes it more difficult than usual to make assumptions that would constitute a basis for an internally consistent and timely set of projections.

The swift escalation of trade tensions and extremely high levels of policy uncertainty are expected to have a significant impact on global economic activity. Global growth is projected to drop to 2.8% in 2025 and 3% in 2026, much below the historical (2000–19) average of 3.7%.

Growth in advanced economies is projected to be 1.4% in 2025, with United States growth expected to slow to 1.8% and growth in Euro zone expected to come down to 0.8%, owing to greater policy uncertainty, trade tensions, and softer demand momentum.

In emerging market and developing economies, growth is expected to slow down to 3.7% in 2025 and 3.9% in 2026, with significant downgrades for countries affected most by recent trade measures, such as China.

GDP Growth Expectations

Region	2024	2025P	2026P
World	3.3	2.8	3.0
USA	2.8	1.8	1.7
Euro Area	0.9	0.8	1.2
Emerging & Developing Economies	4.3	3.7	3.9
China	5.0	4.0	4.0
India	6.5	6.2	6.3

The resilience shown by many large emerging market economies may be tested. On the upside, a de-escalation from current tariff rates and new agreements providing clarity and stability in trade policies could lift global growth.

The path forward demands clarity and coordination. Countries should work constructively to promote a stable and predictable trade environment, facilitate debt restructuring, and address shared challenges. At the same time, they should address domestic policy and structural imbalances, thereby ensuring their internal economic stability. This will help rebalance growth-inflation trade-offs, rebuild buffers, and reinvigorate medium-term growth prospects, as well as reduce global imbalances. The priority for central banks remains fine-tuning monetary policy stances to achieve their mandates and ensure price and financial stability in an environment with even more difficult trade-offs.

Source: IMFs World Economic Outlook, April 2025

Indian Economy

India continues to be one of the bright spots in the global economy. India is poised to lead the global economy once again, with the International Monetary Fund (IMF) projecting it to remain the fastest growing major economy over the next two years. According to the April 2025 edition of the IMFs World Economic Outlook, Indias economy is expected to grow by 6.2% in 2025 and 6.3% in 2026, maintaining a solid lead over global and regional peers.

While the above is a downward revision to the January 2025 forecast, it takes into account the impact of heightened global trade tensions and growing uncertainty Despite this slight moderation, the overall outlook remains strong. This consistency signals not only the strength of Indias macroeconomic fundamentals but also its capacity to sustain momentum in a complex international environment. As the IMF reaffirms Indias economic resilience, the countrys role as a key driver of global growth continues to gain prominence.

After several years of overlapping shocks, the global economy has entered a phase of cautious stabilisation. Growth remains modest and projections for global output have been revised downward, reflecting a steep rise in tariff rates, policy uncertainty, and slowing progress in international cooperation. Global inflation is expected to decline, although at a slower pace than previously anticipated, and downside risks such as trade tensions and volatile financial markets continue to weigh on the outlook.

For India, however, the growth outlook is relatively more stable. The IMF projects steady expansion for the Indian economy, supported by firm private consumption, particularly in rural areas. In a global environment marked by uncertainty and subdued growth, Indias resilience stands out, reinforcing its role as a key driver of global economic activity.

Indias economic outlook for 2025 and 2026 remains one of the brightest among major global economies, as highlighted by the IMF. Despite global uncertainties and downward revisions in growth forecasts for other large economies, India is set to maintain its leadership in global economic growth. Supported by strong fundamentals and strategic government initiatives, the country is well-positioned to navigate the challenges ahead. With reforms in infrastructure, innovation, and financial inclusion, India continues to enhance its role as a key driver of global economic activity.

Source:https://pib.gov.in/PressReleasePage.aspx?PRID=2123826

Global Plastic Industry

Global Plastic Market size was valued at USD 712.0 billion in 2023 and is poised to grow from USD 740.48 billion in 2024 to USD 1013.4 billion by 2032, growing at a CAGR of 4.0% during the forecast period (2025-2032). Plastic has emerged as a massively popular material in almost all industry verticals in some or the other way. High use in packaging is projected to be the prime factor driving plastic market growth. Growing use of plastic in multiple industry verticals such as construction and automotive to create lightweight products is also estimated to bolster plastic demand in the future. Advancements in plastic recycling technologies will also create new opportunities for plastic companies over the coming years. The development of bioplastics is also a key opportunity for plastic manufacturers going forward.

Packaging is projected to be the prime end user of plastic across the study period (2025-2032). The lightweight and highly affordable nature of plastic is what makes it a preferred packaging material for multiple products. Rapidly expanding e-commerce industry and growing demand for packaging materials are expected to help the dominance of this segment going forward.

Easy manufacturing of plastic products is what makes injection molding a dominant application segment. As the name suggests molten plastic is injected into molds to create plastic products usinginjectionmolding.Thistechniqueisusedinmultipleindustry verticals such as automotive, medical device manufacturing, and other industries to create plastic components.

Meanwhile, the demand for plastic in thermoforming applications is projected to surge at an impressive pace across the study period. High product durability, flexible design, and cost-effective manufacturing are key benefits of thermoforming that are boosting market growth via this segment

On the other hand, the demand for plastic in North America is projected to increase at the fastest CAGR over the coming years. Growing use of plastics for medical devices and electronics manufacturing is a key trend that will boost market growth. High use of plastic in packaging, growing demand for plastic in different industry verticals and establishment of plastic recycling infrastructure are driving market growth.

Source: https://www.skyquestt.com/report/plastic-market

Indian Plastic Industry

The plastic industry in India market size is expected to reach INR 4,466 billion by 2029, growing at a CAGR of over 6.5%. As of 2023-24, the Share of Indias plastic products industry is 0.5% of Indias GDP

The consumption of plastics in India has significant regional variation, with Western India accounting for 47%, Northern India for 23%, and Southern India for 21%. The remaining 9% is consumed in Eastern India. India recycles plastic at a rate of 60%, which is higher than that of developed nations.

The ‘Make in India, ‘Skill India, ‘Swachh Bharat, and ‘Digital India initiatives of the government are increasing plastic production, and by 2027, it is expected that the plastics industry will generate INR 10,382 billion in annual revenue, with two lacs tons of exports. The government launched Centres of Excellence to boost petrochemical research and approved 23 CIPETs to promote skills and innovation in the sector Source:https://uja.in/blog/market-reports/plastic-industry-in-india/ Source: https://www.ibef.org/exports/plastic-industry-india

Consumer Segment

Home Furnishing Business

The Furniture and Home Furnishing Store Market size is estimated at USD 539.72 billion in 2025, and is expected to reach USD 661.40 billion by 2030, at a CAGR of 4.15% during the forecast period (2025-2030). Over the years, trends and new ideas have come and gone in the furniture and home furnishings industry. With increasing housing prices and a shortage of space, furniture and furnishings are being modified to make it possible to live in a smaller space. Through technology and new ideas, sofas, beds, and other types of furniture are getting better and better.

With the start of COVID-19, people were limited in what they could do in their homes, and people around the world were spending more and more time at home. This made people change the way they decorated and furnished their homes. Smart home products observed a continuous increase in purchases as consumers spent more time at home. With a growing percentage of the population working from home, multi-purpose furniture is in high demand, serving a variety of functions. This leads to furniture stores increasing their variety of products.

Increasing household numbers are among the factors contributing to the Noth America real estate industrys growth. Consequently, the region market for furniture for homes is seeing growth. Additionally accelerating the real estate industrys growth is the region growing immigrant population. Home furnishings are becoming more and more in demand as North America residential construction picks up steam and the countrys residential activity rises. This is especially true for newly purchased homes. It is anticipated that this will increase market demand Source:https://www.mordorintelligence.com/industry-reports/ furniture-and-home-furnishing Steel Furniture Market size was valued at USD 653.85 Billion in 2024 and is projected to reach USD 988.33 Billion by 2031, growing at a CAGR of 5.30%. The furniture business is expected to benefit from the rapid expansion of the building sector, as well as investments in smart city projects. Increased marketing initiatives for ready-to-use furniture in commercial and residential buildings to attract more consumers and close better agreements are projected to drive market growth. Source:https://www.verifiedmarketresearch.com/product/steel-furniture-market/

At Shaily

Our consumer segment is divided into home furnishing business, personal care FMCG packaging, carbon steel furniture. We offer complete services from design to final delivery catering to segments like Kitchenware, integrated cooking, dining solutions, organisational and storage solutions. While we have been serving reputed companies like Gillette, P&G, Unilever since the early 1990s, our main customer is a Swedish home furnishing major having long standing relationship with us over a decade. We also have expertise in secondary operations like ultra-sonic welding, vacuum metalizing, high-speed rotary pad printing, polymer painting, screen printing, hot stamping, and hot foiling. Apart from 6 facilities dedicated for plastic, we have 1 dedicated plant for carbon steel business.

In FY25, Consumer segment contributes highest to the overall business and expect the same to go down in the revenue pie mix thus de-risking our overall business. We expect to ramp up capacity in next 2 years to its peak. We expect the segment to grow at steady 8-10% CAGR over next 3-5 years. We have been awarded several new businesses from marquee FMCG customers over last year.

HealthCare Segment

Global Medical Device market

The global medical devices market size was valued at USD 542.21 billion in 2024. The market is projected to grow from USD 572.31 billion in 2025 to USD 886.68 billion by 2032, exhibiting a CAGR of 6.5% during the devices forecast period. North America dominated the medical market with a market share of 38.17% in 2024.

The increasing number of patients suffering from acute and chronic diseases, including diabetes, cancer, and others, coupled with growing awareness regarding the treatment options among these patients, is resulting in a growing number of patients undergoing diagnostic and surgical procedures.

The rising number of surgical procedures, including cardiac, orthopaedic, neurological, and others globally, is expected to contribute to market expansion The growing initiatives by various major companies and healthcare agencies operating in the market to raise awareness regarding these novel therapies and treatment options among patients are further supporting the increasing product demand The key manufacturers are currently focusing on strategies to increase innovation toward achieving breakthrough technologies with a strong emphasis on R&D investments, further likely to boost the global medical device market growth. Additionally, the prominent players are emphasizing showcasing their product portfolios at various national and international conferences to strengthen their geographical presence. This creates lucrative opportunities in the untapped and underpenetrated markets for the expansion of the demand for innovative medical devices Source:https://www.fortunebusinessinsights.com/industry-reports/medical-devices-market-100085

Indian Medical Device market

The projected revenue in the Medical Devices market in India is expected to reach INR US$7.47bn in 2025. Looking ahead, the market is anticipated to grow at an annual growth rate of 8.16% from 2025 to 2029, resulting in a market volume of INR US$10.22bn by 2029.

Several macroeconomic factors have contributed to the growth of the Medical Devices market in India. The countrys growing middle class, increasing disposable income, and improving healthcare infrastructure have created a favorable environment for the adoption of medical devices. Additionally, the governments focus on promoting domestic manufacturing and reducing import dependency has further boosted the growth of the medical devices industry.

Source:https://www.statista.com/outlook/hmo/medical-technology/medical-devices/india

GLP 1 drug outlook

Outlook: GLP-1 market is estimated to grow from USD 49.3 billion in the current year to USD 157.5 billion by 2035, at a CAGR of 11.1% during the forecast period, till 2035. According to the World Health Organization (WHO), more than 1 billion individuals are suffering from obesity, worldwide; of these, 650 million individuals are adults. It is estimated that 4 million people die annually due to obesity. In addition, a recent study indicates that close to 530 million adult population suffers from diabetes globally; of these, 98% of the population is expected to have type 2 diabetes Benefits: GLP-1s are becoming crucial for weight loss and can offer emerging health benefits to a wide range of individuals. This discovery has fueled an unprecedented surge in interest and demand for these medications. Survey shows that anywhere from 8% to 10% of Americans are currently taking GLP-1s, while 30% to 35% of Americans are interested in using them. Demand for prescriptions has been so high that suppliers often struggle to meet demand. This has been driven by the easing of some manufacturing constraints, improved side effect profiles, new market entrants, increased acceptance by payers. In addition to helping drive weight-loss, there is a significant amount of evidence that GLP-1s help with several other important diseases like cardiovascular diseases, Chronic Kidney diseases, Alzheimers, Dementia, fat liver diseases and Parkinsons. On top of the evidence that GLP-1s reduce peoples weight and slow the progression of many chronic diseases, there is evidence that they may reduce addictive or compulsive behaviour, whether that be abusing alcohol, nicotine, illegal narcotics, gambling, or even biting ones nails. Over the past 30 years, the obesity rate among adolescents has quadrupled, highlighting a growing public health concern.

Opportunities: Considering the growing burden of obesity and diabetes, there has been a rise in the need for safe and effective medications. As a result, various companies have started developing and evaluating potential candidates targeting these indications. In the recent past, GLP-1 drugs have emerged as a promising option. It is worth highlighting that 15 GLP-1 drugs have been commercialized for targeting various indications. Additionally, more than 135 drug candidates are currently being evaluated across various phases of development. The GLP – 1 market is anticipated to witness steady growth in the coming decade. As awareness and understanding of the potential benefits of GLP-1 therapies continue to evolve, there is increasing openness to their use among younger populations. While current adoption among children and adolescents aged 12 and older still represents a small fraction of total users, it is growing rapidly offering renewed hope to families striving for a healthier future. Demand and insurance coverage will likely continue to increase as GLP-1s. Adoption of GLP-1 drugs will likely continue to grow dramatically, especially when the medical and institutional community begins to recommend GLP-1s as the standard of care for treating obesity.

The global semaglutide market size was estimated at USD 28,429.9 million in 2024 and is projected to reach USD 93,598.8 million by 2035, growing at a CAGR of 10.5% from 2025 to 2035, driven by the increasing prevalence of type 2 diabetes and obesity, rising demand for GLP-1 receptor agonists, and growing adoption of weight management treatments. North America was the largest revenue generating market in 2024. Ozempic (semaglutide) accounted for a revenue of USD 19,454.8 million in 2024. With obesitys growing burden on healthcare systems and economies, the market is expanding, positioning Wegovy (Semaglutide) as a leading solution in medical weight management. The pipeline for semaglutide-based interventions highlights a broad spectrum of indications beyond diabetes and obesity, areas where approved drugs like Ozempic and Wegovy already dominate.

The global Mounjaro market size accounted for USD 14.18 billion in 2024 and is predicted to increase from USD 16.82 billion in 2025 to approximately USD 78.51 billion by 2034, expanding at a CAGR of 18.67% from 2025 to 2034. North America dominated the Mounjaro market with the largest market share of 75% in 2024. The Mounjaro market is gaining traction due to rising obesity rates and the prevalence of type 2 diabetes. Mounjaro injections offer relief and are associated with a 20% reduction in obesity, along with the potential to prevent related side effects. The soaring global prevalence of metabolic disorders, such as type 2 diabetes and obesity, is the most compelling driver of the Mounjaro market. Lifestyle changes, sedentary behaviour, and poor dietary habits have escalated the demand for innovative therapeutic solutions Mounjaros superior efficacy in reducing both blood glucose and body weight makes it highly attractive to healthcare providers. Governments and private organizations are increasingly investing in chronic disease management programs, which boost demand Source:https://www.precedenceresearch.com/Mounjaro-market?utm_source=chatgpt.com Source : https://www.grandviewresearch.com/industry-analysis/ semaglutide-market-report Source : Obesity and Beyond -Citi Report Source:https://www.pwc.com/us/en/services/consulting/ business-model-reinvention/glp-1 -trends-and-impact-on-business-models.html Source:https://www.globenewswire.com/news-relea se/2025/03/18/3044263/ 28124/en/GLP-1 -Market-Industry-Trends-and-Global-Forecasts-2024-2035-Over-150-GLP-1 -Drug-Candidates-in-Development-for-Multiple-Indications-Type-2-Diabetes-and-Obesity-Drive-GLP-1-Drug-Deve.html

At Shaily

We are engaged in contract manufacturing of drug delivery devices like pen injectors, auto injectors and other speciality devices. We, through Shaily Innovations Limited, have designed and developed 7 intellectual property led drug delivery injectable devices majorly focused on GLP-1 drugs among other therapies. Beyond injectors, we also do pharma packaging as well. While we continue to expand our contact manufacturing business, we aim to strengthen our position in health care segment predominantly through our IP led platforms as we foresee substantial opportunity for GLP – 1 drugs worldwide. Thus, capitalising on our IP led portfolio, our health care segment aims to contribute 25-30% of overall revenue within 2 years. Backing with high margin segment, we aspire to grow the healthcare segment by 30-35% CAGR within next 3-5 years and remain optimistic on this segment to be key growth driver for our overall business. We plan to double our healthcare capacity over next 12-18 months.

In January 2025, we have incorporated ‘Shaily Innovations FZCO a new wholly owned subsidiary in Dubai. Thus, expanding our reach to global markets through our subsidiaries Shaily Innovations Limited and Shaily Innovations. Last year, we have signed 8 contracts for Pen Injectors for GLP 1 and other therapies

Industrial Segment (Automotive, lighting, appliances, engineering)

The global automotive shift knob market size is poised to witness substantial growth, with a projected increase from USD 1.5 billion in 2023 to an estimated USD 2.3 billion by 2032, reflecting a CAGR of 4.9% over the forecast period. This growth is primarily driven by increasing vehicle production, technological advancements in automotive components, and the rising consumer preference for enhanced vehicle aesthetics and ergonomic designs. The automotive industry continues to evolve, and with it, the demand for sophisticated and customizable interior components, such as shift knobs, has risen significantly, underpinning the markets potential expansion.

Our Industrial Segment comprises of manufacturing automotive components like knobs etc, supplier of casings of electrical household appliances and high performance engineering products. We provide high performance engineering solutions which enables conversion of metal into high strength plastics in automotive components. Basis our current order book and existing customer relationships, we are optimistic to achieve decent growth in near future.

Consumer Electronics Segment

The global consumer electronics market size was valued at USD 815.16 billion in 2024. The market is projected to grow from USD 864.73 billion in 2025 to USD 1,467.94 billion by 2032, exhibiting a CAGR of 7.85% during the forecast period (2025-2032). The India consumer electronics market size reached USD 83.70 Billion in 2024. The market is expected to reach USD 152.59 Billion by 2033, exhibiting a growth rate (CAGR) of 6.90% during (2025-2033). Asia Pacific dominated the consumer electronics market with a market share of 38.08% in 2024. The market is driven by the rising disposable incomes, growing internet penetration, tech-aware youth, and growing middle class. Moreover, the increasing demand for smart phones, wearables, and smart home appliances, government programs, growth in e-commerce, and technology developments such as 5G and AI are some of the factors propelling the India consumer electronics market share.

Companies are focusing on developing high performing and convenient-to-use devices owing to the increasing demand. Therefore, the advent of technology and digitalization is likely to push the demand for electronic items and domestic household appliances. Increasing demand for remote work tools and connected home setups continues to drive sales of computers, cameras, and smart entertainment systems.

Government initiatives such as the electronics manufacturing and export plan (targeting USD 300 billion by 2025–26) are boosting local production. Rising middle-class incomes and smart home adoption contribute to strong market growth. Growing R&D activities will lay the foundation for the markets growth in the future and sustainability in the consumer electronics industry. Electronics manufacturing and export market of India is expected to reach USD 300 billion by 2025-26. Although consumer electronics manufacturers are highly concentrated in the Asian region, players in Europe are taking efforts to increase domestic manufacturing to meet the growing consumer demand https://www.imarcgroup.com/india-consumer-electronics-market?utm_source=chatgpt.com https://www.fortunebusinessinsights.com/consumer-electronics-market-104693?utm_source=chatgpt.com

Consolidated Financial Performance of the Company for FY 2024-25

The company reported Revenue of H786.8 Cr in FY 2024-25 as compared to H643.9 Cr in FY 2023-24, a growth of 22% Y-o-Y. Revenue from sale of products and services stood at H782.3 Cr in FY 2024-25 as compared to H641.5 Cr in FY 2023-24. The company reported EBITDA of H178.4 Cr in FY 2024-25 as compared to H123.4 Cr in FY 2023-24 i.e. a growth of 45% Y-o-Y.

EBITDA margins stood at to 22.7% in FY 2024-25.

Profit before tax (PBT) came in H119.3 Cr in FY 2024-25 as compared to H69.8 Cr in FY 2023-24 i.e. a growth of 71%. The company reported Profit after Tax of H93.1 Cr in FY 2024-25 as compared to H57.3 Cr in FY 2023-24 i.e. a growth of 63% Y-o-Y.

The revenue mix for exports to imports stands at 78:22. The revenue mix continue to skew towards exports.

Our Debt-to-Equity ratio stands at 0.4x times.

Total Capex spend (including work in progress) during FY 2024-25 is H72.2 Cr. The major capex has been towards the new pharma plant.

Significant changes in Key Financial Ratios during FY 2024-25

The key financial ratios during FY25 vis-?-vis FY24 are as below:

Key Financial Ratios	31st March 2025	31st March 2024	Variance
Debtors turnover Ratio	4.58	5.49	-16.54%
Inventory Turnover	3.02	5.07	-40.47%
Interest Coverage Ratio	8.04	4.9	64.05%
Current Ratio	1.22	1.28	-5.01%
Debt Equity Ratio	0.4	0.45	-11.11%
Operating Profit Margin (%) EBITDA	22.67%	19.17%	18.26%
Return on Net worth (%) (ROE)	18.50%	13.31%	38.99%