Shish Industries Ltd Management Discussions.


The plastic industry in India made a promising beginning in 1957 with the production of polystyrene. Thereafter, significant progress has been made, and the industry has grown and diversified rapidly. The industry spans the country and hosts more than 2,000 exporters. It employs about 4 million people and comprises more than 30,000 processing units, 85-90% of which are small and medium-sized enterprises. ? India exported plastics raw material worth US$ 280.38 million in March 2021, and the export during April 2020 to March 2021 was US$ 3.29 billion. ? The total plastic and linoleum export during April 2020 to March 2021 was US$ 7.45 billion and for the month of March 2021, it was US$ 719.15 million. ? In April 2021, export of plastic and linoleum stood at US$ 726.74 million. ? In FY20, plastic and linoleum export from India stood at US$ 7.55 billion. ? In FY21 export of plastic sheets, films, and plates stood at US$ 1.53 billion and packaging material was US$ 863.62 million.

? The Indian plastics industry produces and export a wide range of raw materials, plastic-moulded extruded goods, polyester films, moulded/ soft luggage items, writing instruments, plastic woven sacks and bags, polyvinyl chloride (PVC), leather cloth and sheeting, packaging, consumer goods, sanitary fittings, electrical accessories, laboratory/ medical surgical ware, tarpaulins, laminates, fishnets, travel ware, and others. ? The Indian plastics industry offer excellent potential in terms of capacity, infrastructure, and skilled manpower. It is supported by many polymer producers, plastic process machinery and mould manufacturers in the country.

? Among the industrys major strengths is the availability of raw materials in the country. Thus, plastic processors do not have to depend on import. These raw materials, including polypropylene, high-density polyethylene, low-density polyethylene, and PVC, are manufactured domestically.

Recent Developments

The Department of Chemicals and Petrochemicals has approved 10 Plastic Parks in the country, out of which 6 parks have been given final approval in the below states: Assam (1 nos.) Madhya Pradesh (2 nos.) Odisha (1 nos.) Tamil Nadu (1 nos.) Jharkhand (1 nos.) These Plastic Parks will help to achieve environmentally sustainable growth and increase employment.

Plastics Export Promotion Council

The Plastics Export Promotion Council (PLEXCONCIL) is the apex Government body responsible for the promotion of plastic export. PLEXCONCIL members comprise large-/medium-/small-scale manufacturers and exporters. The council supports exporters by participating in international trade fairs, exploring new markets, organising buyer- seller meets both in India and overseas, and engaging in various other promotion and need- based activities.

Evolving Regulatory Framework and Consumer Requirements to Influence Market Growth

The packaging sector is heading down the sustainable and environment-friendly lane due to the evolving regulatory landscape, government regulations, and increasing consumer awareness pertaining to the ill effects of unsustainable packaging waste. Regulatory bodies, in accordance with companies and retailers operating across the fast-moving consumer goods sector, are seeking novel packaging solutions that are in line with the modern-day sustainability objectives. Plastics corrugated packaging has gained considerable traction over the past decade, particularly due to the exponential rise of the eCommerce sector due to which, the global plastics corrugated packaging market witnessed considerable development in recent years. Players involved in the current global plastics corrugated packaging market are increasingly focusing on the discovery of novel and innovative packaging solutions and systems. The evolving global plastics corrugated packaging market landscape is expected to open up new avenues for market players and provide new merger & acquisition and partnership opportunities. Moreover, in the wake of the mounting environmental concerns and sustainability challenges, the global plastics corrugated packaging market is anticipated to witness some major changes during the forecast period. The increasing demand for plastics corrugated packaging from the food & beverages sector, along with the consistent expansion of end-use industries is expected to drive the global plastics corrugated packaging market in the forthcoming decade. At the back of these factors, along with the increasing emphasis on minimizing packaging leakage and damage, the global plastics corrugated packaging market is expected to witness significant growth during the forecast period.

Booming eCommerce Sector to Bolster Market Growth

The demand for plastics corrugated packaging has witnessed consistent growth due to a host of factors including the onset of cutting-edge digital printing technologies and the booming eCommerce industry. The global plastics corrugated packaging market offers critical services to businesses as well as individuals around the world a factor that is slated to fuel market growth during the assessment period. Plastics corrugated boxes mainly cater to the demands of various end-use sectors, such as pharmaceuticals, food & beverages, tobacco, and durable goods. The eCommerce sector has played a key role in revolutionizing the global plastics corrugated packaging market. As the eCommerce sector around the world is likely to expand at a steady pace in the upcoming years, the demand for plastics corrugated boxes is expected to remain high. While the number of eCommerce transactions, orders, and sales continue to move in the upward trajectory, market players are projected to rely on tried and testing packaging alternatives to attain these objectives. Advancements in digital printing services and technologies are estimated to bolster the growth of the global plastics corrugated packaging market during the assessment period. The ability to personalize the various packaging systems is one of the key factors that is expected to provide a solid boost to the plastics corrugated packaging market during the assessment period.

Sustainable Packaging Initiatives and Innovative Food Packaging Solutions to Impact Market Growth

A number of packaging companies and stakeholders involved in the global plastics corrugated packaging market is expected to focus on product innovation and development to ensure compliance with regulatory guidelines. Furthermore, the increasing number of sustainable packaging initiatives and consumer uncertainty pertaining to the use of plastic could potentially have a negative impact on the growth of the global plastics corrugated packaging market. In September 2019, Amazon India announced that the company is increasingly focusing on minimizing the use of single-use plastic in the upcoming years. The increasing focus on minimizing the utilization of plastic across the packaging sector is projected to have a negative impact on the global plastics corrugated packaging market.

COVID-19 Pandemic to Positively Impact Global Market

The outbreak of the COVID-19 pandemic is expected to have a positive impact on the overall growth of the global plastics corrugated packaging market in 2020. The increasing demand for COVID-19-related drugs due to the swelling number of cases worldwide is projected to augment the demand for efficient plastics corrugated packaging across the pharmaceutical sector. In addition, due to stringent lockdown measures and transportation restrictions, the eCommerce sector has remained in the spotlight throughout 2020, as consumers continue to purchase a wide range of goods and commodities from eCommerce platforms. Due to this, the demand for plastics corrugated packaging is on the rise.

Plastics Corrugated Packaging Market: Overview

? According to Transparency Market Researchs latest report on the global plastics corrugated packaging market for the forecast period of 2020-2028, the market is estimated to grow due to the demand from automobile, building & construction, and personal care industries ? The global plastics corrugated packaging market is expected to expand almost twice the current market share during the forecast period. Plastics corrugated packaging has anti-slip properties and enhance the aesthetics of surfaces, which is likely to increase the sales of plastics corrugated packaging in the years to come.

Need for Protective Packaging in eCommerce Sector Augmenting Market Growth

? Demands from various brand owners are now being strongly felt by the packaging industry, as those brands now are in the need of secondary packaging to promote their business more intensely. This increases the requirement for manufacturers to produce corrugated plastic packaging solutions with high quality graphic design. These brand owners are grabbing opportunities through better engagement and involvement with their customers, which are driving marketing and encouraging repeat-business for attracting new customers. ? Moreover, safe and secured product delivery is the major concern of the eCommerce industry. Therefore, end users are emphasizing on protective packaging through plastic corrugated sheets and liners, which has capacity to withstand sudden jerks. ? According to TMR analysis, global online sales revenue is expected to reach $5.8 Trn by the end of 2023 that will certainly affect packaging demand and especially it will create demand for the corrugated plastic packaging products as it represents more than 70% of demand in the eCommerce sector.

Spill-proof and Non-contaminated Food and Beverage Delivery Creating Growth Opportunities

? Advancements in food processing and food packaging play a key role in boosting the plastics corrugated packaging market sales in the world. TMR team analysed that the global food industry contributes more than 52% market share. The increasing consumption of ready-to-go food products, changing lifestyles, rapidly evolving consumer habits, and ease of access are pushing the global food market to grow, which, in turn, is driving the plastics corrugated packaging market growth. ? Increased per capita personal disposable income has given birth to consumer preference on packaged food over other food. This change in consumer behavior has led to the production of more packaged food. Various Quick Service Restaurants (QSRs) such as KFC, McDonalds, are gaining traction due to its upsurge food quality and on-time delivery phenomenon. ? Furthermore, consumers are highly conscious about spill-proof and non-contaminated food delivery amid COVID-19. Unlike paper packaging, plastic corrugated packaging has good water resistance and ensures leakage safety. Moreover, such packaging solutions are made of FDA approved material, which further reduces chances of contamination due to chemical reactions.

Plastics Corrugated Packaging Market: Key Findings

? Among materials, the polyethylene segment is estimated to account for nearly 34% value share by the end of 2020 and is likely to expand 1.3 times of current market value by 2030. ? Folding boxes segment is projected to hold more than 1/4th share of the global market during 2020-2028. ? Demand for plastic corrugated packaging in food & beverages industry is expected to upsurge over the next eight years, attributing to increasing concern of safe and hygienic packaging of consumable products. ? Europe market is anticipated to outpace other regions with the prominent market share and maximum incremental opportunity. However, Asia Pacific market is anticipated to lead during the forecast period.



? Rising Demand for Reinforced Plastics: The global fiber reinforced plastics (CFRP) market is expected to register a moderate growth during the forecast period 2018 - 2023. These plastics have been widely used in the automobile industry because they offer a great alternative to metal components. In addition, they are now gaining popularity in the construction, medical, military, and marine sectors owing to their versatility, lightweight and durability.

? Corrugated Sheets are Strong, durable and less expensive; hence its in high demand


? Increased Competition from Organized Players ? Changing in Government Policy


The company is primarily engaged in the business of Corrugated Plastic Sheets, which constitute a single reportable segment in accordance with Ind AS 108 "Segment Reporting".

Particulars F.Y. 2020-21 F.Y. 2019-20
Revenue From Operations 2,828.26 1,599.94
Other Income 79.73 37.23
Total Income 2,907.99 1,637.16
Less: Total Expenses before Depreciation, Finance Cost and Tax 2,605.24 1,395.66
Profit before Depreciation, Finance Cost and Tax 302.74 241.50
Less: Depreciation 83.16 84.23
Less: Finance Cost 29.92 24.80
Profit Before Tax 189.66 132.47
Less: Current Tax 53.44 41.33
Less: Prior Period Tax Expense - (1.92)
Less: Deferred tax Liability (Asset) 2.05 (4.02)
Profit after Tax 134.18 97.08


During the year under review, the revenue from operation of the Company was stood at INR 2,828.26 Lakh as against that of INR 1,599.94 Lakh for previous year. Revenue from operation of the Company was increased by 76.77% over previous year. Profit before Tax for the financial year 2020-21 stood at INR 189.66 Lakh as against that of INR 132.47 Lakh making the net profit of INR 134.18 for the financial year 2020-21 as against the net profit of INR 97.08 for the financial year 2019-20. During the year under review, export sales of the Company was increased by 118.43% than that of previous year, due to which the revenue of the Company was increased. On the other side, the Company also performed well in Domestic Market. The domestic sales of the Company was increased by 29.01% than that of previous year. However, increase in revenue also caused increase in cost of material and other operation expenses.


The global corrugated packaging market is expected to perform better than other paper-based packaging materials. Food and beverage sectors will continue to be the largest consumers of corrugated packaging, where the growth is expected to be underpinned by online retailing. Morrisons, Britains fourth biggest supermarket, has recently teamed up with Amazon to offer fresh and frozen products to the UK customers. Amazon has already been offering thousands of chilled, frozen and perishable products from local shops in the US market. In the non-food sector, some end-use sectors will see renewed growth due to changing market dynamics and consumer behaviour while other will face decelerations in demand growth. Brand owners and suppliers are set to change their strategies to capture market share which should directly impact corrugated packaging companies. Commodity Inside has identified a number of megatrends which are set to impact corrugated packaging industry. In developing and emerging markets, corrugated packaging is advancing in new product categories. Many fresh food products which were previously transported in wooden/plastic crates and jute bags are now being shipped in corrugated boxes, which keep products fresh for relatively longer and minimise damages during transportation. The size and share of Plastic Packaging Market are expected to grow 385.5 billion USD by 2026, from 265.2 billion USD in 2020 at a CAGR of 6.1%. Plastic packaging has become an integral part of many businesses because of its cuttingedge design that assists in providing innovative packaging solutions. The plastic packaging is utilized for the shielding of sensitive products that are hard to carry and transfer. Plastic is known to be of less cost and durable performance to the goods. Plastic packaging is employed for the protection of goods when in transit, storage, and distribution. It also shields and escalates shelf life of goods from breaking, spoiling, and contamination. It acts as a way to provide customer information about the product and handle brand identity and variation. Plastic packaging has been extensively permitted and acknowledged in packaging customer goods; from food items and electronic devices to big business equipment and machines. It serves as an easy and durable way of packaging for several businesses. Plastic packaging businesses have matured with the advent of technology and overall environmental awareness. The global plastic packaging market is multiplying were mature markets are offering a modest expansion rate whereas the latest growing markets are opening up the latest opportunities for prospective expansion rate. Plastics are organic materials with a notable molecular weight that is made of different synthetic organic elements that can be shaped into a variety of shapes, because of malleability. Plastic products comprise several altered elements like wood, paper, metals, and glass in numerous uses. The packaging is a technique that has to enclose and protecting several kinds of goods for storing purpose, distribution, sale, and utilization. Plastic is generally more competitive in price and also offers good performance. As a recyclable material, plastic offers environmental advantages like waste reduction and energy savings.


The very nature of the Companys business makes it susceptible to various kinds of risks. The Company encounters market risk and mainly operational risks in its daily business operations. The Company therefore always ensures that its entire inventory, from raw material to finished goods is insured at all times, whether under transit or at the manufacturing facilities. The risk management review framework provides complete oversight to various risk management practices and process. The framework and assessment remains dynamic and aligns with the continuing requirements and demands of the market.


Internal Control system and adequacy Internal Control measures and systems are established to ensure the correctness of the transactions and safe guarding of the assets. Thus, internal control is an integral component of risk management. The Internal control checks and internal audit programmes adopted by the Company plays an important role in the risk management feedback loop, in which the information generated in the internal control process is reported back to the Board and Management. The internal control systems are modified continuously to meet the dynamic change. Further the Audit Committee of the Board of Directors reviews the internal audit reports and the adequacy and effectiveness of internal controls.


The Company believes in establishing and building a strong performance and competency driven culture amongst its employees with greater sense of accountability and responsibility. The Company has taken various steps for strengthening organizational competency through the involvement and development of employees as well as installing effective systems for improving their productivity and accountability at functional levels. The Company acknowledges that its principal asset is its employees. Ongoing in-house and external training is provided to the employees at all levels to update their knowledge and upgrade their skills and abilities. As on March 31, 2021, the Company had total 35 full time employees. The industrial relations have remained harmonious throughout the year.


Particulars F.Y. 2020-21 F.Y. 2019-20 Reason
Debtors Turnover 18.12 times 11.30 times Debtors Turnover Ratio increased due to reduction in Credit Period given to the Customers.
Inventory Turnover 5.55 times 3.83 times Ratio improved due to decrease in holding period of Inventory.
Interest Coverage Ratio 7.34 times 6.34 times Interest Coverage Ratio increased due to decrease in cost of Borrowing.
Current Ratio 2.11 : 1.00 2.41 : 1.00 Current Ratio has slightly decreased due to increase in liabilities.
Debt Equity Ratio 0.09 : 1.00 0.21 : 1.00 Due to reduction in overall debt amount, ratio improved.
Operating Profit Margin (%) 16.35% 21.33% Operating Margin has been decreased due to increase in raw material prices.
Net Profit Margin (%) 4.74% 6.07% Net Profit Margin has been decreased due to increase in raw material prices and other expenses.
Return on Net Worth 11.54% 10.17% Return on Net worth has been increased due to increase in earning.


Statements in this Report, describing the Companys objectives, projections, estimates and expectations may constitute forward looking statements within the meaning of applicable laws and regulations. Forward looking statements are based on certain assumptions and expectations of future events. These statements are subject to certain risks and uncertainties. The Company cannot guarantee that these assumptions and expectations are accurate or will be realized. The actual results may be different from those expressed or implied since the Companys operations are affected by many external and internal factors, which are beyond the control of the management. Hence the Company assumes no responsibility in respect of forward-looking statements that may be amended or modified in future on the basis of subsequent developments, information or events.