Sundaram Multi Pap Ltd Management Discussions

GLOBAL ECONOMY:

The global economy grew at 2.8% and is expected to grow at the same rate to 2.8% in CY 2025 before recovering slightly to 3.0% in CY 2026. This trajectory reflects the growing impact of geopolitical tensions, trade disruptions, and tighter financial conditions in several major economies. The United States, previously buoyed by strong domestic demand, now faces a tempered outlook with growth forecasted at 1.8% in CY 2025, primarily due to restrictive monetary policy and the disruptive effects of newly implemented tariffs. In contrast, the Euro Area is expected to grow at just 0.8%, constrained by weak consumption and political uncertainty. Among emerging markets, India continues to stand out as a growth leader, with the IMF projecting robust GDP growth of 6.5% in FY2025, supported by strong domestic demand, infrastructure push, and stable macroeconomic fundamentals. Chinas growth is expected to moderate to 4.0%, reflecting ongoing structural adjustments and subdued external demand. Meanwhile, the escalation of tariff measures, particularly between the U.S. and China, has significantly disrupted global trade flows and supply chain resilience, contributing to a more fragmented and uncertain global economic environment.

Global inflation is expected to ease gradually, declining to 4.3% in CY 2025 and further to 3.6% in CY 2026, with advanced economies on track to achieve their targets ahead of emerging markets. This disinflationary trajectory is underpinned by a gradual cooling of labor markets and a retreat in energy costs. However, geopolitical flashpoints, including the Russia-Ukraine conflict and the Israel- Gaza war, could exert localized inflationary pressures, particularly in energy and food markets, triggering short-term volatility despite the overarching downtrend. Additionally, the divergence in monetary policy easing across regions will influence global capital flows, investment decisions, and exchange rate movements, creating a more complex backdrop for cross-border economic activity.(Source: IMF Report on World Economic Report, April 2025)

INDIAN ECONOMY:

During the year under review, Indias GDP grew at a rate of 6.5%. Despite global economic turbulence and geopolitical conflicts in parts of Europe and the Middle East, Indias economy demonstrated significant resilience. This impressive expansion was fueled by strategic government initiatives and a steady increase in exports. Looking forward, Indias growth trajectory is expected to remain robust, where the GDP growth is projected to sustain at 6.5% in FY 2026 and to complement the growth targets, the Union Budget aims to stimulate consumption through strategic tax reforms and sector-specific support. The RBIs back-to-back rate cuts by 100 bps including the 50-bps rate cut in June, 2025 has lowered the repo rate to 5.5%, which will increase liquidity in the economy.

Inflation has eased, decreasing from 5.4% in FY 2024 to an encouraging 3.6% in FY 2025, creating a more stable economic environment. This downward trend in inflation is bolstering positive consumer sentiment, setting the stage for heightened consumer spending across key retail categories. Although urban consumption exhibited a plateauing trend, rural consumption remained robust supported by strong agricultural performance. On the other hand, the services sector continued to be a key driver of growth.

OUTLOOK:

A continued upward despite past challenges. The role of paper in promotion of literacy and education, propagation of information and knowledge and in packaging of commodities of commercial value, makes it an indispensable product. Indias prospects for sustained growth are strengthened by ongoing structural reforms and policies aimed at promoting investment and productivity. India is well-positioned to become a leading economy in the coming years by its expanding and youthful workforce. Geopolitical changes and global economic shifts present both challenges and opportunities, requiring businesses to stay nimble. The Government has also played pivotal role to emphasis on fostering entrepreneurship, innovation and in combination of startup ecosystem and rapidly growing digital economy, which are likely to further drive growth and create new opportunities for businesses and individuals. The overall Indias economy appears for a brighter future in 2025 and onwards.

INDUSTRY STUCTURE AND DEVELOPMENTS:

The education sector plays a vital role in shaping the future of individuals and societies and serves as a cornerstone for economic development, social progress and cultural enrichment. With advancements in technology and evolving learning methodologies, the sector continues to undergo transformation, offering innovative solutions to address diverse educational needs. Indias higher education system is among the largest Globally.

Paper Industry, occupies a prestigious position, among the various manufacturing enterprises, in view of its significant contribution to the Society. Role of paper in promotion of literacy and education, propagation of information and knowledge and in packaging of commodities of commercial value, makes it an indispensable product. The books and stationery industry deals in a wide range of products and categories, comprising paper products, writing instruments, computer stationery, school books, office books products, among others.

The Indian stationery market has registered substantial growth in the past few years owing to the growing urban population, and increasing demand for stationery products in the private and public sector, along with growing government initiatives in improving the education system. According to the report, India Stationery Market Outlook, 2027-28 the market is anticipated to grow at more than 8% CAGR for 2022-28. The rise in digital content surrounding stationery products and its use has also introduced an entirely new breed of influencers and reviewers.

The total market of stationary is made from paper stationary and non-paper stationary products. Paper stationary market is further segmented into products for office use and non-office use. Non-paper stationary segment covers products such as writing instruments, office products, colors and other adhesive & technical instruments. In short, stationary market includes products like, notebooks, paper for office, pens, non-paper for office, pencils, colors and much more types. Among this entire category, apart from dominating paper stationary, non-paper stationary category is contributed major market share. Further, writing instrument has chunked the largest pie of the non-stationary market with segment likewise, pen, pencil and others. All these lead to the one conclusion that evolving digitalization has not yet proving as a threat for the stationary products as considering the potentiality of growth of market.

Initiatives of the Indian Government in the Field of Education:

Numerous initiatives are undertaken by the Government and other social welfare institutions to promote Right to Education such as:

> Pradhan Mantri Schools for Rising India (PM-SHRI) Scheme- The Government launched a Centrally Sponsored Scheme (CSS) called PM Schools for Rising India (PM SHRI) on 7 September, 2022. These schools will be equipped with modern infrastructure and showcase the implementation of the NEP and emerge as exemplary schools over a period of time. Under the scheme, sponsored by the Government of India, aims to establish over 14,500 schools.

These schools, overseen by various authorities including the Central Government, state/UT Governments, local bodies, prioritize creating inclusive and welcoming environments.

> ‘National Education Policy (NEP) 2020- The National Education Policy envisions an education system rooted in Indian ethos that contributes directly to transforming India sustainably into an equitable and vibrant knowledge society, by providing high-quality education to all, and thereby making India a global knowledge superpower. NEP aims to uplift vulnerable, underprivileged, and under represented populations through education. The intent is to provide world- class education to all children, regardless of where they live or the economic background they come from.

> Samagra Shiksha Scheme- The Samagra Shiksha Scheme integrates school education from pre-school to class XII, aligned with the United Nations Sustainable Development Goal for Education. It supports the Right of Children to Free and Compulsory Education Act, 2009, and aligns with the NEP 2020. The scheme aims to provide equitable, inclusive education, catering to diverse backgrounds, multilingual needs, and varying academic abilities, fostering active student engagement.

> National Initiative for Proficiency in Reading with Understanding and Numeracy (NIPUN) Bharat Mission-

The Scheme aims to ensure that every child in India gains foundational numeracy and literacy by the end of Grade 3 and thereby establishes priorities and a plan of action for States/ UTs to attain the same objective.

Rising inclination towards pursuing higher studies have resulted in opening up of newer and better avenues thereby infusing higher demand and enhancing stationery industry growth prospects.

E-Learning

Over the years, higher and easier availability of internet and smartphone accessibility at affordable rates has paved the way for deeper penetration. Formal education system has undergone a significant shift towards online models across the value chain, from admissions to assessments. Educational technology, or EdTech, has played a vital role in this digital transformation of education delivery. The EdTech industry experienced phenomenal growth during the COVID-19 pandemic and is expected to continue expanding rapidly in the coming years. A huge part of this adoption can be accredited to the collaborative effort of all the stakeholders - the Government, private and public schools, tutors, coaching institutes, students, and teachers, who collectively facilitated this growth.

Indias current EdTech landscape mainly entails Pre-K-12/ college learning, test preparation, tutoring, upskilling and technology providers. Technology-enabled learning and understanding can surely help cover other remaining segments too. It can help plug the shortcomings in our countrys education system by alleviating concerns to make learning accessible, affordable and flexible for everyone. Additionally, and more importantly, it can also help address the eminent gaps arising from lack of proper school infrastructure, teacher absenteeism or unavailability, inadequate training of in-service teachers, lack of accessibility to learning, especially in remote areas, amongst many other challenges.

BUSINESS REVIEW/STATE OF THE COMPANYS AFFAIRS:

Our brand, Sundaram was established in 1985. It started off as a school and office paper stationery manufacturing company. With having a tremendous demand for quality products, we have recorded a strong year on year growth.

Sundaram is known for its quality in terms of value we provide. As a human right, we believe education is must for every child at an affordable price. In line with this vision, we have always striven to provide quality products at an affordable price to people. Today, we have wide varieties of products which are convenient and worthwhile to every age group. Quality Products with good service are the key factors for success in our industry. Our goal is to provide products to all the states in the country, and provide durable and high-quality products to consumers.

However, the world today is shifting to a more web driven one but still the paper industry has its own significance. This belief combined with our 30+ years of experience has helped us to cover the paper stationery product market extensively with various manufactured products.

Over the past 30+ years the company has grown by many folds and diversified into various other verticals of business. Our dedication and passion to deliver the best has led us to explore new avenues and foresee the future.

With a wide range of over 200 products today Sundaram sells more than 5 lakh books everyday through its strong distribution network of 15000 dealers and distributors.

We design, manufacture and market paper stationery products - exercise note books, long books, note pads, scrap books, drawing books, graph books - for students of all ages, as well as office/ corporate stationery products and printing, writing & packaging paper.

With the strong brand and market penetration we are present in pan Maharashtra and have a strong brand recall among consumers. The brand Sundaram stands for trust, quality products and for a legacy. As its rightly said, "Education is the strongest weapon" we want to deliver quality products at the best rates to the entire country.

The times have changed people dont take the risk of buying substandard products any more. The market for branded products is very huge today, and it can demand a premium. The extended products and high-quality paper premium products can be introduced under the same brand. The brand will be used for other stationery products in the market in the near future.

SUNDARAM is mainly in the Business of School & Office stationery as well as E-learning segment. The enormous size of School and paper stationery industry of India makes it one of the most important sectors of Indian Economy. Increasing Economic Growth, High Literacy Rate, more Government Spending on Education, Growing Population, Urbanization, higher proportion of young adults, better living standards, shift in focus from inexpensive to quality products etc. are some major factors that are driving the paper stationery business to flourish. The thrust on education by the Government is the prime growth of the notebook industry.

E-CLASS:

E-class is a revolutionary product by our company, developed to help the students ease the burden of studies and score more marks. E-class is an innovative educational content for the students of Maharashtra State Boards 1^st to 10^th standards for all subjects, available in English, Marathi, Semi English, Hindi and Urdu medium as per the syllabus.

With the stress and difficulties in education arising every day, we have created content which will help the students learn in a better and a new way. It is said what we see (visuals) is often remembered more than what we simply just read. Keeping that concept in mind, we have converted the black and white textbook into audio-video animated content explaining each chapter and subject in detail.

E-Class is an attempt to encourage quality learning and help the process of learning by making it effective and engaging in innovative ways. At E-Class we have developed solutions and delivery platforms that enrich teaching and learning experience. The main aim is to go beyond the traditional black and white textbook approach and connect technology with education.

Edzam is a revolutionary online digital app and portal that has transformed the process of learning through the support of audiovisual content, assessment tool, question bank and analytical reports.

We believe that to become a leader in any field one must foster a conception of excellence in education. Education is the pillar and base of entire human life and we believe our learning solutions will not only help build the base but will make the education roots stronger forever. We are building an army of students for this nation and we support the Digital India mission strongly.

OUTLOOK ON OPPORTUNITIES AND THREATS:

The paper industry has occupied a prestigious position, among the various manufacturing enterprises, in view of its significant contribution to the Society. With close to one-third of Indias population being under the age of fifteen, the country has a remarkable growth opportunity for the education sector. The outlook of this industry remains bright in light of growing middle- class population coupled with thriving income levels, boost in "Beti Padhao" campaign, increase in variety of courses offered by colleges and universities, growing emphasis of the Government, and more. However, accessing quality education and financial commitment to education development continues to remain challenging. The demand is expected to grow on account of an anticipated pickup from the education sector with improving literacy rates and growing enrolment as well as increasing number of schools and colleges. Improving literacy rates, rising circulation and an increasing number of newspapers and magazines is expected to support growth in demand.

On the other hand, there is sharp rise in the number of internet users has boosted the demand for e-learning platforms and courses. The global e-learning market has seen a tremendous increase in demand for content developed and designed to meet remote learning needs. Anyone from anywhere in the world can access self-paced learning modules offered by educational institutions. The educational institutions are collaborating with suppliers to leverage e-learning and expand their students reach. This indeed leads to more opportunities for the supply side of the e-learning industry. Important emerging trends like e-classrooms, micro learning, mobile learning and social learning are driving exponential growth in the market.

The e-Learning companies in India are striving to replace the traditional education system with the modern education system by adopting latest educational technologies. The e-Learning companies in India are working effectively with the government, and educational boards to make the cloud platform prevalent. Besides, by adopting learning analytics or big data analytics, these eLearning companies are helping online course providers design custom-made courses, ensure self-regulation of learners, conduct frequent auto-graded quizzes, and make grades and learning progress accessible to students. Thus, the evolution and rising awareness regarding latest technologies will increase the adoption of eLearning in the Indian market, thereby pushing growth in the online education market in India.

RISK AND CONCERN:

The risk is always the part and parcel of any business activity. The Company operates in a highly competitive environment that is subject to innovation and varying level of resources available to each player in this segment of business. Companys risk management strategy focuses on identifying and mitigating potential risks that could impact the business. The common risks inter alia are: Risk to Company Assets and Property, Employees Related Risks, Foreign Currency Risks, Risks associated with Non-Compliance of Statutory enactments, Competition Risks, Operational Risks, Business risk, Technology obsolescence, Investments, Retention of talent and Expansion of facilities. Business risk, inter-alia, further includes financial risk, political risk, fidelity risk, legal risk. Immense competition is faced by the company from the international players and unorganized sectors.

Education system in India is evolving so as the content for the learning. The Company is constantly reviewing the risk that would impact adversely. Cost of raw material and inflationary pressure also increase the cost of manufacturing, but the availability of raw material from the suppliers at the right time and at the right price has enabled the company to reduce the cost of manufacturing. For Inflationary pressures and it impact the company has taken suitable cost control steps.

The Companys Compliance Risk/ Integrity Risk is reduced by adherence to all laws and regulations by employing a rigorous verification process. We have a robust reporting structure in place, extending from business line executives to the Audit Committee and the Board of Directors. An expert team conducts an annual internal audit, scrutinizing key elements of corporate operations, followed by thorough reviews by internal auditors, the Audit Committee, and the Board of Directors. The Audit Committee consistently assesses the suggestions put forth by internal auditors and proposes measures to bolster internal controls.

The Companys Human Risk is minimal as it enjoys a harmonious industrial relationship in the manufacturing units of the Company. Lack of clarity on future Government policy continues to be an area of major concern for the industry. The exact impact of this cannot be evaluated until the proposed changes are actually introduced and implemented.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY:

Our internal control system is reliable, efficient and crucial to the success of our Company. We review our numerous segments and sales operations with the help of the internal control system. We have deployed an effective internal control system, through which we review our sales operations and numerous sectors. This system assures proper maintenance of internal audit controls, like observing various operations, protecting assets and complying with regulations. The yearly internal audit covers important areas of business operations identified by a team of experts. Each area is reviewed by internal auditors, the Audit Committee and the

Board. The Audit Committee considers the inputs from the internal auditors and advices ways to enhance the internal controls, time and again.

Disclosure on Internal Financial Control and their adequacy & brief description on performance with respect to operational performance is given in Directors Report.

FINANCIAL PERFOMANCE WITH RESPECT TO OPERATIONAL PERFORMANCE:

(Rs. In lakhs)

Particulars	2024-2025	2023-2024
Total Revenue	12,940.50	12,733.73
Operating Expense	12,580.79	12,295.60
EBITDA	189.11	252.28
EBITDA Margin	1.46	1.98
Depreciation	433.67	414.13
PAT	(512.07)	(508.18)
Capital Employed	9,291.05	11,658.15
EBIT	(244.56)	(161.85)
ROCE	(2.01)	(139)
Net worth	8,753.78	9,263.07

Revenue: Our Companys overall total income increased to Rs. 12,940.50 Lakhs for 2024-25 from Rs. 12,733.73 Lakhs for 2023-24. This increase in revenue mainly attributed to opening up of schools and offices and increase in sales of stationery.

Expenses: Our Companys overall expenses increased to Rs. 12,580.79 Lakhs for 2024-25 from Rs. 12,295.60 Lakhs for 202324. This increase in expenses can be attributed mainly to the increase in business volume as seen from increase in revenue.

Profit / (Loss): Our Company has incurred loss of Rs. 512.07 Lakhs for FY 2024-25 as against the loss of Rs. 508.18 Lakhs in FY 202324.

Net Worth: Our Companys net worth decreased to Rs. 8,753.78 Lakhs for 2024-25 from Rs. 9,263.07 Lakhs for 2023-24.

HUMAN RESOURCES / INDUSTRIAL RELATIONSHIP:

Human Resources are one of the most important ingredients to fuel future growth and progress of the organization. The Company therefore strives to align human resource policy and initiatives to meet business plans. Companys focus on promoting wellbeing of its employees, providing safe and congenial work environment. Training of employees to maintain high level of motivation is an ongoing process. Career development opportunities are provided at all levels and across all functions. In challenging business environment, company & its management has maintained healthy and cordial relationships with all the stakeholders.

CHANGES IN KEY FINANCIAL RATIOS:

Pursuant to the provisions of Regulation 34(3) of SEBI (LODR) Regulations 2015 read with Schedule V part B (1) details of changes in Key Financial Ratios are given as hereunder:

Ratio		Year Ended
		March 31, 2025	March 31,2024
1 Debtors Turnover Ratio	Times	9.13	7.25
2 Inventory Turnover Ratio	Times	6.16	6.92
3 Interest Coverage Ratio	Times	(0.28)	0.07
4 Current Ratio	Times	2.45	3.61
5 Debt Equity Ratio	Times	0.54	0.67
6 Operating Profit Margin	%	(2.68)	(2.54)
7 Net Profit Margin	%	(4.02)	(4.00)
8 Return on Net Worth		(5.82)	(5.48)

DISCLOSURE OF ACCOUNTING TREATMENT

The financial statements of the Company have been prepared in accordance with Indian Accounting Standards (Ind AS) notified under the Companies (Indian Accounting Standards) Rules, 2015 (as amended from time to time). The details of accounting treatment are given in Significant Accounting policies of the Financial Statements.

CAUTIONARY STATEMENT:

Statement in this Managements Discussion and Analysis detailing the Companys objectives, projections, estimates, expectations or predictions are "forward-looking statements" within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or implied. Important factors that could make a difference to the Companys operations include global and Indian demand-supply conditions, finished goods prices, stock availability and prices, cyclical demand and pricing in the Companys principal markets, changes in Government regulations, tax regimes, economic developments within India and the countries within which the Company conducts business and other factors such as litigation and labor negotiations.

On behalf of the Board of Directors
For Sundaram Multi Pap Limited
Sd/-	Sd/-
Amrut P. Shah	Shantilal P. Shah
DIN: 00033120	DIN: 00033182
Chairman & Managing Director	Whole-time Director
Date: August 25, 2025
Place: Mumbai