Tarsons Products Ltd Management Discussions

ECONOMIC OVERVIEW

Global Economy

The global economy demonstrated resilience in 2024, adapting to shifting conditions with strategic policy adjustments. Despite inflation, geopolitical tensions, trade disruptions, and political instability fueling volatility, economies responded by diversifying trade routes, strengthening supply chains, and refining policies. With policymakers focused on reinforcing economic resilience, growth is projected at 2.8% in 2025 and 3.0% in 2026, reflecting steady but cautious progress.

Global Economic Growth

Global headline inflation is expected to decline more slowly than earlier anticipated. It is now projected to ease to 4.3% in 2025 and further to 3.6% in 2026. The revision reflects higher inflation estimates for advanced economies, partially offset by marginal downward adjustments in emerging markets and developing economies.

The U.S. economy is now expected to grow at 1.8% in 2025, reflecting a downward revision driven by the combined impact of restrictive monetary policy and escalating trade disruptions. Inflation is likely to remain elevated, with recent tariff measures alone adding an estimated one percentage point. Domestic consumption is losing momentum, while the manufacturing sector is grappling with rising input costs amid persistent global supply chain pressures.

Concerns are rising over increasing financial system fragility, particularly in emerging markets and among non-bank financial institutions (NBFIs). Volatility in equity markets, stretched asset valuations, and persistently high corporate debt levels across several economies are contributing to an increasingly uncertain financial outlook. Central banks face a delicate balancing act as they attempt to manage inflation without triggering financial instability.

Emerging market economies are particularly exposed under current conditions. Rising sovereign debt servicing costs, capital outflows driven by widening interest rate differentials, and depreciating currencies are compounding inflationary pressures and macroeconomic vulnerabilities. Collectively, these factors increase the risk of abrupt investment halts and potential debt distress. Without timely multilateral support and the activation of structured debt resolution frameworks, financial stress in these economies could intensify further.

Way Forward

Despite the challenges facing the global economy, this period offers a unique opportunity to strengthen resilience and chart a more sustainable path forward. The adaptability shown by many economies under pressure signals that recovery is possible with the right mix of coordinated policies and proactive reform.

By working together to establish a stable and transparent trade environment, advancing timely debt resolution, and addressing structural imbalances, countries can support a more balanced and inclusive global recovery. Maintaining clear monetary policy direction, using macroprudential tools as needed, and implementing credible fiscal plans will help restore financial stability and protect long-term growth.

International cooperation will be essential in navigating the road ahead. With aligned strategies, strong leadership, and a commitment to shared progress, the global economy can regain momentum, rebuild buffers, and open up new opportunities for prosperity across regions.

(Source: World Economic Outlook, January and April 2025)

Indian Economy

The Indian economy is estimated to grow at 6.5% in 2024-25, remaining one of the fastest-growing major economies despite global uncertainties. Strong domestic demand, rising capital expenditure, and a resilient services sector drive this growth. The service sector continues to lead, contributing 55% to Gross Value Added (GVA), with IT and computer services exports seeing steady double-digit growth.

The industrial sector is also estimated to grow by 6.2% in 2024-25, led by strong performances in electricity and construction. However, the manufacturing segments growth may drop from last year due to weaker global demand and lower corporate investments.

Supporting the overall sectors growth, Indias renewable energy capacity has surged by 15.8% year-on-year (Y-O-Y), now making up 47% of the total installed capacity, reinforcing Indias commitment to sustainability. Real estate is gaining renewed momentum with increased housing demand across urban centers. Furthermore, the digital economy is set to surpass USD 1 Trillion by 2025, further accelerating economic transformation.

Indian Economy GDP Growth Rate (in %)

Inflation is expected to stay stable, backed by prudent fiscal and monetary policies. Infrastructure investments and manufacturing incentives under the Production-Linked Incentive (PLI) scheme will strengthen economic momentum. To achieve the longterm vision of Viksit Bharat by 2047, India must sustain 8% annual GDP growth. Structural reforms will drive this by improving business ease, simplifying regulations, and fostering a competitive investment climate. A robust policy framework focused on improving governance, regulatory efficiency, and economic resilience will be key to sustaining this momentum.

At the heart of these reforms, the Ease of Doing Business 2.0 initiative is reducing compliance burdens, streamlining approvals, and utilizing digital solutions to create a more business-friendly ecosystem. Complementing this, systemic deregulation is removing outdated laws, improving transparency, and ensuring regulatory efficiency. These enhancements are driving faster decision-making and boosting investor confidence. Additionally, simplified labor laws consolidate multiple labor codes, fostering workforce flexibility, easing hiring, and encouraging job creation.

Meanwhile, tax rationalization is ensuring a simplified and predictable fiscal framework, strengthening Indias appeal as a global investment hub. Together, these structural reforms are laying the foundation for a dynamic, innovation-driven, and resilient economy, positioning India for long-term prosperity.

(Source: https://www.india-briefing.com/news/economic-survey-of-india-2024-25-key-highlights-36004.html/)

Way Forward

Indias economy is projected to grow between 6.3% and 6.8% in 2025-26. Structural reforms, digital transformation, and a rising consumption base are going to be the key drivers of this growth. Initiatives such as Make in India and the PLI schemes are fostering a robust manufacturing ecosystem, attracting major investments in key sectors like electronics, semiconductors, and renewable energy.

Additionally, large-scale infrastructure development-highways, ports, and smart cities—is set to boost economic activity and job creation. With continued policy support and strategic investments, India is on track for sustained growth in the foreseeable future, solidifying its place as a global economic powerhouse.

(Source: https://www.ibef.org/news/indian-economy-expected-to-grow-6-3-6-8-in-fy26-economic-survey#:~:text=Indian%20Economy%20News-, Indian%20economy%20expected%20to%20grow,6.8%25%20in%20FY26%3A%20Economic%20Survey&text=Indias%20economy%20is%20 expected%20to,%2C%20on%20January%2026%2C%202025.)

INDUSTRY OVERVIEW

Global Healthcare Industry

The global healthcare services sector has seen strong growth in recent years and is set to maintain its upward trajectory. The market is projected to grow from USD 8,778.73 Billion in 2024 to USD 9,255.77 Billion in 2025, at a 5.4% CAGR. This growth stems from medical advancements, an aging population, the expansion of health insurance market, government healthcare programs and evolving healthcare regulations.

Looking ahead, the healthcare services market is set to grow steadily to USD 1 1,222.08 Billion by 2029, with a 4.9% CAGR. Key factors driving this growth include the rise of telehealth and digital health, evolving healthcare workforce strategies, health equity initiatives, value-based care, and potential shifts in reimbursement models.

Major industry trends in the coming years will focus on telemedicine integration, patient-centered care, preventive healthcare and wellness, personalized medicine, and increased healthcare consolidation. With these transformative shifts, the sector is poised for sustained progress, improving accessibility, efficiency, and patient outcomes worldwide.

Way Forward

The global healthcare services market is set for steady growth, fueled by technological advancements, an aging population, and evolving care models. The rise of telehealth, Al-driven diagnostics, and precision medicine are reshaping patient care, enhancing both accessibility and efficiency.

Increasing emphasis on health equity, value-based care, and workforce strategies will further shape the industrys trajectory. As healthcare systems worldwide adapt to new challenges, the sector will continue to evolve, driven by digital integration, preventive healthcare, and personalized treatment approaches.

Projected Global Healthcare Market Size (Between 2024-29)

Indian Healthcare Industry

Indias healthcare sector is evolving rapidly, fueled by innovation and strong government backing. The market is expected to reach USD 638 Billion by 2025. The Union Budget 2025 has allocated Rs. 99,856 Crores, marking a 9.8% increase, to boost infrastructure, add 10,000 medical college seats, and promote innovation through increased MSME investments and AI Centers of Excellence.

Key initiatives, including the Ayushman Bharat Digital Mission, customs duty exemptions on life-saving drugs, and expanded broadband for rural health centers, are improving accessibility and affordability. Additionally, the Heal in India initiative and on- arrival visas are strengthening Indias position in medical tourism.

With a significant push for AI and digital transformation in healthcare, increased investment in healthcare data solutions and AI- powered innovations will improve patient care, optimize resource allocation, and enhance decision-making processes. Despite challenges in rural infrastructure and workforce development, Indias strategic efforts are building a more inclusive, efficient, and globally competitive healthcare system.

(Source: https://www.expresshealthcare.in/news/decoding-union-budget-2025-key-takeaways-for-healthcare-sector/447938/,https://www.financialexpress. com/business/healthcare-indian-healthcare-market-projected-to-reach-638-Billion-by-2025-report-reveals-3678354/)

Export Opportunity Market

Indias laboratory plasticware market holds strong export potential, fueled by a global market estimated to reach USD 2.99 Billion by 2030, with a 4.8% CAGR. This growth is driven by increasing R&D activities in pharmaceuticals, biotechnology, and healthcare, along with a rising number of diagnostic laboratories.

The preference for plasticware, owing to its superior chemical resistance, durability, ease of handling, and cost advantage over glassware, further amplifies the demand. Additionally, the emerging trend toward sustainable laboratory plasticware, with a global market expected to reach USD 2.69 Billion by 2035, offers Indian manufacturers a chance to cater to environmentally conscious consumers.

(Source: https://www.grandviewresearch.com/industry-analysis/laboratory-plasticware-market-report, https://www.rootsanalysis.com/reports/ sustainable-laboratory-plasticware-market.html)

Way Forward

Indias healthcare sector is set for strong growth, driven by expanded medical education capacity, better rural healthcare access through digital infrastructure, and enhanced affordability programs like the Ayushman Bharat Digital Mission. The Union Budget 2025 has increased healthcare funding, reflecting the governments focus on public health infrastructure.

Despite this rise in funding, concerns remain about whether the funding is enough to close long-standing resource gaps, especially in rural healthcare, primary care facilities and skilled workforce availability. Managing these structural issues is crucial for inclusive healthcare access and Indias rise as a global medical tourism hub.

Emerging sectors such as health-tech, clinical research, and online pharmacy commerce are gaining traction, creating space for innovation and better patient outcomes. These areas are likely to attract sustained investor interest, fueling continued expansion in the healthcare sector.

Lab Equipment Industry Global Lab Equipment Overview

The lab equipment market has grown steadily, rising from USD 29.16 Billion in 2023 to USD 31.51 Billion in 2024. It is expected to reach USD 49.75 Billion by 2030, with a 7.92% CAGR. Rapid technological advances and integration of automation and digitalization into laboratory processes are fueling this expansion.

Increasing R&D investments and a stronger focus on drug discovery and clinical trials are driving demand for lab equipment. The need for cost-effective, energy-efficient, and portable solutions is also rising, especially in industrializing nations. Supportive government policies in these regions further drive market expansion.

As the market evolves, demand is rising for personalized, interconnected systems that meet advancing scientific needs. Strengthening global distribution networks can help companies unlock opportunities in underserved markets. On the other hand, research and development efforts should focus on automation, scalability, material sustainability, and device miniaturization. By driving innovation and prioritizing user-friendly interfaces, companies can maintain a competitive edge and shape the future of the lab equipment industry.

(Source: https://www.globenewswire.com/news-release/2024/11/28/2988626/28124/en/iab-Equipment-Market-Research-Insights-by-Product- End-user-Application-Technology-Region-and-Company-Global-Forecast-2025-2030.html)

Way Forward

The global lab equipment industry is set for sustained growth, driven by technological advancements, increasing research activities, and rising automation demand. AI, IoT, and cloud integration are transforming laboratories by improving efficiency, accuracy, and real-time data analytics. However, high costs, regulatory complexities, and skill shortages necessitate a shift toward affordable, user-friendly, and smart lab solutions.

Expanding global distribution networks, particularly in emerging markets, and fostering collaboration among manufacturers, research institutions, and governments will be crucial for innovation and regulatory compliance.

Moving forward, the industry must prioritize sustainability, miniaturization, and modular designs to meet evolving scientific needs. Investments in AI-driven automation, precision diagnostics, and connected laboratory ecosystems will be key differentiators. These advancements will position the lab equipment sector to drive scientific progress and support critical research breakthroughs in the coming years.

Indian Lab Equipment Market Overview

The Indian lab equipment market is growing rapidly in 2024, driven by strategic healthcare investments, a booming pharmaceutical industry, and rising R&D activities. The market is projected to register a CAGR of 6.7% from 2024 to 2030, reaching USD 3,348.0 Million by 2030. Another forecast projects a 6.3% CAGR from 2024 to 2032, with the market reaching USD 4,142.85 Million by 2032. This growth is largely fueled by Indias role as a global provider of generic medicines and vaccines. Growing innovation in laboratories, rising health awareness, and the availability of skilled talent further accelerates the expansion.

Key growth drivers include rising demand for accurate diagnostics, broadening R&D infrastructure, and government initiatives like the PLI Scheme, which supports domestic manufacturing. Indias cost advantage, combined with world-class medical expertise and advanced technology, further strengthens its appeal as a major market for lab equipment. The market is divided into five segments: general, analytical, clinical, support, and specialty equipment. General lab equipment held the largest revenue share in 2023, while the support equipment segment emerged as the fastest-growing segment.

(Sources: https://www.pharmabiz.com/NewsDetails.aspx?aid=165700&sid=1https://www.inkwoodresearch.com/reports/india-analytical-laboratory-instruments-market-forecast-2024-2032/)

Way Forward

The Indian lab equipment market is set for steady growth, driven by rising investments in healthcare, pharmaceuticals, and R&D, alongside strong government support. The Union Budget 2025-26 underscores this commitment with a Rs. 20,000 Crores allocation to the Department of Science and Technology. This funding aims to initiate a Rs. 1 Lakh Crore private sector-led R&D fund to foster innovation in deep tech and emerging sectors.

The integration of automation, AI, and digital solutions will enhance precision, efficiency, and scalability in laboratory operations. Additionally, initiatives like the PLI Scheme are expected to boost domestic manufacturing, reducing import dependence and driving innovation. By adopting emerging technologies and addressing regulatory challenges, the sector is well-positioned for long-term growth and global competitiveness.

(Source: https://pib.gov.in/PressReleasePage.aspx?PRID=2098352)

COMPANY OVERVIEW

Tarsons Products Limited (referred to as TPL, Tarsons, or the Company) is one of Indias leading labware manufacturers, engaged in the designing, development, manufacturing, and marketing of consumables, reusables, and benchtop equipment & instruments. With over 40+ years in the life sciences industry, Tarsons is known for delivering high-quality, reliable products that are trusted by research centers, universities, pharmaceutical companies, CROs, diagnostic labs, and hospitals.

The Company offers a diversified product portfolio of 2,000+ SKUs across 350 product segments, including bottles, beakers, centrifuge tubes, pipette tips, and PCR consumables. These products are manufactured at six vertically integrated facilities in West Bengal, ensuring stringent quality control and operational efficiency. Tarsons has established a robust market share in the highly fragmented Indian labware sector and continues to reinforce its leadership through innovation and precision.

With a strategic vision for growth, the Company is expanding its product portfolio, particularly in high-growth segments like cell culture and Bio process products while leveraging digital transformation to enhance customer engagement and operational efficiency. Supported by a pan-India distribution network and long-standing relationships with distributors, Tarsons ensures widespread availability of its products. Additionally, as one of the few Indian players with a significant global presence, the Company supplies labware to over 40 countries through 45+ authorized distributors and partners.

As demand for high-quality labware continues to rise, Tarsons remains at the forefront of scientific research and laboratory applications, strengthening its position in both the Indian and global markets.

Operational Review

In 2024-25, TPL achieved key milestones in manufacturing, expanding its capabilities and strengthening its market presence, leading to strong revenue performance. The Companys strategic focus on product diversification, operational efficiency, and technological advancements positioned it well for sustained growth. As a result, TPL recorded a revenue of Rs. 314.18 Crores during the fiscal year.

Designed to meet the growing demand for plastic labware over the next 3 to 5 years, this facility enhances production capacity and supports the introduction of new product lines, such as the cell culture line. The expansion at Panchla underscores the Companys commitment to scale operations and strengthening its market leadership.

Tarsons manufacturing operations are backed by vertically integrated capabilities, with design and development carried out entirely in-house. The Company has embraced automated manufacturing, leveraging robotics and advanced technologies developed in collaboration with overseas partners. This ensures precision, consistency, and efficiency while maintaining stringent quality standards. Additionally, Tarsons production processes are completely free from human touch, ensuring the purity levels essential for life sciences applications. All products are manufactured in fully validated and third-party certified ISO 8 clean rooms, adhering to globally recognized ISO and CE certifications.

Further expanding its infrastructure, Tarsons is developing a new fulfilment center and manufacturing facility in Amta, West Bengal, which will feature in-house sterilization capabilities. This strategic addition will enhance supply chain efficiency and reinforce the Companys commitment to delivering high-quality labware products with stringent sterility standards.

On the global front, Tarsons strengthened its international footprint with the strategic acquisition of Nerbe R&D GmbH and Nerbe Plus GmbH & Co. KG, enhancing its presence in the European market. This acquisition expands product reach, opens new growth avenues, and positions the Company to compete for larger global bids.

With increased manufacturing capacity, a broader product portfolio, and an expanding distribution network, Tarsons is well- positioned to serve both domestic and international markets. The Companys export revenue stood at Rs. 99.82 Crores, reflecting 20.3% YoY growth, driven by strong demand across key global markets. Domestically, its presence has expanded whole of India, while its export footprint now spans 40+ countries. These strategic initiatives, combined with a steadfast focus on innovation, quality, and customer satisfaction, lay a strong foundation for sustained growth and long-term value creation.

Financial Review

Particulars	2024-25	2023-24
Revenue ( in Million)	3,141.77	2,773.10
EBITDA ( in Million)	1,054.00	1,034.39
EBITDA Margin (%)	33.55	37.30
PAT ( in Million)	427.31	512.47
PAT Margin (%)	13.60	18.48
Earnings per Share (?)	8.03	9.63
Return on Capital Employed (%)	8.62	9.14
Return on Equity (%)	6.71	8.61
Net Worth ( in Million)	6,523.89	6,204.17

Risk Management

TPLs risk management framework is designed to proactively identify, assess, and mitigate potential threats, ensuring long-term business resilience. Closely monitored by the Board of Directors and reinforced by a dedicated Risk Management Committee, this structured approach enables the Company to navigate dynamic market conditions and operational challenges effectively.

Regular reviews and refinements of risk policies allow TPL to stay ahead of emerging risks while maintaining a well-disciplined control environment. To strengthen this further, the Company invests in employee training programs and implement stringent management protocols, equipping the workforce with the knowledge and skills to integrate risk mitigation into daily operations. By fostering a culture of awareness and preparedness, TPL ensures that risk management remains a core pillar of its strategic decision-making.

Key Risks and Mitigation Strategies

Risk	Impact	Mitigation
Competition Risk	Heightened competition from established and unorganized players can put downward pressure on pricing, affecting the Companys profitability and margins.	To sustain its competitive edge, Tarsons focuses on continuous innovation and product differentiation. The Company also strengthens its market presence by strategically investing in focused branding and marketing campaigns, ensuring clear distinction from competitors.
Operational Risk	Disruptions in manufacturing processes or quality control failures could damage TPLs reputation, leading to adverse effects on overall business performance and results.	TPL integrates automation across production stages to enhance efficiency and minimize human error, ensuring seamless operations. Additionally, the production process begins with sourcing premium raw materials from globally recognized suppliers. By deploying advanced processing technologies and enforcing stringent quality control, the Company maintains its commitment to excellence at every stage.
Industry Risk	Regulatory changes and unexpected market shifts create unpredictable challenges in an industry that continues to evolve dynamically.	TPL, being a globally operating entity, conducts continuous risk assessments across multiple markets, closely tracking industry trends to identify potential challenges. With regular evaluations, the Company implements proactive measures to navigate challenges and maintain stability in a dynamic landscape.
Suppliers Risk	Fluctuations in raw material prices and operational costs can influence overall revenues and profitability. These fluctuations can not only impact TPLs profit margins but also affect the value chain.	The Company maintains strong relationships with a diverse network of suppliers to mitigate potential supply chain disruptions. Strategic sourcing agreements help manage fluctuations in raw material costs, which account for approximately 25.47% of revenue. To counter price volatility, the Company implements annual pricing revisions, ensuring cost escalations are effectively offset.
Liquidity Risk	Inability to finance asset expansion or fulfill financial obligations could negatively impact on the Companys financial standing and market reputation.	TPLs strong banking relationships with HDFC Bank, ICICI Bank, Axis Bank, Citi Bank, Kotak Bank, Yes Bank and Federal Bank play a vital role in supporting its financial operations. The Company ensures sound liquidity management to mitigate interest rate risks while maintaining steady cash flows. Its financial strength is further reflected in its A credit rating by CARE, reinforcing its stability and growth potential.
Forex Risk	Fluctuations in foreign exchange rates can affect TPLs financial performance, given its reliance on exports.	While importing raw materials, the Company simultaneously exports finished goods, ensuring a natural hedge and mitigating its exposure to currency fluctuations.

HUMAN RESOURCE

TPLs strength lies in its people, who drive innovation and excellence every day. The Company fosters a culture of collaboration, inclusivity, and continuous learning. Employees across diverse functions-engineering, quality control, administration, and production-play a crucial role in achieving business goals. To support this workforce, TPL has implemented a structured performance management system that motivates employees and ensures that individual contributions align with organizational vision.

Beyond professional growth, Tarsons prioritizes well-being and engagement through initiatives that support work-life balance. The Company invests in technical expertise, leadership training, and continuous skill development to empower its workforce. As of 31st March, 2025, TPL employs 906+ full-time employees across its offices and manufacturing units in India. By nurturing talent, the Company builds a workforce ready to shape the future.

HEALTH, SAFETY AND ENVIRONMENT

TPL upholds a strong commitment to ensuring a safe and secure work environment, embedding safety principles into its core operations. The Company recognizes that a well-protected workforce is fundamental to operational success and business continuity.

To maintain high safety standards, Tarsons meticulously designs and enforces health and safety policies, complemented by regular internal and external safety audits. Continuous performance monitoring further ensures strict adherence to these policies.

Additionally, the Company takes proactive measures to reduce the environmental footprint of its products and processes while fostering ecological balance and biodiversity around its industrial sites. Statutory compliance remains a top priority, with all necessary licenses, approvals, and certifications in place to safeguard its workforce and associated personnel.

To strengthen risk management, TPL ensures that all new employees undergo extensive safety training before commencing production activities. By instilling a safety-first mindset, the Company empowers employees to take responsibility for their well-being and that of their colleagues.

Employee welfare remains a focal point, with medical care provided through insurance coverage under the Employees State Insurance Act of 1948 (ESIS). For employees not covered under ESIS, group health insurance benefits are extended.

Sustainability is seamlessly integrated into TPLs operations, reinforcing efficiency while minimizing environmental impact. By prioritizing employee well-being, workplace safety, and sustainable practices, TPL remains committed to building a responsible and future-ready organization.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Company maintains a strong focus on compliance, ensuring strict adherence to procedures, laws, regulations, and legislative requirements. A structured approach to internal controls strengthens transparency and reinforces operational excellence across all levels.

To uphold efficiency in its complex operations, TPL conducts regular risk assessments, implements mitigation measures, and continuously monitors activities. Independent auditors carry out internal audits, ensuring thorough documentation and reporting, while swiftly escalating any discrepancies to Management and the Audit Committee for timely resolution.

A robust IT infrastructure further enhances compliance by safeguarding data security and streamlining audit processes. Additionally, the Company follows stringent transaction recording and accounting standards to ensure financial integrity.

The Management Information System (MIS) plays a crucial role in real-time reporting, supporting expense control, and promptly addressing variances between actual and budgeted allocations. By effectively utilising technology, TPL enhances operational resilience, efficiency, and regulatory compliance.

CAUTIONARY STATEMENT

Statements in the Management Discussion and Analysis describing the Companys projections, estimates, and expectations may be interpreted as forward-looking statements within the meaning of applicable securities laws and regulations. Actual results could differ from those expressed or implied. I mportant factors that could make a difference to the Companys operations include economic conditions affecting demand/supply, price conditions in the domestic and international markets in which the Company operates, and changes in Government regulations, tax laws, and other statutes. The Company assumes no responsibility to publicly amend, modify, or revise any forward-looking statements based on any subsequent developments, information, or events.