Transforming India's flexible packaging industry
Dear Stakeholders,
I am delighted to be addressing you all as the Managing Director of Huhtamaki India
Limited and with your support, I am confident that we will take this Company to great
heights of success.
In FY2022, we made strategic progress toward our ambition of helping brands enhance
their impressions through reliable, responsible, sustainable and innovative packagi ng
solutions. Although uncertainties remain due to the dynamic macroeconomic environment and
the lingering effects of the pandemic, we continued to strengthen our balance sheet during
the year and establish benchmarks in flexible packaging and labelling solutions.
Revenue from operations increased by 13.6% to Rs. 29,829 million during the year and
registered a CAGR of 6% over the last 5 years. In spite of flat volumes, the Company has
been able to realise value for its product offering which was partly offset by a steep
increase in raw material prices during the year.
EBITDA (before exceptional items) stood at Rs. 1,742.6 million in 2022 against Rs.
1,184 million in 2021, representing a 47.2% increase.
Profit after Tax (PAT) stood at Rs. 496.4 million in 2022 as against a loss of Rs.
226.9 million in 2021.
The industry faced its share of turmoil during the year. As the demand for affordable,
safe and hygienic packaging increased, so did the challenges of lengthening supply chains,
rising product-to-paper packaging ratio, an unprecedented rise in the price and hindered
supply of our raw materials. Proactive planning and value engineering ensured our
continued competitiveness, despite the cumulative rise i n costs across our supply chain.
Our Company continues to leverage the expertise, knowledge and resources of Huhtamaki
Oyj in terms of, inter-alia, the strong brand reputation of Huhtamaki in the market,
access to a wide range of resources such as technology, financial capital, human
resources, network of suppliers/customers, wealth of knowledge and expertise in the
flexible packaging industry, which have helped Huhtamaki India further improve its
performance.
On a steady path toward our goal
We are at the forefront of transforming the packaging industry in India and have been
actively working on sustainable solutions that are both eco-friendly and cost-effective.
During the year, we continued to focus on developing fully recyclable mono-material
structures for flexible packaging under our blueloop™ brand. This is our
enterprise-wide brand which comprises a range of sustainable packaging solutions and
technologies and we are making strategic investments in our manufacturing capabilities to
deliver game-changing innovation. We have also made investments in digital printing
technology that enables us to offer personalised packaging solutions with minimal waste.
Furthermore, we implemented recycling programmes for used packaging materials, which
help in reducing the overall environmental impact of packaging. Our commitment to
sustainability and innovation has stood us in good stead as a pioneer in the Indian
packaging industry.
Taking a progressive stance, with a focus on sustainability
Our aim is to consistently provide our customers with dependable, responsible and
cutting-edge packaging options. Equally, we work closely with our partners to mitigate and
eliminate the negative impacts of packaging on the environment.
One of the initiatives undertaken by Huhtamaki India was to sponsor a trust (Huhtamaki
Foundation) to recycle post-consumer multi-layered plastic waste that is difficult to
recycle and would otherwise end up in landfills. The Foundation has been working to
collect post-consumer waste from nearby cities like Pune and recycle it into either
value-added products or granules that can be used as a substitute for virgin plastic. This
step is part of Huhtamaki Foundation's #CloseTheLoop initiative to tackle post-consumer
waste to deliver valuable secondary resource material.
To reduce our scope 1 emission, we shifted the operations of our Rudrapur factory from
furnace oil to piped natural gas for heating of thermic oil, resulting in 75% lesser
emissions and higher efficiency. As a result of switching to biomass fuel at Sricity, we
were able to shift to 9.8% renewable energy for our primary energy needs. We reduced our
absolute scope 1 GHG emissions by 8.9 % this year and this project contributed towards
achieving this.
Sustainability is a fundamental aspect of our strategy and daily operations.
We strive to conduct business in a financially, environmentally, and socially
responsible manner.
With ethics and integrity
As a leader, integrity is my foremost priority. We must run our business in a
transparent and honest manner and be accountable for our actions toward all our
stakeholders. We have a robust corporate governance framework in place that inspires trust
among everyone associated with us, thus enabling us to build a sustainable brand for
tomorrow. We are also consistently improving our processes by implementing best-in-class
standards and practices that guide our actions.
Focusing on the future
The Indian packaging industry is predicted to experience significant growth in the near
future due to increased demand for packaged food and non-food items due to population
growth, rising income levels, expansion of organised retail and rise in e-commerce.
Moreover, with rising environmental awareness, the need for sustainable packaging is now
crucial. We are, thus, committed to meeting the increasing demands of consumers and making
positive changes to become the first choice in sustainable packaging.
Our key focus areas in the coming years
• Our financial and non-financial performance, especially considering the
continued impact on the market and supply chains due to geopolitical and other
macroeconomic conditions
• A strong balance sheet
• Portfolio optimisation and expansion with cutting-edge sustainable packaging
solutions
• Compliance and ethical conduct
• People - their safety and skill upgradation
• Long-term sustainability
As I take on the reins as the Managing Director of Huhtamaki India, I would like to
thank the whole team for your support and hard work - it is a pleasure to see the passion
and commitment you bring. Finally, everything that we do is for our customers - thank you
for challenging us to go beyond each time. I would also like to take this oppurtunity to
express my gratitude to our bankers, government authorities, all our business partners and
shareholders for their support and confidence in us.
With the continued oversight of the Board, I am confident that Huhtamaki India will
scale new heights and generate unparalleled value for all its stakeholders.
Best wishes,
Dhananjay Salunkhe
Chairman.