Rushil Decor Ltd

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Dear Shareholders,

I extend my warm greetings to all the stakeholders, associates and the entire community associated with Rushil Dcor Limited. I am glad for this opportunity to share our Company's business progress, achievements, and progressive outlook with you all. But before I proceed, I sincerely hope you and your dear ones are safe and urge you to continue taking good care and be cautious in these uncertain times.

The Year that was

The year 2020 saw Indian industries and their counterparts worldwide reeling under the impact of the Covid-19 pandemic. This never-seen-before health crisis and the toll it took in the form of the first and second waves on India's economic zeal and social spirit has been monumental.

With the Government and society's unrelenting safety measures, the number of cases has gradually subsided. The economy is slowly yet

firmly inching back towards normal, and so are different industries across various sectors.

I am happy to state that we have reopened our business while ensuring the highest possible safety measures and precautions for all our employees and business associates. In the year ended 31st March 2021, we registered a revenue of 339.77 Cr., with EBITDA and PAT at 39.29 Cr. and

13.72 Cr., respectively.

Despite such turbulent market conditions, we were able to maintain the previous year's topline. Operating margins were impacted due to the continued expenses incurred even during the various lockdowns. However, we drew upon our advantage to maintain our market shares across all our brands. In fact, our Q4 2020-21's performance is a good indication of our recovery in terms of revenue and operating profit, vis--vis the Q4 of 2019-20.

On the Path of Growth

The onset of Covid-19 did not augur well with the Indian economy, especially in the first couple of quarters of 2020-21. However, the economy showed grit and resilience and is back on its course of growth and expansion. According to the latest report by Asian Development Bank, India's GDP is estimated to grow @10% for the financial year 2021-22; having contracted by 7.3% during the fiscal year 2020-21.

(Source: https://scroll.in/latest/1000624/ indias-economic-growth-forecast-lowered-to-10-for-2021-22-says-asian-development-bank).

As far as the Wood Panel and Decorative Laminates industry are concerned, we are safely positioned to capture a large share of the growing market with our flagship brands – VIR Laminate, VIR MDF, and VIR PVC.

We identify steady growth of the commercial and housing real estate sector as our principal growth driver. Due to rising safety awareness amongst general masses and large-scale vaccination drives conducted by the Government of India, both commercial and housing real estate segments have been abuzz with construction activity. The insistence of the Government of India in providing housing for all has also been a major boost. The rising income of the urban households has translated into rising demand for well-furnished living and workspaces with high aesthetic appeal.

This has led to the demand for trendy, ready-to-assemble (RTA) furniture that is pocket friendly, durable and eye-catching. The furniture industry has traditionally relied on Plywood for its manufacturing requirements. However,

Plywood is being gradually replaced by the medium density fibreboard (MDF) that is equally durable, highly affordable and environmentally sensitive.

At RDL, we strongly believe that MDF is a futuristic product. Speaking from the growth trends demonstrated by the MDF segment, it can be safely assumed that the MDF will take over a large part of Plywood segment in the coming decade.

Laminates and MDFs were the second and third highest revenue grosser after Plywood in the wood furniture market in India in 2020. Currently, the MDF segment has reported a CAGR of about 15% per annum (p.a.) and is soon anticipated to increase to 20%. The market size of MDF in India is Rs.18 Billion. India imports 2.4 lac cubic meters of MDF every year. With our Andhra Pradesh (AP )plant soon reaching its optimum capacity, we expect Rs.350 Cr. of annualized turnover in the MDF segment only.

The market size of laminate segment in India is Rs.50 Billion and presents an opportunity of a 10% CAGR every year. According to the Department of Commerce and Industry, Indian imports under the segment, during the year 2020-21, were to the tune of

Rs.541.03 lacs.

PVC market in India, presently worth

Rs.10 Billion, is estimated to expand at 10% CAGR. We are expanding our dealership network across the nation to increase our market presence in these segments, too. Thus, being well-heeled amongst the industry leaders in decorative laminates and MDF, RDL can proudly identify with its motto of growth and excellence.

Being in harmony with the community

We, as a Company, believe in maintaining a sustainable work environment and deeply care for the community and environment in which we operate. Corporate social responsibility (CSR) has been a core part of our value system ever since our Company's emergence. Our goal is to aid significant socio-economic development. The vital areas of CSR activities for us have been education, health and well-being projects and eradication of hunger and poverty.

Our overall strategy is based on the principles of organic growth, operational improvement, strong financial position, and innovative products. Our focus is on penetrating the existing markets further through multiple channels. Different segments and the multitude of channels have played a crucial role in targeting a large market share in South India.

In the end

I want to thank the entire team of RDL for their untiring efforts, hard work and dedication. I would also sincerely like to thank all the stakeholders for their undeterred support and faith in our Company. This trust is what motivates us to achieve newer heights and grow consistently.

Take care and stay safe!

Warm Regards,

Krupesh Thakkar