Dear Shareholders,
As I sit down to reflect on our journey over the past year, I am reminded of the
vibrant spectrum of experiences we have encountered together. This year was a year of
applying resilient strategies and expanding opportunities. We diligently pursued key
initiatives to enhance resilience in a demanding industry environment, laying a robust
foundation for sustainable growth. The Company continued to focus on higher speciality
sales, meaningful diversification and growth opportunities in one and other business
verticles.
Our resilience in the face of challenges has not only strengthened us but also
positioned us ahead of the competition. As we present our financial outcomes, CSR
endeavours, and sustainability achievements, we underscore our unwavering commitment to
being a socially responsible and visionary organization, dedicated to forging a brighter
future for everyone.
Industry overview and FY24 in retrospect
Packaging is one of India's fastest-growing sectors. In recent years, it has become a
key driver of technology and innovation, contributing significantly to various
manufacturing industries. These include agriculture, fast-moving consumer goods (FMCG) and
other consumption-driven sectors such as textiles, tape, and pharmaceuticals.
The India Packaging Market size is estimated at USD 84 bn in 2024, and is expected to
reach USD 143 bn by 2029, growing at a CAGR of 11% during the forecast period 2024-2029*.
This surge in demand is propelled by the expansion of consumer markets, especially in
processed food, personal care, & pharmaceutical end- user industries. The packaging
industry is driven by the factors such as rising population, increasing income levels and
changing lifestyles are anticipated to drive consumption across various industries leading
to higher demand for packaging products.
FY24 witnessed the BOPP & BOPET industry contending with excess supply due to the
simultaneous commencement of numerous production lines. Despite burgeoning demand, this
surplus created margin pressures that reverberated throughout the sector. Nonetheless, our
strategic emphasis on speciality films, which comprise over two-thirds of our revenue,
empowered us to withstand these pressures and achieve substantial outperformance relative
to industry benchmarks.
Financial Performance
Navigating through challenges, Cosmo achieved a revenue of Rs. 2587 Crores and EBITDA
of Rs. 251 Crores for the year reflecting speciality films strength. The financials remain
strong with Net Debt/EBITDA at 2.2 times and Net Debt/Equity at 0.4 times. The company's
performance reflects our persistent ability to drive business growth despite arduous
environments.
In the coming years, our priority is sustainable growth in flexible packaging, with
emphasis on advancing our capabilities in speciality films. Our new busienss segments
including Speciality Chemicals, rigid packaging and petcare brand Zigly, will ensure a
robust path forward.
The Board has recommended dividend of Rs. 3/- (30%) per equity share subject to
approval of shareholders.
Research & Development
Our commitment to innovation and research and development (R&D) is ingrained in our
culture and drives our pursuit of excellence. With a dedicated team of over 30
researchers, we proudly lead the way as one of the few packaging companies globally with
such a robust R&D structure. Our relentless focus on R&D enables us to
continuously innovate, staying ahead of industry trends and market demands. Throughout the
year, our R&D endeavours have borne fruit, resulting in the development of several new
and sustainable products that have significantly contributed to our growth and success.
In FY25, we will be launching a sun control film, ‘Cosmo Sunshield'. This
innovative product will blend technology and innovation, redefining window films as a
sustainability-driven and energy-saving solution. In the next two years, we will aim for
organizational growth by increasing our capacity by 50% by expanding Cast Polypropylene
(CPP) and Biaxially Oriented Polypropylene (BOPP) capacities.
The Future
We are embarking on an ambitious growth journey, characterized by a major expansion
plan aimed at enhancing our capacity and capabilities in the flexible packaging business.
With close to 50% capacity addition planned in phases, we are poised for significant
growth and innovation. In FY23, we achieved a milestone with the commissioning of our
specialized BOPET line. Moving forward, we are on track to commission the CPP line and
BOPP line within the next two years, further solidifying our position as a leader in the
industry. These lines will be the world's largest production capacity, coupled with lower
production costs, enabling us to meet the evolving needs of our customers more
efficiently.
Moreover, our investment in the CPP and BOPP lines aligns with our commitment to
sustainability, as these lines will offer a mono-layered structure, reducing environmental
impact and promoting eco-friendly packaging solutions.
Our specialized BOPET line is paving the way for the launch of several new specialty
products, including heat control film, security film, and PET-C film. These innovative
solutions will further differentiate us in the market and meet the diverse needs of our
customers. Furthermore, our strategic diversification into emerging sectors such as
specialty chemicals, rigid packaging and pet care are progressing as planned. These
segments are witnessing robust growth and are poised to contribute significantly to our
long-term value creation.
Moving forward, the Company is also focussing on various cost rationalization
initiatives.
Paying back to the Society
As a socially responsible company, Cosmo First is deeply committed to giving backto the
community and making a positive impact on society. Through our dedicated arm, Cosmo
Foundation, we have embarked on various Corporate Social Responsibility (CSR) initiatives
throughout the year, aligning with our core principles
of Education, Environment, and Empowerment. In our efforts to empower individuals, we
launched the Cosmo Basic English Learning Capsule, an online portal designed to facilitate
Basic English communication skills. English learning classes benefitted 6191 students in
16 rural schools. This year, Cosmo Foundation expanded its foot prints by adding six new
schools, welcoming 1000 more students under its umbrella with a total impact spanning to
13000 rural students from 52 schools and 142 villages. Computer Operation & Digital
Skill Building program is benefitting 8477 students with 25 Computer labs, aligning with
Government program and policies on Digital India. Under Cosmo Fruit Tree Plantation Drive,
the foundation has been fostering agroforestry with 115 farmers across 19 villages in
Gujarat and Maharashtra boasting an impressive 90% survival rate of 40,000 fruit saplings.
Cosmo Foundation has established an Urban Miyawaki Forest at the Army Equestrian Centre
and Aahwan Center in New Delhi by planting 16,000 trees and nurture the same to ensure its
growth. These initiatives exemplify our dedication to creating a sustainable and equitable
future for all.
ESC and Sustainability:
I am proud to affirm our unwavering commitment to sustainability. Our efforts to
enhance product efficiency, reduce harmful emissions and optimize operations and supply
chain efficiency not only benefit the environment but also bolster our business.
In addition to these measures, we have implemented various sustainability initiatives
such as rainwater harvesting, reuse of treated effluent water, utilization of renewable
energy sources and adoption of water-based coatings. These initiatives underscore our
dedication to responsible practices and contribute to our broader sustainability goals.
In conclusion, I would like to express my gratitude to our shareholders, customers,
suppliers and employees for their support and trust in Cosmo First. Despite the challenges
we have faced, our steady focus on operational efficiency and strategic initiatives
ensures we navigate through turbulent times with resilience and determination. As we
continue to adapt to the evolving landscape, we remain optimistic about the future,
leveraging our strengths to overcome challenges and seize opportunities for growth and
innovation. I would like to reinforce that we are committed to the highest standards of
corporate governance, operational excellence and financial discipline for long term
shareholder value creation. I look forward to many milestones that Cosmo aims to conquer
in pursuit of its corporate mission.
Ashok Jaipuria
Chairman & Managing Director.