Navigating Challenges,
Building for the Future
AS WE REFLECT ON THE YEAR GONE BY, I AM PLEASED TO SHARE WITH YOU THE PROGRESS,
CHALLENGES, AND STRATEGIC INITIATIVES THAT HAVE SHAPED PIL ITALICA LIFESTYLE'S JOURNEY IN
THE LAST FINANCIAL YEAR. DESPITE FACING HEADWINDS IN THE EXTERNAL ENVIRONMENT, WE HAVE
REMAINED STEADFAST IN OUR COMMITMENT TO LONG-TERM GROWTH AND VALUE CREATION.
MACROECONOMIC CONTEXT AND PERFORMANCE REVIEW
FY25 has been a subdued period from a macroeconomic perspective, especially for the
consumer market in India.
The demand scenario has not been conducive over the last couple of quarters, influenced
hitting the pockets of consumers, tepid income growth, and consequently lower disposable
income for lifestyle products. Headline inflation numbers reflect the challenging
environment that has affected consumer spending patterns.
These macro factors have weighed on our performance for FY25, reflecting in topline
growth moderation during the period under review. Revenue for FY25 reached 100.83 crore,
reflecting a year-on-year increase of 4%. Meanwhile, EBITDA margins improved from 8.4% in
FY24 to 10.0% inFY25,contributingtoariseinNetProfit crore in FY24 to 5.24 crore in FY25.
Despite these short-term challenges, I am confident that our Company has demonstrated
operational resilience and remains committed to investing in future growth.
Unwavered by the immediate macro challenges, PIL Italica has continued to build on its
long-term strategic initiatives that will position us for sustainable growth in the years
ahead.
STRENGTHENING PORTFOLIO
To begin with, the Company has been working towards strengthening its portfolio through
new product launches.
More emphasis is on launches of value-added products that enable better margins.
We have stepped up launches in our Wedding Chairs collection, Kids World collection
with new models, as well as unique launches such as our Phoenix Folding Chair - which is
India's first fully plastic made folding chair follow our previous innovations such as
Ventilation chairs, Spine Care series, and Luxury series.
Investments are planned to increase the library of moulds & dyes at our
manufacturing sites, which will allow for a broader product portfolio. This aligns with
our strategy to shift towards more value-added products, which will drive better
realizations and aid our margin growth, as alluded to earlier.
CAPITAL EXPENDITURE
Recognizing the need for further investments in our facility, we have also announced a
capital outlay of 25 Crore for our Silvassa facility. This investment demonstrates our
commitment to growth even in challenging times.
It will involve investments into a new injection moulding lines equipped with the
latest technology, as well as investments into new moulds and dyes to enhance the
production capacity as well as capabilities of this site in terms of a broader product
portfolio. Overall, we expect an increase in production capacity to the tune of 1,600 MTPA
from these initiatives. This expansion will be implemented in a phased manner by March
2026.
Once the expansion is completed, our total production capacity will rise from 8,450
MTPA to 10,050 MTPA, reinforcing our commitment to meeting the evolving needs of our
factorssuchascustomers. This expansion will also bolster our capacity to cater well to the
Western markets, where we have historically maintained a strong presence.
STEPPING UP BRAND VISIBILITY
To make the most of our expanding manufacturing capacity, we will be investing further
in our marketing initiatives and distribution channels to enable the reach of our products
across the country.
To increase brand awareness for Italica, we have stepped up our spending for
initiatives such as newspaper advertisements during the festive seasons in regional
papers. We have also launched campaigns such as 'Store on Wheels' where we operated small
commercial vehicles with product samples & demonstrations in new markets such as
Eastern India.
We also launched an 'Arch Gate' campaign during Diwali & Durga Puja in Northern and
Eastern parts of India with arch gates installed at dealer shops & stores, coupled
with other dealer branding initiatives.
At the same time, we have been participating in exhibitions & trade fairs in
Lucknow, Prayagraj, Chennai, Gandhinagar, Goa, Noida, Jhunjhunu among other markets to
showcase our latest innovations, connect with industry stakeholders, and explore new
business opportunities.
Lastly, we have bolstered our digital marketing & digital footprint of the Italica
brand. Be it through running meticulous social media campaigns, or through new initiatives
such as Brand Promotion & Advertisement during the IPL on Jio Cinema Application.
These efforts have not only increased our online engagement but also strengthened our
brand recognition across various platforms.
NEW GEOGRAPHIES
As I have detailed in my earlier letters, over the last couple of years, PIL Italica
has been emphasizing more on geographical expansion with the ultimate objective of
establishing a Pan-India presence.
In recent years, we have stepped up our focus on markets in Northern, Eastern and
Southern India, expanding beyond our stronghold in the Western markets. We have made
significant progress in opening up new markets, appointing dealers & distributors in
said markets, and strengthening our foothold across different regions. We have also
appointed dedicated teams & fleet-on-street to enable on-ground visibility of our
brand.
To ensure our products reach markets on time, and to cater to the growing needs of the
market, we have established fulfillment centers in these regions, ensuring timely supply
of products to the distribution channel. As of FY25, we had 11 fulfillment centers serving
customers across various states and union territories.
We also have plans to bolster our manufacturing & distribution infrastructure in
the future through new manufacturing as well as fulfillment locations, as and when the
external environment becomes more conducive, and we get back on the growth track.
LOOKING AHEAD
As we begin a new year, we are hopeful of a more conducive external environment,
enabling us to see the early results of our strategic objectives. We maintain our optimism
about improving macro conditions.
Our focus remains unwavering on delivering exceptional products, fostering innovation
in all aspects of our operations, and creating value for our stakeholders. We belive that
our strategic initiatives in product innovation, capacity expansion, and market
penetration will position us well to capitalize on opportunities as the market recovers.
On behalf of the entire PIL Italica team, I extend my sincere gratitude to our
shareholders for their unwavering support and trust. Together, we will continue to scale
new heights and create a lasting legacy in the industry.
Yours sincerely,
Daud Ali
Managing Director