Advance Multitech Ltd Management Discussions

Your Directors have pleasure in presenting the management discussion and analysis report for the year ended on March 31, 2025.

1. Industry Structure and developments.

Textile Industry:

During the period under the review, the Company had been operating in Manufacturing of Rubber Belts and Conveyor Belts.

The textiles manufacturing business is a pioneer activity in the Indian manufacturing sector and it has a primordial importance in the economic life of the country. Growth in sector depends on consumer spending and there are multiple factors affecting consumer spending like actual and perceived economic condition, disposable income, employment and consumer credit availability. The government has been pushing for indigenous production through Make in India campaign to bring down imports.

2. Opportunities and Threats Opportunities

• Low cost skilled labour

• Presence across the value chain

• Growing domestic market

• Recent government efforts to promote the industry.

Threats

• Effect of historical government policies

• Tech obsolescence. Quality is not consistent

• Delay in delivering the goods at the right time.

3. Segment -wise or product-wise performance:

The Company operates in a single segment of activity viz. textile and hence the segment reporting is not applicable to the Company.

4. Outlook

The global textile industry has witnessed a moderate recovery in FY 2024-25, following volatility caused by inflationary pressures, supply chain disruptions, and geopolitical tensions. Demand from key markets such as the US and Europe stabilized in the latter half of the year, while Asian economies, particularly India, Bangladesh, and Vietnam, continued to show resilience.

Outlook for FY2025-26

With macroeconomic stability improving and demand recovery in major textile markets, the outlook for the coming year remains optimistic. Key focus areas include:

• Strengthening backward integration and automation.

• Increasing presence in value-added segments like technical textiles.

Expanding presence in domestic retail and online channels.• Enhancing ESG compliance and carbon footprint reduction.

5. Risks and Concerns

Raw Material Volatility: Fluctuations in cotton and synthetic fiber prices impacted margins.

Export Dependency: Global trade policies and currency fluctuations pose a risk.

Environmental Regulations: Increasing compliance burden around effluent treatment and emissions.

The company has mitigated risks by entering long-term supply contracts and diversifying its raw material sourcing.

6. Internal Control System and their adequacy

The Company maintains adequate internal control systems, which provides, among other things, reasonable assurance of recording the transactions of its operations in all material respects and of providing protection against significant misuse or loss of companys assets.

Internal Controls are adequately supported by internal audit and periodical review of by the management. The audit committee meets periodically to review with the management and statutory auditors, financial statements. The Audit Committee also meets with the internal auditors to review adequacy /scope of internal audit function, significant findings and follow up thereon and finding of abnormal nature.

7. Discussion on financial performance with respect to operational performance.

Figure for the current year was quite satisfactory. The consolidated revenue for the year is Increased by 23.48% to Rs. 9,68,24,637/- as compared to Rs. 7,84,15,516/- during the last year. The net profit after tax is Rs. 35.51 lacs as compared to last years Loss after tax of Rs. 682.41 lacs.

8. Material developments in human resources/ Industrial Relations front, including number of people employed.

Relations with the employees of the Company at various levels remained harmonial during the year under the review. The Company is making its best efforts to retain and attract talented employees. During the year under the review, the Company has complied with all legislative provisions of labour laws.

The number of employees of the company as of 31^st March, 2025 was 21.a. Basis of related party transaction:

During the year under the review, there were no related party transactions which were outside the purview of the limits.

b. Disclosure of Accounting treatments:

The Company has followed all relevant Indian Accounting Standards while preparing the financial Statements.

c. Board Disclosures - Risk Management:

The Company has developed comprehensive risk management policy and same is reviewed by the Audit Committee, which in turn, informs the Board about the risk assessment and minimization procedures. Major risks identified for the Company by the management are Currency fluctuation, Compliance, Regulatory changes, Manufacturing & Supply, Litigation, Information Technology and new capital investments return. The management is however, of the view that none of the above risks may threaten the existence of the Company as robust Risk mitigation mechanism is put in place to ensure that there is nil or minimum impact on the Company in case any of these risks materialize. Since the risk control frame work is new to Indian Corporate Culture, it is being strengthened on continuous basis using the outside professional help.

d. Proceeds from public issues, right issues, preferential issues etc.:

Not applicable, as no capital has been raised by the Company in last 10 Years.

Besides above, there was no instance of non-compliance of any matter related to the capital markets during the last three years.

NOMINATION AND REMUNERATION POLICY

1. PREAMBLE

Pursuant to the Section 178 of the Companies Act, 2013 (hereinafter refer as "the Act") read with the rule 6 of the Companies (Meeting of the Board and its powers)Rules, 2014 and Regulation 19 of the SEBI(listing Obligations and Disclosures Requirements) Regulations, 2015 signed by the Company with the Stock Exchanges, The Nomination and Remuneration committee of the Board of the Company has formulated a remuneration policy to decide the criteria for the appointment and for the remuneration to the Directors, key managerial personnel and other employees.

2. OBJECTIVE

i. To guide the Board in relation to appointment and removal of Directors, Key Managerial Personnel and Senior Management

ii. To evaluate the performance of the members of the Board and provide necessary report to the Board for further evaluation of the Board

iii. To recommend to the Board on Remuneration payable to the Directors, Key Managerial Personnel and Senior Management.

iv. To provide to Key Managerial Personnel and Senior Management reward linked directly to their effort, performance, dedication and achievement relating to the Companys operations

v. To retain, motivate and promote talent and to ensure long term sustainability of talented managerial persons and create competitive advantage.

vi. To devise a policy on Board diversity.

vii. To develop a succession plan for the Board and to regularly review the plan

3. Constitution of Nomination and Remuneration Committee:

The Board has constituted the "Nomination and Remuneration Committee" of the Board which is in line with the requirement under the Companies Act, 2013.

The Board has authority to reconstitute this Committee from time to time.

The Committee shall, while formulating the policy ensure that:

• the level and composition of remuneration is reasonable and sufficient to attract, retain and motivate the Whole time Directors, Key Managerial personnel and Senior executives of the quality required to run the Company efficiently;

• relationship of remuneration to performance is clear and meets appropriate performance benchmarks; and

• Remuneration to Whole time Directors, Key Managerial Personnel and senior management involves a balance between fixed and variables pay reflecting short and

long term performance objectives appropriate to the working of the company and its goals.The meeting of the Committee shall be held at such regular intervals as may be required.

Necessary disclosures of this policy shall be made in the Annual Report of the Company in terms of Section 178 of the Companies Act, 2013 and Regulation 19 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

4. Criteria for board membership and board diversity

a) The Director must have relevant experience in Finance /Law /Management/ Sales/ Marketing/ Administration/ Corporate Governance/ Human Resources or the other disciplines related to Companys business.

b) The Director should possess the highest personal and professional ethics, integrity and values

c) The Director shall not have any material interest with the Company or any of its officers, other than as a director or shareholder of the Company. Wherever required the Director should disclose the nature of his interest, if there are reasons to believe there is or a likely hood of potential conflict of interest.

5. Remuneration Criteria:

The Policy is largely based on industry benchmarks, the Companys performance vis-a-vis the industry, peer group comparison, factors like inflation rate in the country and performance of the employees.

a) For the Whole Time Directors/ Executive Directors:

• Nomination and Remuneration Committee shall recommend to the Board, the remuneration, within the maximum limits as set under the Companies Act, 2013, and Rules made there under and subject to the approval of the shareholders as and where applicable.

• Remuneration to whole time director/Executive Director would also depend on the performance and profitability of the company during the year as decided by Nomination and Remuneration committee from time to time.

However, no remuneration or any other payments are made to any directors of the company and hence company does not require to have criteria for the same.

b) For the Key Managerial Personnel and Other Employees:

• The remuneration of other KMP and other employees largely consists of basic salary, perquisites, and allowances (both fixed and variable). Perquisites are paid according to the Company policy.

• The components of the total remuneration vary for different grades and are governed by the industry pattern, qualification & experience/merits, performance of each employee. The Company while deciding the remuneration package takes into consideration current employment scenario.

6. Policy Review & Future Amendment

This policy shall remain in force unless modified by the Remuneration committee.