Aegis Logistics Ltd Management Discussions

Introduction

Aegis Logistics Limited and its subsidiaries (the Aegis Group or the Group) have continually evolved to meet changing market and environmental conditions since 1956. The world is undergoing a sustainability challenge manifesting in many forms-among them climate change, shifting geopolitical dynamics, and their impact on global supply networks. India, which has now surpassed China as the worlds most populous country, can no longer be immune to such challenges and in fact, has made international commitments to reduce its carbon emissions to net zero by 2070. This presents both a defining challenge and a significant opportunity. The Group is playing an active role in this transition. In this context, we commit ourselves to supporting Indias transition to a more sustainable future. We store and distribute liquids and gases across India in a safe and sustainable manner with a dedicated focus on environmental impact.

Project GATI (Gateway Access to India)

To systematically capture emerging opportunities, the Aegis Group operates under its unified strategic initiative: Project GATI (Gateway Access to India) to invest in the storage solutions and infrastructure required to address the markets evolving demands. Our focus remains on developing a network of terminals along Indias coastline and robust distribution facilities, strengthening our ability to serve customers efficiently.

FY 2025-26 Highlights

Equity and Debt Listing of Material Subsidiary

Marking a pivotal milestone during the period under review, the Companys material subsidiary, Aegis Vopak Terminals Limited (AVTL), completed its listing on both BSE Limited and the National Stock Exchange of India Limited (NSE), effective June 02, 2025. AVTL subsequently raised debt capital via the private placement mechanism and listed its Non-convertible Debentures under Debt Segment of the National Stock Exchange of India Limited.

Terminalling

Our joint venture with Royal Vopak, Aegis Vopak Terminals Ltd. (AVTL), continues to grow in scale and capability. The combined reputation and quality of Aegis and Vopak have driven consolidation in the third-party logistics sector. An example is the various acquisitions and additions over the decades, making Aegis the most prominent tank terminal service provider in several of the major ports of India. Significant capacity milestones during the period under review include new capacity addition of 61,000 kiloliters of liquid storage at Pirpau, Mumbai Port effective September 2025. We have successfully commissioned Liquefied Petroleum Gas (LPG) terminals at Mangalore and Pipavav with an aggregate storage capacity of 130,000 MT. At Jawaharlal Nehru Port Authority (JNPA) we have successfully commissioned a liquid terminal with a storage capacity of 101,900 cbm, with further capacities under construction for liquid and Liquefied Petroleum Gas (LPG) storage and an LPG bottling plant.

Furthermore, Indias first independent Ammonia Terminal , featuring a static storage capacity of 36,000 metric tons is progressing well and is expected to be commissioned in H1 FY 2026-27.

Integrated LPG Supply Chain Well Positioned to Serve Sustainable Energy Demands

Aegis is a fully integrated participant in the Indian LPG market, comprised of four main segments: domestic cooking gas, industrial, commercial, and transportation. While LPG is not a renewable energy source, it is a much cleaner fuel than biomass, coal, or kerosene.

Its portability and convenience make it an ideal fuel to help India transition to a more sustainable energy future. In addition to the demand from the domestic segment, the industrial use of LPG substituting dirty fuels has been boosted with the commissioning of the New Mangalore and Pipavav

LPG Terminals . The continuing rise in our distribution volumes to 754,000 MT in 2025-26 from 160,000 MT in 2021-22 reflected this, including those distributed in industrial-scale cylinders. The gas terminalling business continues to grow as a result of increasing LPG demand in the country and addition of storage capacity at new and existing port locations. Throughput volumes of LPG have increased substantially to 5.2 MMT (million metric tonnes) in 2025-26 from 2.9 MMT in 2021-22.

FY 2025-26 Financial Performance

Reflecting strong operating leverage and enhanced asset utilization levels across all key port terminals, the Group recorded strong profit growth during the financial year.

With the rapid increase in LPG distribution volumes and liquid tankage capacity, the operational profit of the Group increased to Rs. 1,560.33 crores as compared to Rs. 1,120.21 crore in the previous year. Furthermore, the EBITDA split between LPG and Liquids is reflected in the image:

Divisional Performance Review

Liquid Logistics Division

Liquid terminalling revenues stood at Rs. 643.91 crores in FY 2025-26 as compared to Rs. 649.77 crores the previous year and EBITDA of the division was at Rs. 472.35 crores compared to Rs. 498.33 crores in the previous year. The steady financial performance is primarily due to better capacity utilization at our key hubs in Mangalore, Kandla, Mumbai, Kochi, and Haldia. Future growth in this division will be supported by ongoing capacity expansions at Kandla, Mumbai and JNPA, partial commissioning at the newly developed facility at JNPA, and an optimized product mix handled across all operational terminals. The Mumbai terminals continue to function at full capacity.

Gas Division

Aegis Group captures the complete logistics value chain from sourcing and terminalling to the national distribution of LPG. In FY 2025-26, the gas division recorded total revenues of Rs. 7,689.29 crores as compared to Rs. 6,114.03 crores in the previous year, representing an increase of 25.76%. This strong performance was driven by the highest-ever volumes in both the logistics / throughput and distribution sub-segments.

The EBITDA for the Gas division increased by 68.79% to Rs. 1,126.59 crores as compared to Rs. 667.45 crores in the previous year, mainly due to higher terminalling volumes. Distribution of LPG and Propane through all channels in packed cylinders and bulk continues to be a focus area. This steady growth signals an increasing demand for LPG, and our integrated logistics services make Aegis Group uniquely positioned to both capture market share and achieve our vision of a more sustainable future.

New Developments

At Mumbai port, the Company has been allocated additional plots admeasuring an aggregate of ~19,000 m 2 and it is in the process of construction of Liquid Tank Terminals for further expansion of Liquid storage capacity. Once complete, these tanks would cater to additional liquid storage requirements of customers and also ease the load on the existing liquid storage facilities at Mumbai, which are currently at full utilisation.

New Capacity addition of 61,000 kiloliters of liquid storage at Pirpau, Mumbai Port which will enable the Company to meet both current and future demands from existing as well as new customers and also ease the load on the existing liquid storage facilities of the Company at Mumbai. The capacity addition will also reinforce operational resilience and enhance our competitive positioning.

At JNPA, construction and development of the landmark greenfield terminal (The J2 Project) on 30 acres of allocated land is progressing on schedule. This multi-asset infrastructure development involves 318,100 cubic meters of new liquid product storage, 77,286 metric tons of cryogenic LPG capacity, and a specialized LPG Bottling Plant with a processing capacity of 35,000 MT per annum. Phase-I liquid storage capacity is expected to be commissioned in H1 FY27.

At Pipavav Port, the Group commissioned a cryogenic LPG terminal with a static storage capacity of 48,000 MT in July 2025.

At the same port, construction of Indias first independent Ammonia Terminal with a static storage capacity of 36,000 MT is progressing well and is expected to be commissioned in H1 FY 2026-27.

At New Mangalore Port, the Group successfully commissioned its cryogenic LPG terminal for the storage and terminalling of Liquefied Petroleum Gas (LPG) with static storage capacity of 82,000 MT in June 2025. To maximize the efficiency of this terminal, construction of LPG Rail Loading Infrastructure and a downstream Bottling Plant are currently underway.

At Kandla Port, the Group has been allotted a plot for construction and development of liquid terminal with a storage capacity of 94,148 cubic meter. This is expected to enhance the Groups presence and strengthen its storage infrastructure at the location, where it already has significant existing capacities.

At Haldia Port, the Group made its debut in the East Coast logistics market via HALPG, adding 25,000 MT of LPG storage capacity at Haldia.

Summary & Financial Key Ratio Analysis

With its strong market position, phase-wise capacity deployment, improved product mixes, and structural scaling in high-margin Gas Distribution, the Group is exceptionally well-positioned for continuous growth in FY 2026-27. The significant changes in the financial ratios of the Group, which are more than 25% as compared to the previous year on a consolidated basis, are summarised as follows:

Ratio	Consolidated		Change (%)	Reason for change
	FY 2025-26	FY 2024-25
Debtors Turnover Ratio	14.19	11.21	27%	Higher LPG throughput volumes drove significant sales growth, while improved collection efforts and faster receivables conversion kept the year-end debtors balance broadly flat, resulting in a higher turnover ratio.
Interest Coverage Ratio	10.83	6.98	55%	Interest expenses fell following debt repayment funded by equity issuance in a subsidiary, while earnings grew on the back of higher LPG throughput volumes.
Current Ratio (%)	170.66%	320.64%	-47%	The decrease in the Current Ratio is primarily due to an increase in current borrowings arising from the classification of Non-Convertible Debentures (NCDs) as current maturities of long-term borrowings, in accordance with the terms of borrowing.
Return on Net Worth (%)	16.81%	15.56%	8%	Improved profitability driven by higher LPG throughput and distribution volumes.
Debt to Equity Ratio	0.04	0.41	-90%	The decrease in the Debt-to-Equity Ratio is primarily due to a reduction in non-current borrowings following the repayment of debt from the proceeds of equity share issuance by a subsidiary.
Net debt to Equity Ratio	(0.40)	(0.05)	700%	The negative net debt-to-equity ratio is primarily due to a reduction in borrowings following the repayment of debt from the proceeds of equity share issuance by a subsidiary.

Statutory & Operational Disclosures

Internal Control Systems and Adequacy

The Company has a robust internal control framework designed to safeguard its assets, prevent losses arising from unauthorized use or disposition, and ensure that all transactions are properly authorized, accurately recorded, and reported in a timely manner. The Company conducts audits of various departments based on an annual audit plan through an independent internal auditor and reports significant observations along with Action Taken Reports to the Audit Committee from time to time. The Company also considers the observations and recommendations of the statutory auditors in evaluating and strengthening the adequacy and effectiveness of its internal control systems.

The Company periodically reviews and updates its risk management policy to identify, assess, and mitigate potential risks, thereby safeguarding its assets, financial performance, and employees from potential losses, operational disruptions, and legal liabilities.

Occupational Health, Safety, and Environment (OHSE)

The Company holds ISO 9001:2015, ISO 14001:2015, and ISO 45001:2018 certifications, ensuring full compliance with quality, environmental, and safety standards. It remains committed to safeguarding the health of its workforce, protecting the environment, minimising risks, and supporting sustainable growth. The Regular monthly reviews are conducted across all sites to ensure compliance with OHSE standards. The organisation emphasises maintaining a safe working environment at terminals and jetties. Key safety practices include conducting Management of Change (MOC) processes and HAZOP studies prior to any modification, along with active departmental and central safety committees. Continuous improvement is encouraged through suggestion schemes, safety inspections, and awareness campaigns to integrate safety into every activity. Employees are trained in safe operating procedures, technical skills, first aid, and firefighting.

To ensure preparedness, employees regularly participate in emergency response training and mock drills. Safety awareness initiatives-such as slogan competitions, poster campaigns, and hazard identification activities-are conducted for employees, contract workers, and transporters.

Periodic internal audits are carried out to identify and address gaps, strengthening overall safety and compliance. To control VOC emissions, the Company has implemented measures such as:

Internal Floating Roofs on closed-roof tanks

Vapour absorption chillers at loading points

Bottom-loading facilities for all VOC products

Safety enhancements also include the installation of retractable wire rope fall arrestor systems at liquid filling bays in Mahul-1 and Mahul-2, ensuring a safer working environment.

The Company follows a zero-spillage policy across all terminals, supported by ongoing hardware improvements to reduce VOC emissions. Environmental initiatives include the implementation of an e-gate pass system to reduce paper usage, elimination of plastic water bottles, and replacement of MH lights with energy-efficient LED lighting.

To ensure operational redundancy and continuity, additional blowers have been installed at the NPPT filling bay.

Training programs are conducted in accordance with OISD-154 to build awareness of job-related hazards, embed safe and standardised work practices, and ensure prompt responses during emergencies.

Human Resources Development

Aegis Group employs over 1,143 people. As the Company continues to grow rapidly, it remains committed to developing the capabilities of young managers and strengthening its middle management team in key functional areas to support and sustain the businesss future growth plans.

Risks and Concerns

Delays in renewing licenses and permits consume time and resources that could be deployed more productively. Project timelines could be extended due to the lengthy and complex process of securing environmental permits.

Corporate Social Responsibility (CSR)

Aegis Group contributes directly to eligible Corporate Social Responsibility (CSR) projects and supports the ANaRDe Foundation, a government-accredited NGO. Through this Foundation, the Group works actively in rural development and poverty alleviation, primarily in Gujarat and Maharashtra.

The Foundation has been engaged in a focused initiative for the benefit of rural communities in India, including afforestation, sanitation, water resource management, and financial inclusion.

Forward-Looking Statements

This report contains forward-looking statements based on certain assumptions and expectations of future events. The Company cannot guarantee that these assumptions and expectations are accurate or will be realized. The Companys actual results, performance, or achievements could thus differ materially from those projected in any such forward-looking statements. The Company assumes no responsibility to publicly amend, modify or revise any forward-looking statements, on the basis of subsequent developments, information, or events.