Agribio Spirits Ltd Management Discussions

> ECONOMIC OVERVIEW

The global economy remained resilient during FY 2025-26 despite geopolitical uncertainties, evolving trade policies and fluctuations in commodity prices. Against this backdrop, the Indian economy continued to demonstrate strong resilience, supported by robust domestic demand, investment and infrastructure development.

India continued to strengthen its position as a major global economy, with growth supported by the services, manufacturing an d infrastructure sectors. Inflationary pressures moderated during the year, while the Government and the Reserve Bank of India continued to take appropriate fiscal, monetary and regulatory measures to support sustainable economic growth and maintain financial stability.

Overall, Indias strong domestic market, improving infrastructure and increasing integration with the global economy provide a favourable foundation for sustained economic growth.

> INDUSTRY STRUCTURE AND DEVELOPMENT

The Indian jute industry continues to play an important role in the economy by providing employment, particularly in rural and semi-urban areas. India remains one of the leading producers of raw jute and jute products, with West Bengal being the major producing and manufacturing region.

During FY 2025-26, the industry operated amid challenges relating to raw material availability, input costs and market demand. The Government continued to support the sector, with the Minimum Support Price (MSP) for raw jute (TD-3 grade) fixed at Rs.5,650 per quintal for the 2025-26 season, supporting farmers and providing stability to the raw jute market.

The industry is also witnessing increasing opportunities in diversified and eco-friendly jute products such as shopping bags, mats, carpets, handicrafts and geo-textiles. Growing environmental awareness and the shift towards sustainable alternatives to plastic are expected to support the long-term growth prospects of the jute industry.

> OPPORTUNITIES AND THREATS/ RISKS & CONCERNS

? Opportunities

In view of rising concern for environment and global warming, jute products are getting preference over other substitutes. Demand for diversified jute goods is increasing due to its functional value and increasing awareness for use of biodegradable products.

There may be opportunities for export of jute products at attractive prices, which in turn may result in an increase in demand for raw jute.

? Risks & Concerns / Threats

Due to low production, the price of raw jute generally prevails over the MSP determined by the Government as a result it is becoming difficult for your corporation to procure raw jute under MSP.

It is also risky to procure raw jute at ruling price for commercial operation.

There are various threats to the Company such as the market Competitors, which indulge in cost cutting of the product, which forces the Company to sell its product as low cost. This also led to loss to the Company. On the other hand, Companys raw material is based on agro product which is affected by calamities, which deteriorate the quality of the product, which is the major threat to the Company.

> SEGMENT-WISE OR PRODUCT-WISE PERFORMANCE

The Company is operating in the single segment; Therefore, segment wise information has not been disclosed.

> OUTLOOK

The jute industry is expected to benefit from continued government support through MSP and compulsory packaging regulations, alongside rising global preference for sustainable and biodegradable products. While supply-side challenges and competition from synthetic substitutes remain, the focus on product diversification, modernization, and export opportunities is likely to drive steady growth in the coming years.

> INTERNAL CONTROL SYSTEM AND THEIR ADEQUACY

The Company has adequate internal control system to safeguard the companys assets from any loss or damage, to control cost, prevent revenue loss and required financial and accounting controls and to effectively implement the applicable accounting standards.

> MATERIAL DEVELOPMENT IN HUMAN RESOURCES/ INDUSRIAL RELATIONS FRONT

Your Company maintained good industrial relation during the year under review. We believe that the people are the most valuable assets of the company as they contribute significantly to the achievement of business objectives. During the year, various HR measure were taken to make the HR policies up to the required business needs. The Company has strong dedicated term of employees and they have shown commitments, competence and dedication in all area of business.

> DETAILS OF SEGNIFICANT CHANGES IN KEY FINANCIAL RATIO

In accordance with the SEBI (Listing Obligations and Disclosures Requirements) Regulations, 2015, the Company is required to give details of significant changes (change of 25% or more as compared to immediately previous financial year) in key sector-specific financial ratios. During the year the Company maintain the specific ratios as follows:

During FY 2025-26, the Current Ratio decreased from 15.83 to 4.32, primarily reflecting changes in the composition of current assets and current liabilities. The Debt-Equity Ratio increased from 0.03 to 0.17, indicating an increase in the Companys debt relative to its equity. The Debt Service Coverage Ratio decreased from 4.26 to 1.70, reflecting a reduction in the Companys debt servicing capacity compared with the previous year. On the positive side, Return on Equity increased from 35.96% to 41.88%, while Return on Capital Employed improved from 16.49% to 19.70%, indicating better returns and improved utilisation of capital during the year.

> CAUTIONARY STATEMENT

Statements in this Report describing the Companys objectives, projections, estimates, expectations, or predictions may be "f orward- looking statements" within the meaning of applicable laws and regulations. Actual results could differ materially from those expressed or implied due to risks, uncertainties, and external factors such as government policies, economic developments, demand -supply conditions, raw material availability, market prices, and other incidental factors. The Company assumes no responsibility to publicly amend, modify, or revise any forward-looking statements based on subsequent developments, information, or events.