Ajooni Biotech Ltd Management Discussions.

A. CAUTIONARY STATEMENT:

The statements in the "Management Discussion and Analysis Report" describe the Companys objectives, projections, expectations, estimates or forecasts which may be "forward-looking statements" within the meaning of the applicable laws and regulations. Actual results may differ substantially or materially from those expressed or implied therein due to risks and uncertainties. Important factors that could influence the Companys operations, inter alia, include global and domestic demand and supply conditions affecting selling prices of finished goods, input availability and prices, changes in government regulations, tax laws, economic, political developments within the country and other factors such as litigations and industrial relations.

B. COVID-19 UPDATE

The unprecedented COVID-19 outbreak has significantly impacted economies across the globe and India is no exception. With the strict lockdown imposed at the beginning of the Financial Year 2020-21, demand and supply were disrupted in India. However, the impact of the lockdown and economic disruption was different in different sectors. Agriculture and allied services, the sector in which your Company operates, was classified under essential goods and services and operations were allowed during the lockdown. Therefore, the manufacturing plant of your Company were functional with in a weeks time after obtaining the necessary approvals from the relevant Government authorities.

The Company efficiently conducted business through virtual meetings with multiple stakeholders including distributors, vendors, dealers and farmers.

C. INDIAN ECONOMY AND AGRICULTURE OVERVIEW:

Considering the sector-wise growth, while the output for all the sectors declined over the previous year but agriculture sector has seen growth of 3.6%.however demand was lower across sectors due to lockdown and the supply of goods and services was disrupted mainly due to the non-availability of labour and logistics constraints. Agricultural activities and allied businesses like Dairy or Fisheries on which our business of cattle feed is dependent were categorized under essential goods and services and this coupled with favourable macro indicators and timely Government support resulted in the agriculture sector performing better than others.

D. KEY BUSINESS SEGMENTS:

The company deals in a Single segment.

E. COMPANYS FINANCIAL AND OPERATIONAL PERFORMANCE:

For the Financial Year 2020-21, your Company reported total income of Rs. 51.04 Crores as compared to 40.03 Crores in the previous Financial Year. Profit before tax stood at Rs. 50.42 lacs as compared to 48.07 Lacs reported in the previous Financial Year.

F. OPPORTUNITIES, STRENGTHS, THREATS, RISKS & CONCERNS:

(i) Opportunities and Strengths:

• Scope of Increase market share:

The Companys ability to increase sales will be strengthened by continued focus on offering a wide range of innovative products which will help in gaining market share. Also in the medium-term, due to strict government laws to be implemented very shortly leading to the closure of unorganised sector units, corporate and larger players will gain market share.

• Strong Research & Development (R&D) Capabilities:

The Companys emphasis on R&D has been critical to its success and a differentiating factor from competitors. Dedicated R&D is undertaken in existing products primarily with a focus to improve yields and process efficiencies. Investment is also being made in developing innovative technologies to further growth of the product portfolio

(ii) Threats, Risks & Concerns:

• Adverse economic impact of COVID-19 pandemic:

If the COVID-19 pandemic continues for a very long time leading to lockdowns, it can disrupt economic activity. It can lead to issues regarding unavailability of labour, inter-state trade movements etc. which can adversely impact the businesses of the company.

• Availability of raw materials and arrangements with suppliers for raw materials:

The price and availability of raw materials which is basically agriculture residues depend on several factors beyond the Companys control, including overall economic conditions, production levels, market demand and competition for such materials, production and transportation cost, duties and taxes and trade restrictions. The Company typically sources raw materials from third-party suppliers or the open market which exposes the Company to volatility in the prices of raw materials and dependence on third-party for delivery of raw material may adversely affect operations.

• Seasonal variations in the businesses:

Your Companys businesses are subject to seasonal variations that could result in fluctuations in performance. The Company sells lower volumes of cattle feed during the monsoons due to the availability of green fodder. As a result of such seasonal fluctuations, sales and results of operations may vary by fiscal quarter, and the sales and results of operations of any given fiscal quarter may not be relied upon as indicators of the sales or results of operations of other fiscal quarters or future performance. In addition, financial performance is also impacted by other risks such as inability to manage diversified operations, dependency of revenue from animal feed business and dependency of the utilization of services of third parties for our operations.

G. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY:

Your Company remains committed to improve the effectiveness of internal control systems for business processes with regard to its operations, financial reporting and compliance with applicable laws and regulations. The Company has a proper system of internal controls to ensure that all assets are safeguarded and protected against loss from unauthorized use or disposition and that all transactions are authorized, recorded and reported correctly.

H. MATERIAL DEVELOPMENTS IN HUMAN RESOURCES:

The workforce is a critical factor in maintaining quality and safety, which strengthens the competitive position and the human resource policies focus on training and retaining of the employees of the Company. The Company trains employees regularly to increase the level of operational excellence, improve productivity and maintain compliance standards on quality and safety. Employees are offered performance-linked incentives and benefits and the Company conducts employee engagement programs from time to time. The Company also hires contract labour from time to time. The management team comprises of professionals with a proven track record. The

Company continues to remain focused and sensitive to the role of human resources in optimizing results in all its areas of working and its industrial relations also continue to be cordial.

By Order of the Board of Directors
For Ajooni Biotech Limited
Date: 27.08.2021 Jasjot Singh Gursimran Singh
Place: Mohali Managing Director Director
DIN:01937631 DIN:02209675