Ajooni Biotech Ltd Management Discussions

ANNEXURE C TO DIRECTORS REPORT INDUSTRY

Structure & Developments

Indias livestock sector continues to be one of the most significant contributors to the agricultural economy and rural livelihoods. The sector contributes approximately 30% of the Agricultural Gross Value Added (GVA) and provides direct and indirect employment to millions of rural households.

According to the latest Livestock Census, India has over 536 million livestock, making it the worlds largest livestock population. India also ranks first globally in cattle, buffalo, and bovine populations, as well as in milk production.

The dairy industry has emerged as one of the most resilient and fastest-growing segments of Indian agriculture. Rising population, increasing urbanisation, changing dietary habits, growing health consciousness, and increasing disposable incomes continue to drive demand for milk and dairy products.

The livestock and dairy sectors are expected to remain major drivers of rural economic development, nutritional security, and sustainable agricultural growth in the coming decades.

INDIAN ANIMAL FEED MARKET

Indias dairy and cattle feed industries are closely interconnected and grow hand in hand. With India having the worlds largest livestock population and being the leading milk-producing country, the demand for scientifically balanced cattle feed continues to rise.

Higher milk production can only be sustained when dairy animals receive adequate nutrition, which directly influences milk yield, reproductive efficiency, animal health, and overall productivity.

As the dairy sector expands due to rising milk consumption, improved breeding practices, and government support, the demand for high-quality cattle feed also grows proportionately. Therefore, the growth of the dairy industry is a strong driver of the cattle feed sector, making both industries mutually dependent and integral to the development of Indias rural economy and agricultural value chain.

The cattle feed segment continues to dominate the market due to Indias position as the increasing adoption of scientific feeding practices by dairy farmers.

Future growth is expected to be driven by productivity enhancement rather than livestock population expansion, making scientifically balanced nutrition an essential requirement for sustainable dairy development.

Recognising the importance of the livestock sector, the Government of India continues to implement various programs aimed at enhancing productivity, farmer income, breed improvement, and nutritional security.

Government support for precision farming and scientific feeding practices is expected to significantly enhance dairy productivity and increase demand for quality animal feed.

OUTLOOK

The long-term outlook for Indias dairy and animal nutrition sectors remains highly encouraging.

Future growth in milk production is expected to be driven by improvements in animal productivity rather than expansion in livestock numbers. Consequently, demand for scientifically balanced animal nutrition solutions is expected to grow significantly.

Ajooni Biotech Limited is strategically positioned to benefit from these structural growth opportunities through strengthening farmer engagement programs, enhancing market penetration, and increasing operational efficiencies through technology. Developing innovative nutritional products, expanding distribution networks and continuing investments in sustainability and quality infrastructure.

These industry developments present significant opportunities for Ajooni. The Companys emphasis on quality cattle feed, strong distribution network, farmer-centric approach, and commitment to improving livestock productivity positions it well to capitalise on the growing demand for scientific animal nutrition and the continued expansion of Indias dairy industry. Through continuous product innovation, market expansion, and customer engagement, Ajooni aims to strengthen its presence and contribute meaningfully to the growth of the livestock sector.

COMPANY OVERVIEW

Ajooni Biotech Ltd. is a research-driven organisation committed to animal healthcare solutions with a mission to support dairy farmers by helping them sustainably increase milk yield while ensuring the health and well-being of their livestock."

As one of the organised players in the Compounded Animal Feed sector in India, Ajooni offers a diverse portfolio including Premium Cattle Feed, Cattle Feed Chips, Camel Feed, Cotton Oil Cake, Mustard Oil Cake, and a comprehensive range of Feed supplements tailored to cover the entire lifecycle of animals.

Over the years, the Company has established itself as a trusted partner for dairy farmers through its unwavering commitment to quality, innovation, customer satisfaction, and sustainable growth.

The Company remains focused on delivering scientifically balanced nutritional solutions that enhance animal productivity while improving profitability for farmers. At the core of Ajoonis success lies its profound grasp of livestock nutrition, coupled with a pioneering approach to formulation development.

Ajooni has a strong contract manufacturing presence and counts large corporations among its clients. It has also established a successful track record in nurturing stable and long-term relationships with highly reputed milk societies and Milk processing companies. Business association & strategic partnership with major brands of Indian markets for supply of Feed & Feed Supplements makes it a first choice of multi-national companies as a trusted strategic partner for contract manufacturing.

OPERATIONAL EXCELLENCE

Operational excellence remains a cornerstone of the Companys business philosophy.

The Company continuously focuses on Process optimisation, Manufacturing efficiency, Cost competitiveness, Product consistency and Supply chain effectiveness.

These efforts help maintain high standards of quality while enhancing productivity and profitability.

The Companys manufacturing infrastructure reflects its commitment to quality, innovation, sustainability, and operational excellence. The Company installed a new highly sophisticated PLC- controlled manufacturing facility, ensuring Automated process control and Enhanced production efficiency.

The Company has invested in solar energy infrastructure to promote green renewable energy utilisation and to lower energy costs.

In-house ultra-modern testing & validation laboratories feature state-of-the-art equipment, ensuring rigorous quality control & implementation of stringent quality control systems at all levels, from raw materials to online checking and finished products, giving our company an edge over other competitors. Emphasizing transparency and upholding ethical business standards has earned the unwavering trust of farmers.

The Company maintains internationally recognised certifications ISO 9001 - Quality Management System, ISO 14001 - Environmental Management System, ISO 45001 - Occupational Health & Safety Management System. The Companys ISI-certified products reflect adherence to prescribed quality standards and reinforce customer confidence.

The Companys Zero Defect Zero Effect (ZED) Certification demonstrates excellence in quality manufacturing, process efficiency, and environmental responsibility. Strict adherence to GMP standards ensures product consistency, hygiene, quality assurance, and regulatory compliance.

OPPORTUNITIES AND THREATS

Opportunities

1. Growing Milk Production

India is the worlds largest milk producer, and continuous growth in milk production is increasing the demand for balanced cattle feed. Higher milk yields require scientifically formulated nutrition, creating significant opportunities for feed manufacturers.

2. Rising Livestock Population

India has one of the largest livestock populations globally. Growth in dairy cattle and buffalo populations directly expands the market for cattle feed, supplements, and nutritional products.

4. Government Support

Government initiatives focused on dairy development, animal husbandry, breed improvement, fodder development, and farmer income enhancement are encouraging the adoption of quality feed and nutritional solutions.

5. Increasing Per Capita Consumption

Rising incomes, urbanization, and growing awareness of nutrition are increasing demand for milk and dairy products, thereby supporting long-term growth in the cattle feed industry.

7. Export Potential

Indias expanding dairy sector and growing expertise in animal nutrition create opportunities for exporting feed products and nutritional solutions to emerging dairy markets.

Ajooni Biotech Limited is well-positioned to capitalise on these opportunities. Backed by modern manufacturing infrastructure, strong quality systems, sustainability initiatives, customer-centric practices, and a commitment to innovation, the Company remains confident of delivering sustainable growth and creating enduring value for farmers, customers, employees, shareholders, and society at large.

Threats

1. Volatility in Raw Material Prices

Prices of maize, soybean meal, rice bran, mustard cake, and other feed ingredients are highly sensitive to weather, crop production, export-import policies, and market speculation, thereby affecting profitability.

2. Disease Outbreaks

Outbreaks of diseases such as Lumpy Skin Disease and Foot-and-Mouth Disease can adversely affect the dairy sector, reducing feed consumption and farmer investment.

Ajooni believes that challenges such as raw material volatility and feed shortages will accelerate the transition toward organised, technology-driven, and nutrition-focused feed manufacturers. By emphasising innovation, supply chain resilience, product quality, and farmer-centric solutions, Ajooni aims to transform these industry challenges into sustainable growth opportunities while supporting the long-term development of Indias dairy sector.

RISK & CONCERNS

Key business risks include Raw material price fluctuations and supply chain disruptions. The Company continuously monitors these risks and implements appropriate mitigation measures through diversified sourcing, prudent inventory management, process optimisation, and strategic planning.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Company has established adequate internal control systems commensurate with the nature and scale of its operations. The internal control framework ensures the protection of assets, Reliability of financial reporting, compliance with laws and regulations, Operational efficiency and Risk management and fraud prevention.

The recent implementation of the ERP system strengthens: Inventory management. Production planning and financial control, and continuous monitoring mechanisms further strengthen the Companys governance framework.

HUMAN RESOURCES

Human Resources & Industrial Relations

At Ajooni Biotech Limited, we believe that our employees are the foundation of our success, and we remain committed to fostering a workplace culture built on integrity, mutual respect, continuous learning, and employee well-being.

Industrial relations during the year remained cordial and harmonious. The Company maintained constructive engagement with employees at all levels, ensuring smooth operations and a collaborative work culture. Management continues to encourage teamwork, employee participation, and open dialogue, which have significantly contributed to operational efficiency and organisational stability.

The Company remains committed to maintaining the highest standards of occupational health and safety and complies with all applicable labour laws and statutory requirements. Various initiatives relating to workplace safety, employee welfare, and skill development are regularly undertaken to create a healthy and productive working environment. As on 31st March 2026, the Company employed 182 personnel across its operations.

COMPANYS FINANCIAL AND OPERATIONAL PERFORMANCE

The Company achieved robust growth during the current financial year, building on its strong foundation of strategic investments and operational ability. The Turnover of Rs.18237.81 lakhs marked a significant increase of 59%, Profit Before Tax (PBT) rose to Rs.573.83 lakhs and Profit After Tax (PAT) increased to Rs. 432.19 lakhs.

Strategic Update: MORINGA CULTIVATION TRAILS:

The Company explored the potential of Moringa as a nutritionally rich and sustainable ingredient for cattle feed and invested considerable time and effort in evaluating different varieties and species of Moringa across locations and under various cultivation practices. The results did not support its commercial and financial viability at scale.

In the larger interest of the Company and its shareholders, we have decided to discontinue further work on this project and redirect our time, resources, and efforts toward identifying more viable and economically sustainable feed ingredients. Innovation remains at the heart of the companys strategy, and we will continue our search for cost-effective nutritional solutions that can enhance the quality and value of our cattle feed products and support long-term growth.

Disclaimer: This report contains forward-looking statements that involve risks and uncertainties. Actual results may differ materially from those expressed or implied. These forward-looking statements involve known and unknown risks, uncertainties, and other factors that may cause actual results, performance, or achievements of the Company to be materially different from any future results, performance, or achievements expressed or implied by such forward-looking statements.

These statements are based on assumptions and expectations of future events, which the management believes to be reasonable at the time of preparation. The Company undertakes no obligation to publicly revise or update any forward-looking statements, whether as a result of new information, future events, or otherwise. Readers are cautioned not to place undue reliance on these forward-looking statements.