Ajooni Biotech Ltd Management Discussions

The Indian cattle feed industry is undergoing a significant transformation, driven by growing demand for safe and nutritious animal products, rising awareness among farmers, and government support for the livestock sector. India remains the worlds largest milk producer, and with a growing focus on productivity, quality feed continues to be central to the dairy ecosystems growth.

With increasing urban dairy demand and organized dairies, formal feed producers will gain market share. Despite volatility in commodity markets and disruptions in the global supply chain caused by geopolitical factors, the Indian cattle feed industry has demonstrated resilience. Increasing mechanization in farming, digital access in rural areas, and the push towards organized animal husbandry are expected to create strong tailwinds for professionally managed feed companies.

India, with its massive cattle population and leadership in milk production, holds immense potential. The Indian Feed market reached INR 956.7 Billion in 2022. Looking forward, the market to reach INR 1,578.2 Billion by 2028, exhibiting a growth rate (CAGR) of 8.2% during 2023-2028. The growing need for animal protein from the cattle and poultry industries has propelled the market for items made from animal feed. Cattle feed is in high demand because it supports milk production, enhances animal health, and improves the quality of dairy products. The expanding dairy sector will probably contribute significantly to market expansion in the upcoming years.

The company is moving beyond institutional clients to direct B2C distribution via expanding dealer network across India; over 150 dealers onboarded, and Geographic scaling from seven Northern states to national presence, leveraging strong brand, certifications, and organized supply chain.

Ajooni Biotech continues to build on its leadership in vegetarian animal nutrition through a multi-pronged strategy that includes:

Backward integration via linkages with FPOs for direct procurement.

Forward integration into direct B2C distribution

Capacity expansion through greenfield setup in Punjab

R&D investment for innovation in animal health and productivity Our strategy focuses on:

Innovation-led, cost-effective nutrition solutions.

Strong farmer and dealer engagement.

Operational excellence and digital transformation,

Sustainable practices and diversification.

The market is primarily driven by the growing cattle population in the country. This can be attributed to the developing dairy industry, which has been supported by the White Revolution 2.0. As a result, India has the largest cattle population in the world, which is escalating the demand for animal feed across the country. Besides this, the Government of India is planning to implement schemes and policies, such as the Livestock Insurance Scheme, E-Pashu Haat, Rashtriya Gokul Mission, and National Livestock Mission, aimed at improving the animal feed industry. Moreover, the emergence of non-traditional feed ingredients and various technological advancements, such as the development of genetically modified animal feed ingredients, represents another growth-inducing factor.

The escalating appetite for animal-derived proteins majorly drives the market in India. This can be supported by the rising population and altered dietary habits. As the global population continues to grow and dietary choices tend to shift towards animal-based proteins, the demand for animal feed is rising to cater to the requirements of livestock, poultry, and fish production. Along with this, the growing concern for animal welfare, the quality, and safety of animal feed, as well as the prevalence of food-borne bacterial infections, Bovine Spongiform Encephalopathy (BSE), and dioxin contamination are providing a boost to the market. In addition, the rising awareness regarding the significance of sustainability amongst producers, retailers, and consumers is influencing the demand for feed products made in accordance with sustainable practices. Moreover, the incorporation of non-Genetically Modified Organisms (non-GMO) crops due to the consumers’ need for all-natural food sources is creating a positive market outlook.

The Indian feed industry is around 35 years old and is mainly restricted to dairy and poultryfeed manufacturing. Feed manufacturing on a commercial and scientific basis started back around 1965 in India with the setting up of medium-sized feed plants in northern and western India. Animal feed was produced primarily to supply the needs of dairy cattle.

The poultry sector was still at an embryonic stage and was restricted to backyard production, with the native bird kept mainly to produce eggs. The Indian feed industry is undergoing a very exciting phase of growth for the next decade. The dairy, poultry, and aqua sectors occupy the majority of the share in overall feed demand.

High Demand for Compound Feed: Compound feed is a mixture of raw materials and supplements fed to the livestock, sourced from either plant, animal, organic or inorganic substances, or industrial processing, whether or not containing additives. While soybean, corn, barley, wheat, and sorghum are the most commonly used raw materials, vitamins, minerals, and amino acids are the most common additives blended to form compound feed. With multinational companies eyeing the lucrative Indian markets, the animal feed industry in India will have to increase their capacities keeping in mind the quality issues to leverage on the growing demand for compound feed.

With changing income levels and more people eating fish,meat and chicken, there will be a higher requirement of processed dairy, aqua and poultry products, which in turn will result in higher compound feed requirement.

High Nutritional Value: Higher output animal production is now increasingly important for commercial livestock and mixed farm viability, and nutrition (particularly protein)requirements have become much more demanding. High performing animals need higher quality feed, and except for extensive sheep and beef systems, demand for quality protein and energy are now the norm in the form of compound or straight feeds. Various farmers in the country are providing high quality feeding options to improve the health of their livestock. This in turn is driving the demand for poultry feed consisting of high nutritional value.

Technological Innovation: The India animal feed industry is characterized by the increasingdemand for meat, dairy, and other livestock-based products, which, in turn, influences growth and innovations in the feed industry. Various stakeholders, including regulatory bodies, feed suppliers, distributors, key feed & feed additive manufacturers, and processing equipment and technology manufacturers, are engaged in research and development to address the modern world challenges associated with the livestock feed industry.

Large Consumer Base: The animal feed industry in India has been witnessing very lucrative phase of growth. There is huge scope for growth in this sector due to the presence of large consumer base in the country with industry becoming more organized. Incessant population growth and rising affordability has surged demand for animal protein in India. Animal feed industry deals with food given to animals in cattle, poultry and aquaculture sector as part of animal husbandry. With increased participation of private sector in dairy and poultry industry, the scenario is expected to change and resulting increased animal feed consumption. The robust demand outlook for dairy, meat and poultry products, growing awareness among farmers about yield benefits of compound animal feed and depleting green pastures have opened up a huge opportunity for the animal feed industry.

Growing Livestock and Poultry Population: The livestock sector has a significant position inthe food value chain as it feeds a population of over 7 billion humans. Livestock products like milk, eggs and meat are considered the prime source of protein thereby catering to 33% of the human protein intake and acts as a potential remedy to under nourishment. Encouragingly, it is witnessing a transformational change with the adoption of industrialized farming methods that utilize a much higher share of compound animal feed. Poultry sector is now in current state where commercial production is the norm of the day with a number of technologies intervention.

Rising Awareness among Consumers: Consumer awareness is growing in terms of organic food products in recent years as almost all the food Ingredients are grown under intense production systems which utilize lot of chemicals and pesticides to control the pests and diseases. Some of the important aspects of organic poultry are as follows- Management of poultry under, backyard/free-range. For supplementary feeding, organically produced feedingredients should be used by the farmers. Given the majority of vegetarian population domestically, growing awareness over nutritional diet and scope of yield improvement is fostering the demand for animal feed. Poultry feed is burgeoning on the back of growing preference for non-veg food, especially chicken amid youth population is primarily driving the market demand.

Cattle feed plays a vital role not only in the productivity and health of livestock but also in ensuring human health, economic sustainability, and environmental balance.: Balanced cattle feed enhances the quality of milk and meat, increasing essential nutrients like protein, calcium, omega-3 fats, and vitamins. Proper feed reduces the risk of antibiotic residues, toxins, and harmful pathogens in dairy and meat products. A hygienic, nutrient-rich diet improves animal immunity and reduces the need for medication, helping to prevent disease transmission from animals to humans (e.g., brucellosis, tuberculosis).

A nutritious, balanced feed ensures: Better digestion, Higher milk yield, Faster growth rates, improved fertility, and Longer animal lifespan. Higher productivity leads to better income for dairy farmers. Reduced veterinary costs due to healthier animals. Encourages sustainable dairy entrepreneurship in rural areas. Optimized feed reduces methane emissions per litre of milk or kg of meat produced. Reduces overgrazing and land degradation by minimizing the need for extensive fodder use.

Ajooni Biotech Limited is a nutritionally driven cattle feed company committed to improving animal health, milk productivity, and rural prosperity. The company has a portfolio of a wide range of Quality compounded feed, Cattle feed Chips, Cotton oil cake, Mustard oil cake, Pig Feed, Camel Feed, and a Wide range of Feed supplements to meet regional needs and cover the entire cycle of an animal.

Enables holistic dietary provision: Protein, minerals, vitamins, and other essential nutrients are found in cattle feed. These necessary nutrients work together to support cattle’s digestion, tissue regeneration, daily activity needs, and other processes. High-productivity cattle require the optimal nutrition, which grazing cannot supply. Cattle feed meets this need.

Promotes growth: The vital nutrients in cattle feed are present in the proper ratios to encourage animals to grow more quickly. Giving cattle and buffaloes specialised complex feed and supplements improves their weight, muscle to fat ratio, and growth rate since they have distinct nutritional needs.

Addressing of the nutritional needs of pregnant cows: Cows need to change their diets while they are expecting. Giving pregnant cows specialised feed promotes the foetus’s healthy growth, which benefits the health of the calf after birth.

Improves Milk Production: The amount and type of feed offered to milch animals has a significant impact on milk output. Compound feed and nutritional supplements help dairy cattle’s rumen microbes produce more protein and digest more fibre, which increases milk production and improves milk fat composition.

Takes care of nutritional needs of calves and heifers: To grow and develop, calves and heifers require the proper nutrients. A special diet for calves reduces the stress of weaning, promotes rumen development and stops diarrhea.

During the year, the Company continued to optimize its operational capabilities through :-

ERP Integration: Implementation of enterprise-wide ERP improved real-time data management, inventory control, and customer servicing. Quality and Certifications: Adhering to ZED (Zero Effect Zero Defect) principles and maintaining various ISO certifications enabled us to uphold world-class standards in production and compliance.

Animal Feed Business in which Company operates are largely unorganized, therefore, cost leadership is a key enabler for your Company to increase the market share of its products in those segments. The Company’s ability to increase sales of own brand will be strengthened by continued focus on offering a wide range of innovative products across both business verticals which will help in gaining market share. Stringent quality Standards by regulatory bodies to be applicable to Feed Industry would be leading to the closure of smaller or unorganized business units, Our company having adopted strong Quality parameters and Certifications adopted will gain market share. Own distribution network will benefit the Company to leverage the competitive advantage to enhance competitiveness and reduce geographic and political risks in businesses.

Company’s widespread network and significant operational experience and introduce a range of innovative and value-added products in the market to cater to the evolving needs of the customers.

The Company’s emphasis on R&D has been critical to its success and a differentiating factor from competitors.

R&D initiative is undertaken in existing products primarily with a focus to improve yields and process efficiencies. The Company also focuses on R&D efforts in areas where there is significant growth potential.

Un-favourable local and global weather patterns can have an adverse effect on the business: As an agri-based Company, the businesses are sensitive to weather conditions, including extremes such as drought and natural disasters. The availability of raw materials required for operations and the demand for products may be adversely affected by longer than usual periods of heavy rainfall in certain regions or a drought in India. The occurrence of any unfavorable weather patterns may adversely affect business, results of operations and financial condition. 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 The products that your Company manufactures or processes are subject to risks such as contamination, adulteration and product tampering during their manufacturing, transport or storage. Inherent business risks exist in form of product liability or recall claims if products fail to meet the required quality standards or are alleged to result in harm to customers. Such risks may be controlled, but not eliminated, by adherence to good manufacturing practices and finished product testing. Company’s animal feed business is 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.

RISKS AND MITIGATION a) Raw Material Price Volatility: Prices of feed ingredients such as maize, soybean meal, and molasses are subject to climatic and market fluctuations. The Company mitigates this risk through diversified sourcing, long-term supplier relationships, and inventory management strategies. b) Regulatory and Compliance Risks: With increasing focus on food safety and sustainability, regulatory compliance is critical. Ajooni maintains a proactive compliance culture through audits, training, and technology integration. c) Credit and Collection Risks: Delayed payments in some territories could impact working capital. Strengthened credit policies, dealer monitoring, and financing partnerships help manage this exposure.

Looking ahead, Ajooni Biotech aims to:

- Expand its market reach in underpenetrated regions.

- Scale up sustainable initiatives like Moringa-based supplements. - Deepen digital transformation and farmer engagement. - Explore forward integration and value-added products.

The Indian governments continued support to the livestock sector through PM Matsya Sampada Yojana, National Livestock Mission, and Startup Agri-Tech incentives offer strategic tailwinds to organized players. We believe the cattle feed industry will be a cornerstone of food security, rural income generation, and sustainable agriculture and Ajooni Biotech is positioned to lead this transformation.

Ajooni Biotech has robust internal control systems commensurate with the size and complexity of its operations. Periodic internal audits, Board-level oversight through the Audit Committee, and real-time reporting ensure control adequacy and timely corrective action.

The Company continues to invest in its people through structured training, process ownership, and performance-based rewards. A robust HR policy ensures engagement, retention, and a culture of excellence and responsibility.

The Company achieved robust growth in FY 2024 25, building on its foundation of strategic investments and operational agility. Key financial indicators are as follows:

These figures underscore our focus on financial discipline and strategic investment in capacity-building and operational excellence. The growth was driven by volume expansion, product mix optimization, financial prudence, and cost control across operations.