Astonea Labs Ltd Management Discussions

The Management of Astonea Labs Limited is pleased to present the Management Discussion and Analysis Report for the financial year ended March 31,2026.

Astonea Labs Limited is engaged in the manufacturing, marketing, contract manufacturing, and distribution of pharmaceutical, nutraceutical, cosmeceutical, and cosmetic products. The Company operates through diversified product portfolios including tablets, capsules, softgels, powders, ointments, creams, lotions, skincare, haircare, and personal care products. The Company continues to focus on quality manufacturing, operational excellence, regulatory compliance, and customer-centric business practices to strengthen its position in domestic as well as international markets.

1. INDUSTRY STRUCTURE AND DEVELOPMENTS

The Indian pharmaceutical industry continues to demonstrate resilient growth supported by increasing healthcare av/areness, rising disposable incomes, expanding healthcare infrastructure, and favorable government initiatives. India remains one of the largest global suppliers of generic medicines and pharmaceutical formulations, supported by its strong manufacturing capabilities and cost competitiveness.

In addition, the nutraceutical, cosmetic, and personal care industries in India are witnessing substantial growth due to changing consumer preferences, increasing focus on wellness and preventive healthcare, rapid urbanization, digital commerce expansion, and rising demand for premium skincare and personal care products. Consumers are increasingly inclined towards quality, innovative, and scientifically formulated products, thereby creating significant opportunities for manufacturers with strong research, development, and production capabilities.

Astonea Labs Limited operates across pharmaceutical, nutraceutical, cosmeceutical, and cosmetic segments and has established itself as a quality-focused manufacturing organization. The Company possesses capabilities in third-party manufacturing, contract manufacturing, own brand development, exports, and customized product formulation. Its manufacturing facilities are designed and operated in accordance with applicable quality standards including WHO-GMP requirements, enabling the Company to cater to diverse customer requirements across domestic and international markets.

The Company continues to strengthen its operational capabilities by adopting advanced manufacturing practices, improving product quality standards, and enhancing customer relationships. Continuous focus on innovation, product diversification, and compliance management remains integral to the Companys long-term business strategy.

2. BUSINESS OVERVIEW

The Company is primarily engaged in the following business activities:

• Manufacturing of pharmaceutical, nutraceutical, cosmeceutical, and cosmetic products;

• Contract manufacturing for domestic and international customers;

• Marketing and distribution of own brands including Glow Up, Regero, and Avicel;

• Export of products to international markets;

• Development of innovative formulations and customized manufacturing solutions.

The manufacturing facility of the Company located in Raipur Rani, Haryana is equipped with modern machinery, quality control systems, and operational infrastructure that support scalable manufacturing operations and efficient production processes. The Company continues to emphasize quality assurance, regulatory compliance, process optimization, and customer satisfaction in all aspects of its operations.

3. OPPORTUNITIES AND THREATS

Opportunities

The Company continues to witness significant growth opportunities arising from favorable industry trends and increasing market demand. Key opportunities include:

• Growing demand for pharmaceutical, wellness, and preventive healthcare products;

• Expansion in third-party and contract manufacturing opportunities;

• Increasing export opportunities in international markets;

• Rising consumer demand for nutraceutical, skincare, and cosmetic products;

• Growth of e-commerce platforms and digital healthcare channels;

• Expansion into regulated and semi-regulated international markets;

• Increasing preference for quality-certified manufacturing partners.

The Companys emphasis on innovation, product quality, manufacturing excellence, and regulatory compliance positions it favorably to capitalize on emerging market opportunities and strengthen its competitive position.

Threats

The Company operates in highly competitive industries and faces certain risks and challenges, including:

• Intense competition in pharmaceutical and cosmetic sectors;

• Changes in regulatory and compliance requirements;

• Volatility in prices and availability of raw materials;

• Foreign exchange fluctuations affecting export operations;

• Supply chain disruptions and logistics-related challenges;

• Pricing pressures in domestic and international markets;

• Technological changes and evolving consumer preferences.

The Company continuously monitors industry developments and adopts appropriate risk mitigation strategies to minimize the potential impact of such challenges on its business operations and financial performance.

4. SEGMENT-WISE / PRODUCT-WISE PERFORMANCE

The Company primarily operates in the following segments:

• Pharmaceutical products;

• Nutraceutical products;

• Cosmetic and personal care products;

• Contract manufacturing services.

During the financial year under review, the Company continued to strengthen its presence in both domestic and export markets through quality-focused manufacturing, timely execution, and customer-centric business strategies. The Company witnessed continued demand across its product categories supported by expansion of customer relationships and increased manufacturing activities.

The Company also focused on expanding its own brands and strengthening third-party manufacturing partnerships, v/hich contributed to operational growth, improved market reach, and enhanced business opportunities. Continuous efforts were undertaken to diversify the product portfolio and improve manufacturing efficiencies in order to support long-term growth objectives.

5. OUTLOOK

The outlook for the pharmaceutical, nutraceutical, and cosmetic industries remains positive driven by increasing healthcare expenditure, rising awareness regarding wellness and preventive healthcare, growing demand for personal care products, and expansion in global pharmaceutical markets.

The Company intends to focus on the following strategic priorities:

• Strengthening manufacturing capabilities and infrastructure;

• Expanding domestic and international business operations;

• Enhancing and diversifying product portfolio;

• Increasing focus on research and product development;

• Improving operational efficiencies and cost management;

• Strengthening customer relationships and market presence;

• Enhancing regulatory and quality compliance standards.

The Management remains optimistic about the long-term growth prospects of the Company and believes that its diversified business model, manufacturing capabilities, and quality-driven approach will support sustainable growth in the coming years.

6. RISKS AND CONCERNS

The outlook for the pharmaceutical, nutraceutical, and cosmetic industries remains positive driven by increasing healthcare expenditure, rising awareness regarding wellness and preventive healthcare, growing demand for personal care products, and expansion in global pharmaceutical markets.

The Company intends to focus on the following strategic priorities:

• Strengthening manufacturing capabilities and infrastructure;

• Expanding domestic and international business operations;

• Enhancing and diversifying product portfolio;

• Increasing focus on research and product development;

• Improving operational efficiencies and cost management;

• Strengthening customer relationships and market presence;

• Enhancing regulatory and quality compliance standards.

The Management remains optimistic about the long-term growth prospects of the Company and believes that its diversified business model, manufacturing capabilities, and quality-driven approach will support sustainable growth in the coming years.

7. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Company has established adequate internal control systems commensurate with the size, nature, and complexity of its business operations. These internal control mechanisms are designed to ensure operational efficiency, safeguarding of assets, accuracy of accounting records, reliability of financial reporting, and compliance with applicable laws and regulations.

The internal control systems are aimed at ensuring:

• Efficient utilization and protection of Company assets;

• Accuracy and reliability of accounting and financial records;

• Compliance with statutory laws, regulations, and internal policies;

• Prevention and detection of frauds, errors, and irregularities;

• Timely preparation and reporting of financial information;

• Proper authorization and monitoring of transactions.

The Management periodically reviews the effectiveness of internal controls and continuously undertakes measures for strengthening operational processes and improving overall efficiency.

8. DISCUSSION ON FINANCIAL PERFORMANCE WITH RESPECT TO OPERATIONAL PERFORMANCE

During the financial year under review, the Company continued to witness growth in business operations supported by increased manufacturing activities, expansion of customer base, and diversification of product offerings.

The Company remained focused on:

• Improving operational efficiencies;

• Enhancing product quality standards;

• Cost optimization initiatives;

• Expansion of manufacturing capabilities;

• Strengthening customer service and delivery systems;

• Enhancing production planning and supply chain management.

The Management continues to adopt prudent financial and operational strategies to ensure sustainable growth, profitability, and long-term value creation for stakeholders.

The above discussion should be read in conjunction with the Management Commentary on FY 2025-26 Audited Financial Results issued byAstonea Labs Limited, which provides detailed insights into the Companys financial performance, strategic initiatives, operational developments, margin movements, and future growth outlook.

Reference: Management Commentary on FY 2025-26 Audited Financial Results of Astonea Labs Limited dated May 30, 2026.

9. HUMAN RESOURCES AND INDUSTRIAL RELATIONS

Human resources continue to remain one of the key strengths of the Company. The Company believes that employee development, engagement, and motivation are critical for achieving operational excellence and sustainable business growth.

The Company continues to focus on:

• Employee development and capability enhancement;

• Training and skill development initiatives;

• Workplace safety and employee welfare;

• Performance-driven and professional work culture;

• Employee engagement and retention programs;

• Building leadership and operational competencies.

Industrial relations during the year remained cordial, harmonious, and conducive to smooth business operations. The Company values its human capital and remains committed to maintaining a positive and productive work environment.

10. ENVIRONMENT, HEALTH AND SAFETY

The Company remains committed to maintaining high standards of environmental, health, and safety practices across its operations. The manufacturing facilities operate with emphasis on sustainable manufacturing practices, waste management, employee health and safety, and compliance with applicable environmental and safety regulations.

The Company continuously undertakes initiatives aimed at promoting safe working conditions, environmental sustainability, energy conservation, and operational responsibility.

11. DETAILS OF SIGNIFICANT CHANGES IN KEY FINANCIAL RATIOS

During the financial year under review, the Company has monitored key financial ratios in accordance with applicable regulatory requirements. Wherever significant changes of 25% or more were observed as compared to the previous financial year, appropriate explanations have been provided in the financial statements and notes forming part of the Annual Report.

The computation of key financial ratios and explanations for significant changes, wherever applicable, may be referred to in the Notes forming part of the Financial Statements.

The Management continuously evaluates the financial position, operational efficiency, and capital structure of the Company to ensure sustainable financial performance.

12. DISCLOSURE OF ACCOUNTING TREATMENT

The financial statements of the Company have been prepared in compliance with the applicable Accounting Standards (AS), provisions of the Companies Act, 2013, and other applicable regulatory requirements.

No treatment different from that prescribed in the applicable Accounting Standards has been followed in the preparation of the financial statements.

13. CAUTIONARY STATEMENT

Statements made in this Management Discussion and Analysis Report describing the Companys objectives, estimates, projections, expectations, or predictions may constitute forward-looking statements within the meaning of applicable laws and regulations. Actual results may differ materially from those expressed or implied depending upon various factors including economic conditions, government policies, regulatory developments, market conditions, consumer demand, competition, and other incidental factors beyond the control of the Company.