Bayer CropScience Ltd Management Discussions

1. Overview of Indian Agriculture

Agriculture and allied sectors continue to play a vital role in Indias economy, contributing about 18% to Gross Value Added (GVA) and 16_17% to the countrys GDP, while employing nearly 46% of the workforce. The sectors resilience is supported by improved productivity, policy interventions and technology adoption. As per the Second Advance Estimates for 2024 25, India recorded foodgrain production of 3,577 lakh metric tons, reffecting continued strength in agricultural output. The Government of India continues to support the sector through _agship initiatives such as PM KISAN, Pradhan Mantri Fasal Bima Yojana, PM Krishi Sinchayee Yojana, National Food Security Mission, National Mission on Edible Oils and the Digital Agriculture Mission. The Union Budget 2026 27 increased allocation for agriculture and allied sectors to 1.63 lakh crore, with focus on productivity enhancement, climate resilience, irrigation, digital agriculture and farmer welfare.

The Government is also strengthening farmer collectivization and market linkages through the formation and promotion of 10,000 Farmer Producer Organizations (FPOs), aimed at improving farmers access to technology, quality inputs, advisory services, credit and markets.

The Government is also promoting sustainable and climate-resilient agricultural practices, including water-efficient cultivation methods such as Direct Seeded Rice (DSR), particularly in water-stressed regions. Such practices are aimed at improving resource-use efficiency, reducing labor and water dependency, and supporting long-term agricultural sustainability.

Continued emphasis on high-value agriculture, digital technologies, climate-resilient farming and rural infrastructure is expected to support long-term growth, sustainability and enhanced farmer incomes.

Source: Economic Survey 2025 26; Union Budget 2026 27; Ministry of Statistics & Programme

Implementation (MoSPI); Ministry of Agriculture & Farmers Welfare (Government of India).

2. Industry Overview

The Government of India continues to focus on improving agricultural productivity, sustainability and resilience through initiatives promoting climate-resilient crop varieties, natural farming, improved irrigation, digital agriculture and self-su_ciency in pulses and oilseeds. Policy support is also directed towards strengthening agricultural infrastructure, promoting farmer collectivization through FPOs, expanding Digital Public Infrastructure (DPI) and enabling technology-led farming practices to improve farmer incomes and resource efficiency.

Source: Union Budget 2026_27; Ministry of Agriculture & Farmers Welfare.

Crop Protection

India remains one of the leading producers and exporters of agrochemicals globally. The crop protection industry continues to benefit from increasing awareness of scientific farming practices, rising mechanization and adoption of precision agriculture technologies such as drones and digital advisory platforms.

Government initiatives supporting drone usage under the Namo Drone Didi scheme and promotion of precision agriculture are accelerating adoption of efficient crop protection practices, enabling optimized input application, improved pest management and enhanced farm productivity. Increasing focus on sustainable agriculture and integrated pest management is also supporting responsible input usage and improved resource efficiency.

Source: Ministry of Agriculture & Farmers Welfare; Economic Survey 2025 26.

Seeds

The Government of India continues to strengthen the seed ecosystem through the Sub-Mission on Seeds and Planting Material (SMSP) under the Green Revolution – Krishonnati Yojana. The program focuses on improving seed quality, enhancing Seed Replacement Rates (SRR), strengthening seed infrastructure and promoting adoption of improved crop varieties.

Government initiatives supporting certified seeds, seed villages, seed treatment and modern seed testing infrastructure are contributing to higher productivity and improved farm resilience. Continued emphasis on climate-resilient, high-yielding and region-specific crop varieties is expected to support sustainable agricultural growth and improved farmer outcomes.

Source: Ministry of Agriculture & Farmers Welfare; Economic Survey 2025 26.

Digital Farming

Digital technologies such as artificial intelligence (AI), machine learning (ML), remote sensing, IoT and digital advisory platforms are increasingly transforming Indian agriculture. The Governments Digital Agriculture Mission (DAM) and AgriStack initiative aim to build a comprehensive digital ecosystem for agriculture through farmer registries, digital crop surveys, geo-referenced land records and data-driven advisory systems.

Government initiatives are also promoting the use of drones for crop monitoring, precision spraying, nutrient management and field mapping to improve productivity and optimize input usage. Weather-based advisories, digital platforms and AI-enabled tools are helping farmers make informed decisions related to sowing, irrigation, crop protection and market access, thereby improving efficiency, resilience and transparency in agricultural service delivery.

Source: Union Budget 2026 27; Ministry of Agriculture & Farmers Welfare; Economic Survey 2025_26.

3. Company Overview

Bayer CropScience Limited is a key player in the Indian agriculture industry. The Companys operations include three key business areas: Crop Protection, Seeds and Digital Farming.

Crop Protection: The Companys Crop Protection portfolio comprises chemical and biological solutions for the management of weeds, pests, and diseases. The portfolio includes insecticides, fungicides, herbicides, seed treatment solutions, and biologicals. The business is supported by integrated stewardship programs and agronomic advisory services aimed at enabling sustainable and efficient crop management practices.

Seeds: The Seeds business leverages advanced breeding technologies and genetic diversity to develop high-performing hybrids with improved resilience to biotic and abiotic stresses, including drought, pests, and diseases. In India, the seed portfolio is focused on hybrid corn as a key crop, supporting higher productivity, yield stability and greater farm-level resilience.

Digital Farming: Digital Farming integrates advanced technologies including remote sensing, artificial intelligence, IoT, drones, and data analytics to enable precision agriculture and data-driven decision-making. The Companys digital ecosystem, comprising FarmRise™, FarmRise One, Alivio, and Ask Deena, supports farmers through agronomic advisory, market linkages, financial access, traceability and risk mitigation solutions.

Transformative Initiatives for Indian Farmers

The Company has distinguished itself by leveraging its proven capabilities in innovation-driven solutions, sophisticated processes and technologies, world-class services, and superior business models. It continues to work closely with Indian farmers to help them overcome agricultural challenges. Several transformative initiatives have been undertaken by the Company to support Indian farmers. They include:

Better Life Farming: a multi-stakeholder partnership

Better Life Farming (BLF) is a transformative initiative created through a partnership between the International Finance Corporation (IFC), Neta_m, and Yara, playing a crucial role in Bayers go-to-market strategy in India. With over 1,600 centers, BLF provides smallholder farmers with access to essential agricultural inputs, advisory services, irrigation solutions, finance, insurance, and market linkages.

Its Hub-and-Spoke architecture connects BLF

Centers with Agri-Entrepreneurs, FPOs, and value chain partners, effectively reaching over 600,000 farmers. By shifting from a product-led to an ecosystem-led approach, BLF integrates services to enhance productivity and income, moving beyond mere transactions to measurable livelihood improvements.

Importantly, BLF also emphasizes gender inclusion by actively involving women agri-entrepreneurs, thereby strengthening rural entrepreneurship and empowering marginalized communities. This comprehensive model fosters an inclusive agricultural ecosystem that benefits Millions of farmers across India.

Food Value Chain Partnership

Bayer collaborates with over 60 partners across food value chains to enable traceable, sustainable, and resilient sourcing systems. This initiative integrates inputs, advisory services, digital tools, and market access to strengthen supply chains and support regenerative agriculture outcomes. By expanding partner engagement through emerging value pools such as bioethanol and silage, Bayer is enhancing its reputation and outreach across the ecosystem, further solidifying its commitment to sustainable agricultural practices and resilient food systems.

Bayer Learning Centers

Over 50 Bayer Learning Centers across India provide structured agronomic demonstrations, crop system interventions, and training programs. These centers have engaged more than one lakh farmers and stakeholders through physical and digital platforms, supporting capability building and demand creation.

Advancing Regenerative Agriculture in the field

The Bayer ForwardFarm in Haryana serves as a 10-hectare demonstration platform for regenerative agriculture, integrating soil health management, precision irrigation, digital advisory tools, and integrated pest management practices. It also serves as a knowledge platform that fosters dialogue and demonstrates regenerative agriculture system blocks in practice, yielding nature-positive outcomes while increasing productivity & farmer income.

Bayers DirectAcres program is helping advance regenerative agriculture practices in rice cultivation through the promotion of Direct Seeded Rice (DSR) across more than 100 clusters in India. Compared to traditional puddled transplanting methods, DSR has the potential to reduce water usage by up to 40%, lower greenhouse gas emissions by up to 45%, reduce labor dependency by up to 50%, and enable earlier harvesting. The program currently engages over 15,000 farmers across more than 48,000 hectares, supporting the adoption of climate-smart and resource-efficient farming practices. By 2030, Bayer aims to further scale the initiative by supporting over one Million smallholder farmers in adopting DSR-based cultivation systems.

Product Stewardship

Supporting our customers and partners in the safe handling of our seed and crop protection products is the cornerstone of our product stewardship strategy. Bayer markets Crop Protection products, seeds, and services, which have been granted regulatory approval by the concerned Central and State authorities. All our crop protection products are safe for the operator and the environment when used in accordance with label instructions. We also observe the International Code of Conduct on Pesticide Management of the United Nations Food and Agriculture Organization (FAO). The principles of this code cover the entire life cycle of a product or technology, from its development to its application and beyond.

Our product stewardship measures also include displaying product information of the highest mandated standards and transparency in line with the law of land for labeling of our products. In addition to product information, it also offers key information such as Direction for Use (DFU) that enables our customers to utilize our products in ways that generate maximum value for their enterprises, including safety standards.

BCSL continues to offer regular training and awareness programs to help farmers identify and purchase authentic crop protection products in a developing digital ecosystem and to cater to the evolving needs of the farmers. Bayer has launched a digital agriculture platform AgrowSmart – One-Stop Agro Solution that delivers localized best in class crop advisory on seeds, crop protection solutions and provides agronomic insights to both internal and external stakeholders in the parameterized form to support business and sustainability goals. The crop protection products now have a QR code in each of the labels to address counterfeiting issues.

Supporting our customers and partners in the safe handling of our seed and crop protection products is a focus of our product stewardship through regular training and awareness programs to help farmers identify and purchase authentic crop protection products. Training programs also focus on the safe & responsible use of crop protection products and the proper use of Personal Protection Equipment (PPE).

4. Financial and Operational Performance

Financial Performance including ratio analysis

In financial year 2025 26, the Companys Revenue from Operations increased by 4% to 56,750 Million, compared to 54,734 Million in the previous year. Profit Before Tax stood at 8,549 Million, compared to 7,074 Million in the previous year.

Ratio Analysis

Ratio	Formula	Apr\u201925-	Apr\u201924-	Deviation
		Mar\u201926	Mar\u201925	(%)
Debtors Turnover Ratio (times)	[Revenue from Operations/ Average	5.5	5.7	-4%
	Trade receivables]
Inventories Turnover Ratio (times)	[Cost of Goods Sold/ Average	1.5	1.7	-12%
	Inventories]
Interest Coverage Ratio (times)	[Earnings before Interest and Tax/	44.2	42.6	4%
	Finance Cost]
Current Ratio (times)	[Current Asset/ Current Liability]	1.9	2.0	-5%
Debt Equity Ratio (times)	[Debt/ Shareholders Equity]	N.A.	N.A.	-
Operating Profit Margin Ratio (%)	[Earnings before Interest and Tax/	15.4%	13.2%	17%
	Revenue from Operations]
Net Profit Margin Ratio (%)	[Profit after Tax/ Revenue from	12.1%	10.4%	16%
	Operations]
Return on Net Worth (%)	[Profit after Tax/ Average	23.7%	19.9%	19%
	Shareholders equity]

Operational Performance

Crop Protection: While the sector remains structurally resilient, financial year 2025 26 witnessed weather-led volatility, particularly impacting kharif crop cycles in certain regions. Despite the headwinds, the business remained focused on supporting farmers through timely product availability, targeted farmer engagement and customer-centric messaging.

During the year, we strengthened our portfolio through six new launches across insecticide, herbicide and fungicide categories, aimed at addressing evolving pest, weed and disease challenges faced by Indias smallholder farmers. Our differentiated portfolio approach and broad product mix continued to enable farmers to access relevant crop protection solutions across varying crop and climatic conditions.

In 2025 26, the Company successfully launched the following new crop protection products across different crops and geographies:

• Bicota – A differentiated solution for stem borer management in rice, offering extended protection of up to one additional week. The product also delivers supplementary agronomic benefits, including soil pest management, promotion of productive tillers, enhanced plant vigor, and support for improved yield outcomes.

• Camalus – A broad-spectrum crop protection solution designed for effective management of both chewing and sucking pests in vegetable crops, supporting healthier crop growth and improved productivity.

• Council Prime – A specially crafted weed management solution for rice cultivation in North and East India, combining complementary chemistries to deliver synergistic performance, robust weed control, and support for enhanced yield potential.

• Etciostar – An effective weed management solution for rice cultivation, particularly suited to the agronomic needs of farmers in north and east India, enabling cleaner fields and supporting improved crop establishment and productivity.

• Mateno More – An advanced three-way herbicidal combination developed to address critical weed management challenges in wheat cultivation, delivering superior control efficacy and supporting improved farm productivity.

• Yeoval – A best-in-class solution for the management of early shoot borer in sugarcane, while also supporting early-stage root development and effective soil pest management to promote healthier crop growth.

Seeds : High-quality seeds play a critical role in determining yield and outcomes. Rice and corn, as the top two cereal crops in the country, are key to ensuring food, feed, and energy security. With land being a _nite resource and demand steadily rising, we are focused on improving crop yields through high-performing hybrid seeds to support farmers more effectively.

Our Seeds business continued to grow on the back of strong customer acceptance, expanded acreages, and successful new hybrid launches. We also saw increased demand for existing high-value hybrids. This combination, along with rising corn demand and favorable commodity prices, contributed to strong business performance.

During the year 2025 26, the Company successfully launched the following new hybrid seeds variants in corn:

• D : This KC9256 is our new offering for the farmers of Madhya Pradesh, Maharashtra, Karnataka, Telangana, Andhra Pradesh, Tamil Nadu, Odisha and Chhattisgarh. DEKALB® 9256 offers attractive bold grains with high test weight and serves the farmers of the South and West states in both Kharif and Rabi seasons.

• DKC8174 : This is our new addition to the medium maturity hybrids to serve the needs of the customers in the states of Rajasthan, Uttar Pradesh, Madhya Pradesh, Himachal Pradesh, Punjab where this _ts well in the crop rotation. DEKALB® 8174 is offered in Xellano brand and offers higher yields with yield consistency in the medium maturity segment.

• 9243C : This is our new offering to the farmers of South-West and Central parts of India for the rainfed geographies in the states of Madhya Pradesh, Karnataka. 9243C is offered in Xellano brand and offers consistent and reliable performance in rainfed conditions.

5. Opportunities and Outlook

Indias agriculture sector continues to emerge as one of the worlds largest and fastest-growing agricultural economies. The sector is being supported by structural reforms, government investments, increasing formalization, and rapid digital and technological advancement. As agricultural supply chains become increasingly interconnected, Indias scale as both a producer and consumer positions the sector as a critical contributor to global food, nutritional, and energy security.

The sector is increasingly shifting from volume-led growth toward a more integrated model focused on productivity, resilience, sustainability, and value creation. Rising domestic demand, export opportunities, food processing, and bio-based value chains are expected to create new growth avenues across agriculture.

Going forward, the opportunities in Indian agriculture are expected to be driven by three key pillars - Scaling Up Reliable Access, Digital Intelligence, and Sustainability.

Scaling Up Reliable Access

Improving access to quality inputs, agronomic knowledge, finance, markets, and infrastructure remains critical to enhancing productivity and farmer incomes.

Government initiatives such as PM KISAN, Pradhan Mantri Fasal Bima Yojana (PMFBY), National Agriculture Market (eNAM), and FPO promotion are strengthening financial inclusion, market access, and value-chain integration. At the same time, diversi_cation toward high-value crops such as fruits, vegetables, pulses, and oilseeds is supporting both income growth and food and nutritional security.

Industry-led initiatives, including Bayers integrated crop solutions, farmer partnerships, and market-linked programs, continue to complement these efforts by improving access to quality solutions and agronomic support.

The sector is also expected to play an increasing role in supporting Indias energy transition through opportunities linked to biofuels and bio-based feedstocks.

Digital Intelligence and Precision Agriculture

Indias agricultural ecosystem is increasingly being shaped by digitalization, AI-led advisory systems, satellite monitoring, drones, and precision farming technologies. Government-led initiatives such as AgriStack, combined with growing adoption of digital agriculture solutions, are enabling more data-driven farm decision-making, improving resource-use efficiency, and enhancing climate resilience. Platforms such as BayersFarm Rise ecosystem are supporting farmers with personalized agronomic insights, weather-based recommendations, and improved access to advisory services across the crop cycle.

Sustainability, Resilience and Resource Efficiency

As climate variability, soil degradation, and water stress intensify, sustainability and resilience are becoming central to the future of Indian agriculture. Productivity growth will need to go hand in hand with responsible resource management.

Practices such as regenerative agriculture, conservation farming, DSR, Alternate Wetting and Drying (AWD), and micro-irrigation are gaining importance in improving soil health, enhancing water-use efficiency, and reducing environmental impact.

Industry collaborations and initiatives, including Bayers work in regenerative agriculture and climate-smart farming systems, continue to support the transition toward more sustainable and resource-efficient agriculture.

The Road Ahead

The future of Indian agriculture will be shaped by the convergence of reliable access, digital intelligence, and sustainability-led growth. As productivity, resilience, and sustainability increasingly go hand in hand, stronger collaboration between government, industry, research institutions, and farmer networks will be essential to accelerating innovation and scaling impact.

Aligned with Indias broader Viksit Bharat 2047 vision, the sector is well positioned to build a globally competitive, climate-resilient, and future-ready agri-food ecosystem that supports farmer prosperity, food and nutritional security, and sustainable economic growth.

For Bayer, these evolving sectoral trends present significant opportunities to further strengthen its role in advancing climate-smart agriculture through integrated crop solutions, digital advisory platforms, regenerative agriculture programs, and farmer-centric partnerships that support sustainable productivity growth.

6. Material developments in Human Resources/Industrial Relations front, including number of people employed

The details about Human Resources can be found under the heading Human Resources in the Directors Report and the number of people employed can be found in Annexure D of the Directors Report as well as in the Business Responsibility and Sustainability Report (BRSR).

7. Risks and Concerns

The external operating environment has been impacted by geopolitical developments, particularly in the Middle East, which will lead to increases in raw material and logistics costs and can disrupt supply planning cycles resulting in higher input costs and pricing pressures.

Elevated fertilizer and input costs are expected to influence farmer affordability, which may moderate demand across certain agri-input categories. At the same time, inventory levels and competitive landscape continue to affect pricing dynamics. Further, potential El Niño conditions may result in warmer and drier weather patterns, leading to variability in crop cycles, pest incidence and overall agri-input demand.

To manage this risk, the Company has taken proactive measures, focusing on supply chain planning, utility management and continued focus on cost efficiencies. These actions are supporting supply reliability and operational stability. The Company continues to monitor these developments closely to mitigate these risks to the extent possible and ensuring timely availability of inventory to the farmers.

8. Internal Control Systems

Your Company has established appropriate and effective internal control systems for its business processes covering operations, financial reporting and compliance with applicable laws, regulations and internal policies. These internal controls are designed to ensure the orderly and efficient conduct of business and to support reliable financial reporting and regulatory compliance. The Companys internal financial controls over financial reporting are adequate and were operating effectively as at March 31, 2026.

The Audit Committee of the Board reviews the adequacy and operating effectiveness of controls and also approves the Internal Audit Plan for audits to be conducted. Internal audits are conducted at periodic intervals across locations and processes in accordance with the approved plan.

Internal audit findings, observations and recommended corrective actions are discussed with the Management and presented to the Audit Committee on a periodic basis. Management implements suitable remedial measures in response to audit observations, and the status of implementation of agreed action plans is monitored and reviewed by the Audit Committee to ensure timely closure and strengthening of internal controls.

9. Cautionary Statement

The statements in the Management Discussion

& Analysis, describing the Companys objectives, expectations and forecasts may be forward-looking within the meaning of applicable securities laws and regulations. The actual results may di_er from those expressed or implied, depending upon the economic and climatic conditions, government policies and other incidental factors.

The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise, except as may be required under applicable law.