Beezaasan Explotech Ltd Management Discussions

1. Industry Structure and Developments

The industrial explosives sector plays a strategic and economic role in a countrys development, security, and industrialization. Industrial explosives are extensively used in mining (coal, iron ore, limestone, etc.}, quarrying, Infrastructure projects (tunnels, roads, dams}. They facilitate efficient rock blasting, reducing cost and time in arge-scale projects.

The sector supports a wide supply chain, including raw material providers, transporters, and component manufacturers. It creates skilled employment in manufacturing, logistics, and engineering. By supporting mining and infrastructure, it indirectly boosts power generation, steel, and construction sectors.

Beezaasan Explotech Limited operates within the defense and industrial explosives sector, a critical component of national security and infrastructure development. The Indian explosives industry is experiencing stable demand, fuelled by ongoing infrastructure projects, mining activity, and government spending on defence modernization. The Government of Indias push for self-reliance under the "Aatmanirbhar Bharat" initiative and the liberalization of the defence manufacturing sector have opened new avenues for domestic manufacturers.

Despite global geopolitical uncertainties and supply chain constraints, the Indian explosives market is expected to witness moderate growth, supported by increased defence allocation and expanding private participation.

2. Opportunities and Threats

Opportunities:

• Government Initiatives: Support for indigenous defence manufacturing under "Make in India".

• Increased Mining Activity: Rising demand in coal and mineral mining sectors.

• Export Potential: Opening of export opportunities in friendly nations.

• Technological Upgradation: Adoption of automated and safer production techniques.

Threats:

• Stringent Regulatory Environment: Compliance with safety, environmental, and defence regulations.

• Raw Material Volatility: Fluctuations in cost and availability of raw materials.

• Security Risks: High-risk profile due to the nature of operations.

• Global Instability: Geopolitical tensions affecting exports and supply chains.

3. Segment-wise or Product-wise Performance

Beezaasan Explotech Limited operates primarily in one segment ? manufacturing and supply of industrial and Defense-grade explosives. During the year ended March 31, 2025, the Company recorded a revenue growth of 14.70 % driven by increased orders from mining and infrastructure clients, along with preliminary defence contract executions.

Product performance highlights:

• Industrial Explosives: Stable performance with consistent demand from coal mining operations.

• Defence Applications: Initial traction in precision applications, with promising pilot project approvals.

4. Outlook

The outlook for FY 2025-26 remains cautiously optimistic. With the governments sustained emphasis on infrastructure and defence procurement, Beezaasan Explotech aims to strengthen its position through:

• Capacity expansion

• R&D in safer, more efficient explosives

• Strategic partnerships and technology collaborations

• New Manufacturing Facilities to start Operation and thereby contributing in the Overall Growth of the Company

Investments in digital transformation and sustainability measures are expected to enhance operational efficiency and compliance adherence.

5. Risk Management

The Company follows a structured risk management framework. Key risks identified include:

• Operational Risks: Handled through stringent SOPs and safety audits.

• Compliance Risks: Periodic legal review and internal compliance checks.

• Market Risks: Diversification into newer geographies and customer segments.

• Technology Risks: Ongoing investments in R&D and collaborations to stay current.

6. Internal Control Systems and Their Adequacy

Beezaasan Explotech Limited has established robust internal control systems commensurate with its size and operations. The framework ensures:

• Accuracy of financial records

• Safeguarding of assets

• Operational efficiency

• Statutory compliance

These systems are reviewed periodically by internal and statutory auditors, and corrective actions are taken promptly wherever required.

7. Discussion on Financial Performance with Respect to Operational Performance

During FY 2024-25, the Company achieved**:

• Revenue: ? 214,99,50,867

• EBITDA Margin: 10.31%

• Net Profit:? 12,30,11,180 ** Standalone Figures

Growth was primarily driven by higher production volume, cost optimization, and prudent working capital management. Rising input costs were partly mitigated through improved procurement strategies and automation in manufacturing.

8. Disclosure of Accounting Treatment:

The Company has followed the Accounting Standards (AS) for drawing-up its accounts as prescribed by the Institute of Chartered Accountants of India, in the preparation of financial statements. There are no audit qualifications in the Companys financial statements for the year under review.

(A) STATUTORY COMPLIANCE:

The Company has complied with all the statutory requirements. A declaration regarding compliance of

the provisions of the various statutes is also made by the Chairman and Managing Director at each Board Meeting. The Company ensures compliance of the ROC, SEBI Regulations.

(B) FORWARD LOOKING STATEMENTS:

Outlook for future are estimates based on certain assumptions and expectations of future events, eco- political and other developments across the country, the company cannot guarantee that these are accurate or will be realized. Statements in Management Discussion and Analysis describing the Companys objectives, expectations or predictions may be forward-looking within the meaning of applicable securities law and regulations. The companys actual results, performance or achievements could thus differ from those projected in any forward- looking statements.

9. Human Resources and Industrial Relations

Employee engagement, skill development, and safety

remain the cornerstones of the Companys HR policies.

Industrial relations continued to be cordial throughout

the year.

Key HR initiatives:

• Periodic safety and compliance training

• Employee welfare schemes

• Performance-linked incentives

10. Environmental, Social, and Governance (ESG) Initiatives

Beezaasan Explotech iscommittedtosustainablepractices:

• Safe disposal of hazardous waste

• Minimization of environmental footprint

• Community welfare programs in operational regions

• ESG compliance integrated into strategic decisionmaking

Ratio	FY 2024-25 Ratio	FY 2023-24 Ratio	% Variance Reason for Variance
(a) Current Ratio	3.45	1.04	23?.92 Qurrent Ratio Increased during 24-25, IPO Funds received and stand credit in Bank Accounts,

Details of significant changes (i.e. change of 25% or more as compared to the immediately previous financial year) in key financial ratios, along with detailed explanations thereof, including:

Ratio	FY 2024-25	FY 2023-24	% Variance Reason for Variance
	Ratio	Ratio
(b) Debt-Equity Ratio	0.25	1.56	-83.82 D/E Ratio has been reduced as the Shareholders fund increased due to Increase in Share Capital during the year
(c) Debt Service Coverage Ratio	3.41	2.12	60.86 DSCR has increased due to increase in EBITDA during the year
(d) Return on Equity Ratio	1.02	0.54	88.60 ROE has been increased during the year due to increase in Profit during the year
(e) Inventory turnover ratio	9.50	11.04	-13.95 Inventory Turnover Ratio reduced dueto increase in average inventory during the year
(f) Trade Receivables turnover ratio	33.26	21.48	54.80 Trade Receivable Turnover Ratio Turnover Ratio has been increased due to Decreased average trade receivable during the year
(g) Trade payables turnover ratio	571.71	102.51	457.72 Trade Payables Turnover Ratio Turnover Ratio has been increased due to decrease in average trade payables
(h) Net capital turnover ratio	4.66	38.20	-87.80 Net Capital Turnover ratio has been decreased due to substantial increase in working capital during the year as Share Capital Received have been credited and stand in Current Assets.
(i) Net profit ratio	6.06	2.72	122.83 Net Profit Ratio has been increased dueto increase in profit during the year
(j) Return on Capital employed	19.49	26.88	-27.48 ROCE has been decreased due to increase in shareholders fund during the year
(k) Return on investment	14.25	21.52	-41.48 ROI has been decreased due to increase in shareholders fund during the year

Details of any change in Return on Net Worth as compared to the immediately previous financial year along with a detailed explanation thereof

During the year 2024-25, the Net Worth of the Company has been increased from ? 2385.59 Lacs to ? 9765.53 Lacs. This increase is due to Increase in Share Capital & Securities Premium through the Initial Public Offering. The Profit after tax

(PAT) also increased from ? 513.49 lacs to ? 1391.19 Lacs.

As the Net Worth of the Company has been increased more than the increase in the PAT, the resulting Return on Net Worth has been decreased from 21.52 times to 14.25 times.

Cautionary Statement

Statements in this report relating to the Companys objectives, projections, outlook, estimates, and expectations may be considered "forward-looking statements" within the meaning of applicable laws and regulations. Actual results may differ materially from those expressed or implied, depending on various economic, regulatory, and operational factors.

FOR AND ON BEHALF OF THE BOARD BEEZAASAN EXPLOTECH LIMITED

Navneet Somani Rajan Somani

Place: Gandhinagar Chairman and Managing Director Director

Date: 02.09.2025 DIN: 01782793 DIN: 10440137