Biopol Chemicals Ltd Management Discussions

OPERATIONS

The following discussion and analysis of our financial condition and results of operations for the Fiscal Year 2025, Fiscal
Year 2024 and Fiscal Year 2023 is based on, and should be read in conjunction with, our Restated Financial Information,
including the schedules, notes and significant accounting policies thereto, included in the chapter titled "Restated Financial
Information " beginning on page 206 of this Draft Red Heiring Prospectus. Our Restated Financial Information have been
derived from our audited financial statements and restated in accordance with the SEBI ICDR Regulations and the ICAI
Guidance Note. Our financial statements are prepared in accordance with AS.

You should read the following discussion of our financial condition and results of operations together with our restated
financial information included in this Draft Red Herring Prospectus. You should also read the section titled "Risk Factors"
beginning on page 33 of this Draft Red Herring Prospectus, which discusses a number offactors, risks and contingencies
that could affect our financial condition and results of operations. Our fiscal year ends on March 31 of each year, so all
references to a particular fiscal year are to the twelve-month period ended March 31 of that year.

In this section, unless the context otherwise requires, any reference to "we", "us" or "our" refers to our Company. Unless
otherwise indicated, financial information included herein are based on our "Restated Financial Information " for the
Fiscal Year 2025, Fiscal Year 2024 and Fiscal Year 2023 included on page 206 of this Draft Red Heiring Prospectus.

Note: Statement in the Management Discussion and Analysis Report describing our objectives, outlook, estimates,
expectations or prediction may be "Forward Looking Statements" within the meaning of applicable securities laws and
regulations. Actual results could differ materially from those expressed or implied. Important factors that could make a
difference to our operations include, among others, economic conditions affecting demand/supply and price conditions in
domestic and overseas market in which we operate, changes in Government Regulations, Tax Laws and other Statutes and
incidental factors.

BUSINESS OVERVIEW

Our Company is engaged in the business of manufacturing and distribution of specialty chemicals under the categories of
silicones, emulsifiers, biochemicals and polyelectrolytes. Our product portfolio consists of 66 products which comprises of
40 silicone-based products, 5 emulsifier-based products, 15 biochemical products and 6 polyelectrolyte products. These
products are used in applications across various industry segments, including softeners, emulsions and hardeners for
textiles; silicone fluids and cleaning chemicals for home care; silicone adjuvants and surfactants in agriculture; and release
agents in industrial chemicals.

In addition, our Company also provides technical consultancy services to customers. These services are offered either in
connection with the sale of our products or in certain cases, separately at the request of customers for specific requirements.
Our consultancy services include support on the application of specialty chemicals in textile processing, guidance relating
to the manufacture of dyes and advice on the use of specialty chemicals in industrial formulations, enabling customers in
achieving specific application requirements.

Our Company operates on a business-to-business (B2B) model, catering to institutional clients rather than retail end-users.
We conduct our business through a combination of direct sales and a network of distributors, enabling us to serve customers
across both domestic and international markets. In the domestic market, our sales are spread across several regions,
including West Bengal, Gujarat, Maharashtra, Tamil Nadu and Karnataka, with a significant portion of revenue derived
from West Bengal and Gujarat. While our exports are currently focused on Bangladesh, which is a global hub for textiles
and apparel manufacturing (Source: Bangladesh Investment Development Authority https://www. bida. gov.bd/investment-
sector/textiles-apparels) . The details of our revenue from operations from these major revenue-contributing regions for the
financial year ended March 31, 2025, 2024 and 2023, respectively are as follows:

(€ in lakhs)

Particulars	FY 2024-25		FY 2023-24		FY 2022-23
	Revenue from Operations	%	Revenue from Operations	%	Revenue from Operations	%
West Bengal	3,007.16	61.21	357.58	14.04	473.33	24.49
Gujarat	1,220.74	24.85	1,648.19	64.71	887.65	45.93
Bangladesh	369.08	7.51	166.79	6.55	253.31	13.11
Total	4,596.98	93.57	2,172.56	85.30	1,614.29	83.54

Key Performance Indicators of our Company.

As per Restated Financial Information

(€ in Lakhs, otherwise mentioned)

Key Financial Performance	March 31, 2025	March 31, 2024	March 31, 2023
Revenue from Operations (1)	4,912.84	2,546.97	1,932.43
EBITDA (2)	653.39	442.71	155.72
EBITDA Margin (%) (3)	13.30%	17.38%	8.06%
PAT (4)	434.34	296.32	53.79
PAT Margin (%) (5)	8.84%	11.63%	2.78%
Return on Equity (%) (6)	38.19%	53.87%	31.38 %
Debt to Equity Ratio (times) (7)	0.57	0.39	3.71
Current Ratio (times) (8)	1.81	2.08	1.75
Return on capital employed (%) (9)	30.55%	34.03%	17.81 %

As certified by Statutory Auditor of our Company, by way of their certificate dated September 23, 2025
Notes:

(1 Revenue from operation means revenue from sales and other operating revenues

(2) EBITDA is calculated as Profit before tax + Depreciation + Interest Expenses - Other Income

(3) ‘EBITDA Margin is calculated as EBITDA divided by Revenue from Operations
⁽⁴PAT is calculated as Profit before tax - Tax Expenses

(5) ‘pa t Margin is calculated as PA T for the year divided by revenue from operations

(6) Return on Equity is ratio of Profit after Tax and Average Shareholder Equity

(7 Debt to Equity ratio is calculated as Long Term Debt + Short Term Debt divided by equity
(8) Current Ratio is calculated by dividing Current Assets to Current Liabilities

(9 Return on Capital Employed is ratio of EBIT and Capital Employed, where Capital Employed = Tangible Net Worth +
Total Debt + Deferred Tax Liability

SIGNIFICANT DEVELOPMENTS AFTER MARCH 31, 2025

Except as discussed below and elsewhere in this Draft Red Herring Prospectus, in the opinion of the Board of Directors of
our Company, since March 31, 2025 as disclosed in this Draft Red Herring Prospectus, there have not arisen any
circumstance that materially or adversely affect or are likely to affect the profitability of our Company or the value of its
assets or its ability to pay its material liabilities within the next twelve months.

• Our Company has approved the Audited Financial Statements for the financial years ended on March 31, 2025 pursuant
to a resolution passed by the Board of Directors at their meeting held on July 01, 2025 and through ordinary resolution
passed by the Shareholders of our Company at their Annual General Meeting dated July 24, 2025.

• Our Company has approved the Restated Financial Information for the financial years ended on March 31, 2025, March
31, 2024 and March 31, 2023, respectively, by the Board of Directors pursuant to a resolution passed at their meeting
held on September 23, 2025.

• The Board of our Company has approved to raise funds through Initial Public Offering in the board meeting held on
September 06, 2025.

• The members of our Company approved proposal of Board of Directors to raise funds through initial public offering
in the EOGM held on September 08, 2025.

• Our Company has approved the Draft Red Herring Prospectus vide resolution in their Board Meetings dated September
29, 2025.

STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES

For details in respect of Statement of Significant Accounting Policies, please refer to the chapter titled "Restated Financial
Information" beginning on page 206 of this Draft Red Heiring Prospectus.

KEY COMPONENTS OF THE COMPANYS BALANCE SHEET

The following table sets forth selected financial data derived from our restated statement of assets & liabilities as at Fiscal
2025, 2024, and 2023:

(Rs in Lakhs)

Particulars	Fiscal 2025	Fiscal 2024	Fiscal 2023
Liabilities
Long-term Borrowings	62.97	-	449.94
Short-Term Borrowings	705.56	357.65	218.93
Trade Payables	857.82	393.75	301.24
Short-term provisions	128.99	30.25	1.82
Other Current Liabilities	31.76	49.25	87.10
Assets
Property, Plant & Equipment and Intangible Assets	22.55	27.20	26.85
Trade receivables	1,665.64	1,013.12	701.22
Inventories	1,181.43	613.30	160.43
Cash and cash equivalents	114.83	8.23	5.98
Short-term loans and advances	153.27	90.88	199.72

A) Long-Term Borrowings:

The companys long-term borrowings have changed from ?449.95 Lakhs in Fiscal 2023 to Nil in Fiscal 2024 to ?62.97
Lakhs in Fiscal 2025.

(Rs in Lakhs)

Particulars	Fiscal 2025	Fiscal 2024	Fiscal 2023
Secured
Vehicle Loan - From Bank	3.51	-	13.04
Unsecured
Term Loan - From Bank	36.72	-	11.11
Term Loan - From NBFCs	22.74	-	0
Loan from Others	-	-	425.79
Total	62.97	-	449.94

The companys long-term borrowings decreased from ?449.95 Lakhs in Fiscal 2023 to Nil in Fiscal 2024, following the
pre-payment of all outstanding loans as part of the business transfer from United Chemical Company to Biopol Chemicals
Limited . However, in Fiscal 2025, long-term borrowings increased to ?62.97 Lakhs, driven by fresh loans availed from
NBFCs and bank to support the companys operational funding requirements.

B) Short-Term Borrowings:

(Rs in Lakhs)

Particulars	Fiscal 2025	Fiscal 2024	Fiscal 2023
Current Maturities of Long-Term Debt
Secured
Vehicle Loan - From Bank	3.72	-	7.55
Term Loan - From Bank	0	-	45.79
Unsecured
Term Loan - From Bank	12.78	-	19.66
Term Loan - From NBFCs	7.81	-	1.77
Loans Repayable on Demand - Secured
Working Capital Loan from bank	681.25	357.65	144.16
Particulars	Fiscal 2025	Fiscal 2024	Fiscal 2023
Total	705.56	357.65	218.93

The companys short-term borrowings increased from ?218.93 Lakhs in Fiscal 2023 to 357.65 in Fiscal 2024, firstly due
to prepayment of current maturities of long-term debts the borrowings has decreased to NIL & due to the transfer of
Business from United Chemical Company to Biopol Chemicals limited company has availed fresh loans in the from of cash
credit from axis bank so the borrowings has increased . Further, it increased to ?705.56 Lakhs in Fiscal 2025 due to current
maturities of term loans taken from banks & NBFCs during the year.

C) Trade Payables:

Trade payables include dues payable to creditors. The companys payables increased from ? 301.24 Lakhs in Fiscal 2023
to ?393.75 Lakhs in Fiscal 2024 to ?857.83 Lakhs in Fiscal 2025, which is in line with the growing expenses of the
company. The following are details of the Trade Payables of the company:

(Rs in Lakhs)

Particulars	Fiscal 2025	Fiscal 2024	Fiscal 2023
Total outstanding dues of micro enterprises and small enterprises	8.70	13.86	4.65
Total outstanding dues of creditors other than micro enterprises and small enterprises	849.12	379.89	296.59
Total	857.82	393.75	301.24

D) Short-term Provisions:

The companys short-term provisions have increased from ?1.82 Lakhs in Fiscal 2023 to ?30.25Lakhs in Fiscal 2024 to
?128.99 Lakhs in Fiscal 2025, due to an increase in the provision of income tax, which is in line with the growing operations
of the company. The table below shows details of the short-term provisions of the company:

(Rs in Lakhs)

Particulars	Fiscal 2025	Fiscal 2024	Fiscal 2023
Provision for Gratuity	0.6	0.49	0.43
Provision for Income Tax	128.39	29.76	1.39
Total	128.99	30.25	1.82

E) Other Current Liabilities

The companys other current liabilities have decreased from ?87.10 Lakhs in Fiscal 2023 to ?49.25 Lakhs in Fiscal 2024
to ?31.76 Lakhs in Fiscal 2025. The table below shows details of the short-term provisions of the company:

(Rs in Lakhs)

Particulars	Fiscal 2025	Fiscal 2024	Fiscal 2023
Advance Received from Customers	0.06	33.5	77.84
TDS & TCS Payable	9.95	0.51	5.15
PT Payable	0.02	0.01	-
ESIC Payable	0.02	-	-
EPF Payable	0.18	-	-
Credit Card Payable	-	-	1.70
Director Remuneration Payable	7.8	3.06	-
Salary Payable	13.73	12.17	2.41
Total	31.76	49.25	87.10

The companys other current liabilities decreased due to an increase in TDS & TCS Payable, an increase in expenses payable
such as salary payable, directors remuneration payable etc, which was offset by a decrease in advances received from
customers of the company.

F) Property, Plant & Equipment and Intangible Assets:

The following are the details of "Property, Plant & Equipment and Intangible Assets":

(Rs in Lakhs)

Particulars	Fiscal 2025	Fiscal 2024	Fiscal 2023
Property, Plant and Equipment	22.3	21.20	26.63
Capital WIP	0	5.9	0
Intangible Assets	0.22	0.1	0.22
Total	22.52	27.20	26.85

The companys Property, Plant & Equipment and Intangible Assets have Decreased from Rs26.63 Lakhs in Fiscal 2023 to
Rs21.20 Lakhs in Fiscal 2024. This was on account of depreciation charged during the fiscal year. Further, it was Increased
to Rs22.33 Lakhs in Fiscal 2025.

G) Trade receivables:

Trade receivables refer to outstanding dues from customers that remain unpaid. The following are details of the Trade
receivables of the company:

(Rs in Lakhs)

Particulars	Fiscal 2025	Fiscal 2024	Fiscal 2023
Trade Receivables	1,665.64	1,013.12	701.22
Total	1,665.64	1,013.12	701.22

The companys trade receivables increased from Rs701.22 Lakhs in Fiscal 2023 to Rs1,013.12 Lakhs in Fiscal 2024 to
Rs1,665.64 Lakhs in Fiscal 2025, which is in line with the growing operations of the company.

H) Inventories:

The companys inventory increased from Rs160.43 Lakhs in Fiscal 2023 to Rs613.30 Lakhs in Fiscal 2024 to Rs1,181.43 Lakhs
in Fiscal 2025 due to an increase in Purchases of Stock-in-trade, raw material and finished goods, which is in line with the
growing operations of the company. The following are the details of the Inventories of the company:

(Rs in Lakhs)

Particulars	Fiscal 2025	Fiscal 2024	Fiscal 2023
Raw Material	355.2	78.67	63.1
Stock in trade	183.28	182.94	4.05
Finished Goods	642.95	351.69	93.28
Total	1181.43	613.30	160.43

I) Cash & Cash Equivalents:

The companys cash & cash equivalents changed from ?5.98 Lakhs in Fiscal 2023 to ?8.23 Lakhs in Fiscal 2024 to ^114.83
Lakhs in Fiscal 2025, which is in line with the operations of the company. The following are the details of the Cash & Cash
Equivalents of the company:

(Rs in Lakhs)

Particulars	Fiscal 2025	Fiscal 2024	Fiscal 2023
Cash in Hand	2.27	6.74	4.98
Balance in Current Account	112.56	1.49	1.00
Total	114.83	8.23	5.98

J) Short-term Loans & Advances:

The companys Short-term loans & advances decreased from ?199.72 Lakhs in Fiscal 2023 to ?90.88 Lakhs in Fiscal 2024
due to decrease in balance with revenue authorities and then increased to ?153.27 Lakhs in Fiscal 2025 due to increase in
balance with revenue authorities, advance given to supplier ad advances to employees. The following are the details of the
Short-term loans & advances of the company:

(Rs in Lakhs)

Particulars	Fiscal 2025	Fiscal 2024	Fiscal 2023
Balance With Revenue Authorities	81.56	70.98	138.24
Advance Given to Supplier	67.89	17.23	59.21
Advances Given to Employees	3.82	2.67	2.27
Particulars	Fiscal 2025	Fiscal 2024	Fiscal 2023
Total	153.27	90.88	199.72

RESULTS OF OUR OPERATION

The following discussion on results of operations should be read in conjunction with the Restated Financial Information of
our Company for the Fiscal Year 2025, Fiscal Year 2024 and Fiscal Year 2023:

in Lakhs)

Particulars	For the Year Ended on
	March 31, 2025	% of Total Income	March 31, 2024	% of Total Income	March 31, 2023	% of Total Income
Revenue From Operations	4,912.84	99.95%	2,546.97	100.00%	1932.43	99.97%
Other Income	2.29	0.05%	0.05	0.00%	0.61	0.03%
Total Income	4,915.13	100.00%	2,547.02	100.00%	1,933.04	100%
Expenditure
Cost of Material Consumed	1,586.15	32.27%	601.97	23.63%	1216.62	62.94%
Purchase of Stock in Trade	2,732.55	55.59%	1680.59	65.98%	152.65	7.90%
Changes in Inventories of Finished Goods	-291.60	-5.93%	-437.30	-17.17%	272.96	14.12%
Employee Benefit Expense	105.26	2.14%	45.20	1.78%	40.76	2.11%
Finance Costs	68.16	1.39%	38.76	1.52%	79.25	4.10%
Depreciation and Amortization Expense	7.10	0.14%	8.02	0.31%	5.20	0.27%
Other Expenses	127.09	2.59%	213.8	8.39%	93.72	4.85%
Total Expenditure	4,334.71	88.19%	2,151.04	84.45%	1,861.16	96.28%
Profit/(Loss) Before Tax	580.42	11.81%	395.98	15.55%	71.88	3.72%
Tax Expense:
Tax Expense for Current Year	146.88	2.99%	100.54	3.95%	18.66	0.97%
Deferred Tax	-0.80	-0.02%	-0.88	-0.03%	-0.57	-0.03%
Net Current Tax Expenses	146.08	2.97%	99.66	3.91%	18.09	0.94%
Profit After Tax	434.34	8.84%	296.32	11.63%	53.79	2.78%

FACTORS AFFECTING OUR RESULTS OF OPERATIONS

Our business is subjected to various risks and uncertainties, including those discussed in the section titled "Risk Factors "
beginning on page 33 of this Draft Red Herring Prospectus. Our results of operations and financial conditions are affected
by numerous factors including the following:

• Any slowdown or shutdown in our operations;

• Fluctuations in the costs of labour, equipment, and interest rates.

• Failure to acquire new consumers or retain existing customers or fail to do so in a cost-effective manner;

• Inability to accurately manage our inventory, this may adversely affect our goodwill and business, financial condition
and results of operations;

• Our ability to attract and retain qualified personnel;

• Orders placed by customers may be delayed, modified or cancelled, which may have an adverse effect on our business,
financial condition and results of operations;

• Conflict of interests between our Company and other venture or enterprises promoted by our promoter or directors;

• Volatility of loan interest rates and inflation;

• Natural calamities, climate change and health epidemics could adversely affect the Indian economy and our business,
financial condition, and results of operations;

• Changing laws, rules and regulations and legal uncertainties, including adverse application of tax laws, may adversely
affect our business, financial condition and results of operations;

• A slowdown in economic growth in India could cause our business to suffer;

• Expanding into new states or business segments

• Fraud or improper employee conduct.

• Our inability to maintain or improve our brand image;

• Global economic conditions which may have an adverse effect on our business, financial condition, results of
operations and prospects.

KEY COMPONENTS OF THE COMPANYS PROFIT AND LOSS STATEMENT

• Revenue from operations: Revenue from operations mainly consists of Income from AV Integration, Sale and
Distribution of AV Products, Service Robots, IT Software Development/Consulting Services, etc.

• Other Income: Other Income includes Interest income, Incentives, etc.

• Expenses: The Companys expenses consist of Cost of material consumed, Purchases of Stock-in-Trade, Changes in
Inventories of Finished Goods, Employee Benefit Expenses, Finance Cost, Depreciation and Amortization Expense,
Other Expenses, and tax expenses.

• Cost of material consumed: Cost of material consumed consist of purchases of raw material and difference in opening
stock of raw material and closing stock of raw material.

• Purchases of Stock-in-Trade: Purchases of Stock-in-Trade include purchases of various products such as speakers,
robots, etc.

• Employee Benefits Expense: Employee benefit expenses include Salary & Wages, Remuneration to Directors and
Gratuity Expenses.

• Finance Cost: Finance Cost includes Interest Expenses and Other Borrowing Costs.

• Depreciation and Amortization Expense: We recognize Depreciation and Amortization expense on a WDV basis as
per the rates outlined in the Companies Act, 2013.

• Other Expenses: Other expenses include Freight Charges, Legal & Professional fees, Rent, Rates & Taxes,
Commission & Brokerage, etc.

FISCAL 2025 COMPARED WITH FISCAL 2024

(Rs in Lakhs)

Particulars	For the Year Ended on
	March 31, 2025	March 31, 2024	% Change
Revenue From Operations	4,912.84	2,546.97	92.89%
Other Income	2.29	0.05	4480.00%
Total Income	4,915.13	2,547.02	92.98%
Expenditure
Cost of Material Consumed	1,586.15	601.97	163.49%

 

Particulars	For the Year Ended on
	March 31, 2025	March 31, 2024	% Change
Purchase of Stock in Trade	2,732.55	1,680.59	62.59%
Changes in Inventories of Finished Goods	-291.60	-437.30	-33.32%
Employee Benefit Expense	105.26	45.20	132.88%
Finance Costs	68.16	38.76	75.85%
Depreciation and Amortization Expense	7.10	8.02	-11.47%
Other Expenses	127.09	213.80	-40.56%
Total Expenditure	4,334.71	2,151.04	101.52%
Profit/(Loss) Before Tax	580.42	395.98	46.58%
Tax Expense:
Tax Expense for Current Year	146.88	100.54	46.09%
Deferred Tax	-0.80	-0.88	-9.09%
Net Current Tax Expenses	146.08	99.66	46.58%
Profit After Tax	434.34	296.32	46.58%

Revenue from Operation

Revenue from operations has increased by 92.64% from Rs2,659.62 Lakhs in Fiscal 2024 to Rs5,123.56 Lakhs in Fiscal 2025.
The table below sets forth the details of the revenue bifurcation of the company: -

(Rs in Lakhs, except percentages)

Particulars	For the year ended March 31, 2025		For the year ended March 31, 2024		% change
	Amount	% of Revenue from operations	Amount	% of Revenue from operations
Agriculture	12.95	0.26%	20.94	0.82%	-38.16%
Industrial Chemical	512.34	10.43%	163.42	6.42%	213.51%
Personal & Home Care	150.21	3.06%	72.43	2.84%	107.39%
Textile Chemical	4,156.24	84.60%	1,997.52	78.43%	108.07%
Consultancy Services	81.10	1.65%	292.66	11.49%	-72.29%
	4,912.84	100.00%	2,546.97	100.00%

The companys revenue increased due to the following reasons: -

1) Increase in revenue from Textile Chemical and Industrial Chemical - During FY 2025, the company reported
revenue of Rs4,668.58 Lakhs from textile and Industrial chemicals, contributing 95.03% of Revenue from Operations.
This revenue came from sales to the textile & industrial segment. The revenue from this segment showed an increase
compared to the previous year, indicating a larger share of total operations during the financial year.

2) Increase in Revenue from Geographical Sale - In FY 2025, the company recorded revenue of Rs3,007.16 Lakhs
from West Bengal and Rs1,220.74 Lakhs from Gujarat, representing 61.21% and 24.85% of the total revenue from
operations. In FY 2024, revenue from West Bengal was Rs357.58 Lakhs and from Gujarat Rs1,648.19 Lakhs,
contributing 14.04% and 64.71%, respectively. The company continued its export activity in Bangladesh, with revenue
of Rs369.08 Lakhs in FY 2025 and Rs166.79 Lakhs in FY 2024, representing 7.51% and 6.55% of revenue from
operations. The figures reflect a geographical shift in sales, with Gujarat contributing a higher share in FY 2024. West
Bengal and Bangladesh showed a decline in contribution compared to the previous year. Overall, revenue distribution
across regions indicates growth in operations from Gujarat, while maintaining export presence in Bangladesh. This
geographical spread resulted in an overall increase in revenue from operations in FY 2025.

3) Increase in manufacturing capacity of the company : During FY 2025, the Company commissioned a new reactor
vessel with jacket and condenser on February 23, 2024. The installed capacity of this reactor is 2,000 litres per day.
Accordingly, the installed capacity for FY 2025 has been increased from 11,69,000 litres in FY 2024 to 18,25,000
litres in FY 2025. This increase in capacity leads to increase in revenue from operation during the year.

Other Income

Other income had increased by Rs2.24 Lakhs from Rs0.05 Lakhs in Fiscal 2024 to Rs2.29 Lakhs in Fiscal 2025 due to a
reduction in Interest income during the year.

Cost of Material Consumed

Cost of material consumed is increased from Rs601.97 Lakhs in Fiscal 2024 to Rs1,586.15 Lakhs in Fiscal 2025 due to
increase in purchase of Raw material from Rs617.54 Lakhs in Fiscal 2024 to Rs1,862.68 Lakhs in Fiscal 2025.

Purchases of Stock-in-Trade

The companys purchases of stock-in-trade increased from Rs1,680.59 Lakhs in Fiscal 2024 to Rs2,732.55 Lakhs in Fiscal
2025. The increase in the companys purchases is directly attributable to the increase in its operations.

Changes in Inventories of Finished Goods and stock in trade

Changes in inventories of finished goods and stock in trade is due to change in opening stock of finished goods and stock
in trade with the closing stock of finished goods and stock in trade.

Employee Benefit Expenses

Employee benefit expenses had increased by Rs60.04 Lakhs from Rs45.20 Lakhs in Fiscal 2024 to Rs105.26 Lakhs in Fiscal
2025. This was primarily due to an increase in Salary & Wages from Rs33.37 Lakhs in Fiscal 2024 to Rs39.03 Lakhs in Fiscal
2025 and an increase in Remuneration to directors from Rs11.00 Lakhs in Fiscal 2024 to Rs62.00 Lakhs in Fiscal 2025.

Finance Cost

Finance Cost had increased by Rs29.41 Lakhs from Rs38.76 Lakhs in Fiscal 2024 to Rs68.16 Lakhs in Fiscal 2025. This was
primarily due to a increase in Interest paid on borrowings from Rs25.38 Lakhs in Fiscal 2024 to Rs45.22 Lakhs in Fiscal 2025
due to new borrowings, increase in Bank Charges & Processing fees from Rs13.07 Lakhs in Fiscal 2024 to Rs17.65 Lakhs in
Fiscal 2025.

Depreciation and Amortization Expenses

Depreciation had decreased by Rs 0.90 Lakhs from Rs8.02 Lakhs in Fiscal 2024 to Rs7.10 Lakhs in Fiscal 2025.

Other Expenses

Other expenses had decreased by Rs86.72 Lakhs from Rs213.80 Lakhs in Fiscal 2024 to Rs127.09 Lakhs in Fiscal 2025. The
decrease was primarily due to a decrease in packing material expenses by Rs74.24 Lakhs, legal & professional expenses by
Rs22.85 Lakhs, office expense by Rs1.58 Lakhs, Transportation expense by Rs2.94 lakhs etc. This was offset by an increase in
Marketing & Business promotion expense by Rs27.76 Lakhs, Printing & Stationery expenses by Rs1.43 Lakhs, etc. in Fiscal
2025.

Tax Expenses

The Companys tax expenses increased by Rs46.42 Lakhs from Rs99.66 Lakhs in Fiscal 2024 to Rs 146.08 Lakhs in Fiscal
2025. This was on account of an increase in Tax expenses of the current year by Rs46.34 Lakhs and deferred tax by Rs0.08
Lakhs in Fiscal 2025.

Profit after Tax

In Fiscal 2025, the Company reported a net profit of Rs434.34 Lakhs attributable to owners, marking a growth of 46.58%
from Rs296.32 Lakhs in Fiscal 2024. This growth was primarily driven by an increase in Total Income, which rose from
Rs2,547.02 Lakhs in Fiscal 2024 to Rs4,915.13 Lakhs in Fiscal 2025.

Despite the increase in the absolute amount of profits, the companys profit margin decreased from 11.63% in Fiscal 2024
to 8.84% in Fiscal 2025. This reduction in profit margin was on account of an increase in the purchases of raw from 24.25%
of total revenue in Fiscal 2024 to 37.90% of total revenue in Fiscal 2025 & an increase in employee benefit expenses from
1.78% of total revenue in Fiscal 2024 to 2.14% of total revenue in Fiscal 2025. This was offset by a decrease in other
expenses from 8.39% of total revenue in Fiscal 2024 to 2.59% of total revenue in Fiscal 2025.

FISCAL 2024 COMPARED WITH FISCAL 2023

(Rs in Lakhs)

Particulars	For the Year Ended on
	March 31, 2024	March 31, 2023	% Change
Revenue From Operations	2,546.97	1,932.43	31.80%
Other Income	0.05	0.61	-91.80%
Total Income	2,547.02	1,933.04	31.76%
Expenditure
Cost of Material Consumed	601.97	1,216.62	-50.52%
Purchase of Stock in Trade	1,680.59	152.65	1000.94%
Changes in Inventories of Finished Goods	-437.30	272.96	-260.20%
Employee Benefit Expense	45.20	40.76	10.89%
Finance Costs	38.76	79.25	-51.11%
Depreciation and Amortization Expense	8.02	5.20	53.74%
Other Expenses	213.80	93.72	128.08%
Total Expenditure	2,151.04	1,861.16	15.57%
Profit/(Loss) Before Tax	395.98	71.88	451.26%
Tax Expense:
Tax Expense for Current Year	100.54	18.66	439.09%
Deferred Tax	-0.88	-0.57	54.39%
Net Current Tax Expenses	99.66	18.09	451.22%
Profit After Tax	296.32	53.79	451.27%

Revenue from Operation

Revenue from operations has increased by 178.28% from Rs1932.43 Lakhs in Fiscal 2023 to Rs2,646.97 Lakhs in Fiscal 2024.
The table below sets forth the details of the revenue bifurcation of the company: -

(Rs in Lakhs, except percentages)

Particulars	For the year ended March 31, 2024		For the year ended March 31, 2023		% change
	Amount	% of Revenue from operations	Amount	% of Revenue from operations
Agriculture	20.94	0.82%	32.64	1.69%	-35.85%
Industrial Chemical	163.42	6.42%	191.66	9.92%	-14.73%
Personal & Home Care	72.43	2.84%	103.36	5.35%	-29.92%
Textile Chemical	1,997.52	78.43%	1,445.67	74.81%	38.17%
Consultancy Services	292.66	11.49%	159.10	8.23%	83.95%
	2,546.97	100.00%	1,932.43	100.00%

The companys revenue increased due to the following reasons: -

1) Increase in revenue from Textile Chemical and Consultancy - During FY 2023-24, the company reported
revenue of Rs2,290.18 Lakhs from textile chemicals and consultancy services, contributing 89.92% of Revenue
from Operations. This revenue came from sales to the textile industry and consultancy services. The revenue from
this segment showed an increase compared to the previous year, indicating a larger share of total operations during
the financial year.

2) Increase in Revenue from Geographical Sale - In FY 2024, the company recorded revenue of Rs357.58 Lakhs
from West Bengal and Rs1,648.19 Lakhs from Gujarat, representing 14.04% and 64.71% of the total revenue from
operations. In FY 2023, revenue from West Bengal was Rs473.33 Lakhs and from Gujarat Rs887.65 Lakhs,
contributing 24.49% and 45.93%, respectively. The company continued its export activity in Bangladesh, with
revenue of Rs166.79 Lakhs in FY 2024 and Rs253.31 Lakhs in FY 2023, representing 6.55% and 13.11% of revenue
from operations. The figures reflect a geographical shift in sales, with Gujarat contributing a higher share in FY
2024. West Bengal and Bangladesh showed a decline in contribution compared to the previous year. Overall,
revenue distribution across regions indicates growth in operations from Gujarat, while maintaining export presence
in Bangladesh. This geographical spread resulted in an overall increase in revenue from operations in FY 2024.

3) Increase in manufacturing capacity of the company : During FY 2024, the Company commissioned a new
reactor vessel with jacket and condenser on February 23, 2024. The installed capacity of this reactor is 2,000 litres
per day. Accordingly, the installed capacity for FY 24 has been adjusted for the balance period of 37 days in FY
2024. This increase in capacity leads to increase in revenue from operation during the year.

Other Income

Other income had decreased by Rs0.56 Lakhs from Rs0.61 Lakhs in Fiscal 2023 to Rs0.05 Lakhs in Fiscal 2024. This was
mainly due to decrease in Interest income by Rs0.61 Lakhs during the year offset with increase in foreign exchange gain
Rs0.05 Lakhs.

Cost of Material Consumed

Cost of material consumed is decreased from Rs1,216.62 Lakhs in Fiscal 2023 to Rs601.97 Lakhs in Fiscal 2024 due to
decrease in purchase of Raw material from Rs1,254.22 Lakhs in Fiscal 2023 to Rs617.54 Lakhs in Fiscal 2024. During the
Fiscal 2024 the proprietorship firm United Chemical Company was taken over by our company w.e.f. September 30, 2023.
At the time of acquisition, closing stock of raw materials of United Chemical Company was transferred to the company as
sales. In the consolidated restated financial statements, this closing stock was eliminated from purchases, leading to a
reduction in reported raw material consumption for Fiscal 2024.

Purchases of Stock-in-Trade

The companys purchases of stock-in-trade increased from Rs152.65 Lakhs in Fiscal 2024 to Rs1,680.59 Lakhs in Fiscal 2024.
The increase in the companys purchases is directly attributable to the increase in its operations. During the Fiscal 2024 the
proprietorship firm United Chemical Company was taken over by our company w.e.f. September 30, 2023. At the time of
acquisition, closing stock of finished goods & stock in trade amount of Rs94.89 Lakhs of United Chemical Company was
transferred to the company as sales. In the consolidated restated financial statements, this closing stock was eliminated from
purchases.

Changes in Inventories of Finished Goods and stock in trade

Changes in inventories of finished goods and stock in trade is due to change in opening stock of finished goods and stock
in trade with the closing stock of finished goods and stock in trade.

Employee Benefit Expenses

Employee benefit expenses had increased by Rs4.44 Lakhs from Rs40.76 Lakhs in Fiscal 2023 to Rs45.20 Lakhs in Fiscal
2024. This was primarily due to an increase in Remuneration to directors from Nil in Fiscal 2023 to Rs11.00 Lakhs in Fiscal
2024 which is offset with an decrease in Salary & Wages from Rs39.93 Lakhs in Fiscal 2023 to Rs33.37 Lakhs in Fiscal 2024.

Finance Cost

Finance Cost had decreased by Rs40.51 Lakhs from Rs79.25 Lakhs in Fiscal 2023 to Rs38.76 Lakhs in Fiscal 2024. This was
primarily due to a decrease in Interest paid on borrowings from Rs67.66 Lakhs in Fiscal 2023 to Rs25.38 Lakhs in Fiscal 2024
and offset with increase in Bank Charges & Processing fees from Rs10.22 Lakhs in Fiscal 2023 to Rs13.07 Lakhs in Fiscal
2024. This decrease was mainly due to reduction in total borrowings of the company.

Depreciation and Amortization Expenses

Depreciation had increased by Rs2.80 Lakhs from Rs5.20 Lakhs in Fiscal 2023 to Rs8.02 Lakhs in Fiscal 2024. This was
primarily due to change in method of current years depreciation.

Other Expenses

Other expenses had increased by Rs120.06 Lakhs from Rs93.72 Lakhs in Fiscal 2023 to Rs213.80 Lakhs in Fiscal 2024. This
increase was primarily due to an increase in packing material expenses by Rs74.24 Lakhs and legal & professional expenses
by Rs20.74 Lakhs, . This was offset by a decrease in Gst expense & late fees by Rs8.75 Lakhs and travelling & conveyance
expenses by Rs4.19 Lakhs, etc., in Fiscal 2024.

Tax Expenses

The Companys tax expenses increased by Rs81.58 Lakhs from Rs18.09 Lakhs in Fiscal 2023 to Rs99.66 Lakhs in Fiscal 2024.
This was on account of an increase in Tax expenses of the current year by Rs81.89 Lakhs.

Profit after Tax

In Fiscal 2024, the Company reported a net profit of Rs296.32 Lakhs attributable to owners, marking an increase from
Rs53.79 Lakhs in Fiscal 2023. This growth was primarily driven by an increase in Total Income, which rose from Rs1,933.04
Lakhs in Fiscal 2023 to Rs2,547.01 Lakhs in Fiscal 2024.

The companys profit margin also increased from 2.78% in Fiscal 2023 to 11.63% in Fiscal 2024. This increase in profit
margin was on account of a decrease in the Finance Cost from 4.10% of total revenue in Fiscal 2023 to 1.52% of total
revenue in Fiscal 2024 & a decrease in employee benefit expenses from 2.11% of total revenue in Fiscal 2023 to 1.78% of
total revenue in Fiscal 2024. This was offset by an increase in purchase of stock in trade from 7.90% of total revenue in
Fiscal 2023 to 65.98% of total revenue in Fiscal 2024.

CASH FLOWS

(Rs in Lakhs)

Particulars	Year ended March 31, 2025	Year ended March 31, 2024*	Year ended March 31, 2023#
Net Cash from Operating Activities	(233.67)	(887.16)	23.57
Net Cash from Investing Activities	(2.45)	(7.10)	(49.37)
Net Cash from Financing Activities	342.72	902.49	13.61
Net Increase/ (Decrease) in Cash & Cash Equivalents	106.60	8.23	(12.19)
Opening Balance of Cash & Cash Equivalent	8.23	-	18.17
Closing Balance of Cash & Cash Equivalent	114.83	8.23	5.98

*Our Company was incorporated on April 12, 2023. The company acquired the business of United Chemical Company
w.e.f September 30, 2023 through a Business Transfer Agreement dated September 25, 2023. As the company was
incorporated during the same financial year, its opening balance of Cash and Cash Equivalents is Nil

# The business of the proprietorship firm, M/s United Chemical Company, was taken over by Biopol Chemicals Limited
w.e.f September 30, 2023 through a Business Transfer Agreement dated September 25, 2023. As a result, the closing
balance of Cash and Cash Equivalents for FY 2022-23 does not match the opening balance for FY 2023-24.

Cash Flows from Operating Activities

For the financial year ended March 31, 2025

Our net cash used in operating activities for the year ended March 31, 2025, was (Rs233.67 Lakhs) as compared to the Profit
Before Tax at Rs580.42 Lakhs. Our operating profit before working capital changes was Rs654.80 Lakhs for the financial
year ended March 31, 2025 which was primarily adjusted against increase in trade receivables by (Rs652.52 Lakhs), increase
in inventory by (Rs568.13 Lakhs), increase in short term loans and advances by (Rs62.39 Lakhs),increase in other current
asset by (Rs5 Lakhs), increase in non-current asset by (Rs1.05 Lakhs), decrease in trade payables by Rs466.36 Lakhs, decrease
in other current liabilities by (Rs17.49) Lakhs and Net Income taxes paid of (Rs48.25 Lakhs).

For the financial year ended March 31, 2024

Our net cash generated from operating activities for the year ended March 31, 2024, was at (Rs887.16 Lakhs) as compared
to the Profit Before Tax at Rs171.20 Lakhs. Our operating profit before working capital changes was Rs187.74 Lakhs for the
period ended March 31, 2024 which was primarily adjusted against increase in trade receivables by (Rs615.76 Lakhs),
increase in inventory by (Rs613.30 Lakhs), increase in short term loans and advances by (Rs86.25 Lakhs),increase in non -
current asset by (Rs0.10lakhs), increase in trade payables by Rs204.40 Lakhs, increase in other current liabilities by Rs49.25
Lakhs and Net income taxes paid of (Rs13.14 Lakhs).

For the financial year ended March 31, 2023

Our net cash generated from operating activities for the year ended March 31, 2023, was at Rs23.57 Lakhs as compared to
the Profit Before Tax at Rs71.88 Lakhs. Our operating profit before working capital changes was Rs156.62 Lakhs for the
financial year ended March 31, 2023 which was primarily adjusted against increase in trade receivables by (Rs567.65 Lakhs),
decrease in inventory by Rs235.36 Lakhs, decrease in short term loans and advances by Rs184.37 Lakhs, increase in non
current asset by (Rs 15.95 Lakhs), decrease in trade payables by (Rs30.74 Lakhs), decrease in other current liabilities by
Rs82.05 Lakhs and Net income tax paid of (Rs20.49 Lakhs).

Cash Flows from Investment Activities

For the financial year ended March 31, 2025

For the financial year ended March 31, 2025, the net cash used in Investing Activities was (Rs2.45 Lakhs). This was mainly
on account of Purchase of Property, Plant and Equipment of (Rs2.45 Lakhs).

For the financial year ended March 31, 2024

For the financial year ended March 31, 2024, the net cash used in Investing Activities was (Rs7.10 Lakhs). This was mainly
on account of Purchase of Property, Plant and Equipment of (Rs1.23 Lakhs), purchase of Capital WIP (Rs5.90 Lakhs) and
netting off with sale of Property, Plant and Equipment of (Rs0.03 Lakhs) .

For the financial year ended March 31, 2023

For the financial year ended March 31, 2023, the net cash used in Investing Activities was (Rs49.37 Lakhs). This was mainly
on account of the increase in non current investment of (Rs25.62 Lakhs), interest received of Rs0.61 Lakhs, Purchase of
Property, Plant and Equipment of (Rs24.36 Lakhs).

Cash Flows from Financing Activities

For the financial year ended March 31, 2025

For the financial year ended March 31, 2025, the net cash generated from financing activities was Rs342.72 Lakhs. This was
mainly on account of proceeds from long-term borrowings of Rs62.97 Lakhs, proceeds from Short-Term Borrowings of
Rs347.91 Lakhs, and Finance Cost of (Rs68.16 Lakhs).

For the financial year ended March 31, 2024

For the financial year ended March 31, 2024, the net cash generated from financing activities was Rs902.49 Lakhs. This was
mainly on account of proceeds from the Issue of Share Capital of Rs557.25 Lakhs, proceeds from Short-Term Borrowings
of Rs357.65 Lakhs, and Finance Cost of (Rs12.14 Lakhs).

For the financial year ended March 31, 2023

For the financial year ended March 31, 2023, the net cash used in financing activities was Rs13.61 Lakhs. This was mainly
on account of proceeds from proprietor capital introduced of Rs 21.50 Lakhs, capital withdrawn of Rs37.48 Lakhs, proceeds
from Long-Term Borrowings of Rs22.24 Lakhs, repayment of Long-Term Borrowings of (Rs75.93 Lakhs), proceeds from
Short-Term Borrowings of Rs171.84 Lakhs, repayment of Short-Term Borrowings of (Rs9.31 Lakhs) and Finance Cost of
(Rs79.25 Lakhs).

RELATED PARTY TRANSACTIONS

Related party transactions with certain of our promoter, directors and their entities and relatives primarily relate to
remuneration, salary, commission and issue of Equity Shares. For further details of related parties kindly refer chapter titled
"Restated Financial Statements" beginning on page 206 of this Draft Red Herring Prospectus.

OFF-BALANCE SHEET ITEMS

We do not have any other off-balance sheet arrangements, derivative instruments or other relationships with any entity that
have been established for the purposes of facilitating off-balance sheet arrangements.

QUALIFICATIONS OF THE STATUTORY AUDITORS WHICH HAVE NOT BEEN GIVEN EFFECT TO IN
THE RESTATED FINANCIAL STATEMENTS

There are no qualifications in the audit report that require adjustments in the Restated Financial Statements.
QUALITATIVE DISCLOSURE ABOUT MARKET RISK
Financial Market Risks

Market risk is the risk of loss related to adverse changes in market prices, including interest rate risk. We are exposed to
interest rate risk, inflation and credit risk in the normal course of our business.

Interest Rate Risk

Our financial results are subject to changes in interest rates, which may affect our debt service obligations in future and our
access to funds.

Effect of Inflation

We are affected by inflation as it has an impact on the salary, wages, etc. In line with changing inflation rates, we rework
our margins so as to absorb the inflationary impact.

Credit Risk

We are exposed to credit risk on monies owed to us by our customers. If our customers do not pay us promptly, or at all,
we may have to make provisions for or write-off such amounts.

OTHER MATTERS

Details of Default, if any, Including Therein the Amount Involved, Duration of Default and Present Status, in
Repayment of Statutory Dues or Repayment of Debentures or Repayment of Deposits or Repayment of Loans from
any Bank or Financial Institution

Except as disclosed in chapter titled "Restated Financial Statements" beginning on page 206 of this Draft Red Herring
Prospectus, there have been no defaults in payment of statutory dues or repayment of debentures and interest thereon or
repayment of deposits and interest thereon or repayment of loans from any bank or financial institution and interest thereon
by the Company.

Material Frauds

There are no material frauds, as reported by our statutory auditor, committed against our Company, in the last three Fiscals.

Unusual or infrequent events or transactions

Except as described in this Draft Red Herring Prospectus, during the period/ years under review there have been no
transactions or events, which in our best judgment, would be considered "unusual" or "infrequent".

Significant Economic Changes that Materially Affected or are Likely to Affect Income from Continuing Operations

Indian rules and regulations as well as the overall growth of the Indian economy have a significant bearing on our
operations. Major changes in these factors can significantly impact income from continuing operations. There are no
significant economic changes that materially affected our Companys operations or are likely to affect income from
continuing operations except as described in chapter titled "Risk Factors beginning on page 33 of this Draft Red Herring
Prospectus.

Known trends or uncertainties that have had or are expected to have a material adverse impact on revenue or
income from continuing operations

Other than as described in the section titled "Risk Factors" and chapter titled "Managements Discussion and Analysis of
Financial Conditions and Results of Operations", beginning on page 33 and 259 of this Draft Red Herring Prospectus
respectively to our knowledge there are no known trends or uncertainties that have or had or are expected to have a material
adverse impact on revenues or income of our company from continuing operations.

Future relationship between Costs and Income

Other than as described in the section titled "Risk Factors" beginning on page 33 of this Draft Red Herring Prospectus, to
our knowledge there are no factors, which will affect the future relationship between costs and income or which are expected
to have a material adverse impact on our operations and finances.

The extent to which material increases in revenue or income from operations are due to increased volume,
introduction of new products or services or increased prices

Changes in revenue in the last three financial years are as explained in the part "Financial Year 2024 -25 compared with
Financial Year 2023-24 and Financial Year 2023-24 Compared with Financial Year 2022-23" above.

Significant dependence on a single or few Suppliers or Customers

The percentage of contribution of our Companys Top Customers & Suppliers have been mentioned under para "Our Major
Customer/Suppliers" in the chapter titled "Our Business" on page 143 of this Draft Red Herring Prospectus.

Status of any publicly announced new products or business segments

Please refer to the chapter titled "Our Business" beginning on page 143 of this Draft Red Herring Prospectus for
new products or business segments.

The extent to which the business is seasonal

Our business is not seasonal in nature.

Competitive Conditions

We operate in a competitive atmosphere. Some of our competitors may have greater resources than those available to us.
While product quality, brand value, distribution network, etc are key factors in client decisions among competitors,
however, reliability and competitive pricing is the deciding factor in most cases. We face fair competition from both
organized and unorganized players in the market.

We believe that our experience, and reliability record with our customers will be key to overcome competition posed by
such organized and unorganized players. Although, a competitive market, there are not enough number of competitors
offering services similar to us. We believe that we are able to compete effectively in the market with our quality of services
and our reputation. We believe that the principal factors affecting competition in our business include client relationships,
reputation, and the relative quality and price of the serve