Bulkcorp International Ltd Management Discussions

You should read the following discussion of our financial condition and results of operations together with our restated financial statements included in the Draft Red Herring Prospectus. You should also read the section entitled "Risk Factors" beginning on page 28, which discusses several factors, risks and contingencies that could affect our financial condition and results of operations. The following discussion relates to our Company and is based on our restated financial statements, which have been prepared in accordance with Indian GAAP, the Companies Act and the SEBI Regulations. Portions of the following discussion are also based on internally prepared statistical information and on other sources. Our fiscal year ends on March 31 of each year, so all references to a particular fiscal year ("Fiscal Year") are to the twelve-month period ended March 31 of that year.

The financial statements have been prepared in accordance with Indian GAAP, the Companies Act and the SEBI (ICDR) Regulations and restated as described in the report of our auditors dated March 15, 2024 which is included in this Draft Red Herring Prospectus under the section titled "Restated Financial Statement" beginning on page 162 of this Draft Red Herring Prospectus. The restated financial statements have been prepared on a basis that differs in certain material respects from generally accepted accounting principles in other jurisdictions, including US GAAP and IFRS. We do not provide a reconciliation of our restated financial statements to US GAAP or IFRS and we have not otherwise quantified or identified the impact of the differences between Indian GAAP and U.S. GAAP or IFRS as applied to our restated financial statements.

This discussion contains forward-looking statements and reflects our current views with respect to future events and financial performance. Actual results may differ materially from those anticipated in these forward-looking statements as a result of certain factors such as those described under "Risk Factors" and "Forward Looking Statements" beginning on pages 28 and 18 respectively, and elsewhere in this Draft Red Herring Prospectus Accordingly, the degree to which the financial statements in this Draft Red Herring Prospectus will provide meaningful information depend entirely on such potential investors level of familiarity with Indian accounting practices. Please also refer to section titled "Presentation of Financial, Industry and Market data" beginning on page 16 of this Draft Red Herring Prospectus.

OUR BUSINESS

Our Company was originally incorporated on October 08, 2009, as a Private Limited Company as ‘Navjivan Polyplast Private Limited under the provisions of the Companies Act, 1956 with the Registrar of Companies, Gujarat, Dadra and Nagar Havelli. The name of our Company was subsequently changed to "Bulkcorp International Private Limited" on August 05, 2015 and received a certificate of incorporation dated August 27, 2015 from the Assistant Registrar of Companies, Registrar of Companies Ahmedabad. Subsequently, our Company was converted into a Public Limited Company pursuant to members resolution passed at Extra-ordinary General Meeting of our Company held on March 04, 2024 and the name of our Company was changed to "Bulkcorp International Limited". A fresh Certificate of Incorporation consequent upon Conversion from Private Limited Company to Public Limited Company dated March 09, 2024 was issued by the Central Processing Centre, Haryana. The Corporate Identification Number of our Company is U25200GJ2009PLC058294.

Our Company, Bulkcorp International Limited is an ISO 9001:2015, ISO 14001:2015, ISO 45001:2018 and BRC certified Company, which is engaged in manufacturing and supply of Food Grade Flexible Intermediate Bulk Container ("FIBC") bags. The manufacturing unit of our Company is situated at, Changodar, Ahmedabad. Our manufacturing facility meets the requirements set out in BRC Global Standard for Packing and Packaging Materials and has achieved certified Grade A. We offer a wide range of customisable packaging solutions FIBC bags (Jumbo Bags) which come in eight variations and container liners. Our manufacturing facility located at Changodar, Ahmedabad is equipped with the required facilities including machinery, and other handling equipment to facilitate smooth manufacturing process. We endeavour to maintain safety and high hygiene in our premises by adhering to key safety and hygiene norms as specified by BRC.

Our manufacturing facility has an in-house testing laboratory to ensure that the finished products match the quality standards as specified by our customers. All our FIBC bags are manufactured in accordance with ISO 21898 and they have undergone quality tests at well reputed labs. We majorly procure our raw materials from Gujarat. As our manufacturing unit is strategically connected to the National Highway and is located in the midst of a developed industrial area, this provides us with operational advantage as transportation process becomes time efficient.

Our company was originally founded by Mr. Siddharth Sharma and Mr. Ganeshkumar Agarwal in the year 2009. Our promoters and promoter group acquired the company during the year 2015 to 2016. Mr. Punit Mahendra Gopalka, Mr.

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Anup Mahendra Gopalka and Mr. Sanjay Pandurang Sadavarte are current Promoters of our company. Combined experience of our promoters more than 35 years of experience in the field of packaging industry. Our promoters are involved in the critical aspects of our business, including expansion, process and plant, finance, sales and marketing. We believe that the sector-specific experience and expertise of our promoters has contributed significantly to the growth of our Company.

We cater to the requirements of crucial industries such as agriculture, chemical, construction, food, pharmaceutical, and mining. Our customer base is spread across the globe with presence in countries like United States of America, Canada, United Kingdom, South Africa, Ivory Coast, South Korea, Spain, Europe, Egypt etc. we are recognised as one star export house by Ministry of Commerce and Trade. The majority of our sales are through exports, which contributed 78.27%, 75.88%, 72.93%, and 77.56% respectively to our total sales for the period/year ended on December 31, 2023, March 31,

2023, 2022 and 2021 respectively.

FINANCIAL KPIs OF OUR COMPANY

Particulars	For the period ended on December 31,		For the Year ended on March 31
	2023	2023	2022	2021
Revenue from Operations (? in Lakhs)	2649.52	3847.07	4842.41	3138.54
Growth in Revenue from Operations (%)	NA	(20.55)	54.29	NA
Gross Profit (? in Lakhs)	1012.23	1191.04	1373.01	988.57
Gross Profit Margin (%)	38.20	30.96	28.35	31.50
EBITDA (? in Lakhs)	368.09	242.06	270.11	190.75
EBITDA Margin (%)	13.89	6.29	5.58	6.08
Profit After Tax (? in Lakhs)	301.11	121.22	172.56	63.53
PAT Margin (%)	11.36	3.15	3.56	2.02
RoE (%)	47.89	29.03	63.30	40.16
RoCE (%)	32.12%	19.85%	27.62%	36.55%
Net Fixed Asset Turnover (In Times)	4.61	6.77	8.28	5.18
Net Working Capital Days	56	2	13	(3)
Operating Cash Flows (? in Lakhs)	(115.78)	370.03	(122.01)	3.09

SIGNIFICANT DEVELOPMENTS SUBSEQUENT TO LAST AUDITED BALANCE SHEET:

After the date of last Audited accounts i.e. December 31, 2023, the Directors of our Company confirm that, there have not been any significant material developments except mentioned below;

Note:

• The Board of Directors in their meeting held on January 16, 2024 approved resolution, for issuing 35,088 Preferential shares and subsequently approved by members of company in the extra- ordinary general meeting held on February 20, 2024. Pursuant to which our company has allotted 35088 Equity Shares on February 29, 2024.
• Members of Company in the Extra-Ordinary General Meeting held on February 20, 2024, approved resolution for increasing authorized capital from ? 205.00 lakhs divided into 20,50,000 shares of ? 10/- each to ? 770.00 lakhs divided into 77,00,000 shares of ? 10/- each.
• The Board of Directors in their meeting held on February 29, 2024 approved resolution for issue of Bonus equity shares in the ratio of 2:1 (Two) new equity share of ? 10/- each for every 1 (One) existing fully paid-up shares of ? 10/- each to existing shareholders of the company which was subsequently approved by Members of Company in the Extra-Ordinary General Meeting held on February 29, 2024. Pursuant to which our company has allotted 3,69,01,760 Bonus Equity Shares on March 01, 2024.
• Board of Directors of the Company has approved in their meeting held on March 09, 2024 issue of upto 2200000 equity shares as Initial Public Offer which was subsequently approved by members of the company in the extraordinary general meeting held on March 11, 2024.

FACTORS AFFECTING OUR FUTURE RESULTS OF OPERATIONS:

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Our Companys future results of operations could be affected potentially by the following factors:

• COVID-19 Pandemic;
• Credit worthiness of our commercial and industrial customers;
• Natural Calamities e.g. Tsunami
• Global GDP growth and seaborne trade growth
• Prevailing commercial freight rates;
• The cost of building new vessels compared to the cost of purchasing and/or repairing existing vessels;
• Changes in laws or regulations
• Political Stability of the Country;
• Competition from existing players;
• Our dependence on limited number of customers/suppliers/brands for a significant portion of our revenues;
• Any failure to comply with the financial and restrictive covenants under our financing arrangements;
• Failure to obtain any applicable approvals, licenses, registrations and permits in a timely manner;
• Failure to adapt to the changing technology in our industry of operation may adversely affect our business and financial condition;
• Occurrence of Environmental Problems & Uninsured Losses;
• Conflicts of interest with affiliated companies, the promoter group and other related parties;
• The performance of the financial markets in India and globally;
• Our ability to expand our geographical area of operation;
• Concentration of ownership among our Promoters.

OUR SIGNIFICANT ACCOUNTING POLICIES:

For Significant accounting policies, please refer Significant Accounting Policies and Notes to accounts, "Annexure IV" beginning under Chapter titled "Restated Financial Statement" beginning on page 162 of this Draft Red Herring Prospectus.

FINANCIAL PERFORMANCE FOR THE PERIOD ENDED ON DECEMBER 31, 2023

(? In Lakhs)

INCOME FROM CONTINUING OPERATIONS	December 31, 2023	%
Revenue from operations	2649.52	96.23
Other Income	103.79	3.77
Total Revenue	2,753.31	100.00
Expenses
Cost of Material Consumed	1,902.83	69.11
Purchase of stock in trade	0.00	-
Changes in Inventories of finished goods, work in progress and stock -in-trade	- 265.53	-9.64
Employee benefits expense	245.90	8.93
Finance Costs	25.99	0.94
Depreciation and amortisation expenses	46.98	1.71
Other expenses	398.24	14.46
Total Expenses	2,354.39	85.51
Restated profit before tax before exceptional and Extraordinary Items	398.92	14.49
Exceptional Item	0.00
Total tax expense	97.81	3.55
Restated profit after tax from continuing operations	301.11	10.94

DISCLOSURE OF THE PERIOD ENDED ON DECEMBER 31, 2023:

Total Revenue:

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Our Company, Bulkcorp International Limited is an ISO 9001:2015, ISO 14001:2015, ISO 45001:2018 and BRC certified Company, which is engaged in manufacturing and supply of Food Grade Flexible Intermediate Bulk Container ("FIBC") bags. Our manufacturing facility meets the requirements set out in BRC Global Standard for Packing and Packaging Materials and has achieved certified Grade A. We offer a wide range of customisable packaging solutions FIBC bags (Jumbo Bags) which come in eight variations and container liners. The Total Revenue from April 1, 2023 to December 31, 2023 was 2,753.31 Lakh, which includes Revenue from Operations amounting to ? 2,649.84 Lakh and Other Income of to

? 103.79 Lakh. Revenue from Operations mainly includes sales from manufacturing operation and sale of service.

(In ? Lakh)

Particulars	For the period ended December 31, 2023
	Amount	In %
Sale of products	2,601.52	98.19
Sales of Services	48.00	1.81
Total Revenue from Operation	2,649.52	100.00

Other Income

Other Income mainly includes income from Foreign exchange fluctuation, Customs duty Income, MEIS Incentive income, Duty drawback income and miscellaneous income.

EXPENDITURE:

Cost of materials consumed

The Cost of Material Consumed was ? 1,902.83 Lakh from April 01, 2023 to December 31, 2023, which is 69.11% of the

Total Revenue.

Employee Benefit Expenses

Employee Benefit Expenses was ? 245.90 Lakh from April 01, 2023 to December 31, 2023, which is 8.93% of the Total Revenue. Employee Benefit Expenses mainly includes Salary and wages, Director Remuneration, Gratuity, contribution to Provident fund and Staff welfare expenses.

Finance Cost

Finance expense was ? 25.99 Lakh from April 01, 2023 to December 31, 2023, which is 0.94% of the Total Revenue. Finance Cost mainly, includes Interest on Secured Loan, Interest on Packing Credit loan, Interest on Loan from Directors and Other Borrowing cost.

Depreciation and amortisation expenses

The Depreciation and amortization from April 01, 2023 to December 31, 2023 was ? 46.98 Lakh that is 1.71% of the Total

Revenue.

Other Expenses

Other Expenses from April 01, 2023 to December 31, 2023 was ? 398.24 Lakh that is 14.46% of the Total Revenue.

Other expense mainly includes Professional & Consultancy Fees, Rent, Rates & Taxes, Advertisement Expenses, Audit fees, Conveyance & Petrol Expense, Clearing Charges, Freight Outward, Repair & maintenance, Sales Promotion, Electric Expense, Travelling Expenses, Sundry Balance Written Off, Insurance expenses and other miscellaneous expenses.

Restated Profit before tax from continuing operations

Profit before Tax from April 01, 2023 to December 30, 2023 stood at ? 398.92 Lakh. During this period, our Company recorded Profit before Tax margin of 14.49 % of Total Revenue.

Restated Profit after tax from continuing operations

Profit after Tax from April 01, 2023 to December 30, 2023 stood at ? 301.11 Lakh. During this period, our Company recorded Profit after Tax margin of 10.94% of Total Revenue.

RESULTS OF OUR OPERATION BASED ON RESTATED FINANCIAL STATEMENT

(? in Lakhs)

Particulars	For the year ended on
	31.03.2023	31.03.2022	31.03.2021
Revenue from operations	3847.07	4842.41	3138.54

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Particulars	For the year ended on
	31.03.2023	31.03.2022	31.03.2021
Total Revenue from Operation	3847.07	4842.41	3138.54
% of growth	-20.55%	54.29%
Other Income	48.63	77.49	37.82
% of growth	-37.24%	104.92%
Total income	3,895.71	4,919.90	3,176.36
% of growth	-20.82%	54.89%
Expenses
Cost of Material consumed	2633.08	3385.38	2215.00
% Increase/(Decrease)	-22.22%	52.84%
Purchases of stock-in-trade	21.20	-	-
Changes in Inventories of work-in-progress	1.75	84.02	(65.03)
% Increase/(Decrease)	-97.92%	-229.21%
Employee benefits expense	355.49	425.54	343.29
% Increase/(Decrease)	-16.46%	23.96%
Finance Costs	61.03	68.54	44.08
% Increase/(Decrease)	-10.95%	55.49%
Depreciation and amortisation expenses	58.35	53.84	50.38
% Increase/(Decrease)	8.38%	6.87%
Other expenses	593.49	677.35	454.52
% Increase/(Decrease)	-12.38%	49.02%
Total Expenses	3,724.40	4,694.67	3,042.25
% to total revenue	95.60%	95.42%	95.78%
Profit/(Loss) Before Extra-Ordinary Items and Tax	171.31	225.23	134.11
% to total revenue	4.40%	4.58%	4.22%
Exceptional Items	0.00	0.00	0.00
Profit before Tax	171.31	225.23	134.11
Total tax expense	50.09	52.67	70.58
% Increase/(Decrease)	-4.89%	-25.38%
Profit and Loss after tax for the Year as Restated	121.22	172.56	63.53
% to total revenue	3.15%	3.56%	2.02%
% Increase/(Decrease)	-29.75%	171.61%

COMPARISON OF FY 2022-23 WITH FY 2021-22: REVENUE:

Revenue from operations

Our Company, Bulkcorp International Limited is an ISO 9001:2015, ISO 14001:2015, ISO 45001:2018 and BRC certified Company, which is engaged in manufacturing and supply of Food Grade Flexible Intermediate Bulk Container ("FIBC") bags. Our manufacturing facility meets the requirements set out in BRC Global Standard for Packing and Packaging Materials and has achieved certified Grade A. We offer a wide range of customisable packaging solutions FIBC bags (Jumbo Bags) which come in eight variations and container liners. The Total Revenue from operations for the year ended on FY 2022-23 was ? 3847.07 Lakh as compared to ? 4842.41 Lakh during the FY 2021-22. Revenue from Operations mainly includes Revenue from Sale of Product. Revenue from operations fallen by 20.55% in FY 2022-23. Reduction in revenue from operations was due to reduction exports sales to USA.

Other Income:

Other income of the company was ? 48.63 lakhs and ? 77.49 lakhs for FY 2022-23 and FY 2021-22 respectively. Other Income consists of Interest on FDR, Foreign Exchange Fluctuation and Miscellaneous Income.

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EXPENDITURE:

Cost of materials consumed.

Our cost of materials consumed decreased by 22.22% from ? 3,385.38 lakhs in FY 2021-22 to ? 2,633.08 lakhs in FY

2022-23, due decrease in revenue from operations of the company.

Purchase of Stock in Trade

Our Purchases of Stock-In-Trade were ? 21.20 lakhs representing 0.54% of Total Income for the year ended March 31,

2023.

Changes in inventories of Finished Goods, Work in Progress and Stock in Trade

Our opening stock of finished goods was ? 181.24 lakhs as at April 1, 2022, while it was ? 265.26 lakhs as at April 1, 2021. Our closing stock of finished goods was ? 179.49 lakhs as at March 31, 2023, while it was ? 181.24 lakhs as at March 31, 2022. The changes in inventories of finished goods to ? 1.75 lakhs in FY 2022-23 from ? 84.02 lakhs in FY 2021-22.

Employee Benefit Expenses

Employee Benefit expenses decreased to ? 355.49 Lakhs for FY 2022-23 from ? 425.54 Lakh for FY 2021-22 showing a decline by 16.46%. Employee Benefit Expenses mainly includes Salary and wages, Director Remuneration, Gratuity, contribution to Provident fund and Staff welfare expenses.

Finance Cost

Finance expense were ? 61.03 Lakhs for FY 2022-23 as against ? 68.54 Lakhs in FY 2021-22 showing decrease of 10.95%. Finance Cost mainly includes Interest on Secured Loan, Interest on Packing Credit loan, Interest on Loan from Directors and Other Borrowing cost.

Depreciation and amortisation expenses

The Depreciation and amortization expense for FY 2022-23 was ? 58.35 Lakh as against ? 53.84 Lakhs for FY 2021-22 showing an increase of 8.38%.

Other Expenses

Other Expenses decreased to ? 593.49 Lakh for FY 2022-23 from ? 677.35 Lakh for FY 2021-22 showing a decrease of 12.38%. Other expense mainly includes Professional & Consultancy Fees, Rent, Rates & Taxes, Advertisement Expenses, Audit fees, Conveyance & Petrol Expense, Clearing Charges, Freight Outward, Repair & maintenance, Sales Promotion, Electric Expense, Travelling Expenses, Sundry Balance Written Off, Insurance expenses and other miscellaneous expenses.

Profit before Extra-Ordinary Items and Tax

The Profit before Extra-Ordinary Items and Tax for the FY 2022-23 was 4.40% of the Total revenue from operations and it was 4.58% of Total revenue from operations for the FY 2021-22. The Profit before Extra-Ordinary Items and Tax has fallen to ?171.31 Lakh in FY 2022-23 from ? 225.23 Lakh in FY 2021-22.

Profit after Tax (PAT)

PAT decreased to ? 121.22 Lakh in FY 2022-23 from ? 172.56 Lakh in the FY 2021-22. PAT was 3.15% and 3.56% of Total Revenue of our company for the year ended on March 31, 2023 and March 31, 2022 respectively. Reduction in profit was mainly due to reduction in Revenue from operations of the company.

COMPARISON OF FY 2021-22 WITH FY 2020-21: REVENUE:

Revenue from operations

Our Company, Bulkcorp International Limited is an ISO 9001:2015, ISO 14001:2015, ISO 45001:2018 and BRC certified Company, which is engaged in manufacturing and supply of Food Grade Flexible Intermediate Bulk Container ("FIBC") bags. Our manufacturing facility meets the requirements set out in BRC Global Standard for Packing and Packaging Materials and has achieved certified Grade A. We offer a wide range of customisable packaging solutions FIBC bags (Jumbo Bags) which come in eight variations and container liners. The Total Revenue from operations for the year ended on FY 2021-22 was ? 4842.41 Lakh as compared to 3138.54 Lakh during the FY 2020-21. Revenue from Operations mainly includes Revenue from Sale of Product. Revenue from operations increased by 54.29%. Income from Operations increased mainly on account of Revenue from Sale of Product. Revenue from operations Increase by 54.29% in FY 2021- 22.

Other Income:

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Other income of the company was ? 77.49 Lakhs and ? 37.82 Lakhs for FY 2021-22 and FY 2020-21 respectively. Other Income mainly consists of Interest on FDR, Income from Foreign Exchange Fluctuation and Miscellaneous Income.

EXPENDITURE:

Cost of materials consumed.

Our cost of materials consumed Increased by 52.84% from ? 2,215.00 lakhs in FY 2020-21 to ? 3,385.38 lakhs in FY 2021-

22. Material consumption increased due to Increase in revenue from operations of the Company.

Changes in inventories of Finished Goods, Work in Progress and Stock in Trade

Our opening stock of finished goods was ? 265.26 lakhs as at April 1, 2021, while it was ? 200.23 lakhs as at April 1, 2020. Our closing stock of finished goods was ? 181.24 lakhs as at March 31, 2022, while it was ? 265.26 lakhs as at March 31, 2021. The changes in inventories of finished goods to ? 84.02 lakhs in FY 2021-22 from negative to ? 65.03 lakhs in FY 2020-21.

Employee Benefit Expenses

Employee Benefit expenses increased to ? 425.54 Lakhs for FY 2021-22 from ? 343.29 Lakh for FY 2020-21 showing an increase of 23.96%. Employee Benefit Expenses mainly includes Salary and wages, Director Remuneration, Gratuity, contribution to Provident fund and Staff welfare expenses.

Finance Cost

Finance expense was ? 68.54 Lakhs for FY 2021-22 as against ? 44.08 Lakhs in FY 2020-21 showing an Increase of 55.49%. Finance Cost mainly includes Interest on Secured Loan, Interest on Packing Credit loan, Interest on Loan from Directors and Other Borrowing cost.

Depreciation

The Depreciation and amortization expense for FY 2021-22 was ? 53.84 Lakh as against ? 50.38 Lakhs for FY 2020-21.

Other Expenses

Other Expenses increased to ? 677.35 Lakh for FY 2021-22 from ? 454.52 Lakh for FY 2020-21 showing an increase of 49.02%. Other expense mainly includes Professional & Consultancy Fees, Rent, Rates & Taxes, Advertisement Expenses, Audit fees, Conveyance & Petrol Expense, Clearing Charges, Freight Outward, Repair & maintenance, Sales Promotion, Electric Expense, Travelling Expenses, Sundry Balance Written Off, Insurance expenses and other miscellaneous expenses.

Profit before Extra-Ordinary Items and Tax

The Profit before Extra-Ordinary Items and Tax for the FY 2021-22 was 4.58% of the Total revenue from operations and it was 4.22% of Total revenue from operations for the FY 2020-21. The Profit before Extra-Ordinary Items and Tax has increased to ? 134.11 Lakh in FY 2021-22 from ? 225.23 Lakh in FY 2020-21.

Profit after Tax (PAT)

PAT increased to ? 172.56 Lakh in FY 2021-22 from ? 63.53 Lakh in the FY 2020-21. PAT was 3.56% and 2.02% of Total Revenue of our company for the year ended on March 31, 2022 and March 31, 2021 respectively. Reason for increase in Profit after Tax was due to increase revenue from operations of the Company.

DISCUSSION ON THE STATEMENT OF CASH FLOWS

The table below summaries our cash flows from our restated for the period /financial year ended December 31, 2023, March 31, 2023, 2022 and 2021:

(? in Lakhs)

Particulars	For the Period / Year ended
	December 31, 2023	March 31, 2023	March 31, 2022	March 31, 2021
Net cash generated from / (used in) Operating activities	(115.78)	370.03	(122.01)	3.09
Net cash generated from / (used in) Investing activities	(76.27)	(40.81)	(48.74)	(18.27)
Net cash generated from / (used in) from Financing activities	194.80	(408.00)	171.82	3.55
Net Increase / (decrease) in Cash & Cash Equivalents	2.75	(78.76)	1.07	(11.62)

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Particulars	For the Period / Year ended
	December 31, 2023	March 31, 2023	March 31, 2022	March 31, 2021
Cash and cash equivalents at the beginning of the Period / year	1.95	80.72	79.65	91.27
Cash and cash equivalents at the end of the Period/ year	4.70	1.95	80.72	79.65

Operating Activities

• In the period ended December 31, 2023, net cash used in operating activities was ? 115.78 Lakhs which mainly on account of increase in inventory of the company. This comprised of the profit before tax of ? 398.92 Lakhs, which was primarily adjusted for depreciation and amortization expenses of ? 46.98 Lakhs, finance cost of ? 25.99 Lakhs and Interest & Other income of ? 0.05 lakhs. The resultant operating profit before working capital changes was ? 472.72 Lakhs, which was again adjusted for changes in working capital requirements.

• In the year ended March 31, 2023, net cash generated in operating activities was ? 370.03 Lakhs. This comprised of

the profit before tax of ? 171.31 Lakhs, which was primarily adjusted for depreciation and amortization expenses of ?

58.35 Lakhs, finance cost of ? 61.03 Lakhs, Provision of gratuity of ? 0.86 Lakhs and Interest & Other income of ?

0.22 lakhs. The resultant operating profit before working capital changes was ? 291.34 Lakhs, which was again adjusted for changes in working capital requirements. Therefore, our net cash outflow from operating activities was ? 370.03 Lakhs which mainly because of increase in inventory of the company.

• In Financial Year 2021-22, net cash generated from operating activities was ?122.01 Lakhs. This comprised of the profit before tax of ? 225.23 Lakhs, which was primarily adjusted for depreciation and amortization expenses of ?53.84 Lakhs and finance cost of ?68.54 Lakhs, Provision of gratuity of ? 0.95 Lakhs and Interest & Other income of ? 0.84 lakhs. The resultant operating profit before working capital changes was ? 347.72 Lakhs, which was primarily adjusted for decrease in Inventories of ?33.15 Lakhs, Increases in trade receivables of ?249.00 Lakhs, decreases in Loans & Advances of ?3.64 Lakhs and Other Assets of ?4.01 Lakhs. Increases in trade payables of ?295.84 Lakhs and Other liabilities of ?34.31 Lakhs.

• In Financial Year 2020-21, net cash generated from operating activities was ?3.09 Lakhs. This comprised of the profit before tax of ? 134.11 Lakhs, which was primarily adjusted for depreciation and amortization expenses of ?50.38 Lakhs, , Provision of gratuity of ? 3.79 Lakhs and finance cost of ?44.08 Lakhs. The resultant operating profit before working capital changes was ? 217.15 Lakhs, which was primarily adjusted for an Increase in Inventories of ?272.39 Lakhs, Increases in trade receivables of ?248.74 Lakhs, decreases in Loans & Advances of ?8.32 Lakhs and Other Assets of ?131.26 Lakhs, Increases in trade payables of ?267.08 Lakhs and Other liabilities of ?82.94 Lakhs.

Investing Activities

• In the period, ended December 31, 2023, net cash outflow from investing activities was ?76.27 Lakhs, which primarily comprised of cash used for the purchase of fixed assets of ? 73.32 Lakhs and Increases of non-current assets of ? 6.00 lakh. Proceeds from sale of assets of ? 8.61 Lakhs and Interest and other income were ?0.05 Lakhs.

• In Financial Year 2022-23, net cash used in investing activities was ?40.81 Lakhs, which primarily comprised of cash used for the purchase of fixed assets of ? 41.02 Lakhs and Interest and other income of ?0.22 Lakhs.

• In Financial Year 2021-22, net cash used in investing activities was ?48.74 Lakhs, which primarily comprised of cash used for the purchase of fixed assets of ? 40.81 Lakhs and Increases of non-current assets of ? 8.76 lakh. Interest and other income of ?0.84 Lakhs.

• In Financial Year 2020-21, net cash used in investing activities was ?18.27 Lakhs, which primarily comprised of cash used for the purchase of fixed assets of ?31.96 Lakhs and Increases of non-current assets of ? 1.52 lakh. Interest and other income of ?15.21 Lakhs.

Financing Activities

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• In the period ended December 31, 2023, net cash generated from financing activities was ?194.80 Lakhs, which predominantly comprised increase of Long term borrowings of ?249.12 Lakhs, repayment of short-term borrowings of

?28.34 Lakhs, and finance cost paid of ?25.99 Lakhs.

• In Financial Year 2022-23, net cash used from financing activities was ?408.00 Lakhs, which predominantly comprised decrease of long-term borrowings of ?298.00 Lakhs and short-term borrowings of ?48.96 Lakhs and finance cost paid of ?61.03 Lakhs.

• In Financial Year 2021-22, net cash generated from financing activities was ?171.82 Lakhs, which predominantly comprised increase of Short-term borrowings of ?253.11 Lakhs, decrease of Long-term borrowings of ?12.75 Lakhs and finance cost paid of ?68.54 Lakhs.

• In Financial Year 2020-21, net cash generated from financing activities was ?3.55 Lakhs, which predominantly comprised Repayment of long-term borrowings of ?4.05 Lakhs, increase of short-term borrowings of ?51.68 Lakhs and finance cost paid of ?44.08 Lakhs.

For further information, please refer "Annexure – IX - Related Party Transaction" under section "Restated Financial Statement" beginning from page no. 162 of this Draft Red Herring Prospectus.

We are exposed to financial market risks from changes in borrowing costs, interest rates and inflation.

We are currently exposed interest to rate risks to the extent of outstanding loans. However, any rise in future borrowings may increase the risk.

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

1. Unusual or infrequent events or transactions

Except as described in this Draft Red Herring Prospectus, there have been no other events or transactions to the best of our

knowledge which may be described as "unusual" or "infrequent".

2. Significant economic changes that materially affected or are likely to affect income from continuing operations. Our business has been subject, and we expect it to continue to be subject to significant economic changes arising from the

trends identified above in ‘Factors Affecting our Results of Operations and the uncertainties described in the section entitled "Risk Factors" beginning on page no. 28 of the Draft Red Herring Prospectus. To our knowledge, except as we have described in the Draft Red Herring Prospectus, there are no known factors which we expect to bring about significant economic changes.

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

Apart from the risks as disclosed under Section titled "Risk Factors" beginning on page no. 28 in this Draft Red Herring Prospectus, in our opinion there are no other known trends or uncertainties that have had or are expected to have a material adverse impact on revenue or income from continuing operations.

4. Future changes in relationship between costs and revenues, in case of events such as future increase in labour or material costs or prices that will cause a material change are known.

Our Companys future costs and revenues will be determined by demand/supply situation, government policies and other

economic factor.

5. Extent to which material increases in net sales or revenue are due to increased sales volume, introduction of new products or increased sales prices.

1

Our Company is engaged in manufacturing and supply of Food Grade Flexible Intermediate Bulk Container ("FIBC")

bags. Increases in revenues are largely linked to increase in volume of products of our company.

6. Total turnover of each major industry segment in which the issuer company operated.

Our Company is engaged in manufacturing and supply of Food Grade Flexible Intermediate Bulk Container ("FIBC") bags. Relevant Industry data, as available, has been included in the chapter titled "Industry Overview" beginning on page no. 104 of this Draft Red Herring Prospectus.

7. Status of any publicly announced new products or business segment.

Our Company is engaged in manufacturing and supply of Food Grade Flexible Intermediate Bulk Container ("FIBC") bags. Otherwise as stated in the Draft Red Herring Prospectus and in the section "Our Business" appearing on page no.109, our company has not publicly announced any new business segment till the date of this Draft Red Herring Prospectus

8. The extent to which business is seasonal.

Our Company is engaged in manufacturing and supply of Food Grade Flexible Intermediate Bulk Container ("FIBC")

bags. Business of our company is not seasonal in nature. Hence, our business is not subject to seasonality or cyclicality.

9. Any significant dependence on a single or few suppliers or customers.

Our Company is engaged in manufacturing and supply of Food Grade Flexible Intermediate Bulk Container ("FIBC") bags. Contribution of our customers and suppliers, as a percentage of total revenue and cost, respectively, for the periods indicated below:

Particulars	Top Customers as a percentage (%) of Revenue From Operations
	For the period ended on December 31, 2023	FY 2022-23	FY 2021-22	FY 2020-21
Top 1	48.98%	46.80%	48.65%	46.90%
Top 3	70.67%	69.02%	76.76%	63.91%
Top 5	80.44%	80.08%	87.86%	76.06%
Top 10	94.08%	90.82%	96.51%	92.02%

Particulars	Top Suppliers as a percentage (%) of Purchase
	For the period ended on December 31, 2023	FY 2022-23	FY 2021-22	FY 2020-21
Top 1	95.15%	95.72%	94.87%	95.35%
Top 3	97.38%	97.18%	97.46%	97.23%
Top 5	98.15%	98.29%	98.40%	98.12%
Top 10	98.95%	99.29%	99.26%	98.87%

10. Competitive conditions:

We face competition from existing and potential competitors which is common for any business. We have, over a period, developed certain competitors who have been discussed in section titles "Our Business" beginning on page no. 109 of this Draft Red Herring Prospectus