Ceeta Industries Ltd Management Discussions

MANAGEMENT DISCUSSIONS & ANALYSIS REPORT

GLOBAL ECONOMY

In FY25, the global economy demonstrated strong resilience, achieving an estimated growth rate of 3.2%. Advanced economies grew by 1.7%, largely driven by robust economic activity in the United States, which helped offset weaker performance in other regions. The Eurozone experienced a slower recovery, with growth projected at just 0.8%, while Chinas economy expanded by 4.8%, although its growth trajectory continues to slow. Commodity markets showed a mixed picture; stable prices prevailed in the second half of the year due to high supply and weak demand, but oil prices remained under pressure amid abundant supply and weakening demand forecasts. Inflation declined faster than anticipated, falling to 5.8% globally, supported by improved supply chain conditions and tighter monetary policies. Inflation in advanced economies eased to around 2%, aligning with central bank targets, prompting institutions like the Federal Reserve and European Central Bank to shift toward more accommodative policies to support growth. Global trade is forecasted to grow by 3.3%, with modest growth of 2.1% in advanced economies and stronger expansion of 5.0% in emerging and developing economies (EMDEs). However, trade activity continues to face headwinds from protectionist measures, trade distortions, and geopolitical tensions, which disrupt supply chains and increase costs. Financial markets remain active, with U.S. equities benefiting from business-friendly policies, while emerging markets adjust to volatile capital flows. The strengthening U.S. dollar continues to influence global trade and investment patterns. Despite challenges from trade and geopolitical shifts, these developments also offer opportunities for innovation and structural resilience, underscoring the need for forward-looking economic strategies and adaptive policymaking to navigate ongoing uncertainty.

OUTLOOK

Global output is expected to maintain steady growth through 2025 and 2026, continuing at the same pace as FY25. The United States is projected to retain its strong economic momentum, while emerging economies will show significant growth potential. In contrast, advanced economies, especially in Europe, are likely to see only moderate expansion. Global inflation is forecast to decline to 4.4% in FY25, and further to 3.5% in FY26, with advanced economies reaching their target inflation rate of 2.1% by FY26. Crude oil prices are expected to fall more sharply in 2025, while non-fuel commodity prices may rise by 2.5%, supporting growth in resource-based sectors. Shifting economic policies and evolving trade dynamics will push businesses to adapt, innovate, and remain competitive in an increasingly complex global environment. The IMF highlights the importance of proactive policy measures to ensure a smooth disinflation process and to boost market confidence. Together, these developments contribute to a more dynamic and resilient global business landscape, encouraging long-term strategic planning.

INDIAN ECONOMY

In FY25, India maintained its position as the worlds fastest-growing major economy, showcasing strong resilience despite subdued domestic demand and persistent global headwinds. Real GDP growth is estimated to moderate to 6.5%, down from 9.2% in FY24, mainly due to a slowdown in Gross Fixed Capital Formation (GFCF) and a temporary dip in government capital expenditure during the general elections and erratic monsoon conditions. However, post-election recovery in public spending helped stabilise growth in the latter half of the year. The economy continued to benefit from its favourable demographics, growing middle class, rapid urbanisation, and expanding digital infrastructure, which together supported sustained momentum in consumption and services. Though urban demand was impacted by high inflation and rural recovery remained gradual, Indias underlying economic strength was evident in the 9.1% rise in GST collections in April 2025, reaching 2.09 lakh crore. Total net tax revenue for FY25 rose to 19.7 lakh crore, up from 18.2 lakh crore in FY24. Private consumption doubled over the past decade, reaching USD 2.1 trillion in 2024, growing at a 7.2% CAGR, setting India on track to become the third-largest consumer market by 2026. Key growth drivers included the rising demand from Gen Z and millennials, forward-looking policies such as the Production Linked Incentive (PLI) scheme, and the reform-focused 2024 25 Union Budget, which emphasized productivity, competitiveness, and stronger Centre-State collaboration. These factors collectively reinforced Indias long-term growth prospects in a rapidly evolving global economic landscape.

OUTLOOK

Indias economic resilience has firmly positioned it as a global growth leader, with projections indicating it will remain the fastest-growing major economy over the next two years. Although the April 2025 forecast saw a slight downward revision from earlier projections in January 2025, the overall outlook remains strong and well above global growth expectations. According to the IMFs World Economic Outlook (April 2025), Indias GDP is projected to grow by 6.2% in 2025 and 6.3% in 2026, maintaining a significant edge over both global and regional peers. This sustained growth momentum is expected to elevate India to the position of the worlds fourth-largest economy by May 2025.

The IMF further projects that India is on track to achieve its ambition of becoming a 41.5 lakh crore economy by 2027, and could surpass 5,644 lakh crore in GDP by 2030. These optimistic projections reflect the strength of Indias macroeconomic fundamentals and its ability to thrive amid global uncertainty. Structural reforms in infrastructure, innovation, and financial inclusion, combined with strategic policy initiatives, continue to strengthen Indias role as a key engine of global economic activity. The countrys growth story is underpinned by stable inflation, sound fiscal management, and a healthy balance of payments, creating a solid foundation for long-term economic success.

INDUSTRY STRUCTURE AND DEVELOPMENTS

Indias packaged food industry, valued at around 3,75,000 crore, sees savoury snacks and sweets accounting for 33.4% of the market. The organised snack foods sector, which includes traditional Indian namkeen and Western snacks like potato chips, reached approximately 50,800 crore in 2024, showing steady growth from 42,695 crore in 2023 and 34,874 crore in 2021. A standout segment within this market is Extruded Namkeen comprising puffs, popcorn, and ready-to-eat cereals which made up 16% of the market in 2024.

This growth is fueled by rapid urbanisation, rising disposable incomes, evolving consumer lifestyles favoring convenient and on-the-go snacking, a large and youthful demographic, and increased acceptance of Western dietary habits. The growing popularity of low-unit packs priced at 5 and 10 has driven penetration to 35 40% in the FMCG market, making snacks affordable and accessible to a wide range of consumers.

Several factors underpin this growth: shifting consumer preferences toward convenience foods; Indias youthful populations demand for quick, budget-friendly snacks; innovative product launches focusing on health, flavor, and premium options; and the influence of global snack trends introducing new varieties. Strategic competitive pricing, enabled by efficient mass production, supply chains, and direct-to-consumer sales models, helps maintain affordability and profitability.Expanding retail networks and the rise of e-commerce, especially in tier 2 and tier 3 cities, have significantly improved product availability. Stringent regulations by the Food Safety and Standards Authority of India (FSSAI) have boosted consumer confidence by ensuring high standards of quality, safety, and compliance in packaged snack foods. Together, these factors continue to drive steady growth and transformation in Indias snack food industry.

OUTLOOK

Indias packaged snack foods market is witnessing rapid transformation, driven by intense competition among global giants, domestic brands, and health-conscious startups offering premium and innovative products. The overall domestic snack market is forecasted to expand at a robust CAGR of 8.63% from 2025 to 2033, reaching an estimated 1,01,811.2 crore by 2033. A key growth driver within this sector is the Extruded Namkeen category, which benefits from aggressive marketing campaigns and strong distribution networks, supported by the extensive penetration of modern retail channels across urban and rural India.

This segment alone is projected to grow at a CAGR of 6.84%, reaching approximately 9,700 crore by 2033. The growing influence of Western snacking preferences has significantly boosted the organised Western salty snacks segment, which includes extruded snack foods. Currently valued at around 24,000 crore, this segment is expected to expand rapidly at a CAGR of 14-15% over the next two to three years. The rising adoption of Western flavors and snack formats is creating a favorable environment for FMCG companies to innovate and capture market share. This trend, coupled with evolving consumer lifestyles, increasing urbanisation, and rising disposable incomes, presents vast opportunities for companies to tap into Indias expanding and diverse snacking culture.

COMPANY OVERVIEW

Founded in 1984, Ceeta Industries Limited has steadily evolved into a dynamic player in Indias snack food manufacturing industry. Having initially operated in the HDPE and granite products, the Company has successfully diversified into the FMCG domain, with a strategic focus on the packaged snacks segment under its brand, ‘Skitos.

The Company operates a modern manufacturing facility in Tumkur, Karnataka, which is equipped with modern technology to support the production of potato chips, extruded snacks, and fryums, etc . The Company serves both its in-house brand and multiple third-party clients through contract manufacturing arrangements, ensuring high-quality output and operational scalability.

The Company has established a growing presence in the Indian snack food market by offering affordable, quality snacks across various price points. It continues to strengthen its distribution footprint through robust partner relationships and is actively pursuing growth in modern trade. In a move to diversify its product portfolio, the Company launched Skitos Fruit Drink a new range of fruit-based drinks available in a variety of flavours designed to meet evolving consumer preferences. This product line aims to appeal to a wider audience and further strengthens the Skitos brand, reinforcing the Companys commitment to innovation and category expansion beyond snacks.

With a sharp focus on product innovation, operational efficiency, and market expansion, Ceeta Industries is well-positioned to scale its FMCG business, while remaining anchored in its core values of quality, integrity, and customer trust. Companys product range available athttps: //ceeta .com/ products.

FUTURE OUTLOOK

The Indian snacks industry is witnessing strong momentum, driven by factors such as rapid urbanisation, changing consumer tastes, and the growing influence of modern retail and digital commerce. With demand surging for both traditional favourites and innovative snacking options, the industry is poised for sustained, long-term growth.Recognising this potential, your Company is well-positioned to leverage emerging opportunities through a focused growth strategy. Key priorities include scaling up sales volumes, launching differentiated and flavour-forward products, optimising operational costs, and expanding market presence through strategic marketing and enhanced distribution networks.The Company remains firmly committed to sustainable growth and ongoing initiatives include operational efficiency enhancements, increased investments in automation and digital capabilities, and tapping into new consumer touchpoints in line with shifting buying behaviours. To strengthen profitability, the Company continues to rationalise trade margins, optimise channel economics, and implement disciplined cost control measures across the value chain.

Looking ahead, the Companys long-term operating model is built on three pillars:

1. Consistent revenue growth of approximately 10%,

2. Profitability-centric approach with >10% EBITDA margins, and

3. Sustaining capital efficiency with a Return on Capital Employed (RoCE) in the range of 15 20%.

By aligning its business strategy with evolving industry dynamics and consumer expectations, your Company

is well-positioned to deliver sustained growth, enhanced stakeholder value, and long-term success.

SWOT ANALYSIS

Strengths	Weaknesses
Diversified and innovative product portfolio	Intense competition from both organised and unorganised players
Strong focus on quality and food safety compliance	Limited product differentiation in certain categories
Tech- and data-driven operational governance	High dependency on raw materials at competitive prices
Experienced and committed leadership team
Products designed for all age groups
Opportunities	Threats
Rising urbanisation, increasing consumer spending and growth in online shopping	Volatility in raw material prices
Greater brand awareness and evolving lifestyle preferences	Persistent inflationary pressures impacting input and logistics costs
Potential to tap underpenetrated markets	Sluggish or inconsistent consumer demand patterns
Expanding presence through alternate channels	Increasing public health awareness leading to shifts in dietary preferences
Launch of new and innovative products
Continuous enhancement of the existing product portfolio

RISK MANAGEMENT AND MITIGATION

Risks and concerns are inherent in any business and can significantly influence performance, reputation, and long-term sustainability. At our Company, risk management is embedded within the overall strategic planning and decision-making process. A comprehensive risk management system and policy has been implemented to proactively identify, assess, and mitigate various business risks. The objective is to safeguard the interests of stakeholders while ensuring operational continuity and long-term value creation.

The Companys risk management framework is designed to address a broad spectrum of risk areas, including market volatility, operational efficiency, financial liquidity, supply chain disruptions, regulatory compliance, and reputational exposure. Periodic risk assessments are conducted to evaluate both inherent and emerging risks. Mitigation plans are developed based on the likelihood of occurrence, potential financial or operational impact, and the velocity of change. In line with the Companys Risk Management Policy, the Audit Committee regularly reviews the risk landscape and monitors the implementation of mitigation strategies. The Board of Directors is kept informed on key risks and the corresponding measures undertaken by management to address them.

Key Risk Areas and Mitigation Measures:

1. Economic and Market Risk: Fluctuations in macroeconomic factors such as inflation, interest rates, and consumer spending patterns can impact business growth. The Company monitors external indicators and adjusts its pricing, marketing, and cost-management strategies to remain agile in the face of economic uncertainty.

2. Raw Material and Input Cost Risk: Volatility in the cost and availability of raw materials and packaging inputs can affect margins. To mitigate this, the Company optimizes procurement processes, builds strong vendor relationships, and explores alternate sourcing options to ensure business continuity and cost stability.

3. Operational and Supply Chain Risk: Operational disruptions or inefficiencies in logistics and supply chain can result in delays or increased costs. The Company focuses on improving process reliability, maintaining buffer stocks where necessary, and reviewing key vendor contracts to ensure responsiveness to market demands.

4. Competition Risk: The Company operates in a competitive FMCG market with both organized and unorganized players. To address this, the Company maintains a focus on product quality, customer satisfaction, and efficient distribution channels. Continuous improvement in branding, pricing, and customer engagement also supports competitiveness.

5. Regulatory and Compliance Risk: Compliance with evolving regulatory frameworks is essential. The Company ensures adherence to applicable laws, including the Companies Act, SEBI Regulations, and relevant tax laws. Regular audits, legal reviews, and internal controls are in place to identify and address compliance risks proactively.

6. Technology and Cybersecurity Risk: As technology adoption increases, the risk of cyber threats, data loss, and system disruptions also grows. The Company has basic data security protocols in place and is working toward strengthening IT infrastructure with secured backups, password protections, and anti-virus systems to reduce vulnerabilities.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Company has established a robust internal control system designed to identify, assess, manage, and monitor key risks, ensuring transparent and accountable operations aligned with both short-term and long-term business objectives. Adequate internal financial controls are in place to safeguard assets, prevent and detect frauds and errors, and ensure the accuracy and timeliness of financial reporting. Quarterly internal audits are conducted across critical functions such as procurement, production, IT, supply chain, sales, marketing, and finance. These audits are reviewed by the management, which implements corrective and remedial measures as needed. The Audit Committee also reviews executive summaries of audit reports and monitors the implementation of action plans, ensuring the internal control framework remains effective and aligned with the scale and complexity of the Companys operations.

HUMAN RESOURCES DEVELOPMENT/INDUSTRIAL REALTIONS

Employees remain the cornerstone of our success, and we are committed to attracting, developing, and retaining talented individuals at all levels. During the year under review, focused efforts were made in improving the overall employee experience, fostering career development, and maintaining a safe, inclusive, and engaging work environment. Our strategic approach to human resource management and productivity enhancement has contributed significantly to achieving key organizational goals and milestones. The human resource environment remained stable and positive throughout the year. As of March 31, 2025, the Company had 58 employees across various locations, compared to 59 employees as on March 31, 2024. Industrial relations continued to remain cordial, with no instances of labour unrest or any disruptions, underscoring a harmonious and cooperative workplace culture.

QUALITY, SAFETY, AND SUSTAINABILITY

Quality and safety are foundational pillars of the Companys operations, especially in the food industry, where strict hygiene, nutritional integrity, and product safety are non-negotiable. During FY 2024 25, the Company upheld its commitment to maintaining high standards across all production and supply chain processes, in alignment with evolving regulatory requirements and industry best practices. Continuous quality checks, adherence to food safety norms, and investment in technological enhancements ensured that our products met stringent quality benchmarks, thereby safeguarding public health and strengthening consumer trust. In addition to quality and compliance, the Company remains equally committed to sustainability and ethical business practices. Responsible sourcing of ingredients, reduction in environmental impact, and the promotion of fair trade principles are central to our operational ethos. Sustainability efforts are focused on minimising waste, conserving natural resources, and using eco-friendly equipment wherever feasible. The Company actively integrates environmentally sound practices into its day-to-day operations to reduce its ecological footprint and support long-term environmental goals. As the industry landscape continues to evolve, the Company recognises the growing importance of integrating food safety, technological innovation, and sustainability into a cohesive strategy ensuring long-term value for consumers, communities, and stakeholders alike.

FINANCIAL PERFORMANCE

Summary of financial performance for the year is given herein below: ( in Thousands)

Particulars	FY 2024-25	FY 2023-24	Growth (%)
Revenue from operations	220254.75	117421.84	+87.56%
Other income	13329.35	14006.25	-4.83%
Total Income	233584.10	131428.09	+77.72%
Profit before Interest & Depreciation	23920.66	(3758.31)	Turnaround from loss
Interest Expense	4888.54	13888.93	-64.80%
Depreciation	10045.36	9800.18	+2.50%
Profit before Exceptional Items	8986.76	(27447.42)	Turnaround from loss
Exceptional Income	28309.64	-	Exceptional Income
Profit before taxation (PBT)	37296.40	(27447.42)	Turnaround from loss
Provision for Tax (Including Deferred tax & IT of Earlier Years)	9842.24	(11460.74)	N/A
Profit after tax(PAT)	27454.16	(15986.68)	Turnaround from loss
Other Comprehensive Income
Items that will reclassified to Profit and Loss (Net of Tax)	512.36	274.49	+86.65%
Total Comprehensive Income for the period	27966.52	(15712.19)	Turnaround from loss

Highlights:

Revenue from operations increased by 87.56%, reflecting strong growth in core business activities, especially in own brand sales and job work.

Total income grew by 77.72%, driven by operational expansion.

Interest costs dropped by 64.80%, showing improved financial efficiency and lower debt burden.

The Company witnessed a complete turnaround in profitability, reporting positive EBITDA, PBT, and PAT after previous year losses.

The exceptional income significantly boosted profits and contributed to a strong bottom-line performance.

Total comprehensive income also showed a recovery, shifting from a negative to a positive figure.

During the financial year 2024 25, the Company demonstrated a notable improvement in its operational performance. The growth was primarily driven by an increase in own-brand product sales under the "Skitos" label, as well as a rise in job work manufacturing activities. The expansion of manufacturing capabilities, along with strengthened distribution and brand presence, played a key role in supporting this growth. Despite challenges such as higher input and administrative costs, the Company successfully leveraged its operational strengths and market positioning to enhance efficiency and productivity. These efforts contributed significantly to the overall business recovery and laid a strong foundation for improved financial results during the year.

The quarterly results for the financial year under review are available on the Companys website at https://ceeta.com/quarterly-report .

SEGMENT WISE PERFORMANCE

The Company has two reportable segments such as Packaged Food Products and Other

Operations.

Summary of operating segments for the year is given herein below: ( in Thousands)

Particulars	Year ended 31st March, 2025			Year ended 31st March, 2024
	Packaged Food Products	Other Operations	Total	Packaged Food Products	Other Operations	Total
Segmental Revenue:	219253.95	14330.15	233584.10	118707.33	12720.76	131428.09
TOTAL REVENUE	219253.95	14330.15	233584.10	118707.33	12720.76	131428.09
Segment Result (before interest and tax):	9223.35	(152.06)	9071.29	(16753.44)	(151.66)	(16905.10)
Less: Unallocated Corporate Expenses (net of un-allocable income)	-	-	(21019.14)		-	8744.74
Profit / (Loss) before Interest and Tax	-	-	30090.43		-	(25649.84)
Add: Interest Income	-	-	12094.51		-	12091.37
Less: Interest Expenses	-	-	4888.54		-	13888.93
Net Profit / (Loss) before Tax	-	-	37296.40		-	(27447.40)
OTHER INFORMATIONS:
CAPITAL EMPLOYED:
Segment Assets	239517.89	977.15	240495.04	222439.00	1009.00	223448.40
Segment Liabilities	64720.88	29.85	64750.73	144788.00	79.00	144867.00
Net Segment Assets			175744.31			78581.40
Add: Unallocated Assets	-	-	98269.45		-	167737.00
Less: Unallocated Liabilities	-	-	514.41			938.00
Net Capital Employed	-	-	273499.35		-	245380.40
Capital Expenditure	20535.07	15.51	20550.58	4129.80	256.38	4386.18
Depreciation	9402.38	642.98	10045.36	9054.59	745.59	9800.18

Segment reports for each quarter of the financial year under review are available on the Companys website at https://ceeta.com/quarterly-report .

KEY FINANCIAL RATIOS

The key financial ratios of the company for the financial year under review as compact to the previous financial year are provided herein under:

Key Financial Ratios	FY 2024-25	FY 2023-24	Change (in %)	Explanations (where change is > 25%)
Debtors Turnover (in times)	92.17	52.17	76.68	Increased due to higher revenue from operations in the FY 2024-25
Inventory Turnover (in times)	5.77	4.85	18.88	-
Interest Coverage (in times)	8.63	(0.98)	983.97	Increased significantly due Ratio to higher operating profit from increased revenue and exceptional income, along w i t h r e d u c e d i n t e r e s t expenses
Current Ratio (in times)	1.55	0.96	61.43	Increased during the current year mainly due to decrease in current borrowings.
Debt Equity Ratio (in times)	0.18	0.55	(67.51)	Decreased during the FY 2024-25 due to significant repayment of borrowings by the company.
Operating Profit Margin (%)	18.06	(10.32)	275.06	Increased mainly due to higher operating profits and income from exceptional items.
Net Profit Margin (%)	12.46	(13.61)	191.55	Increased during the current financial year primarily due t o i n c o m e f r o m a n exceptional item.
Return on Net Worth (%)	10.58	(6.31)	267.70	Increased during the current financial year mainly due to higher operating profit and income from an exceptional item.

CAUTIONARY STATEMENT

Statements in this document that describe the Companys objectives, projections, estimates, expectations, or predictions may be considered "forward-looking statements" within the meaning of applicable laws and regulations. Actual results may differ materially from those expressed or implied due to a variety of factors. Key factors that could cause actual results to differ include, but are not limited to: demand-supply dynamics, pricing of finished goods, stock availability and cost, cyclical trends in the Companys core markets, changes in governmental policies or regulations, shifts in tax regimes, political or economic developments, and other internal business factors.

The Company undertakes no obligation to publicly revise, amend, or update any forward-looking statements based on subsequent events, new information, or future developments.

	For and on behalf of the Board of Directors
	K.M. Poddar	Avinash Kumar Khaitan
Place : Kolkata	Managing Director	Director
Dated : May 30, 2025	DIN : 00028012	DIN : 06936383