Deccan Health Care Ltd Management Discussions

Industry structure and developments:

The nutraceuticals market is poised for substantial growth, driven by an aging population, increasing health consciousness, and ongoing advancements in nutritional science. Companies that leverage innovation, adapt to regulatory changes, and align with evolving consumer preferences will be well-positioned to thrive in this dynamic sector. The nutraceuticals market includes dietary supplements, functional foods, medicinal foods, and pharmaceuticals. Though classified as food products, nutraceuticals also serve significant medical purposes. These specially designed products, derived from various food sources, are rich in bioactive compounds, providing notable nutritional, health, and medicinal benefits. Nutraceuticals are intended to complement a regular diet, supplying additional nutrients that enhance overall health and well-being. They are instrumental in improving health, preventing chronic diseases, extending life expectancy, and supporting both physical and mental wellness. Scientific studies affirm their positive effects on conditions such as cardiovascular disease, hypertension, diabetes, inflammation, and cancer.

Key Categories of Nutraceuticals:

Vitamins and Minerals: Essential for daily bodily functions, these nutrients are often added to foods to enhance nutritional value and boost immunity. Sources can be plant-based, animal-based, or microbial.

Probiotics: Beneficial microorganisms that support digestive health and overall immune function.

Proteins and Peptides: Important for muscle repair, immune support, and overall bodily functions.

Omega Fatty Acids: Crucial for cardiovascular health and cognitive function.

Others: Includes various other beneficial compounds such as antioxidants and herbal extracts.

Product Forms and Applications: Nutraceuticals are available in several forms, including capsules, tablets, soft gels, powders, liquids, and gummies. They find applications in:

Functional Foods: Products designed to offer health benefits beyond basic nutrition.

Functional Beverages: Drinks fortified with nutrients for added health benefits.

Dietary Supplements: Concentrated sources of nutrients or bioactive compounds.

Personal Care Products: Items that enhance health and beauty.

There is a growing preference for transparency in ingredient sourcing and product efficacy. Consumers are increasingly seeking out products with clear, scientifically-backed benefits and ethical sourcing practices. This trend is driving brands to focus on high-quality ingredients and sustainable production methods.

Global Nutraceutical Market Stats

The global nutraceutical market was valued at approximately USD 591.1 billion in 2024 and is projected to grow at a compound annual growth rate (CAGR) of around 8-10%, reaching nearly USD 919.1 billion by 2030. This growth is driven by increasing consumer demand for dietary supplements, functional foods, and natural health products, bolstered by rising health consciousness and a preference for preventive healthcare. Key markets include North America, Europe, and Asia-Pacific, with significant contributions from sectors like vitamins, probiotics, and herbal supplements. The industry is also seeing a surge in online retail channels and innovations in product formulations and delivery methods.

Indian Nutraceutical Market Stats

The Indian nutraceutical market has been experiencing significant growth, reflecting a rising awareness of health and wellness among consumers. Heres a brief overview of the key stats and trends:

Market Size: The Indian nutraceutical market was valued at approximately USD 32.14 billion in 2024. Projections suggest it could grow to around USD 15-20 billion by 2028.

Growth Rate: The sector has been growing at a compound annual growth rate (CAGR) of about 10-15% over recent years.

Consumer Segments: The market is driven by increasing health consciousness, aging populations, and rising disposable incomes. Key segments include dietary supplements, functional foods, and natural and herbal products.

Popular Products: Vitamins and minerals, protein supplements, probiotics, and herbal supplements are among the most popular categories.

Distribution Channels: Online retail and e-commerce platforms are becoming increasingly important, alongside traditional retail and pharmacies.

Regulation and Standards: The Food Safety and Standards Authority of India (FSSAI) oversees the regulation of nutraceuticals, ensuring product safety and quality. The markets expansion is fueled by a growing middle class, increasing urbanization, and heightened focus on preventive healthcare.

Rise of Preventive Healthcare:

Preventive healthcare has gained unprecedented prominence, especially in the wake of the pandemic, underscoring the vital role of the nutraceuticals sector in both health and economic contexts. As individuals increasingly seek to bolster their immune systems, the demand for essential nutrients and micronutrients—such as Vitamin A, Vitamin D, Vitamin C, folate, selenium, and zinc—has surged. Research by Nutrition and Dietary Supplements highlights the potential benefits of integrating diverse ingredients into daily diets, including polyphenols, leguminous seeds with plant protease inhibitors, and proteins like whey protein, to enhance immune function and offer protection against illnesses, including COVID-19. This trend reflects a broader shift towards proactive health management through nutritional and lifestyle interventions.

Current Trends and Future Outlook:

There is a growing health and fitness consciousness among Indias urban population, creating substantial growth opportunities for the nutraceuticals industry. Manufacturers and marketers are innovating new strategies to educate consumers about the benefits of nutraceuticals and their role in preventive healthcare and medical treatment. Industry players are also focusing on enhancing product quality, increasing transparency, and offering competitive pricing to drive growth and innovation. The nutraceutical market, which now commands a 67% share, is surpassing the traditionally dominant pharmaceutical supplement market, underscoring its expanding role in health and wellness.

Measure to Attract Investors & Entrepreneurs:

Tax Incentives and Subsidies: Implementing tax breaks, subsidies, and financial incentives for companies investing in nutraceutical research and development can make the market more appealing.

Streamlined Licensing and Approvals: Simplifying the process for obtaining licenses and approvals for new nutraceutical products can reduce entry barriers and encourage more startups and foreign players to enter the market.

Infrastructure Development: Investing in research facilities, manufacturing plants, and quality control laboratories can enhance the industrys capability and appeal to investors looking for robust operational support.

Public-Private Partnerships: Encouraging collaborations between government bodies and private sector players can drive innovation, improve market access, and offer shared resources and expertise.

Consumer Education Campaigns: Promoting awareness about the benefits of nutraceuticals through educational campaigns can drive consumer demand, thereby attracting investors interested in a growing market.

Export Opportunities: Developing policies that support the export of nutraceutical products can open new revenue streams for companies and attract foreign investment interested in tapping into global markets.

Innovation Grants and Competitions: Providing grants and holding innovation competitions can stimulate research and development, encouraging entrepreneurs to bring novel nutraceutical products to market.

Regulatory Harmonization: Aligning regulations with international standards not only ensures product quality but also simplifies the process for companies looking to enter the Indian market from abroad.

Industry Associations and Networks: Strengthening industry associations and creating networks for investors and entrepreneurs can facilitate knowledge sharing, networking opportunities, and collaboration.

Health and Wellness Trends: Capitalizing on the growing global and domestic trends towards health and wellness can attract investors looking to enter a market with increasing consumer interest and spending.

These measures collectively aim to create a favourable environment for growth, innovation, and investment in the Indian nutraceuticals sector.

Initiatives taken by Deccan Health Care Limited:

Online Expansion: In the age of e-commerce dominance and rapid online retail expansion, were harnessing this trend to reach more consumers effectively. Through constant innovation, were revolutionizing product structures, ensuring our offerings remain at the forefront of the industry.

Diversification into new categories: Our proactive expansion from the nutraceuticals segment to personal care, self-care and nutri-foods reflects a strategic response to evolving consumer preferences and market dynamics. With a dedicated focus on expanding our product range in these sectors, we are well-positioned to meet the rising demand for health and wellness products.

Product Innovation Catalogue: Currently boasting a portfolio of over 1000 recipes, including 400 in- market SKUs and 173 new recipes, we demonstrate a robust commitment to product innovation and diversity. Our ambitious expansion strategy, spanning both domestic and international markets, highlights our dedication to fostering growth.

Expansion into New Geographies & Markets: Through initiatives such as intra-state expansion in India and forging distribution partnerships in the Gulf Cooperation Council (GCC) and the US, we are actively reaching new consumer segments and broadening our market presence. Moreover, our planned investments in a new intermediary factory and enhancements to packaging facilities underscore our readiness to support future growth.

Year 2024-25 Highlights:

Innovating Nutritional Science for Public Health :

At DHCL, we have strengthened our commitment to nutrition-led health solutions by accelerating efforts to address iron deficiency through an innovative, food-based approach. A cornerstone of this initiative is our Iron-Enriched Fruit Bar — a scientifically validated, consumer-centric alternative to conventional iron tablets. This novel solution is designed not just for efficacy, but for real-world practicality. By delivering iron in a tasty, easy-to-consume format, the Iron -Enriched Fruit Bar overcomes common barriers associated with traditional supplementation, such as poor adherence and gastrointestinal side effects. Its accessibility and appeal make it particularly well-suited for integration into daily diets, especially within underserved populations where nutritional deficiencies are most prevalent. Through this product, DHCL is redefining how iron supplementation can be delivered — not as a medicine, but as an enjoyable and sustainable part of everyday nutrition.

Compliance rate compared to traditional iron pills. Conventional iron supplements often face challenges such as poor taste, gastrointestinal discomfort, and pill fatigue, which lead to low adherence and high dropout rates, particularly among children and adolescents. In contrast, the fruit bar format is delicious, easy to consume, and free from common side effects, resulting in near-universal acceptance among target groups. By transforming iron supplementation into a pleasant and convenient daily experience, we have dramatically improved consistency in consumption. This consistency is critical to achieving measurable improvements in hemoglobin levels and overall health outcomes.

Compared to traditional iron supplements, our Iron-Enriched Fruit Bar significantly enhances compliance rates. Conventional iron pills often suffer from poor palatability, gastrointestinal side effects, and "pill fatigue," particularly among children and adolescents—factors that contribute to low adherence and high dropout rates. In contrast, the fruit bars appealing taste, ease of consumption and gentle formulation have led to near-universal acceptance within our target populations.

By transforming iron supplementation into a convenient and enjoyable daily habit, we have greatly improved consistency in intake—a key factor in driving measurable increases in hemoglobin levels and overall health outcomes. This improved adherence underscores the bars potential as a sustainable, population-level intervention in the fight against iron deficiency.

In partnership with NGOs, Corporate CSR initiatives, and District Administrations, DHCL introduced the Iron-Enriched Fruit Bar to thousands of children in government schools—replacing conventional iron pills with a more accessible, acceptable solution. Widely distributed across multiple regions, the initiative successfully delivered over 100,000 units to young children and women—those most vulnerable to iron deficiency.

The impact was profound. Within just 21 to 84 days, 95% of adolescent girls showed improved hemoglobin levels, with an overall success rate nearing 100%—a result that exceeded outcomes typically associated with synthetic iron supplements. To enhance efficacy, a biannual deworming component was integrated into the program, addressing parasitic infections that can inhibit iron absorption—particularly in areas with poor sanitation.

This holistic, food-based model has demonstrated not only strong clinical effectiveness but also real-world scalability, offering a viable and community-friendly strategy to combat iron deficiency at the population level.

In collaboration with NGOs, Corporate CSR programmes, and District Administrations, we collaborated to introduce the Iron-Enriched Fruit Bar to thousands of children in government schools. Replacing conventional iron pills, the bar was widely accepted and distributed across regions, with over 100,000 units reaching young children and women those most at risk of iron deficiency.

The results were significant. Hemoglobin levels improved in 95% of adolescent girls within 21 to 84 days, with a near 100% success rate, surpassing outcomes seen with synthetic iron medicines. A biannual deworming component further supported iron absorption, especially in areas with poor sanitation. This integrated, food-based approach proved both effective and scalable in addressing iron deficiency at the community level.

Collaborative Support :Driving Impact through Partnership

The success of our Iron-Enriched Fruit Bar initiative and its growing role in reshaping public health outcomes has been made possible through the strength of our collaborations. At DHCL, we believe that sustainable health solutions are built not in isolation, but through strategic alliances across sectors. Our progress in delivering 100% of the Recommended Dietary Allowance (RDA) for iron, in line with the goals of the Anemia Mukt Bharat program, reflects the power of what can be achieved when science, community, and purpose converge.

This innovation is more than a product. It represents a shared commitment to national wellbeing. We are grateful for the support of NGOs, government health departments, academic institutions, corporate CSR partners, and local community organizations who have played a vital role in scaling this initiative. From last-mile delivery and health education to monitoring and evaluation, each partner has brought a unique strength to the mission.

Our collaborative model has not only expanded our reach but also ensured that implementation remains context-specific, culturally sensitive, and rooted in real community needs. This synergy has allowed us to deliver impact at scale while keeping efficiency, transparency, and trust at the core of our operations.

We extend our deepest thanks to all our partners, both longstanding and newly on boarded. Your belief in the vision of food-based, science-backed nutrition is accelerating our collective progress toward a healthier, anaemia-free India. We are adding more every day. As we continue to grow, so too does the network of change makers committed to bringing lasting transformation to the health landscape of the country.

Together, we are proving that shared value creation for society and shareholders alike is not Only possible but imperative.

International Year of Millets (IYoM-2023) - A Milestone Achievement:

In a groundbreaking move to promote global awareness and consumption of nutritious and sustainable foods, the Indian government has designated 2023 as the International Year of Millets (IYoM-2023). This initiative underscores the importance of millets in enhancing food security, nutrition, and agricultural sustainability.This initiative underscored the importance of millets in enhancing food security, nutrition, and agricultural sustainability, and the momentum continues to resonate strongly in 2024–25.

In response to this significant development, Deccan Health Care has taken a proactive step by launching its innovative Organowild millet cookies. This product not only aligns with the governments vision but also caters to the growing consumer demand for health-conscious and eco-friendly food options. By incorporating millets—known for their high nutritional value, including rich protein content, vitamins, and minerals—into their product line, Deccan Health Care is addressing both domestic and international markets. The launch of Organowild millet cookies reflects a strategic alignment with global health trends and the increasing consumer preference for functional foods. This initiative positions Deccan Health Care as a forward-thinking leader in the nutraceutical industry, capitalizing on the global spotlight on millets to expand its market reach and promote sustainable food practices. By leveraging the International Year of Millets, Deccan Health Care is not only contributing to the global movement towards healthier eating but also setting a precedent for innovation and responsibility in the nutraceutical sector. This effort highlights the companys commitment to offering products that support both personal wellness and environmental sustainability, reinforcing its role in the evolving landscape of global nutrition.

In 2024–25, Deccan Health Care continues to capitalize on the global spotlight on millets by reinforcing its innovation-driven approach, scaling its market reach, and strengthening its role in promoting sustainable food practices. This initiative highlights the companys dual commitment to personal wellness and environmental responsibility, thereby consolidating its leadership in the evolving nutraceutical industry and contributing meaningfully to the post-IYoM legacy of millets.

Nutritional Support Program: A Landmark Anemia-free India Initiative for Rural Health In a significant stride towards combating malnutrition and anemia among women and girls in rural India, Deccan Health Care, in collaboration with the B2C Foundation and Ganga Aruna Foundation, has launched a transformative Nutritional Support Program. This initiative is part of the broader Prime Ministers Anemia Mukt Bharat (AMB) initiative, aimed at eradicating anemia and improving nutritional health across the country. The program is being rolled out at the Telangana State Residential School and Junior College (Girls) in Tandur, Vikarabad district, Telangana, with additional support from IFFCO-TOKIO. This strategic location was selected due to the high prevalence of nutritional deficiencies in the region. The Nutritional Support Program encompasses several critical components designed to address these challenges effectively: o Hemoglobin Level Screenings: Regular screenings are conducted to assess the anemia levels among the students. This data-driven approach helps in identifying individuals at risk and tailoring interventions accordingly. o Customized Nutritional Plans: Based on the screening results, personalized nutritional plans and deworming plans are developed to meet the specific needs of each individual. These plans focus on integrating essential vitamins, minerals, and iron-rich foods into the diet to combat deficiencies and promote overall health. o Educational Workshops: The program includes workshops to educate students, their families, and school staff about the importance of balanced nutrition, anemia prevention, and healthy eating habits. o Community Engagement: Engaging the local community and fostering awareness about the importance of nutrition and regular health check-ups play a crucial role in the programs success. o Sustainable Impact: The initiative aims not only to address immediate nutritional needs but also to build long-term awareness and self-sufficiency in managing health and nutrition. This program marks a significant achievement for Deccan Health Care and its partners, reflecting a strong commitment to improving public health and addressing critical issues faced by vulnerable populations. By implementing a comprehensive approach to nutritional support, the initiative not only aligns with national health goals but also sets a precedent for similar efforts across the country. Through these efforts, Deccan Health Care and its collaborators are making a meaningful impact on the lives of women and girls, contributing to a healthier, more informed generation and supporting the broader vision of an anemia-free India. In FY 2024–25, the Nutritional Support Program partnered with Deccan Health Care, B2C Foundation, and Ganga Aruna Foundation to reduce anemia and malnutrition in rural India. The programs initiatives included distributing nutritional supplements, running awareness campaigns on healthy diets, and collaborating with local health networks to reach women and adolescent girls in underserved communities. These efforts showed positive health outcomes and supported the governments Anemia Mukt Bharat mission.

Financial Performance of the Company:

The summarized financial highlights of the Company for the year ended 31 March 2025 vis-a-vis the previous year are as follows:

	Standalone		Consolidated
Particulars	FY 2024-25	FY 2023-24	FY 2024-25	FY 2023-24
Revenue from Operations	7513.19	5972.89	7505.79	5972.89
Other Income	0.57	1.37	0.57	1.47
Total Revenue	7513.76	5974.26	7506.36	5974.36
Expenses:
Cost of Material Consumed	4096.37	3046.46	4088.97	3046.46
Changes in Inventories of Finished Goods and	660.78	701.52	660.78	701.52
Work-in-Progress
Employee Benefit Expenses	434.82	341.27	444.21	352.38
Other Expenses	2002.22	1507.72	1996.70	1497.47
Finance Cost	7.39	6.35	7.42	8.50
Depreciation and Amortization Expenses	145.26	146.65	145.26	146.65
Total Expenses	7346.84	5749.97	7343.34	5752.98
Profit / (Loss) Before Tax	166.92	224.29	163.02	221.38
Tax Expenses:
Provision for Income Tax	57.01	85.60	57.01	85.60
Less: MAT Credit Entitlement	-	-	-	-
Deferred Tax	(9.88)	(13.48)	(9.86)	(13.48)
Profit / (Loss) after Tax	119.79	152.17	115.87	149.26
Earnings Per Share:
Basic	0.56	0.82	0.54	0.80
Diluted	0.47	0.82	0.45	0.80

1. Previous year figures have been regrouped / re-arranged wherever necessary.

2. These audited standalone & consolidated financial results for the year ended 31 March 2025 is the first annual Audited standalone & consolidated financial results after adoption of Indian Accounting Standards ("Ind AS"). Consequently, the standalone & consolidated financial results for all the periods presented have been prepared in accordance with the recognition and measurement principles as stated therein.

On a Standalone basis, the company achieved a turnover (including other Income) of Rs. 7513.76 Lakhs for the year ended 31 March 2025 as compared to Rs. 5974.26 Lakhs in the previous year. The Net Profit after tax is Rs. 119.79 Lakhs as compared to the net profit after tax of Rs 152.17 Lakhs in previous year, leading to the Basic Earnings per Share of Rs. 0.56 as compared to Rs. 0.82 in previous year.

On a Consolidated basis, the company achieved a turnover (including other Income) of Rs. 7505.36 Lakhs for the year ended 31 March 2025 as compared to Rs. 5974.36 in the previous year. The Net Profit after tax is Rs. 115.87 Lakhs as compared to the net profit after tax of Rs

149.26 Lakhs in previous year, leading to the Basic Earnings per Share at Rs. 0.54 as compared to Rs. 0.80 in previous year.

Threats and key challenges faced by Nutraceutical segment in India:

Lack of Clear Regulatory Framework:

The absence of a comprehensive and clearly defined regulatory framework for nutraceuticals in India poses a significant challenge. This regulatory ambiguity can hinder industry growth by creating uncertainties around compliance, product registration, and safety standards. The lack of standardized regulations can also lead to inconsistent quality across products, affecting consumer trust and market expansion.

Trustworthiness and Counterfeit Products:

The prevalence of fake or counterfeit nutraceutical products undermines the credibility of the sector. Unregistered and unapproved products often flood the market, leading to consumer skepticism and potential health risks. These counterfeit goods not only harm public health but also damage the reputation of legitimate brands, creating a barrier to widespread acceptance and trust in nutraceuticals.

Pricing and Accessibility:

The cost of nutraceutical products can be a significant barrier to their acceptance, especially across different socio-economic classes. Given that nutraceuticals are often positioned as preventive health solutions, higher pricing can limit their accessibility to a broader demographic. This pricing challenge impacts consumer adoption rates and can restrict market growth, particularly in lower-income segments where affordability is a critical factor.

Consumer Awareness and Education:

Limited consumer awareness and understanding of the benefits and science behind nutraceuticals can impede market growth. Without adequate education on the efficacy and safety of these products, consumers may be reluctant to incorporate them into their daily routines.

Quality Control and Standardization

Inconsistent quality control and lack of standardized practices across the industry can affect the efficacy and safety of nutraceutical products. Ensuring uniform quality and adhering to best practices are crucial for gaining consumer confidence and ensuring regulatory compliance.

Market Fragmentation

The nutraceutical market in India is highly fragmented, with numerous small and medium-sized players. This fragmentation can lead to competition on price rather than quality, making it challenging for companies to differentiate themselves and maintain profitability.

Supply Chain Issues

Challenges in sourcing high-quality raw materials and managing an efficient supply chain can affect product availability and quality. Variability in raw material quality and supply disruptions can impact the overall performance of nutraceutical products. Addressing these challenges requires a concerted effort from stakeholders, including government agencies, industry players, and consumer advocacy groups, to establish clear regulations, enhance consumer education, and improve product quality and accessibility.

Outlook and Future Trends:

The past two years have catalysed a significant transformation in human behaviour, particularly concerning health and well-being. This shift towards a healthier lifestyle, accelerated by the pandemic, has intensified the focus on preventive and proactive healthcare. As consumers increasingly prioritize cleaner, more transparent foods, the nutraceutical market in India is experiencing notable growth. Supported by scientific research, this sector is enhancing public health and wellness on a substantial scale.

The nutraceutical industry in India is currently undergoing incredible growth, driven by a combination of factors that align with the evolving consumer preferences for healthier lifestyles and natural products. Between 2023 and 2028, the Indian nutraceutical market is anticipated to expand at a CAGR of 15%. Nutraceuticals are functional foods, dietary supplements, or herbal products that provide health benefits beyond basic nutrition. As the ideology ‘prevention is better than cure and holistic wellness see wider acceptance, the nutraceutical market in India has emerged as a significant player in the global arena.

Factors driving the growth of the nutraceutical industry in India

Change in lifestyles and rising health awareness

In recent years, India has experienced a drastic change in lifestyles, with an increasing number of people becoming health-conscious and looking for proactive ways to manage their well-being. The awareness about the importance of a balanced diet, being physically and mentally fit, and overall health has led consumers to look for natural and safe alternatives, thereby reinforcing the demand for nutraceutical products.

Government support and regulation

The Indian governments supportive policies and regulations have played a significant role in fostering the growth of the nutraceutical sector. Regulatory organizations such as the Food Safety and Standards Authority of India (FSSAI) have established guidelines for the manufacture and marketing of nutraceutical products, ensuring their safety and quality. This move has instilled confidence among both consumers and industry stakeholders.

Research and development

Many contract nutraceutical manufacturers maintain an in-house R&D department meant for consistently developing effective and innovative nutraceutical products. Leading contract pharmaceutical manufacturer Akums Drugs & Pharmaceuticals Ltd, for instance, has an R&D process flow that begins with idea conceptualization to prototype development and ultimately leads to commercialization and launch of the desired nutraceuticals. Scientific advancements have resulted in the development of new formulations and technologies that offer enhanced health benefits, attracting more consumers to the industry.

Personalized nutrition

Personalized nutrition is gaining traction as consumers seek tailored solutions to their specific health needs. The approach ‘one size fits all works no more. Nutraceutical companies leverage technology to offer customized products, further expanding their consumer base. Being highly flexible in all its operations, Akums Drugs & Pharmaceuticals Ltd provides innovative and customized products to its clients. Be it the ingredients, the packaging, or the labeling, the company goes above and beyond to meet the personalized nutritional requirements of its clients.

Future prospects of the nutraceutical industry in India

Expanding elderly population

India is experiencing a demographic shift, with an increasing number of elderly individuals This aging population will drive the demand for nutraceuticals that cater to age-related health issues, including but not limited to bone health, cognitive function, and joint pain.

Product diversification and integration of Ayurveda

The industry will witness continuous innovation and product diversification to address various health needs and preferences of consumers. Formulations with evidence-based benefits and natural ingredients will attract a larger customer base. As the country has a history of traditional medicine systems like Ayurveda that encourages using traditional herbs, the nutraceutical industry is more likely to integrate age-old practices to develop effective and culturally relevant products.

Global reach

Indian nutraceutical companies are increasingly eyeing the global market. Indias renown a hub for natural and herbal remedies will bestow the country with a competitive edge the global market. The nutraceutical industry in India is on a trajectory of growth and success, driven changing consumer habits, supportive regulations, and the pursuit of a healthier lifestyle The industry is positioned to greatly influence the nations healthcare system while advancing the well-being of its population Kudos to the convergence of innovation, research, and a health-conscious population that paints a bright future for the nutraceutical industry in India. Akums Drugs & Pharmaceuticals Ltd.s role as a reliable contract pharmaceutical manufacturing partner has been instrumental in propelling the nutraceutical industry forward, and its expertise will continue to shape its future in India and beyond.

Risks and Concerns:

The nutraceutical sector faces several risks, which the company addresses through a well-defined risk management process. This process includes identifying, analysing, and assessing risks, formulating mitigation strategies, and implementing controls. While complete risk elimination is not feasible, efforts are made to minimize their impact on operations.

Internal Control Systems and Their Adequacy:

To ensure that business activities are aligned with organizational objectives and resources are utilized optimally, the Company has established comprehensive internal control systems across all operations. In addition to these controls, a well-structured internal audit system is in place to monitor and enhance operational and financial performance.

The effectiveness of our operations and financial health can be influenced by several factors, including:

Supply and Availability of Raw Materials/Traded Goods: Ensuring consistent supply and quality of raw materials and traded goods.

Competition: Navigating competition from both existing players and new market entrants.

Distribution Channel Performance: Maintaining efficient and reliable distribution channels.

Brand Image: Sustaining and enhancing the Companys brand reputation.

Interest Rate Policies: Managing the impact of interest rate fluctuations.

Economic and Demographic Conditions: Adapting to changes in the economic and demographic landscape.

Regulatory Changes: Complying with evolving laws and regulations relevant to the nutraceutical industry both domestically and internationally. The Company remains committed to refining its internal control systems and internal audit processes to proactively address these factors, thereby supporting its strategic objectives and maintaining operational excellence.

Discussion on Financial Performance with respect to the Operational Performance:

On a Standalone basis, the company achieved a turnover (including other Income) of Rs. 7,513.76 Lakhs for the year ended 31 March 2025 as compared to Rs. 5,974.26 Lakhs in the previous year. The Net Profit after tax is Rs. 119.79 Lakhs as compared to the net profit after tax of Rs 152.17 Lakhs in previous year, leading to the Basic Earnings per Share of Rs. 0.56 as compared to Rs. 0.82 in previous year.

On a Consolidated basis, the company achieved a turnover (including other Income) of Rs. 7505.36 Lakhs for the year ended 31 March 2025 as compared to Rs. 5,974.36 in the previous year. The Net Profit after tax is Rs. 115.87 Lakhs as compared to the net profit after tax of Rs 149.26 Lakhs in previous year, leading to the Basic Earnings per Share at Rs. 0.54 as compared to Rs. 0.80 in previous year.

Material Development in Human Resources/Industrial Relations:

The Company considers employees as its vital and most valuable assets. Your Company considers manpower as its assets and understands that people have been driving force for growth and expansion of the Company.

As of March 31, 2025, there are 83 permanent employees on the rolls, diligently working and dedicated to the companys goals. Through our Learning and Development initiatives, the Company continues to upskill and reskill our employees for their jobs. The Company is into process of continuous improvements based on feedback and inputs from multiple stakeholders, past experiences and industrys best practices (Recruitment and Selection, Leave & Attendance Management) for giving better employee experiences. The Company will continue to create opportunity and ensure recruitment of diverse candidates without compromising on meritocracy.

Significant changes (i.e. change of 25% or more as compared to the immediately previous financial years) in Key Financial Ratios, along with explanation are as under:

Ratios	FY 2024-25	FY 2023-24	Reason for variance More than 25 %
Inventory turnover ratio	1.19	0.88	The inventory turnover ratio improved during F.Y 2024-25 due to a 4.57% decline in closing inventory, suggesting faster inventory movement, better sales realization, and enhanced inventory management practices. This reflects the companys strategic focus on optimizing working capital and reducing stockholding costs.
Current ratio	7.24	12.25	The 40.90% decline in the Current Ratio is primarily due to a sharp rise in current liabilities —especially trade payables and other financial obligations— while current assets increased at a slower pace. This indicates a strategic shift in working capital management and greater use of short-term liabilities to fund operations

 

Operating Profit Margin (%)	1.43	3.97	During the year revenue increased but operating profit margin reduced by 64.04% because of decrease in operating profit.
Net Profit Margin (%)	1.59	2.55	During the year, Revenue from operation increased at higher proportion than increase in net profit . Thus, Net Profit Ratio declined from 2.55% to 1.59%.
Return on Net worth (%)	1.12	1.57	The Return on Net Worth declined from 1.57% to 1.12% in FY 24-25, driven by a fall in net profit alongside an increase in shareholders equity. This reflects lower profitability relative to the capital invested by shareholders.
Debt Equity Ratio	0.01	0.01	The Debt-to-Equity Ratio decreased, primarily due to a reduction in total borrowings and a simultaneous increase in equity base.
Return on Capital Employed	1.18	1.61	The ROCE declined from 1.61% in FY23-24 to 1.18% in FY24-25, primarily due to a reduction in operating profits amid rising costs and a moderate increase in capital employed.

Cautionary Statement:

Statements in this Management Discussion and Analysis contains "Forward Looking Statements" including, but without limitation, statements relating to the implementation of strategic initiatives, and other statements relating to Companys future business developments and economic performance. While these forward-looking statements indicate our assessment and future expectations concerning the development of our business, several risks, uncertainties, and other unknown factors could cause actual developments and results to differ materially from our expectations. These factors include, but are not limited to, general market, macroeconomic, governmental and regulatory trends, movements in currency exchange and interest rates, competitive pressures, technological developments, changes in the financial conditions of third parties dealing with us, legislative developments, and other key factors that could affect our business and financial performance. The Company undertakes no obligation to publicly revise any forward- looking statements to reflect future/ likely events or circumstances.

References:

www.biovoicenews.com

https://timesofindia.indiatimes.com/

https://www.foodprocessingindia.gov.in/newsletter/emailer/two