Desi Farms India Limited Management Discussions

1. BUSINESS OVERVIEW

During the financial year ended March 31, 2026, Desi Farms India Limited (Formerly knowns as "SER Industries Limited") ("the Company") was primarily engaged in the logistics and transportation business, including activities relating to the movement and transportation of goods and allied logistics services.

During the year under review, the Company undertook a significant strategic realignment with the objective of diversifying its business operations and establishing a presence in the dairy, milk and allied food products sector. Pursuant to the approval of the Members at the Extra-Ordinary General Meeting held on February 20, 2026, the Main Object Clause of the Memorandum of Association of the Company was altered to enable the Company to undertake activities relating to procurement, sourcing, collection, processing, manufacturing, preservation, pasteurisation, packaging, branding, trading, marketing, sale, distribution, export and import of milk and milk products, dairy products, nutritious and healthy sweets, dairy-based confectionery, ice cream, frozen desserts and other allied and value-added food products.

As part of this strategic transformation, the Company also initiated an inorganic growth strategy through acquisition of dairy companies, namely SNA Milk and Milk Products Limited and DFSU Farmer Connect Private Limited, with the objective of establishing a stronger operating platform in the dairy sector.

The proposed acquisitions were structured through a share swap mechanism. The requisite approval of the Members for the proposed share swap and related issue of securities was obtained at the Extra-Ordinary General Meeting held on February 20, 2026. The transactions were thereafter undertaken pursuant to the In-principal approval dated 24^th June 2026 and consequent allotment of securities, in compliance with applicable statutory and regulatory requirements after the end of the financial year under review.

Further, the name of the Company was changed from SER Industries Limited to Desi Farms India Limited, effective March 19, 2026. The change in name is reflective of the Companys evolving business strategy and its proposed focus on dairy and allied food products.

Accordingly, FY 2025-26 represents a year of significant strategic transition for the Company, from its existing logistics-oriented business towards a broader business model with a focus on dairy and allied food products, supported by both organic and inorganic growth initiatives.

2. INDUSTRY OVERVIEW Logistics Industry

The logistics sector continues to play a critical role in supporting economic activity by facilitating the movement of goods across manufacturing, trading, retail, infrastructure and other sectors. Increasing industrial activity, growth in organised retail and e-commerce, expansion of supply chains and improving transportation infrastructure continue to create opportunities for logistics service providers.

The industry is also witnessing increasing emphasis on technology-enabled logistics, operational efficiency, route optimisation, supply-chain visibility and integrated logistics solutions. At the same time, the sector remains competitive and is influenced by fuel prices, freight rates, availability of transportation capacity, regulatory requirements, infrastructure and overall economic activity.

During FY 2025-26, the Companys operations were primarily focused on logistics and transportation activities. The Company continues to evaluate opportunities to improve operational efficiency and optimise its existing business operations.

Dairy and Allied Food Products Industry

The dairy industry represents a significant opportunity for the Company pursuant to its strategic expansion. India has a large and established dairy ecosystem supported by milk producers, cooperatives, processors, distributors and a broad consumer base.

Changing consumer preferences, increasing demand for packaged and processed dairy products, greater emphasis on nutrition and food quality, urbanisation and the development of organised retail channels provide opportunities for businesses operating across the dairy value chain.

The dairy and allied food products segment also offers opportunities for product diversification into milk products, traditional sweets, dairy-based confectionery, ice cream, frozen desserts and other value-added products.

The Company intends to leverage these opportunities progressively through a combination of business development, operational capabilities and strategic acquisitions.

3. STRATEGIC REALIGNMENT AND DIVERSIFICATION

The financial year under review marked an important phase of strategic realignment for the Company.

While the Company continued to operate primarily in the logistics sector during FY 2025-26, the management evaluated opportunities for diversification into businesses having longterm growth potential. Pursuant to such evaluation, the Company obtained Members approval on February 20, 2026 for alteration of its Main Object Clause to facilitate entry into the dairy, milk and allied food products sector.

The amended objects provide the Company with flexibility to undertake activities across the dairy value chain, including procurement and sourcing of milk and raw materials, processing, manufacturing, preservation, pasteurisation, packaging, branding, marketing, trading, distribution and sale of dairy and allied food products.

The Company believes that this diversification provides an opportunity to establish a broader business platform and pursue sustainable long-term growth.

4. BUSINESS OUTLOOK

The Companys outlook is based on a phased transition from its existing logistics operations towards a diversified business model with a greater focus on the dairy and allied food products sector.

The management believes that the dairy sector offers significant opportunities for expansion, particularly through value-added products and an integrated approach covering procurement, processing, manufacturing, branding, marketing and distribution.

The Companys inorganic growth initiatives through the proposed/undertaken acquisitions of SNA Milk and Milk Products Limited and DFSU Farmer Connect Private Limited (acquisition was completed after the closure of the relevant FY) are expected to complement its strategic objectives by providing access to existing businesses and capabilities in the dairy sector.

Going forward, the Company intends to focus on:

• Strengthening and consolidating its existing operations;

• Developing its presence in the dairy and allied food products sector;

• Leveraging the businesses and capabilities acquired through strategic transactions;

• Expanding its product portfolio into value-added dairy and food products;

• Improving operational efficiency and supply-chain capabilities;

• Building a sustainable and scalable business model; and

• Exploring further organic and inorganic growth opportunities.

The management remains focused on executing the strategic transition in a measured and sustainable manner while maintaining appropriate financial, operational and regulatory discipline.

5. OPPORTUNITIES

The Companys strategic expansion presents several opportunities, including:

Growing Dairy Consumption

India has a large and established dairy consumption base, with opportunities for growth in both traditional and modern dairy products.

Value-Added Products

Increasing consumer preference for packaged, convenient and differentiated food products provides opportunities in value-added dairy products, sweets, confectionery, ice cream and frozen desserts.

Integrated Dairy Value Chain

The amended objects enable the Company to participate across various stages of the dairy value chain, from procurement and sourcing to processing, manufacturing, packaging, branding and distribution.

Inorganic Growth

Acquisition of existing dairy businesses provides an opportunity to accelerate market entry, leverage existing capabilities and build scale.

6. THREATS AND CHALLENGES

The Companys proposed entry into the dairy and allied food products sector is subject to various business and industry-related challenges, including:

• Intense competition from established dairy and food companies;

• Changes in consumer preferences;

• Food safety and quality requirements;

• Regulatory and compliance requirements applicable to food and dairy businesses;

• Dependence on efficient procurement and distribution networks;

• Execution and integration risks associated with acquisitions and strategic transactions.

The Company intends to address these challenges through appropriate business planning, internal controls, quality standards, operational monitoring and prudent financial management.

7. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Company has established internal financial controls commensurate with the size, scale and nature of its operations.

The internal control framework is designed to provide reasonable assurance regarding the orderly and efficient conduct of business, safeguarding of assets, prevention and detection of frauds and errors, accuracy and completeness of accounting records and timely preparation of reliable financial information.

The internal control systems are subject to periodic review by the management and are strengthened wherever considered necessary.

The Company will continue to enhance its internal control framework in line with the expansion and diversification of its business operations, including the Companys entry into the dairy and allied food products sector and the integration of acquired businesses.

The Board is of the opinion that the Company has adequate internal financial controls commensurate with its business operations and that such controls were operating effectively during the financial year under review.

8. FINANCIAL PERFORMANCE

During FY 2025-26, the Companys financial performance primarily reflected its existing logistics and transportation operations.

The strategic expansion into the dairy and allied food products sector was initiated during the latter part of the financial year and is therefore expected to have a progressively increasing impact on the Companys business and financial performance as the new business activities are developed and scaled.

The management continues to focus on improving operational efficiency, prudent deployment of resources and establishing a sustainable financial foundation for the Companys future growth.

The detailed financial performance and financial position of the Company are set out in the financial statements forming part of this Annual Report.

9. HUMAN RESOURCES

Human resources continue to be an important component of the Companys growth strategy. The Company recognises that the successful implementation of its strategic expansion into the dairy and allied food products sector will require appropriate managerial, technical, operational, sales, marketing and other specialised capabilities.

The Company intends to strengthen its human resource base in accordance with its evolving business requirements and ensure that employees are provided with an appropriate working environment and opportunities for development.

The Company continues to maintain a professional and performance-oriented work culture and recognises the contribution of its employees towards achieving its business objectives.

10. CAUTIONARY STATEMENT

This Management Discussion and Analysis Report contains statements that may be considered as "forward-looking statements" within the meaning of applicable laws and regulations. Such statements are based on the Companys present expectations, assumptions, estimates and projections regarding future events and business performance.

Actual results may differ materially from those expressed or implied in such statements due to various factors, including changes in economic conditions, market conditions, competition, regulatory requirements, raw material prices, consumer demand, operational risks, execution of strategic initiatives, integration of acquired businesses and other risks and uncertainties.

The Company assumes no obligation to publicly update or revise any forward-looking statements, except as may be required under applicable laws and regulations.