Dhariwalcorp Ltd Management Discussions

Industry Structure and Developments

The Company is engaged in the business of Basic Chemistry Products, offering an extensive portfolio that includes Microcrystalline Waxes, Semi-Refined Paraffin Waxes, Carnauba Wax, Polyethylene Wax, and several other specialty products to a diverse global customer base. Backed by a robust global supply chain, the Company ensures consistent product availability, efficient delivery, competitive pricing, and a strong commitment to customer satisfaction. Its operations extend across 21 States and 3 Union Territories, reflecting a well-established distribution network and strong market reach. The Companys core business activity revolves around the forward trading of these products, enabling it to effectively respond to market dynamics, optimize inventory cycles, and deliver enhanced value to its customers.

During the year under review, the Company also broadened the scope of its main object clause, by way of a Special Resolution approved by the Members through Postal Ballot, to include activities relating to land development and plotting, thereby enabling the Company to diversify into real estate development, land aggregation and sale of developed plots, in addition to its existing business segments of wax, industrial chemicals and spice & agro products. Accordingly, the industry structure applicable to the Company now also includes the real estate and land development sector, as discussed below.

a) The Chemical Industry:

India holds a strong position in the global exports and imports of chemicals, and the sector continues to attract significant Foreign Direct Investment under the automatic route, barring a few hazardous chemical categories.

Indias chemical industry remains one of the most diversified in the world, spanning more than 80,000 commercial products across bulk chemicals, specialty chemicals, agrochemicals, petrochemicals, polymers, and fertilisers. The sector continues to rank among the leading contributors to Indias GDP and remains a major player within Asias overall chemical output. Through FY 2025-26, the industry sustained its growth momentum, supported by robust domestic consumption, expanding export markets, and rising investment in specialty and sustainable chemistry.

In addition to waxes, other chemical products such as liquid paraffin, rubber process oils, citric acid, refined glycerine, bitumen, petroleum jelly, and paraffin-based petroleum jelly form an integral part of the Companys trading portfolio. These products are indispensable across pharmaceuticals, cosmetics, food preservation, construction, and rubber manufacturing industries. Indias chemical sector has evolved into a global hub for both specialty and commodity chemicals, driven by strong domestic demand, growing export opportunities, and significant investments in advanced refining technologies. The industry is increasingly focused on adopting sustainable practices, bio-based alternatives, and digital solutions to enhance operational efficiencies and align with stringent global environmental and quality standards.

In addition to waxes, other chemical products such as liquid paraffin, rubber process oils, citric acid, refined glycerine, bitumen, petroleum jelly, and paraffin-based petroleum jelly form an integral part of the Companys trading portfolio. These products are indispensable across pharmaceuticals, cosmetics, food preservation, construction, and rubber manufacturing industries. Indias chemical sector has evolved into a global hub for both specialty and commodity chemicals, driven by strong domestic demand, growing export opportunities, and significant investments in advanced refining technologies. The industry is increasingly focused on adopting sustainable practices, bio-based alternatives, and digital solutions to enhance operational efficiencies and align with stringent global environmental and quality standards.

Government Initiatives (Chemical Sector):

• Government initiatives such as mandating BIS-like certification for imported chemicals aim to prevent the dumping of cheap and substandard chemicals into the country, with the chemical industry recognised by the Government as a key growth element.

• The Department of Chemicals & Petrochemicals continues to work towards a Production Linked Incentive (PLI) framework for the chemicals and petrochemical sector, along with a redrafted Petroleum, Chemicals and Petrochemicals Investment Region (PCPIR) policy.

• 100% FDI continues to be permitted under the automatic route in the chemicals sector, barring a few hazardous chemical categories.

• Single window clearances, duty-free import/domestic procurement for SEZ units, and income-tax incentives for export income continue to support the sectors growth.

• Under the PCPIR Policy, the Government continues to target substantial cumulative investment across designated investment regions, with corresponding employment generation.

b) The Spice & Agro products Industry:

India retained its position as the worlds largest producer and exporter of spices during the year, with the spice and agro products industry continuing to anchor the countrys agricultural economy and global trade footprint. The Company remained an active participant in the forward trading of spice and agro products through FY 2025-26, drawing on its market expertise to offer buyers competitive pricing, reliable sourcing and timely delivery of high-quality produce.

c) Land Development and Plotting

Having entered this space through the object clause alteration approved during the year in Annual General Meeting held on August 07, 2025, the Company now has visibility into one of the fastest growing segments of the Indian economy. Rapid urbanisation, rising disposable incomes, the growth of nuclear families and increasing preference for plotted developments in Tier-II and Tier-III cities continue to drive this sector. Plotted developments in particular have gained traction among investors and end-users owing to their lower entry price points, construction flexibility and comparatively quicker regulatory approval cycles relative to constructed real estate.

The sector is undergoing a structural transformation with greater transparency and accountability on account of the Real Estate (Regulation and Development) Act, 2016 (RERA), digitisation of land records, and increasing institutional participation. Growing demand for organised, RERA- compliant plotted layouts with basic infrastructure amenities is expected to provide significant growth opportunities to companies entering this space, including the Company, which has recently altered its object clause to undertake land development and plotting activities.

Government Initiatives

• Enactment and continued strengthening of the Real Estate (Regulation and Development) Act, 2016 (RERA) to bring greater transparency, accountability and buyer protection to real estate transactions, including plotted developments.

• Government schemes such as Pradhan Mantri Awas Yojana (PMAY) continue to promote affordable housing and allied infrastructure development.

• Digitisation of land records under the Digital India Land Records Modernization Programme (DILRMP) to improve title clarity and reduce litigation.

• Continued focus on smart city development and urban infrastructure creation, generating ancillary demand for organised land development in peripheral and satellite towns.

• Relaxation of FDI norms for completed projects and townships, and stamp duty rationalisation by various State Governments, supporting sectoral growth.

Outlook

Dhariwalcorp Limited continues to build on its established trading business in waxes, industrial chemicals and petroleum jelly, while now also positioning itself for growth in land development and plotting following the object clause alteration undertaken during FY 2025-26.

The Companys wax portfolio spans processing, purchase, sale, import and trading of Paraffin Wax, Micro Wax, Slack Wax, Carnauba Wax, Microcrystalline Waxes, Semi Refined Paraffin

Wax, Yellow Beeswax, Hydrocarbon Wax, Montan Wax, Polyethylene Wax, Vegetable Wax, Residue Wax, Palm Wax, BN Micro Wax, Hydrogenated Palm Wax, Micro Slack Wax, PE Wax, Soya Wax, and other variants.

The Companys industrial chemicals portfolio further extends to Rubber Process Oil, Light Liquid Paraffin (LLP), Citric Acid Monohydrate, Refined Glycerin, Bitumen, Stearic Acid, and Petroleum Jelly (including Paraffin Petroleum Jelly and White Petroleum Jelly), together with a broader range of heavy and light chemicals, chemical elements and compounds, petrochemicals, mixtures, derivatives and by-products of a similar nature.

This diversified product range continues to support customers across the Plywood and Board, Paper Coating, Crayon Manufacturing, Candle Production, Textiles, Pharmaceuticals, Petroleum Jelly & Cosmetics, Tube & Tire Manufacturing, Match Production, Food Processing, and Adhesive Manufacturing industries, positioning the Company as a reliable supply-chain partner across these sectors.

The Companys sales continue to be spread across both domestic and international markets, with a PAN India presence covering 21 states and 3 Union Territories. The export division has continued to gain traction during the year, with the Company supplying products to overseas markets as part of its ongoing strategy to widen its global reach.

During the year under review, the Company took several significant strategic and capital-related steps to strengthen its business foundation and growth capabilities, including alteration of its object clause to enter the land development and plotting business, raising of growth capital through a preferential issue of convertible warrants, full conversion of the said warrants into equity shares, an increase in the Authorised Share Capital of the Company, and a sub- division/split of the equity shares of the Company, each of which was approved by the Members of the Company by way of Postal Ballot. These developments are discussed in detail under the head "Significant Corporate Developments during the Year" below.

Looking ahead, the Board views the Companys growth prospects favourably across its established chemicals, waxes, and spice & agro segments, and additionally sees meaningful headroom in the newly added land development and plotting segment. The combination of a wide product portfolio, an established global customer base and a strengthened capital position leaves the Company well placed to capture opportunities as market dynamics and demand patterns continue to evolve.

For the spice and agro products business specifically, growing overseas appetite for high-quality, organic and traceable produce, together with Government-led modernisation of agricultural infrastructure, processing facilities and export promotion schemes, is expected to sustain momentum in this segment going forward.

The Board recognises that headwinds such as commodity price volatility, heightened global competition, real estate market cyclicality and an evolving regulatory landscape will continue to test the business; however, the Company remains confident of navigating these through disciplined execution, customer-focused strategies, prudent deployment of the capital raised during the year, and sustained innovation across its business lines.

While external challenges such as commodity price fluctuations, global competition, and regulatory complexities persist, Dhariwalcorp Limited is confident in its ability to navigate these uncertainties through operational excellence, customer-centric strategies, and continuous innovation. The Company remains committed to driving long-term sustainable growth and creating value for all stakeholders.

On the infrastructure front, the Company continues to own its processing unit at G-764, Boranada Industrial Area, IV Phase, Jodhpur, Rajasthan, admeasuring 1547.50 sq. mts., and operates the following leased warehousing facilities:

1. Plot No. 166, Kamod cow circle, Aslali- Sanathal Ring Road, Kamod, Ahmedabad 382405, India.

2. Ambaji Warehouse Park Phase Plot No.14 R.S. No. 275/1, Village Zarpara, Mundra, Kachchh 370415, Gujarat, India

3. C-27B, Phase I, Basni Industrial Area, Jodhpur, Rajasthan

4. Gala No. B-16, A-15, A-14, A-11, A-8, A-10, A-9, C-15, Servey No.189, 190 And 194, Mayashree Compound, Opp. Preeti Petrol Pump, Purnavillage, Bhiwandi, Thane 421302, Maharashtra, India.

5. Gala No. F-4, F-5, F-8, E-1, E-2, Survey No. 182/1, 182/3, 186/6, 186/9, Krishna Compaund, Purna Village, Bhiwandi, Thane 421302, Maharashtra, India

6. Gala No. 11, 16, 17, Ganesh Compound, Inside Krishna Compound, Survey No. 182, 186, 190, 194, Purna Village, Bhiwandi, Thane 421302, Maharashtra, India

7. Bharat Warehousing Corporation, Gala No. B 14, Servey No.189, 190 And 194, Mayashree Compound, Opposite Preeti Petrol Pump, Purna Village, Bhiwandi, Thane 421302, Maharashtra, India.

8. Khasra No. 25/1, Plot No. 1073/25, Salawas, Jodhpur, Rajasthan

9. KHASRA No. 1237/869, 869/80 VILLAGE- SALAWAS, Jodhpur, Jodhpur, Rajasthan, 342013

10. 36, Narayan Nagar, Shobhawato Ki Dhani Pal Link Road, Jodhpur, Rajasthan 342001. *These warehouses are not owned by our company. However, same has been taken on lease from third party outsourcing agency.

Further, as part of its long-term growth strategy and expansion into industrial and agroprocessing infrastructure, the Company acquired the following parcels of land during the year for the development of industrial plots and agro-processing clusters:

1. Khasra No. 880/408, Village Sarvadi, Kalyanpur, Balotra, Rajasthan, 344026

2. Khasra No. 410, at Village Sarvari, Patwar Halka sarvari, Tehsil Kalyanpur, Dist. Balotra, Rajasthan, 344026

3. Khasra No. 883/411, At Village- Sarvari, Patwar Halka sarvari, Tehsil Kalyanpur, Dist. Balotra, Rajasthan, 344026

4. Khasra No. 1151/883 and 1149/880, Village Sarwadi, Tehsil Kalayanpur, District Balotra, Rajasthan - 344026

5. Khasra No. 789/333 and 271, Village Sarwadi, Tehsil Kalyanpur, District Balotra, Rajasthan - 344026.

6. G-764, Boranada Industrial area Jodhpur, Rajasthan 342001.

7. Plot No. 2610 Boranada Industries, Jodhpur, Rajasthan 342001.

These acquisitions reinforce the Companys strategic vision of expanding its infrastructure base, creating integrated industrial and agro-processing facilities, and supporting future business growth through enhanced operational capabilities and value-added development initiatives.

Opportunities and Threats

Opportunities

• Growing demand in downstream industries such as pharmaceuticals, personal care, food processing, packaging, and rubber is driving the need for chemical and wax products.

• Shift towards specialty and sustainable chemicals, offering potential for portfolio diversification and adoption of eco-friendly solutions.

• Indias position as a global manufacturing hub for specialty chemicals and agricultural commodities due to supply chain realignments in international markets.

• Rising global consumption of organic and health-focused agro products, opening new export avenues for spices and agro-based goods.

• Government initiatives supporting modernization of agricultural infrastructure, establishment of Spice Parks, and promotion of exports.

• Entry into the land development and plotting business is expected to open a new revenue stream for the Company, on account of rising demand for organised, RERA-compliant plotted developments, particularly in Tier-II/In cities and peripheral urban areas.

• Strengthened capital base pursuant to the preferential issue and conversion of warrants and the increase in Authorised Share Capital, providing growth capital to fund expansion across existing and new business verticals.

• Improved liquidity of the Companys equity shares following the sub-division/split, expected to widen the shareholder base and improve trading volumes.

• Digitalization and e-commerce providing platforms to expand reach, improve customer engagement, and tap into newer markets globally.

Threats

• Interest Rate fluctuations and banking sector uncertainties in foreign nations.

• Volatility in raw material prices and global supply chain disruptions impacting cost structures and profitability in the chemical segment.

• Stringent environmental regulations and increasing compliance requirements raising operational costs, especially in global markets.

• Intense competition from other major producing countries like Vietnam, Indonesia, and Brazil in spices and agro products.

• Climatic uncertainties and quality control challenges in the agro sector, affecting consistency and export readiness.

• Cyclicality, regulatory approval risks (including RERA compliance) and price volatility inherent in the real estate and land development business, being a new line of business for the Company.

• Global economic fluctuations and currency volatility potentially impacting export margins and competitiveness.

• Changing consumer preferences and increasing demand for certifications (organic, fair trade, etc.) in agro exports requiring ongoing investments in quality assurance.

Risks and Concerns

As with any diversified trading and, now, real-estate-linked business, the Companys day-to-day operations and long-term objectives remain exposed to a mix of internal and external risks, which the Board and management continue to monitor and mitigate on an ongoing basis.

Business Related Risk:

• Dependence on Suppliers, Customers & Geography - Heavy reliance on a few major customers and external suppliers without long-term agreements, making the business vulnerable to supply chain disruptions, pricing fluctuations, and regional risks.

• Operational & Compliance Risks - Risks related to inventory mismanagement, warehousing, transportation disruptions, and inability to maintain quality standards or adapt to technology. Non-compliance with statutory requirements and regulatory lapses may also lead to penalties or legal issues.

• Financial & Credit Risks - Exposure to counterparty credit risk, unsecured loans, high working capital requirements, and negative cash flows. Rising interest rates, restrictive loan covenants, and dependency on promoter guarantees may strain liquidity and financial flexibility.

• Management & Human Resource Risks - Dependence on promoters, key managerial personnel, and skilled workforce. Any attrition, conflicts of interest in related party transactions, or inability to attract/retain talent could adversely impact operations.

• Market Competition & Strategic Risks - Intense competition, pricing pressures, failure to execute growth strategies, and risks from changing consumer preferences or industry standards may impact revenue and profitability.

• New Business Risk (Land Development and Plotting) - Being a new line of business for the Company, land development and plotting activities are subject to risks relating to title verification, regulatory/RERA approvals, project execution timelines, funding requirements, and cyclicality of the real estate market, which could impact the anticipated returns from this business.

• Capital Structure & Dilution Risk - The preferential issue and conversion of warrants, increase in Authorised Share Capital and sub-division of equity shares have altered the Companys capital structure and shareholding pattern; any future dilution or nonutilisation of proceeds for stated objects as per applicable regulations could impact shareholder value.

External Risk:

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

• Our business is substantially affected by prevailing economic, political and other conditions.

• Our business is affected by global economic conditions, especially in the geographies we cater to, which may have an adverse effect on our business, financial condition, results of operations and prospects.

• Changing laws, rules and regulations and legal uncertainties, including adverse application or interpretation of corporate, real estate and tax laws, may adversely affect our business, prospects and results of operations.

• A slowdown in our exports due to tariffs and trade barriers and international sanctions could adversely affect our business, financial condition and results of operations.

• Natural calamities, climate change and health epidemics could adversely affect the Indian economy and our business, financial condition, and results of operations. In addition, hostilities, terrorist attacks, civil unrest and other acts of violence could adversely affect our business, financial condition and results of operations.

• Foreign investors are subject to foreign investment restrictions under Indian laws that may limit our ability to attract foreign investors, which may have a material adverse impact on the market price of the Equity Shares.

• Financial instability in other countries may cause increased volatility in Indian financial markets.

• The ability of Indian companies to raise foreign capital may be constrained by Indian law.

Internal Control System and Their Adequacy

The Companys internal control environment continues to be anchored by an independent Internal Audit function, supported by a well-established risk management framework and an experienced external firm engaged to carry out periodic Internal Audit reviews. Findings from these reviews are reported to management and the Audit Committee, covering compliance with internal controls as well as the efficiency and effectiveness of operations and key process risks.

The Audit Committee continued to meet at regular intervals during the year to review Internal Audit reports and track closure of action points on past audit observations. With the addition of land development and plotting business during the year, the Company has also taken steps to widen its internal control framework to cover land title due diligence, project monitoring and fund utilisation controls appropriate to the scale of this new business.

The Statutory Auditors of the Company have reported unmodified opinion on the adequacy and operating effectiveness of the Companys internal financial controls over financial reporting for FY 2025-26.

Discussion on Financial performance with respect to operational performance

The discussion below covers the Companys financial results for the year ended March 31, 2026, read together with the significant accounting policies underlying the financial statements, which are set out in the notes forming part thereof.

The following table gives an overview of the annual financial performance of the Company:

Particulars	Standalone	Consolidated
	Current Financial Year (2025-2026)	Previous Financial Year (2024-2025)	Current Financial Year (2025-2026)	Previous Financial Year (2024-2025)
Revenue from Operations	23,640.36	23,351.19	23,640.36	-
Other Income	689.80	295.57	689.80	-
Total Revenue	24,330.16	23,646.75	24,330.16	-
Less: Expenses	23,037.03	23,037.24	23,023.09	-
Profit/loss before Depreciation, Finance Costs, Exceptional items and Tax Expense	1,293.13	609.52	1,307.07	-
Less: Depreciation/ Amortization/ Impairment	36.12	24.52	36.12	-
Profit /loss before Finance Costs, Exceptional items and Tax Expense	1,257.01	585.00	1,270.94	-
Less: Finance Costs	124.87	86.61	139.15	-
Profit /loss before Exceptional items and Tax Expense	1,132.13	498.39	1,131.79	-
Profit /loss before Tax Expense	1,132.13	498.39	1,131.79	-
Less: Tax Expense (Current & Deferred)	273.42	142.89	273.43	-
Profit /loss for the year	858.71	355.50	858.36	-
Earning per equity share (in Rs.)	0.98	0.43	0.98	-

*Calculation of basic and diluted earnings per share for all periods presented has been retrospectively adjusted to reflect the right issue and stock split that occurred during the financial year.

New Projects / Key Developments during FY 2025-26

Pursuant to the alteration of the Object Clause of its Memorandum of Association during the financial year, the Company has commenced the implementation of its diversification strategy by entering into the land development and plotting business. In line with this objective, the Company has acquired the following parcels of land situated at Village Sarwadi/Sarvari, Tehsil Kalyanpur, District Balotra, Rajasthan:

1. Khasra No. 880/408, admeasuring 5.5118 hectares.

2. Khasra No. 410, admeasuring 4.5810 hectares.

3. Khasra No. 883/411, admeasuring 6.3131 hectares.

4. Khasra No. 789/333, admeasuring 1.4083 hectares, and Khasra No. 271, admeasuring 5.8032 hectares.

5. Khasra Nos. 1151/883 and 1149/880.

The land parcels referred to at Sr. Nos. 1 to 4 have been acquired for the development of an Industrial Park with a focus on establishing Agro-Processing Clusters and allied industrial infrastructure.

Further, the Company has received approval for the establishment of an Agro Processing Cluster at Khasra Nos. 1151/883 and 1149/880, Village Sarwadi, Tehsil Kalyanpur, District Balotra, Rajasthan, under the Pradhan Mantri Kisan Sampada Yojana (PMKSY) for the creation of infrastructure for Agro Processing Clusters.

In addition, the Companys Memorandum of Understanding with the Government of Rajasthan for the establishment of an Agro Processing Complex in Jodhpur, Rajasthan, involving a proposed investment of approximately Rs. 100 Crores, continues to progress in accordance with the applicable policies, approvals, and regulatory requirements of the State Government.

Segment-wise or product-wise performance

Following the addition of land development and plotting to its object clause during the year, the Companys reportable business now spans three segments — A) WAX; B) AGRO; and C)

LAND DEVELOPMENT AND PLOTTING — in addition to its existing Wax and Agrobased (including spices) operations.

A) WAX:

Revenue from operations for FY 2026 increase to Rs. 22117.17 lakhs from Rs. 19355.44 lakhs in FY 2025.

B) AGRO:

Revenue from operations for FY 2026 decreased to Rs. 1523.19 lakhs from Rs. 3995.75 lakhs in FY 2025.

C) LAND DEVELOPMENT AND PLOTTING:

This being a new segment added during the year pursuant to the alteration of the Companys object clause, the company has NIL revenue during the year under review.

The Company has provided detailed financial performance of its segments in the "Segment Reporting" section of its Financial Statements, which forms part of this Annual Report.

Material Developments in Human Resources/Industrial relations front, including number of people employed:

A capable and motivated workforce continues to underpin the Companys operations, and the Human Resources function remains focused on building and retaining this talent base. The Companys HR policies continue to be periodically reviewed and aligned with its evolving strategic priorities, and the HR team ran ongoing training initiatives during the year aimed at developing the potential of every individual associated with the Company.

With the commencement of the land development and plotting business, the Company has also begun building a dedicated team with relevant expertise in real estate development, project management and land-related compliances, to support this new business vertically.

The Company acknowledges the employees contribution towards leading, thinking, working, creating, processing and dealing to enhanced growth. The Company values its human resources as the principal drivers of change and focuses on providing individual development and growth in a work culture that encourages teamwork and high performance.

Ratio Analysis:

The Company has witnessed a significant change in the financial ratios as compared to previous year which are as follows:

	UNITS	31-Mar-2026	31-Mar-2025
Ratios -Financial Performance
1. Operating Profit Margin	%	5.73	2.53
2. Net Profit Margin	%	3.63	1.52
3. Return on Net Worth	%	14.00	10.27
Ratios -Growth
4. Total Revenue	%	1.23	2.03
5. EBITDA	%	112.9	-8.14
6. Profit After Tax	%	138.59	-21.11
Ratios- Balance Sheet
7. Debtors Turnover	Times	16.73	18.93
8. Inventory Turnover	Times	8.78	14.34
9. Interest Coverage Ratio	Times	9.13	6.45
10. Current Ratio	Times	3.74	1.81
11. Debt Equity Ratio	Times	0.12	0.33

Detailed Explanation on Change in Return on Net Worth:

During the year under review, the Paid-up Share Capital and Net-worth of the Company have undergone significant changes on account of (i) full conversion of the convertible warrants issued on preferential basis into equity shares, and (ii) the increase in Authorised Share Capital and (iii) sub-division/split of the equity shares of the Company, each of which was approved by the Members through Postal Ballot.