Empire Industries Ltd Management Discussions

The objective of this report is to convey the Managements perspective on the external environment and industry, as well as strategy, operating and financial performance, material developments in human resources and industrial relations, risks and opportunities and internal control systems and their adequacy in the Company during the FY

2025-26. This Report should be read in conjunction with the Companys financial statements, the schedules and notes thereto and other information included elsewhere in the Annual Accounts 2025-26. The Companys financial statements have been prepared in accordance with Indian Accounting Standards (‘Ind AS) complying with the requirements of the Companies Act, 2013, as amended and regulations issued by the Securities and Exchange Board of India (‘SEBI) from time to time.

In 2025, the global economy is navigating a period of resilient but moderate growth constrained by geopolitical fragmentation, trade volatility, and restrictive financial conditions. In stark contrast, the Indian economy has maintained its position as the worlds fastest-growing major economy. A geopolitical risk i.e. conflict, tension, or challenge between nations that arises from the intersection of geography, politics, and economics raised the concern.

Indias GDP growth for FY 26 was estimated at 7.4 per cent driven by the double engine of consumption and investment. Industrial sector showing signs of strength, with manufacturing growing by 8.4 per cent in the first half of FY 26. Indias total exports (Merchandise and Services) reach a record USD 825.3 billion in FY 25.

Empire Industries Limited (Company) is a multi - divisional public limited company engaged in diverse businesses, headquartered in Mumbai. Over 120 years of a strong customer focused approach and a continuous quest for world-class quality. The business verticals include Vitrum Glass, Empire Machine

Tools (EMT-MFTM), Empire Industrial Equipment,

Empire Vending (GRABBIT+), Empire Industrial Centrum, Ambernath, The Empire Business Centre (TEBC), Empire Commercial Property and Empire Foods.

The Vitrum Glass Division is manufacturing Amber

Glass Bottles of international quality and standard for the Pharmaceutical Industry by fully using operating efficiency in its production carries out R&D activities regularly in various manufacturing operations with the objective of improving quality, reducing energy consumption and improving the overall efficiency/productivity.

In Empire Machine Tools division, order in flow for the year was reasonably good and able to achieve the desired targets with combination of high value and niche projects. Division is able to book the orders in various key sectors like Defense, Automotive,

Steel Industries, Off- highway vehicle Industries,

Renewable energy and Aerospace.

Empire Industrial Equipment (EIE) Division achieved good result in terms of order booking revenue. Significant contributions were from Port &

Shipyard sector. Steel and Metallurgy from Private sector also made significant contributions. Shell

Forging line from ordinance factory was also a major achievement.

Empire Industries Limited revolutionized vending in India with the launch of Grabbit+, aiming to become the top vending solution provider for corporate offices.

The Empire Industrial Centrum is being developed on a 35-Acre property in Ambernath. The project started in the year 2014 - 2015 after obtaining all the necessary Government Approvals.

The Empire Business Centre opened in June 2013 at Lower Parel, Mumbai. Catering to office space needs of companies and individuals, which were looking at serviced and furnished office space units as a main stay product

The Empire Commercial Property Division manages Empire Industries Ltd.s owned properties located at Lower Parel and Vikhroli, Mumbai. The campuses are landmark addresses known for its verdant settings, great connectivity & well -maintained premises. The campuses comprise about 10 lakh Sq. ft. of Commercial and IT office space.

Empire Foods division imports and procures Frozen and chilled food products from all over the world and distribute to HORECA (Hotels, Restaurants and Caterers) sector throughout

India. It has various branch office throughout the country and is largest importer and distributor of frozen and chilled food in India.

The Company has developed its commercial Properties at its Lower Parel and IT & ITES premises at Vikhroli and has offered the Multinational Companies and Banks for office use on Leave and License basis. The demand from the Pharmaceutical Industry for Glass Containers manufactured by Vitrum Glass Division is adequate in comparison to its present capacity and hence the Company does not foresee any risks for the demand for the product in near future. However, global surge in the price of crude oil has created a challenge for the unprecedented increase in the price of natural gas used in the manufacturing of glass bottles. The revenue of the Divisions involved in agency businesses for marketing the products manufactured by foreign principals are dependent on the Government Policies declared from time to time. Oil and Gas Sector continues to be major contributor with good contributions from fire and safety sector as well as from steel and metallurgical sector. The Central Governments "Atmanirbhar Bharat" policy is somewhat affecting the order pipeline of this business segment. In the business of Frozen & Chilled Foods, the Company imports various frozen foods from around the globe and sells to HORACA (Hotels, Restaurants and Caterers). The division has been focusing on trading indigenously produced food products. The Company is getting good support in the areas of providing office space on Leave &

License basis. Empire Industrial Centrum division has received very good response from customers for developing the property at Ambernath. The revenue as well as profitability has been increased over previous year and construction of new properties is in full swing.

Every division have different challenges and competitors, so there are no common competitors.

The Company is engaged in the following activities:

During the year under review, the division recorded a turnover of 246.49 crores, including export revenues of 40.44 crores.

The division delivered stable performance during the year despite prevailing market challenges. Continued focus on operational efficiency, product quality, and customer service is expected to support improved performance in the current financial year.

The division enters FY 2026–27 with a healthy order pipeline and expects continued business from existing customers, including orders with improved payment terms. Advance payments in the range of 20%–30% are expected to support cash flow and enable pro-rata invoicing. same to various

At the same time, challenges such as global economic uncertainty and volatility in foreign exchange rates continue to remain areas of attention.

Indias growing manufacturing base and increasing demand for advanced machine tools and niche technologies are expected to support long-term industry growth. The division continues to focus on sectors such as Energy & Power, Automotive, Defence, Railways, Steel, Aerospace, Oil & Gas, Research Institutions, and Machine Tools, with OEMs and Tier-1 suppliers remaining its primary customer base.

During the year under review, the division continued its recovery phase and strengthened its market presence. Several projects remain under discussion and in execution stages.

Ports & Shipyards, Steel & Metallurgy, and Oil & Gas are expected to remain key focus sectors for the division in FY 2026–27. Industry investment trends in these sectors continue to remain encouraging.

The division also expanded its product offerings in line with evolving workplace consumption trends and wellness-oriented requirements.

EMPERIA 1900 continued to expand its portfolio of hygiene and cleaning solutions, including disinfectants, housekeeping products, kitchen care products, and personal hygiene solutions.

The division continues to explore opportunities across sectors where hygiene standards and institutional cleaning requirements are witnessing increased focus.

Empire Industrial Centrum is being developed on a 35-acre property at Ambernath in phases. The project commenced during FY 2014–15 after obtaining applicable approvals.

The project remains a long-gestation development and continues to benefit from infrastructure improvements in the surrounding region, including the ongoing construction of the proposed Chikhloli railway station near the project site.

The Company expects improved sales momentum and collections in the coming years and is evaluating the launch of a commercial development within the project.

The Empire Business Centre provides serviced and furnished office spaces at Lower Parel and Airoli, catering to corporates, professionals, and emerging businesses.

Despite increasing competition in the co-working and flexible office space sector, TEBC continues to maintain its market presence through customer retention, broker relationships, and digital outreach initiatives.

The division continues to evaluate expansion opportunities in Mumbai and other business districts.

The Empire Commercial Property Division manages commercial and IT office spaces at Lower Parel and

Vikhroli, Mumbai, comprising approximately one million square feet.

The division continues to focus on property maintenance, tenant retention, and long-term occupancy stability.

Empire Foods imports frozen and chilled food products from international markets and also procures products locally for distribution to the HORECA sector across India. The division operates through twelve branch offices located across major cities in the country.

During the year, Empire Foods received the "Best Importer of Food & Beverage Products in India" award at the Annapoorna Inter Food Awards 2025. The division expects continued growth in product range and sales during the current financial year.

The performance of all these Divisions is reviewed in the Directors Report.

The demand for office space, virtual offices, meeting rooms, co-working spaces and softened rentals have gradually increased and as a result the business support service segment sustained consequent to the outbreak of pandemic has slowed down.

As a result of capacity building, the Vitrum Glass, belonging to the pharma sector, has performed well post pandemic. The Real Estate business has successfully retained the performance. The opening up of real estate sector and cautious buyer sentiment may lead to an unprecedented increase in the unsold inventory in future.

Grabbit+ vending machine range from Snacks, Beverages & Perishable to Sanitary pad vending machines.

Indias GDP growth for FY 26 was estimated at 7.4 per cent.

The Division-wise outlook and details are given in the Directors Report.

The Company is investing its funds only for the purposes of normal business activities and there are no financial risks except normal business risks which are managed by the prudent business and risk management practices. A fresh challenge looms – the upturn in the interest rate cycle, which is caused by hike in Repo rate by RBI and thereby increase the overall cost of borrowing for the Company. The

Company is regularly taking adequate insurance policies for covering the risks to Companys properties.

The Internal Auditor of the Company is carrying out the internal audit functions of the Company and regularly carries out the internal audit and review of internal control mechanisms prevailing in all the Divisions of the Company and submits the report to the Audit Committee of Board of Directors of the Company from time to time. Immediate corrective actions are taken on the recommendations of such reports. Divisions operational performances are reviewed periodically by the senior management and appropriate policy decisions are taken from time to time.

The Sr. General Manager-Accounts circulates daily drawing power statements to the management. The said statement discloses division-wise daily transactions of cash inflows / outflows, Loans / Advances, receivables positions etc. and required actions are taken immediately to bring the financial position in order so that no inconvenience in terms of liquidity is caused to any Division in carrying out its business activities smoothly.

During the year under review, cordial relationships were maintained between the management and the employees. The Directors place on record their appreciation for the support and contribution from all the employees of the Company. The total numbers of people employed in the Company are shown in the Annexure to the Directors Report.

2. Disclosure of Accounting Treatment:

Financial statements are prepared in accordance with the applicable Accounting Standards specified in terms of

Sections 129 and 133 of the Companies Act, 2013 along with generally accepted accounting principles in India under the historical cost conversion on accrual basis.

All assets and liabilities have been classified as current or non-current as per Companys normal operating cycle and other criteria set out in the Schedule-III of the Companies Act, 2013 as amended from time to time.

There are no significant changes (i.e. change of 25% more as compared to the immediately preceding financial year) in key financial ratios.