EP Biocomposites Ltd Management Discussions

1. BUSINESS OVERVIEW:

Our company is into manufacturing and supply of Fibre Re-Inforced Polymers (FRP) products such as Door Shutters, Frames, Laminated Doors, Biodigestor Tanks, Bio Toilets and Allied Products for Construction and Industrial applications which meet customer requirements. The company was incorporated on 17th January 2020 and has taken over the running business of our promoter M/s ‘OM Ventures, a sole proprietorship through a business transfer agreement dated August 31, 2021 and the Company has become a flagship entity of EP Kamat Group. Subsequently, the company went for its IPO on BSE SME board on 13^th September 2022 and got listed.

While Marketing the Biodigester Tanks as a substitute for traditional Septic Tank we realized the latent need to offer Sewage Treatment Solutions according to the New Pollution Control Board norms and thus the Company has established an Aqua Division offering Sewage & Effluent Treatment Plants for Hotels, Industry, Institutions, Government bodies as well as residential and commercial buildings. The Company, in the year 2023-24, has added the line of Fire doors to its portfolio to better cater to the needs of the customers for a one-stop solution contributing to a clean, green and safe planet.

The overall focus for the year 2024-25 was based on consolidation of the strengths and getting ready for the next growth story of the Company.

2. INDUSTRY STRUCTURE AND ECONOMIC OVERVIEW:

Global Growth

According to the IMFs World Economic Outlook Update (July 2025), global economic growth is projected to be 3.0% in 2025 (revised upward from earlier projections) and 3.1% in 2026. While this represents a modest improvement, growth levels remain low compared to historical norms, reflecting continued economic fragility amid trade disruptions, elevated policy uncertainty, and geopolitical tensions (e.g., rising tariffs)

Indias Economic Trajectory

Despite global headwinds, Indias economic growth remains robust. The IMF projects Indias GDP to grow at 6.2% in 2025 and 6.3% in 2026, reaffirming its position as the fastest-growing major economy globally. Indias resilience is attributed to strong private consumption, supported by macroeconomic stability and structural reforms.

These figures underscore Indias consistent outperformance relative to global peers.

Implications for the Company

The subdued global growth environment necessitates a shift toward local value creation, cost efficiency, and strategic partnerships. Trade-related uncertainties may impact international expansion but underscore the importance of building resilient business pipelines domestically an area where the Company is well-positioned, as well as work on specific export markets, like Africa, which is one of Indias thrust area with high potential .

With India projected to grow faster than any major global economy, the Company benefits from an expanding domestic market. Strong GDP growth should support increased infrastructure development, heightened demand for green and sanitation technologies, and greater willingness among stakeholders to adopt eco-friendly solutions.

In a market characterized by rapid change, increased competition, and heightened ESG focus, the Company remains committed to integrating innovation, operational excellence, and sustainability across its operations aligning with both macroeconomic trends and emerging customer expectations.

Finance Minister Nirmala Sitharaman presented the Union Budget 2025-26 on February 1, 2025, setting a path toward "Viksit Bharat" — the vision of a developed India — with an emphasis on inclusive growth, innovation, and sustainability.

Key Budget Priorities

The Budget outlines ten development priorities spanning key areas of focus:

• Spurring agricultural growth and productivity

• Building rural prosperity and resilience

• Taking everyone together on an inclusive growth path

• Boosting manufacturing and furthering "Make in India"

• Supporting MSMEs

• Enabling employment-led development

• Investing in people, economy, and innovation

• Securing energy supplies

• Promoting exports

• Nurturing innovation

These priorities are designed to complement each other, driving Indias growth & development, and solidifying its position as a beacon of economic hope in a sluggish global economy.

One of the main promises of the Central Government is with reference to moving forward firmly towards net- zero carbon emission by 2070 to usher in green industrial and economic transition. The activities of the Company aid in reduction of falling of trees, recycle million liters of water and facilitate sustainable environment.

The Budgets emphasis on energy security, clean technology, and Make in India directly reinforces the demand for eco-conscious alternatives such as FRP doors. Our sustainable products align with national objectives to reduce resource dependency and promote green infrastructure.

With the Government prioritizing climate resilience and rural-urban sanitation, our DRDO-licensed biodigester systems, along with STP / ETP solutions, gain heightened strategic importance—particularly in regions underserved by traditional waste infrastructure.

Lastly, NITI Aayogs research initiatives on water neutrality and waste-water management in urban cities validate our Companys expertise and solutions, positioning us for potential collaborations and partnerships.

Some of the industry reports estimate that the India wastewater treatment plants market size reached USD 4.33 Billion in 2024 and expect the market to reach USD 7.35 Billion by 2033, exhibiting a growth rate (CAGR) of 6.04% during 2025-2033 with shift towards more sophisticated technologies. Wider reports estimate that the water and wastewater management market size in India stood at INR 216.03 Bn in 2022. It is expected to reach INR 518.15 Bn in 2027, expanding at a compound annual growth rate (CAGR) of 15.95% during the 2023-2027 period.

Regarding the Biocomposites, the composite doors and window market in India is expected to reach a projected revenue of US$ 188.7 million by 2030. A compound annual growth rate of 7.4% is expected of India composite doors and window market from 2025 to 2030.

3. RANGE OF PRODUCTS AND SERVICES:

Our Company is involved in manufacturing & supplying a vast portfolio of products & services for a cleaner, greener and safer planet. The main lines of the business of the Company are:

• FRP doors and other products;

• Water Treatment Solutions & Bio-Digester Tanks & Toilets; and

• Fire doors.

The Companys Fiber-Reinforced Polymer (FRP) business comprises a range of products with diverse applications across construction and infrastructure segments. FRP serves as an eco-friendly alternative to wood, which has traditionally been a preferred building material but is also a limited natural resource whose extensive use contributes to environmental challenges, including rapid deforestation.

Through consistent quality, innovation, and market focus, the Company has established itself as a leading provider of FRP doors in Goa and the Konkan region, reinforcing its position as a reliable supplier of sustainable building solutions.

The Company deploys bio-digester tanks and toilets based on technology licensed from the Defence Research and Development Organisation (DRDO), operating through the Industry Interface and Technology Management division under the aegis of the Ministry of Defence, Government of India. These solutions are designed to address the sanitation needs of communities lacking access to toilets, as well as those where conventional septic systems are inadequate for effective waste management. The anaerobic bio-digester technology enables onsite treatment of human waste in an economical and energy-efficient manner, reducing dependence on large-scale sewage infrastructure.

In addition, the Company provides comprehensive water treatment solutions, including Sewage Treatment Plants (STPs) for domestic wastewater and Effluent Treatment Plants (ETPs) for industrial wastewater. Both solutions facilitate the safe discharge or reuse of treated water, thereby conserving resources and mitigating environmental impact. At present, the Company is recycling more than 3 million liters of wastewater per day for leading hotels, industries, and housing projects.

Through its dedicated Aqua Division, the Company is strategically positioned to deliver integrated sustainability solutions, enabling clients to advance their Environmental, Social, and Governance (ESG) objectives while contributing to long-term environmental stewardship.

The Fire Doors division, which was started in the year 2024, has helped the Company complete its product offerings which generating synergy with the existing businesses.

4. STRENGTHS, OPPORTUNITIES AND THREATS:

Strengths:

With Global and Indias focus on Sustanable Development Goals and Environmental Social Governance coupled with Growth in the Indian economy and demand creates unprecedented opportunities for companies to invest significantly in each of its core businesses. Outlook for the overall industry is positive. In keeping with the philosophy of continuous consumer centric approach which is the hallmark of our organization, several developmental activities have been planned for the next fiscal year.

Some of our strengths which form the basis of Our Company are:

1. Partnerships with government and non-governmental players

The major partner in technology provision, is DRDO, the inventor of the bio-digester technology, is our technology partner. In association with them, we reach out to the rural populace and urban slums. Besides our basic product range of Doors, Bio Digester Toilets and STP / ETP, we would also like to tie up with Entrepreneurs offering containerized STPs & Precast products, SMC Tanks etc. considering a huge demand for these in our targeted market segment. In the medium term, as the volume grows, we propose to manufacture some of the products in house.

We have entered into Collaboration Agreements with M/s. Bactreat Environmental Solutions LLP, which will assist us in offering solutions in special cases like Green Corridors for Smart Cities and M/s. Digital Paani for usage of IOT based solutions to reduce operation & maintenance costs and improve consistency.

2. Technology

TIFAC (Technology investigations & Forecasting) for FRP Doors and unique DRDO Biodigester technology for bio-toilets to offer Greener products for Swachh Bharat Mission is being used by the Company. The company is a licensee (through transfer of technology) and has partnered with DRDO for technology commercialization for large-scale deployment of sanitation systems. The technology is effective in resolving the huge challenge of open defecation in India. We also continue to explore more application areas of the technology. With many successful projects in place, and recognition from the government, industry and academia - we have overcome many entry barriers, and also made a mark for ourselves.

The inclusion of the Biodigester technology in the manual prepared by the Goa State Pollution Control Board (GSPCB) has served great purpose in increasing Biodigester awareness and opportunity creation.

Further, we have entered into Treatment Water Activator technology for sanitation and water treatment challenges which has much wider application, and are now in talks with Indian Institute of Science, Bangalore to acquire Technology for non-biological treatment of waste water.

3. Wide Range of products and services

We are a manufacturing company having varied product segments having a diversified portfolio of products and services for a greener and safer planet.

While exploring multiple under prospective products and services to provide a holistic package to our client we have, in the financial year 2023-24, added fire doors as a product line for our business.

4. Consistent and Standardised Product Quality

Our Company has received ISO Certification from SQAC Certification Private Limited and was found to be in accordance with the requirements of ISO 9001:2015 in regards to manufacturing and supply of Fibre Reinforced Polymer (FRP) products such as door shutters, frames, Biodigester tanks, bio toilets besides design, procurement, system integration, operation and maintenance of waste water recycling systems and allied products for construction and industrial applications.

Our Company undertakes stringent quality control as mandated in its Quality Manual to adhere to the quality norms of ISO.

5. Experienced and Qualified Team

The Promoter and the management team of our Company have significant industry experience and have been instrumental in the consistent growth of our Companys performance. Our Promoter Mr. Rajkumar Kamat has close to 3 decades of business experience and has been instrumental in shaping the growth of our Company. He has been the main guiding force behind the growth and business strategy of our Company. A dynamic and multi-faceted personality, he has been the guiding light in the companys progress and direction so far and continues to mentor our Senior Management Team. Further, our promoter is supported by a team of well qualified and experienced professionals.

Mr. Shreyas Nadkarni is an Executive Director of our company and a key part of the core team. He has completed Post Graduate Diploma in Business Administration (PGDBA) Specialization - Operations Management Welingkar Institute of Management Development & Research, Mumbai. He was associated with the companies such as BNI (Business Network International) - Hubli Dharwad, Karnataka, Telstra India Pvt Ltd - Bangalore, Zettata Technologies Pvt. Ltd - Bangalore, Bharti Airtel Limited - Mumbai, SAP lndia Pvt. Ltd - Mumbai and REGUS Business Centre Dubai - UAE. His extensive business experience and keen marketing insights help the Company in charting its way forward.

We believe that our management teams experience will enable us to continue to take advantage of both current and future opportunities. It is also expected to help us in addressing and mitigating various risks inherent in our business, including significant competition.

6. Environmentally-friendly and Sustainable System

Bio STPs + utilizes multiple technologies innovatively, to customize the waste treatment process for optimum results at minimal cost, thereby contributing effectively to environment protection. The mission is to become the leader in sanitation and water recycling space in India by introducing the most technologically advanced yet environmentally friendly products. The faecal matter isnt left to ground, nor does it pollute the ecology in any manner. The system ensures that the human waste is completely degraded or "consumed". The effluent water is pathogen-free, can be re-used or left to seep into the ground. Even as it percolates, it recharges the water table. Above all, the system doesnt require any energy source or other input for treatment, rather gives out utilizable biogas. There is a growing need to conserve more water and make India more self-sustainable. The bio-toilet can be easily installed without high cost, for the economically challenged or for the people at the bottom of the pyramid (BoP). Bio STP Plus utilizes multiple technologies innovatively, to customize the waste treatment process for optimum results and minimal cost. Our company also manufactures FRP Doors that are unique, eco-friendly and greener alternatives to wooden doors.

7. Strong Client Base

We have developed a strong client base for our products and services. Also, for our products, we have developed a corporate client base as well as Public Sector Undertakings (PSUs), Publicly-listed & Private companies, Construction & Infrastructure companies, Hotels, Foundations, NGOs and other organizations. We have expanded our market across urban, peri-urban and rural India. In addition to the regions we are operating, we have embarked upon expanding our markets into more regions in and around Goa.

Opportunities:

A lack of sanitation also holds back economic growth. The economic losses are mainly driven by premature deaths, the cost of health care treatment, lost time and productivity seeking treatment and lost time & productivity finding access to sanitation facilities. Pollution resulting from improper disposal & treatment of wastewater and domestic fecal sludge affects both water resources and ecosystems. At the same time, fecal sludge and wastewater can provide valuable resources (water, nutrients, soil conditioner, briquettes and energy) and economic opportunities, especially in urban areas and in water-scarce environments.

The Company sees tremendous opportunity in the Biodigester Technology being included in the manual prepared by the Goa State Pollution Control Board. The cost effectiveness and the smaller area requirement is a huge plus and solves a major problem for the upcoming homeowners.

With the Companys collaboration with Bactreat Environmental Solutions LLP, the Company has been awarded an order from M/s. Hubballi-Dharwad Smart City project for their Green Mobility Corridor at Hubballi. As a result of this collaboration, the Company anticipates many more of such projects.

The benefits of tackling the challenges of sanitation are manifold. Improved sanitation leads to lower disease burden, improved nutrition, reduced stunting, improved quality of life, increased attendance ofgirls at school, healthier living environments, better environmental stewardship, increased job opportunities and wages, improved competitiveness of cities, and economic and social gains to society more broadly.

Threats:

We operate in a competitive atmosphere. Some of our competitors may have greater resources than those available to us. While product quality, brand value, distribution network, etc are key factors in client decisions among competitors, price is the deciding factor in most cases. We face fair competition from both organized and unorganized players in the market. We believe that our experience in this business and quality assurance will be key to overcome competition posed by such organized and unorganized players. Although, a competitive market, there are not enough number of competitors offering services similar to us. We believe that we are able to compete effectively in the market with our quality of services and our reputation. Our experience shows that the principal factors leading to a positive outcome are client relationships, reputation, and the relative quality & price of the services.

5. OUR STRATEGIES:

1. Market Expansion

We propose to cater to both, domestic as well as international markets. We aim to further develop our domestic sales networks in two ways: Firstly by strengthening our local presence in and around Goa while increasing the number of retailers and Secondly by creating new distribution channels in non- penetrated geographies considering various cities. We currently supply in Goa, North Karnataka (Belgaum, Hubli & Dharward) and United Arab Emirates (UAE). We want to expand our market by leveraging our business platform and tie up with Business Associates / Distributors throughout India.

We believe that we have developed a good clientele network in domestic markets and going forward shall be able to take advantage of our existing operations and network to expand these markets.

The Company has ventured into setting-up "EP Green Centres" in strategic locations, starting with our Margao EP Green Center, which is a great meeting point with clients as well as to showcase to them the range of products that we deal in. The idea is to expand it with sustainable partners all across the nation and the world in order to extend the Companys reach for its Greentech products and solutions.

2. Investing in Human Resources

The Company believes that the successful execution of its business and growth strategies is fundamentally dependent on the commitment of its employees to the organizational vision. Sustained growth requires continuous investment in the training, development, and empowerment of employees, particularly as the Company expands into new geographic markets. The ability to effectively train both existing and newly inducted personnel will remain a critical determinant of operational success.

The Company emphasizes a culture of transparency, commitment, and coordination in its engagement with employees, suppliers, and customers. Its workforce comprises a balanced mix of young talent and experienced professionals, ensuring efficiency in managing day-to-day operations while also fostering innovation.

6 ANN UAL RErURl 2024-25

To reinforce this culture, the Company has instituted a unique training initiative titled "Employee Bhi Bech Sakta Hai", aimed at ensuring that every employee is familiar with the Companys products and services. This program enhances their ability to serve as brand ambassadors, thereby increasing the Companys customer touchpoints and strengthening its market presence.

As a reflection of our efforts, we were honoured and proud to have received an award at the ‘Best Employer Brand Awards, Goa, given by the Employer Branding Institute- India, in September 2024.

3. Access to business connections

The Promoter of the Company serves as the Head of the Goa region of Business Network International (BNI), a global business organization with a membership base of over 340,000 entrepreneurs and professionals worldwide. This leadership role provides the Company with significant leverage in facilitating growth opportunities. In addition, the Promoters active participation in various industry and business forums enables direct engagement with a wide network of entrepreneurs, thereby supporting both pan-India and international expansion initiatives.

EP Biocomposites Limited is itself a member of BNI, which further strengthens its ability to network, build strategic relationships, and access potential clients and partners. These associations also extend to collaborations with corporate entities and non-profit organizations, thereby enhancing the Companys outreach to end-users and clients across diverse sectors.

4. Innovation and solution-oriented approach

The Company has consistently adopted a solution-oriented approach, whereby existing technologies are effectively leveraged to develop new and customized applications. This strategy has been particularly prominent in the Aqua Division, which is engaged in wastewater management. The nature of projects undertaken in this segment frequently necessitates modifications and improvisations in design and execution, enabling the Company to deliver solutions tailored to the specific requirements of each client.

Through this approach, the Company has successfully introduced innovative wastewater management solutions for client categories that were previously unserved, such as beach shacks and boats. These initiatives not only demonstrate the adaptability of the Companys offerings but also contribute to the expansion of its addressable market.

The Government of Goa has incorporated a number of the solutions presently being offered by the Company as a part of their push for the conservation of environment.

5. Digital Marketing and AI

The Company has significantly enhanced its customer touchpoints and engagement levels through the adoption of various digital and technology-driven initiatives. It maintains an active presence on leading social media platforms such as Instagram, LinkedIn, and Facebook, thereby strengthening its brand visibility and customer outreach.

The increasing granularity of data available across geographies and customer segments provides the Company with actionable insights that can be leveraged to optimize distribution channels and expand its customer base, both domestically and internationally.

In parallel, the Company continues to evaluate and adopt emerging technologies, including developments in artificial intelligence (AI). The integration of AI-based solutions is being actively explored to enhance organizational efficiency and decision-making. As part of this initiative, tools such as conversational AI applications are being encouraged for basic and repetitive tasks, thereby improving workforce productivity and enabling employees to focus on higher-value activities.

6: Enterprise Resource Planning ( ERP ) Implementation

The Company is in the process of the implementation of open source ERP Next in our systems, with the support of Premier Implementation Partners, which aids us in better coordination and accurate reporting, which in turn helps us in faster and better decision making.

6. OUTLOOK:

We, being a part of a sustainable solutions industry ecosystem, have witnessed the growth in this countrys economy, and would like to participate and continually contribute to the growth story that India is today. We expect to improve our position in the market by focusing on environmentally friendly products and market segments and working aggressively in the area of environment protection, productivity, efficiency, and cost reduction.

As mentioned above, India is a growth story in the eyes of the modern world, and one of the largest emerging markets. Our aim is to outpace this growth by adopting our brand new Massively Transformative Purpose (MTP) as the "Planet Care Innovator".

7. MATERIAL DEVELOPMENTS IN HUMAN RESOURCES / INDUSTRIAL RELATIONS FRONT:

Your Company follows a policy of building strong teams of talented professionals. People remain the most valuable asset of your Company. The Company recognizes people as its most valuable asset and the Company has kept a sharp focus on Employee Engagement. The Companys Human Resources is commensurate with the size, nature and operations of the Company.

8. STEPS TAKEN SINCE THE INITIAL PUBLIC OFFERING

Some of the concrete steps taken by your Company since the completion of the Initial Public Offering are as follows:

A. Team Building

The Company has hired an additional team of resources including top management personnel to support its vision for the forthcoming years. The major steps in human resources shoring up are as follows:

- Technical Sales personnel for Kolhapur, Mangalore and Belgaum

- Senior Project Execution Engineer

- Senior Sales Personnel

- Human Resource professionals to handle the HR Department of the Company.

- Systems and Trainings

The Company has focused on establishing robust processes and systems which include the following:

Exhaustive HR Manual through HR and Organizational consultancy

Compliance and Audit systems through Internal Audit process and related consultancy

As a step into going forward with Enterprise Resource Planning we have studied and analysedmultiple offers from various vendors and finalized ERP Next and entered the last phase ofimplementation with the support of Implementation Partners.

B. Collaborations

The Company had collaborated with the Digital Paani and Bactreat Environmental Solutions LLP. Bactreat (a BITS PILANI start-up) collaboration is for BIO STP using vertical flow wetland technology. This helped us to bag an order of Rs. 2.64 Cr to set up 2 nos of 1000 KLD BioSTP on Utkal sub Nallahs as a part of Hubli Smart Citys Green Corridor project. We are looking at further such collaborations in the future.

C. Marketing and Promotion

The Company has participated in multiple programs which were focused on the business of the Company. The glimpses of the same are contained in the photo gallery:

- The Company had organized ‘World Toilet Day function which focused on various aspects andchallenges of sanitation.

- In accordance with our Massively Transformative Purpose or the MTP - "Planet Care Innovator"

- we launched a competition called the "The Planet Care Innovation Challenge", wherein students and Innovators (of all age brackets) were asked to present their unique and innovative solutions related to Water Resource management. It was launched on 22nd March on the occasion of World Water Day and the prize distribution was conducted on 5th June 2024 - on the occasion of World Environment Day while being in Association with the Goa State Pollution Control Board.

- The Company has participated in Amazing Goa and CAI expo during the year 2024-25.

D. Subscription Model

In order to expand the markets by making it easy for customers to make quick decisions, the company provides Packaged STPs which will be offered on Monthly Subscription Basis - This has just been started and execution of 20 KLD packaged STP units for a famous restaurant has been completed.

E. Future Prospects

The company has entered FY 25-26 with a robust order book position and we expect to surpass the performance of 24-25 substantially.

9. CAUTIONARY STATEMENT:

This report contains forward-looking statements based on the perceptions of the Company and the data and information available with the company. The company does not and cannot guarantee the accuracy of various assumptions underlying such statements and they reflect Companys current views of the future events and are subject to risks and uncertainties. Many factors like change in general economic conditions, amongst others, could cause actual results to be materially different.

By Order Of The Board Of Directors FOR EP BIOCOMPOSITES LIMITED

RAJKUMAR G. KAMAT

Managing Director DIN:01157652

Place: Bicholim, Goa

Date: 23rd May, 2025