Freshtrop Fruits Ltd Management Discussions

ANNEXURE- A

ANNEXURE TO THE DIRECTOR S REPORT

The following discussion presents the financial results of Puretrop Fruits Limited for the financial year 2024-25, along with the companys future business outlook. Some statements may be forward-looking and are included in accordance with applicable laws and regulations. Various factors may influence the actual results, which could differ from the Directors expectations regarding future performance and outlook.

GLOBAL MARKET

The Company operates in the dynamic and evolving fruit processing industry, which is experiencing significant global demand growth driven by rising health consciousness, urbanization, and increased consumption of convenient and natural food products. As global consumers increasingly shift toward healthier alternatives, processed fruit products such as pulps, concentrates, purees, and juices are gaining strong market traction. The international market, particularly in North America, Europe, and emerging economies in Asia and the Middle East, presents considerable opportunities for export expansion. Our focus remains on leveraging India s rich agricultural base to meet this demand with high-quality, sustainably sourced products.

In FY 2024 25, we strengthened our export operations by entering new distribution partnerships. Looking ahead, we are investing in advanced processing technologies and supply chain improvements to enhance efficiency, traceability, and shelf-life of our products. Puretrop is also exploring value-added product lines, including ready-to-use fruit products, which cater to premium international markets. While global economic uncertainties and regulatory barriers remain challenges, we believe our strategic positioning, strong sourcing network, and commitment to quality will continue to drive growth in the global fruit processing sector.

INDIAN MARKET

India continues to offer significant opportunities in the fruit processing sector, driven by a large and growing population, rising urbanization, increasing health awareness, and changing consumption patterns. Demand for processed fruit products such as juices, purees, pulps, and ready-to-consume snacks is steadily increasing, particularly in metro cities and tier-2 towns. Government initiatives like Atmanirbhar Bharat , the Production Linked Incentive (PLI) scheme , and investments in agri-infrastructure and cold chain logistics are further supporting the food processing industry. As a country with one of the world s largest fruit production bases, India holds a natural advantage in raw material availability, offering a competitive edge for processors like Puretrop Fruits Limited.

During FY 2024 25, we expanded our domestic distribution network, strengthened partnerships with retail chains and e-commerce platforms, and introduced new consumer-focused product variants aligned with local tastes and nutritional preferences. With increasing demand for clean-label and preservative-free options, we are focusing on innovation and product differentiation to build strong brand recognition. While challenges such as post-harvest losses, logistics costs, and regulatory compliance persist, we are investing in backward integration, farmer training programs, and sustainable sourcing practices to ensure product consistency and traceability. We remain confident in the long-term growth prospects of the Indian market and continue to prioritize quality, affordability, and innovation to meet the evolving needs of domestic consumers

OPPORTUNITIES

Health Awareness

Growing awareness about nutrition, immunity, and preventive health is driving demand for natural and minimally processed food products. Consumers are increasingly seeking clean-label, preservative-free, and vitamin-rich options. This trend creates strong opportunities for Puretrop to expand its range of health-oriented fruit-based offerings like cold-pressed juices, purees, and fortified drinks.

Premium Products

India s rising middle class and affluent urban consumers are willing to spend more on high-quality, exotic, and organic fruit products. There is increasing demand for premium fruit snacks, smoothies, and international-grade pulps. Puretrop can tap into this space by offering differentiated, value-added products with superior packaging, certifications, and traceability.

Retail and E-commerce

The rapid expansion of modern retail, quick-commerce platforms, and online grocery delivery has made it easier to reach a wide consumer base. E-commerce allows better visibility, targeted marketing, and direct consumer engagement. PureTrop can use these channels to launch new products, build brand loyalty, and scale distribution across regions with lower entry barriers

CHALLENGES A. FRESH FRUIT

Lack of Awareness in Chemical Usage: Many Indian fruit farmers lack proper training in Good Agricultural Practices (GAP) , particularly in the safe and judicious use of agrochemicals like pesticides, fungicides, and ripening agents. Often, chemicals are overused, used at the wrong time, or applied without understanding their residual impact. This leads to high pesticide residues in harvested fruits, making them unsuitable for processing, especially for export markets with strict safety standards. The problem is more acute in small and marginal farming communities, where access to agronomists, training, and extension services is limited.

Unpredictable Weather and Infrastructure Deficiencies: Unpredictable weather patterns, such as untimely rains, droughts, hailstorms, and extreme heat have become increasingly common in India due to climate change, significantly disrupting fruit cultivation. Since most fruit crops are highly sensitive to climatic variations , sudden changes can reduce yield, affect fruit quality, or even wipe out entire harvests. This leads to supply instability for processors who rely on consistent and timely sourcing. Compounding this issue is Indias inadequate agricultural infrastructure including poor cold storage facilities, limited refrigerated transport, and fragmented logistics systems. These gaps result in high post-harvest losses (30-40%) , increased raw material costs, and reduced profitability for processing units. For the fruit processing industry to thrive, there must be investment in climate-resilient farming practices, robust cold chain infrastructure, and better weather forecasting tools to stabilize supply and minimize losses.

Land Availability: Land availability is a big problem for fruit processing businesses in India. Many farmers have small and scattered land, which makes large-scale farming difficult. Its also hard to find affordable land to build factories and cold storage near farms. Sometimes land paperwork is unclear, causing legal issues.

GROWTH DRIVERS

Increasing Urbanization and Changing Lifestyles:

With rapid urbanization and busier lifestyles, more people are looking for convenient, ready-to-eat fruit products such as juices, jams, and dried fruits. This shift in consumer habits is driving higher demand for processed fruit items that save time without compromising nutrition. Additionally, growing health awareness encourages consumers to choose natural and nutritious fruit-based products. This trend is pushing companies to expand and innovate in the fruit processing sector.

Rising Export Opportunities: India s processed fruit products like mango pulp, dried fruits, and juices are in high demand globally. Countries in the Middle East, Europe, and the USA import these products, creating strong export potential. This demand helps Indian companies grow by accessing larger markets beyond domestic sales. Improved quality standards and certifications have made Indian exports more competitive internationally.

Expansion of e-commerce and online retail: Another significant growth opportunity is the expansion of e-commerce and online retail platforms for processed fruit products. As more consumers shop online, fruit processors can reach wider audiences quickly and efficiently, including in smaller towns and rural areas. This digital shift allows businesses to offer customized, niche products like organic juices, fruit snacks, and health-oriented blends directly to consumers. Leveraging e-commerce also helps reduce reliance on traditional retail, lowers distribution costs, and creates new avenues for brand building and customer engagement.

PERFORMANCE REVIEW:

Diversified Product Portfolio: The company has shifted focus from exporting raw fruits to producing value-added products under the "Second Nature" brand, including juices and snacks. This transition has led to growing revenue streams from the juice segment

Certifications and Compliance: Puretrop has obtained international certifications such as SGF International E.V., SEDEX, and Halal, ensuring adherence to global food safety and ethical standards.

Strong Governance: The company maintains a clean governance record, with no disqualified directors, and complies with applicable regulations.

FINANCIAL PERFORMANCE

The financial performance of the Company is described in the Director s Report under the head " Financial Result " and " Review of Operations " .

Key Financial Ratios:

The key financial ratios for Financials are as per the below table:( " in Lakhs " )

Particular	Changes	2024-25	2023-24
Sales Volume (Lacs)
Domestic	60.20%	1656.66	2663.54
Exports	57.16%	9500.80	16621.75
Sr. Particular	Changes	2024-25	2023-24
1 Total Revenue (Amount in lacs)	-42.15%	11,157.46	19,285.29
2 EBITDA (Amount in lacs)	-75.58%	2,052.04	8,402.16
3 PBT (Amount in lacs)	-80.34%	1,534.62	7805.04
4 PAT (Amount in lacs)	-80.20%	1,187.02	5995.06
5 Net Worth (Amount in lacs)	-20.71%	11,253.66	14193.62
6 ROE % (Net Profit after tax / Average Shareholders Equity)	-82.54%	9.33%	53.44%
7 Working Capital Ratio (Current Assets / Current Liabilities)	-21.02%	5.75	7.28
8 Fixed Assets Turnover Ratio (Net Sales / Average Fixed Assets)	-87.18%	0.56	4.38
9 Debt Service Coverage Ratio (Earning available for debt service / Debt Service)	-2508.55%	(3.51)	0.15
10 Inventory Turnover Ratio (Sales / Average Inventory)	16.73%	4.83	4.14
11 Debtors Turnover Ratio (Credit Sales / Average Account Receivable)	2.36%	14.83	14.48
12 Interest Coverage Ratio (EBITDA / Interest expenses)	-58.45%	47.09	113.32

Reasons for significant changes:

The company transferred its fresh fruit business to Green Agrevolution Pvt. Ltd. (DeHaat) in November 2023. This deal, valued at INR 770 million, allowed Puretrop to pivot more strongly towards its food processing business, which is poised to benefit from rising global demand for processed fruit products. The transaction included the transfer of key infrastructure and personnel, enabling Puretrop to streamline its operations and DeHaat to strengthen its export capabilities.

GROWTH STRATEGY

Innovation and R&D: We will strengthen our R&D capabilities to develop innovative, health-centric fruit-based products that meet evolving consumer preferences. Emphasis will be placed on sustainable processing, better shelf-life, and clean-label formulations. Investment in food tech and packaging innovation will improve product appeal and environmental impact. Consumer insight-driven development will ensure relevance and competitive advantage.

Impact of the Slump Sale: The recent slump sale enables us to streamline operations and sharpen our focus on the core fruit processing business. Divestment proceeds and freed-up resources will be reinvested in high-growth segments such as exports and premium products. This restructuring positions us as a leaner, more efficient company with clearer strategic priorities. We will also use this transition to enhance our brand image and stakeholder confidence.

Expanding market presence in existing markets: We plan to strengthen our presence in current markets through enhanced retail distribution, supply chain efficiency, and stronger digital presence. Strategic partnerships with e-commerce platforms and regional distributors will help us access untapped consumer segments.

Revamping the product segments: Our product portfolio will be refreshed to focus on value-added, premium categories such as functional beverages and seasonal offerings. We will also explore private label manufacturing and export opportunities for higher revenue diversification. The revamped lineup will position us better in health-conscious and global markets.

Privileging the farmers: Strengthening our farmer network is central to sustainable growth, ensuring quality supply and social impact. Through direct sourcing, crop advisory, and buy-back arrangements, we will offer economic security and fair pricing to farmers. Training in organic and residue-free farming will align production with global quality standards. This inclusive approach enhances traceability, trust, and long-term value creation.

MATERIAL DEVELOPMENT IN HUMAN RESOURCES AND INDUSTRIAL RELATION FRONT:

The Company treasures its human capital as its most important asset. It continues to foster a supportive work culture where all its personnel feel secure and appreciated. Aiming to attract, develop and retain talent in a dynamic operating environment, the Company s human resources policies also promote trust, transparency and cooperation. The employee recognition program is a vital part of the Company. Regular communication with top management helps identify and reward top performers across functions. An objective appraisal system based on KPIs is in place to incentivize employees. The Company currently has a workforce comprising about 150 people on permanent employment and another about 1000 people on seasonal temporary basis. The industrial relations were cordial throughout the year with no incidence of strike or lockouts.

FUTURE OUTLOOK:

Puretrop Fruits Limited s performance in FY 2024-25 reflects its continued resilience and strategic commitment to innovation and market expansion. Building on the solid foundation laid last year, the company is poised to capitalize on growing consumer demand for health-conscious and convenience-focused fruit products. The Food Processing segment is expected to sustain its robust growth, supported by new product launches and enhanced export capabilities. Strengthening supply chain efficiency and expanding digital and retail distribution channels remain key priorities. The company also aims to deepen its direct relationships with farmers, promoting sustainable sourcing and ensuring consistent quality of raw materials. Investments in research and development will accelerate the rollout of functional and clean-label offerings. As Puretrop broadens its market presence domestically and internationally, it is well-positioned to deliver sustained growth and create long-term value for all stakeholders.

CAUTIONARY NOTE:

The MDA section includes forward-looking statements that highlight the potential future prospects of the company. These statements are accompanied by inherent risks and uncertainties that may cause actual results to differ materially. Additionally, the macro-environmental changes and the unpredictable nature of global events, such as the Pandemic, unforeseen challenges for the Company and its operating environment. The information provided in the report is based on assumptions derived from both internal and external sources, and these assumptions may change over time, leading to corresponding adjustments in the estimates provided. It s important to note that these forward looking statements reflect the Company s current intentions, beliefs, or expectations and are valid as of the date they were made. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise.

Reference: Ministry of agricultural government of India, Agricultural and processed food products export development (APEDA), Media report, journals and press release: informatics journal, Business wire news journal, The Federation of Indian Chambers of Commerce and Industry (FICCI), National Horticulture

Date: 18 th August, 2025	By order of the Board
	For Puretrop Fruits Limited
	(Formerly known as Freshtrop Fruits Limited)
Place: Ahmedabad
Registered Office	SD/-
A-603, Shapath IV,	Ashok Motiani
Opp. Karnavati Club, S. G. Road,	Chairman & Managing Director
Ahmedabad 380 015	(DIN: 00124470)