Gayatri Rubbers and Chemicals Ltd Management Discussions

INDUSTRY STRUCTURE AND DEVELOPMENT

Our Company, Gayatri Rubbers and Chemicals Limited (GRCL), incorporated on March 31, 2022, enters its third year of incorporation, continuing to draw strength from its well-established experience in rubber manufacturing and trading. Although the corporate entity is relatively young, the business itself has a rich operational history and a solid reputation for quality and reliability. The rubber industry remains on a stable growth trajectory, driven by consistent demand across automotive, industrial, and consumer markets. Our company with its focus on operational excellence and customer-centric strategies, is poised to consolidate its market position and pursue further expansion in the upcoming financial year.

Leadership and Expertise:

The company, Gayatri Rubbers and Chemicals Limited is spearheaded by its promoters- Mr. Manoj Kumar Aggarwal, Mr. Shilp Chotai, and Mr. Utsav Rajendra Chotai, their proven leadership and deep technical know-how have enabled the company to build a resilient business model, deliver consistent performance, and strengthen its presence in the highly competitive rubber manufacturing sector.

The company continues to strengthen its standing as a trusted supplier in the rubber manufacturing domain through strategic leadership and deep technical expertise. The company secured significant procurement orders from North Western Railway, Maharashtra State Road Transport Corporation, and multiple Indian Railway zones, demonstrating its capability to meet rigorous industry standards. Reliable sourcing of neoprene rubber from MVPL Kolkata and I SMC Private Limited, Ahmedabad ensures consistent product quality.

The company has also expanded its reach in the industrial and power sectors, fulfilling multiple orders for Genus Power Infrastructures Limited and other industrial clients. By consistently delivering high- performance rubber profile gaskets and related solutions, GRCL upholds its reputation for quality, reliability, and timely execution, positioning itself for sustained growth across key markets.

Gayatri Rubbers and Chemicals Limited (GRCL) actively supports Indias growth story by aligning with “Make in India” and “Atmanirbhar Bharat” initiatives. By supplying essential rubber components to Indian Railways, state transport, and industrial projects, the company strengthens domestic manufacturing and contributes to the nations infrastructure and economic development.

The Companys independent directors Mr. Sameer Pravinbhai Raninga, Mr. Fahad Abdulaziz Patel, Mrs. Jaspreet Kaur provide additions to the Board with their expertise and maintain transparency.

Product Range and Market Presence:

Gayatri Rubbers and Chemicals Limited specializes in a diverse range of rubber products. The companys offerings include:

• Rubber Profiles: Tailored solutions for various applications, ensuring durability and flexibility.

• Aluminum Rubber Profiles: Designed to enhance performance in aluminum frameworks.

• Automobile Rubber Profiles: High-quality components essential for automotive assembly and maintenance.

• Rubber Compounds: Essential materials for other manufacturers and original equipment manufacturers (OEMs).

• Clear PVC Profiles: Versatile and transparent profiles used in various industrial and commercial applications.

These products are distributed nationwide, primarily catering to the aluminum and automotive sectors. The companys rubber compounds are supplied to other rubber product manufacturers and OEMs, highlighting its integral role in the supply chain.

OPPORTUNITIES AND THREATS

Opportunities and Strengths:

1. Experienced promoters with industry expertise: The company is led by a trio of promoters with over two decades of specialized experience in the rubber industry, enabling strategic decisionmaking and operational excellence.

2. Established customer relationships: The company has built trusted partnerships with Indian Railways, MSRTC, and prominent industrial clients, ensuring recurring orders and a stable revenue base.

3. Reliable raw material sourcing: The company maintains strong supplier relationships with MVPL Kolkata and I SMC Private Limited, Ahmedabad, ensuring consistent supply of high-quality neoprene rubber.

4. Proven track record in delivery and quality: The companys commitment to strict quality standards and timely fulfilment has earned it a reputation for reliability among government and industrial buyers.

5. Expanding demand across key sectors: With railway modernization, smart metering, and infrastructure development gaining momentum, the company is well-placed to capture increasing demand for rubber profile gaskets.

6. Potential for diversification and exports: company is exploring opportunities to broaden its product portfolio and expand into export markets, further enhancing growth prospects.

Threats and Risks:

1. Supply chain and logistics challenges: The company faces risks from delays in transportation or disruptions in the availability of critical raw materials, affecting timely order fulfilment.

2. Seasonal fluctuations in demand: Demand for rubber products, particularly in infrastructure and transport sectors, can vary seasonally, leading to fluctuations in order volumes and production planning.

3. Labour availability constraints: Seasonal migration and shortage of skilled labour can affect manufacturing schedules, leading to potential delays and higher operational costs.

4. Intense industry competition: The company operates in a highly competitive market with established domestic and international players, requiring constant innovation and cost efficiency.

5. Regulatory and policy-related risks: Changes in manufacturing regulations or fluctuations in government infrastructure spending can affect order volumes and business continuity.

6. Dependence on limited product lines and customers: A significant portion of revenue comes from rubber profile gaskets and a few key clients, making the business vulnerable to demand fluctuations.

7. Exposure to raw material price volatility: Fluctuating prices of neoprene rubber and other inputs can impact production costs and profit margins if not effectively managed.

SEGMENT-WISE OR PRODUCT-WISE PERFORMANCE

Gayatri Rubbers and Chemicals Limited does not have multiple segments. Hence, comments on segments are not required.

OUTLOOK

At Gayatri Rubbers and Chemicals Limited, we are focused on broadening our product range, enhancing operational efficiency, and strengthening supply chain resilience. The company is confident in sustaining its growth momentum. Guided by its focus on quality, compliance, and customer satisfaction, we seek to reinforce our position as a trusted partner in Indias infrastructure and industrial development.

INTERNAL CONTROL

The Company maintains a comprehensive internal control framework, supported by an independent internal audit function and a robust risk management system, ensuring operational discipline and compliance with applicable laws. Adequate controls govern inventory, fixed assets, and revenue processes, safeguarding assets against unauthorized use and ensuring all transactions are properly authorized, accurately recorded, and transparently reported. Regular audits, compliance reviews, and management oversight reinforce the framework, while continuous enhancements keep it aligned with business growth, statutory requirements, and best governance practices, fostering transparency and stakeholder confidence.

Further, the Audit committee overlook the internal control systems and their adequacy. Audit committee regularly reviews and gives recommendations on proper and adequate internal control systems.

OPERATIONAL PERFORMANCE

At Gayatri Rubbers and Chemicals Limited, operational excellence is the foundation of sustained growth. Our modern manufacturing facility, equipped with advanced machinery and handling systems, enables efficient and seamless production processes. Ongoing enhancements in production capacity and capabilities position us to meet evolving market demands with agility and reliability. A rigorous quality control framework ensures that raw materials and finished products meet the highest standards of safety, consistency, and performance. Our supply chain management emphasizes timely delivery, optimized logistics, and enduring partnerships with trusted suppliers. We continuously invest in workforce development and adopt innovative process improvements to strengthen productivity and adaptability. This comprehensive approach drives customer satisfaction, supporting companys long-term success in the competitive market.

DEVELOPMENT IN HUMAN RESOURCE

Our employees are our core resource, and the Company has continuously evolved policies to strengthen its employee value proposition. Your Company was able to attract and retain best talent in the market and the same can be felt in the past growth of the Company. The Company is constantly working on providing the best working environment to its Human Resources with a view to inculcate leadership, autonomy and towards this objective. In the Fiscal Year 2024-25, we have 59 employees including our directors, who look after our business operations, management administrative, secretarial, marketing and accounting functions in accordance with their respective designated goals.

SIGNIFICANT CHANGES

(i) Debtors Turnover: ratio for the FY 2024-25 is 5.46 as compared to FY 2023-24 which was 5.12.

(ii) Inventory Turnover: ratio for the FY 2024-25 is 4.85 as compared to FY 2023-24 which was 3.40. The Change is due to less proportionate increase in sales compare to average inventory i.e. increase in holding of inventory is more.

(iii) Interest Coverage Ratio: ratio for the FY 2024-25 is 9.98.

(iv) Current Ratio: ratio for the FY 2024-25 is 3.54 as compared to FY 2023-24 which was 8.96. The change is due to increase in current liabilities.

(v) Debt-Equity Ratio: ratio for the FY 2024-25 is 0.19 as compared to FY 2023-24 which was 0.01. The Change is due to company raised funds from borrowing.

(vi) Operation Profit Margin (%): Operating profit margin for the FY 2024-25 is 0.13.

(vii) Net Profit Margin (%): Net profit for the F.Y. 2024-25 is 9% as compared to FY 2023-24 which was 6.39%. Change is due to more proportionate increase in profit compared to sales.

FUTURE PROSPECTS:

As Gayatri Rubbers and Chemicals Limited progresses into its next phase of growth, the company remains steadfast in its focus on innovations, quality, and customer-centricity. Backed by strategic expansion initiatives and experienced leadership, is poised to strengthen its position in the rubber manufacturing industry. Leveraging enhanced production capabilities and deep industry expertise, the company aims to consolidate its market presence and deliver sustainable, long-term growth.

CAUTIONARY STATEMENTS

All statements made in Management and Discussion Analysis have been made in good faith. Many unforeseen factors may come into play and affect the actual results, which may be different from what the management envisages in terms of performance and outlook. Factors such as economic conditions affecting demand/supply and priced conditions in domestic & international markets in which the Company operates, and changes in Government regulations, tax laws, other statues and other incidental factors, may affect the final results and performance of the Company.

By order of the Board of directors

Gayatri Rubbers and Chemicals Limited

Sd/-

Shilp Chotai

(Managing Director)

DIN:09557130

Date: 30th August 2025

Place: Porbandar