Gennex Laboratories Ltd Management Discussions

Managements Discussion and Analysis Report on the Business of the Company as applicable and to the extent relevant is given below:

Industry Structure and Development:

Gennex Laboratories Limited is in the business of Manufacturing of Bulk Drugs, Intermediates and Biotech Products. The Company has over the years added more capacity and infrastructure by way of an additional production block and equipment to the plant to handle more products and also tonnages. The Company is having a professionally managed team at every stage of its operations.

Opportunities:

Multipurpose and Multi product production facilities having ISO 14001:2015 and ISO 45001:2018 Certification from TNV Global Limited accredited by United Accreditation Foundation (UAF) with and COFEPRIS (Comisi?n Federal para la Protecci?n contra Riesgos Sanitarios) Certificate from National Health Regulatory Agency of Mexico.

- The Management depth and ability to manage client relationships.

- Enhanced presence in the international market.

Large number of Pharmaceutical companies losing their drug patents, thereby increasing the scope of outsourcing to countries that offer a low cost manufacturing base.

The Pharma sector is expected to witness further consolidation by way of mergers and acquisitions this augurs for growth of the Industry. This would result in better price realization and growth.

Threats:

The Indian Pharma Industry will have to meet the following challenges:

i. Multinational Companies are setting up large plants in India.

ii. Competition in the global market that offer low manufacturing base.

iii. Uncertainties on account of global socio economic environment.

Outlook for the Company:

Your Company is on the verge of completion of the expansion plans undertaken. Your Company has planned its business strategy taking the ground realities into account. The Company has introduced new products which are very competitive and beneficial to the Company.

Segment-wise/Product-wise Performance:

As the company has only one line of product i.e. Pharmaceutical Products (Bulk Drugs), segment-wise or product-wise performance is not applicable for the year 2025-26.

Risks and concerns:

Any Government policy intervention or any change in the Pharma sector benefits and unforeseen adverse market conditions are issues of concern and may put pressure on the performance of the Company.

Internal Control System and their adequacy:

The Company has Internal Control System which is adequate and commensurate with the size of the Company.

Discussion on financial performance with respect to operational performance

A. Financial Conditions:

1. Capital Structure:

The Authorized Share Capital of the Company as at March 31, 2026, is Rs 2,500 Lakhs divided into 2,500 Lakhs Equity Shares of face value of Rs 1/- each. The Share Capital of the Company consists of only Equity Shares. The Paid-up Capital of the Company as on March 31, 2026 is at Rs 2,429.47 Lakhs comprising of 24,29,47,674 Equity Shares of Rs 1/- each fully paid-up.

2. Reserves and surplus:

The Reserves and Surplus of the Company as on March 31, 2026, stands at Rs19,382.45 Lakhs

3. Secured Loans:

The Working Capital Advances as at March 31, 2026, stand at Rs 2,281.97 Lakhs

4. Unsecured Loans:

The Deferred Tax amount as at March 31, 2026, stand at Rs 3.30 Lakhs.

5. Fixed Assets:

The Gross Block stood at Rs 4,673.36 Lakhs and the net block stood at Rs 2,682.28 Lakhs as at March 31, 2026 compared to Rs 4,121.95 Lakhs and Rs 2,227.63 Lakhs as at March 31, 2025, respectively. The increase in the value of the Fixed Assets is on account of procurement of new plant and Machinery.

6. Revenue (Gross):

During the year, the Company achieved sales of Rs 11,985.67 Lakhs compared to Rs 9,457.79 Lakhs in the previous year ended March 31, 2025.

Environment and Safety

The company maintains and effects continual improvement in environmental standards and complies with the safety requirements. The company cares for the safety of its employees and safety training is imparted to the employees in the factory. Personal Protective Equipment is provided to the employees in conformity with statutory requirement.

Human Resources

The company believes that the quality of its employees is the key to its success in the long run and is committed to provide necessary human resource development and training opportunity to equip them with skills, which would enable them to adapt contemporary technological advances.

Details of Significant Changes in the Key Financial Ratios:

The details of significant changes in the key financial ratios during financial year 2025-26 as compared to the immediately previous financial year 2024-25 are given below:

Cautionary Statement

Statement in this "Management Discussion & Analysis" may be considered to be "Forward Looking Statements" within the meaning of applicable securities laws or regulations. Actual results could differ materially from those expressed or implied. Important factors that could make a difference to the Companys operations include global and Indian demand-supply conditions, increased installed capacity, finished goods prices, raw materials availability and prices, cyclical demand and pricing in the Companys markets, changes in Government regulations, tax regimes, besides other factors.