Gloster Ltd Management Discussions

a) Industry structure and developments

The compulsory packing norms for food grains and sugar under Jute Packaging Materials (Compulsory use for Packing Commodities) Act, 1987 (JPMA) stands at the 100% & 20% of production of food grains & sugar respectively and the said notification is valid up to 30th June 2026.

b) Opportunities and Threats/Risks & Concerns Opportunities

- Demand for Companys industrial products like Hessian & Sacking and promotional Jute goods like lifestyle products & other made ups in particular have grown over the years and is expected to see further growth

- Rising concerns for reducing carbon footprints opens doors for use of more bio degradable & sustainable products made from natural fibers;

- Export Demand has been reviving lately

Risk & Concern/ Threat

- Banning of import of specific jute products from Bangladesh via all land routes.

- Availability and price of quality Raw Jute

- Lower incentives on exports impacts competitive pricing in export market

- Any dilution of compulsory Jute Packing Order can adversely affect the market of jute products

c) Segment-wise or product-wise performance

The Company is engaged in the business of manufacturing Jute goods and is managed organizationally as a single unit. Accordingly, the company has only one business. However, the Company has customers in India as well as outside India and thus segment reporting on the Geographical location of its customers is as below: ( j_n lakhs)

Particulars	Within India	Outside India	Total
	2025-26	2024-25	2025-26	2024-25	2025-26	2024-25
Segment revenue by location of customers	73,422.48	44,208.14	17,263.88	18,460.13	90,686.36	62,668.27

d) Outlook

In the current financial year, price of Raw Jute was significantly higher in comparison to the year 2024-25. Estimate for Raw Jute crop for the upcoming season is encouraging as area under cultivation has increased in comparison to the year 2024-25 and the weather has been favourable. The carry over crop in the ensuing season is virtually nil. The price of Raw Jute in the ensuing season shall correct significantly.

Demand from Government is expected to be very strong. With the prices correcting, the Company hopes to win back some of the export markets lost to Bangladesh.

The Company remains focused on improving operational efficiency, enhancing productivity, optimising costs and increasing the share of value-added products while expanding its presence in domestic and international markets. Your management is confident that these initiatives will enable the Company to effectively navigate market challenges and capitalise on emerging opportunities.

e) Internal control systems and their adequacy

The Company has adequate internal control system commensurate with the size, scale and complexity of its operations which provides reasonable assurance with regard to safeguarding the Companys assets, promoting operational efficiency by cost control, preventing revenue leakages and ensuring adequate financial and accounting controls and compliance with various statutory provisions. An independent Audit Committee of the Board of Directors actively reviews the adequacy and effectiveness of internal control systems and suggests improvements for strengthening them.

A summary of Internal Audit observations and Action Taken Reports are placed before the Audit Committee on a periodical basis, for review.

f) Discussion on financial performance with respect to operational performance The following are the significant areas of financial performance:

SPACING=?0? BORDER=?0? WIDTH=?100%? cellpadding=?2?>

Particulars	2025-26	2024-25	Increase/ (Decrease)
Revenue from operations	90,686.36	62,668.27	28,018.09
Raw material cost	61,818.50	33,295.36	28,523.14
Finance costs	1,807.82	915.60	892.22
Profit for the year	3,876.03	4,373.17	(497.14)

g) Human Resources & Industrial Relations

The Company is continuing its efforts through training to enhance competence of its manpower to make them more resourceful in their present job and also to prepare them for future roles. The Company has also introduced staff welfare schemes under which benefits are provided to deserving members of staff.

h) Key Financial Ratios

Sl.No. Ratio	31 March 2025	31 March 2024
1 Current ratio (Times)	1.42	1.73
2 Debt-equity ratio (Times) *	0.23	0.11
3 Debt service coverage ratio (Times) #	4.32	8.46
4 Return on equity ratio (%)	3.27%	3.78%
5 Inventory turnover ratio (Times)	3.42	3.39
6 Trade receivables turnover ratio (Times)	16.51	15.18
7 Trade payables turnover ratio (Times)	19.25	25.63
8 Net capital turnover ratio (Times) @	5.89	4.36
9 Net profit ratio (%) @	4.30%	7.05%
10 Return on capital employed (%)	5.19%	5.68%
11 Return on investment (%) $	11%	16.37%
12 Interest Coverage Ratio (Times)	5.95	7.22
13 Operating Profit Margin (%)	8.30%	9.0%
14 Return on Net worth (%)	3.23%	3.73%

* The variation at 31 March 2026 compared to 31 March 2025 is primarily due to increase in short term borrowing in current financial year.

# The variation are primarily due to decrease in profitability & increase in debt during the year.

@ The variation is primarily due to increase in revenue from operation during the current financial year.

$ The variation is primarily due to decrease in average investment in current financial in comparison to previous financial year.

i) Cautionary statement

Statements made in this section of the report are based on assumptions and expectations of future events. Actual results could however differ materially from those expressed or implied. Important factors that could make a difference include finished goods prices, raw material cost and its availability, change in Government regulations, tax laws, economic developments within the country, currency fluctuation and other factors such as litigation.