Gujarat Petrosynthese Ltd Management Discussions

Industry Structure and Development

The Company is one of the established manufacturers of polymer alloys and blends and a leading compounder of engineering plastics in South India, catering to the specific demands and application requirements of its customers. During the year ended March 31, 2026, the Company recorded total revenue from operations of Rs. 22.57 crore as against Rs. 16.92 crore in the previous year, an increase of 33% over the last year.

Opportunities & Threats

The polymer alloys and blends compounding unit was setup with the technical collaboration and equity participation of Chenguang Research Institute of Chemical Industry (CRICI). The products of our company have diverse uses and applications in several industries right from Automotive, Electronics and telecommunication to Electrical, Medical and Home appliances.

The Company has loyal pan- India customers and enjoys a good reputation in the industry owing to the consistency, reliability and quality of its products. It has a full-fledged testing laboratory along with the latest equipment. One of the major thrusts of the Company has been towards providing compounds for the growing market for e-vehicles and industrial safety equipment. The company has obtained the ISO 9001:2015 and ISO 1400:2015 certification maintaining its pursuit in consistently providing high quality products while observing effective environment management systems. Some of the major threats faced by the company are the unforeseen global supply chain disruptions and volatility in global crude prices causing fluctuations in raw material prices and availability which directly impact the profit margins. The company also faces intense market competition, rising energy costs and evolving environmental and regulatory requirements which may impact operational performance and profitability. However, the company continues to monitor these risks and implements appropriate mitigation measures to minimize their impact on its business operations.

Segment/Product Wise Performance

The Company operates in a single reportable business segment, namely manufacturing of Polymer alloys & Blends, Compounding of Engineering plastics.

During the year 2025-26, the Company achieved a sales volume of 984 MT. The Company developed 26 new customers and 84 new products

Market and Outlook

The Company continues to focus on the development of import-substitution products and specialty polymer compounds tailored to customer-specific requirements. These initiatives have enabled the Company to broaden its customer base and strengthen its market position.

The Companys strategic focus remains on improving compounding mix, enhancing operational efficiency, optimizing energy consumption and maintaining stringent cost controls to improve productivity and profitability. Continuous efforts are being undertaken towards efficient utilization of raw materials and energy resources.

Risks and Concerns

Some of the raw materials are imported from other countries. The volatility of exchange rate of rupee against US dollar accompanied by the problems in supply chain could have a significant impact on the supply and cost of Raw Material. Besides this, since our products are custom made for specific requirements, some of our OEM customers especially in the automotive industry require prolonged validation testing before final approval. This causes delay in revenue generation. Also, the year-on-year demand for reduction in prices from them restricts our ability to pass on the full raw material hikes.

To reduce these risks, the Company maintains adequate inventory of critical raw materials, sources materials from different suppliers and closely monitors market conditions. The management regularly reviews these measures to support smooth business operations and minimize disruptions.

Internal Control Systems and their Adequacy

The Company has an adequate Internal Control System commensurate with the size and nature of its business. The preparation, designing and documentation of Policy on Internal Financial Control have been finalized and implemented which is being reviewed periodically and modified suitably to ensure controls. The internal audit functions are carried out by a separate firm of Chartered Accountants. This is supplemented through an extensive internal audit programmed and periodic review by the management and Audit Committee.

Discussion on Financial Performance with respect to operational performance

The total revenue from the operations for the year ended March31,2026 amounts to Rs.22.57 Crores as against Rs. 16.92 Crores in the previous financial year. The Company continues in its commitment to reduce consumption, energy cost and wastage & get higher yield to achieve maximum profits.

Human Resources

Human Resources are always the most important and valuable asset to the Company. The Company has 26permanent employees as on March 31, 2026 at factory and office level. Our company believes in investing in people to develop and expand their capability. The Company has been able to create a favorable work environment that motivates performance and customer focus. The Human Resource Department regularly arranges training programs on Safety and Emergency preparedness and Awareness and Environmental policy training.

Key Financial Ratios

Return on Net Worth

The return on net worth has increased to 4.51% during the financial year 2025-2026 as against 2.93% in the previous financial year, primarily on account of improved profitability and higher earnings generated during the year.

Cautionary Statement

Statements in the Management Discussion & Analysis Report describing the Companys expectations, opinion, and predictions may please be considered as forward looking statements only. Actual results could differ from those expressed or implied. Companys operations should be viewed in light of changes in market conditions, prices of raw materials, economic developments in the country and such other factors.

For and on behalf of the Board

Gujarat Petrosynthese Limited