(a) Industry Structure and Developments

1. Growing Consumer Demand for Innovation: Consumer demand for new, innovative products continues to grow, particularly in the dietary/nutritional and cosmetics segments. The Company is well-positioned to capitalize on this trend by focusing on R&D and product innovation.

(b) Opportunities and Threats

Opportunities:

1. Growing Consumer Demand for Innovation: Consumer demand for new, innovative products continues to grow, particularly in the dietary/nutritional and cosmetics segments. The Company is well-positioned to capitalize on this trend by focusing on R&D and product innovation.

2. Rising Demand in Emerging Markets: The Company has identified emerging markets, particularly covered all Indian market and then in Asia and Africa, as areas for significant growth. These markets are experiencing an increase in disposable income and consumer demand for health-related and wellness products.

3. Geographic and Market Expansion: The Company plans to expand its footprint in international markets. As part of its strategy, it is exploring entry into additional countries, where demand for the Companys products is expected to rise.

4. Innovation and New Product Development: Continuous innovation and new product launches represent a major growth opportunity. The Company has a robust pipeline of products slated for release in the coming fiscal years, which are gaining traction.

Threats:

1. Low Consumer Awareness: In certain markets, especially emerging economies, consumer awareness of the Companys products is still developing. This could pose a challenge to sales growth, especially in new geographic regions.

2. Government Scheme Delays: The Companys business in certain segments, such as veterinary feeds, may be impacted by delays in the implementation of government schemes and regulations, which could affect the timely release of new products.

3. Professional Skill Shortage: The Companys ability to innovate and maintain high operational standards is challenged by the shortage of skilled professionals in certain markets. This can potentially slow down product development and impact growth.

(c) Segment-wise or Product-wise Performance

Nutraceuticals

Contributed approximately 89.83% of total revenue

Growth driven by rising demand for functional supplements, gummies, protein bars, and wellness products

Strong export traction due to clean-label and certified formulations

Cosmetics

Accounted for 5.06% of revenue

Increased sales of skincare creams, personal care items, and cosmetic jellies

Benefited from rising interest in premium, herbal, and vegan beauty products

Ayurvedic & Herbal Products

Contributed 4.17% of revenue

Boosted by government AYUSH initiatives and consumer preference for natural remedies

Includes herbal tablets, oils, and traditional formulations

Veterinary Feed Supplements

Represented 0.91% of revenue

Steady growth in animal health solutions, especially for poultry and livestock

Includes mineral mixtures and nutritional additives

Homecare Products

Minimal but emerging segment at 0.03% of revenue

Includes eco-friendly cleaning solutions and personal hygiene items

Niche formulations with potential for strategic expansion

(d) Outlook

Influx Healthtech Limited enters the upcoming fiscal year with a strong foundation and a clear growth trajectory. The company aims to expand its manufacturing capacity across nutraceuticals, veterinary feed supplements, cosmetics, and homecare products, supported by proceeds from its successful IPO. With increasing global demand for certified, clean-label wellness products and rising interest in preventive healthcare, Influx is well-positioned to deepen its international footprint and diversify its client base. Strategic investments in automation, R&D, and sustainable packaging will further enhance operational efficiency and product innovation. Backed by robust financials and a scalable business model, the company anticipates continued momentum in revenue growth and margin improvement, reinforcing its role as a leading CDMO in the wellness sector.

(e) Risk and Concerns

Influx Healthtech Limited faces competition and pricing pressure in the fragmented CDMO market, with revenue heavily concentrated in nutraceuticals and a limited client base. Margin volatility from raw-material, supply-chain

and forces swings, evolving FSSAI, AYUSH and US FDA regulations, plus execution risks in capacity expansion, automation and ESG compliance, underscore the need for agile innovation and robust quality controls.

(f) Internal Control Systems and Their Adequacy

The company has implemented robust internal control systems that ensure efficient operations, compliance with laws and regulations, and the reliability of financial reporting. Regular audits and reviews are conducted to assess the adequacy of these systems, with improvements made as necessary to address any identified weaknesses. The internal control framework is deemed adequate and effective in mitigating risks.

(g) Discussion on Financial Performance with Respect to Operational Performance

The companys financial performance has been strong, with revenue growth driven by increased sales across key product segments. Operational efficiency initiatives have resulted in improved margins, despite fluctuations in raw material prices. Investment in technology and production capacity has also contributed to better operational performance, enabling the company to meet growing demand.

(h) Material Developments in Human Resources / Industrial Relations Front, Including Number of People Employed

During the financial year, the company has made significant strides in strengthening its human resources. New training programs have been introduced to enhance employee skills, particularly in areas of quality control and production efficiency. Industrial relations have remained stable, with no major disruptions. The total number of employees as of the end of the financial year stands at 2025-26.

(i) Details of Significant Changes in Key Financial Ratios

Sr No.	Ratios	Numerator	Denominator	As at 31st March, 2026	As at 31st March, 2025	% change in Ratio
i.	Current Ratio (in Times)	Current Assets	Current Liabilities	3.59	1.44	148.22%
ii.	Debt-Equity Ratio (In Times)	Total Debt	Shareholders Equity	-	0.01	-100.00%
iii.	Debt Service Coverage Ratio (in Times)	Earnings available for Debt Servicing	Total Debt service	-	22,523.99	-100.00%
iv.	Return on Equity Ratio (in %)	Profit After Taxes	Average Equity	20.39	36.72	-44.48%
v.	Inventory turnover ratio (in Times)	Cost of Goods Sold	Average Inventory	10.07	11.23	-10.29%
vi.	Trade Receivables turnover ratio (in Times)	Revenue from Operations	Average Trade Receivables	4.43	4.34	2.26%
	(In Times)
vii.	Trade payables turnover ratio (In Times)	Purchase of Goods &services and other expense	Average Trade Payables	4.45	3.84	15.92%
viii.	Net Capital Turnover Ratio (In Times)	Revenue from Operations	Working Capital	3.98	9.17	-56.64%
ix.	Net Profit Ratio (in %)	Net Profit After Taxes	Revenue from Operations	14.08%	12.76%	10.42%
x.	Return on Capital Employed (in %)	Earnings Before Interest and Tax	Capital Employed	27.21%	49.17%	-44.66%

Remark - Any change in the ratio by more than 25% as compared to the preceding year.

Sr. No. of Ratio	Reason of Variance
i.	The company had made fresh issue of shares through public offer and the pending utilisation the funds have been temporarily parked in short term fixed deposits and hence there has been a significant improvement in the current ratio as compared to the previous year.
ii.	The company has repaid all its debts in the current year resulting in Debt-Equity ratio to be Nil.
iii.	The company has repaid all its debts in the current year resulting in Debt-Service Coverage Ratio to be Nil.
iv.	The decline in Return on Equity (ROE) from the previous year is primarily due to a temporary mismatch between capital infusion and its deployment. During the current financial year, the Company raised fresh equity capital through an Initial Public Offering (IPO), significantly increasing the shareholders funds (the denominator). However, these funds were only partially deployed in operations by the end of the year. Because this newly raised capital has not yet reached full productive capacity, net profit did not grow in proportion to the expanded equity base, resulting in a lower ROE for the current period.
vii.	This expansion in the working capital base was primarily driven by higher current assets, specifically the unutilised proceeds from the Companys recent Initial Public Offering (IPO) that are temporarily parked in Fixed Deposits awaiting deployment. Consequently, the growth in the capital base temporarily outpaced revenue growth, resulting in a lower turnover ratio for the current period.
x.	The decline in Return on Capital Employed (ROCE) from the previous year is primarily due to a temporary mismatch between capital infusion and its deployment. During the current financial year, the Company raised fresh equity capital through an Initial Public Offering (IPO), significantly increasing the capital employed base (the denominator). However, these funds were only partially deployed in operations by the end of the year. Because this newly raised capital has not yet reached full productive capacity, net profit did not grow in proportion to the expanded equity base, resulting in a lower ROE for the current period.