Innovative Tyres & Tubes Ltd Management Discussions

In terms of Regulation 34 of SEBI (Listing Obligations and Disclosure Requirements), Regulations, 2015 the Management Discussion and Analysis Report (MDAR) is structured as follows:

Industry structure and developments
Opportunities
Segment-wise or product-wise performance
Outlook
Threats, Risk and Concerns
Internal Control System
Financial and operational performance
Material Development in Human Resources

Some Statements in this discussion may be forward looking. The Companys actual results, performance or achievements can thus differ materially from those projected in any such forward-looking statements in the management discussion and analysis on account of various factors such as changes in Government regulations, tax regimes, impact of competition, etc.

INDUSTRY OVERVIEW:

The Company is principally engaged in the business of manufacturing and processing of Automotive Tyres and Tubes.

OPPORTUNITIES AND THREATS:

The Company continues to focus on strengthening its business operations under the guidance of the present management. With sustained efforts towards operational efficiency, improved capacity utilization, and prudent financial management, the Company is well positioned to capitalize on emerging business opportunities in the industry. The management remains committed to enhancing productivity, expanding its customer base, strengthening stakeholder relationships, and achieving sustainable growth through optimum utilization of available resources.

The Company also expects to benefit from the conducive business environment, policy initiatives of the Government, and improving market conditions, which are expected to support business growth and enhance long-term value for stakeholders.

However, the Company continues to face challenges arising from intense market competition,

fluctuations in raw material prices, changing customer preferences, and overall economic and industry conditions. The management remains focused on mitigating these risks through effective cost management, operational improvements, prudent financial planning, and continuous monitoring of business performance to ensure sustainable growth and profitability.

SEGMENT WISE PERFORMANCE:
Since, the company operates its business under one segment only the report on segment wise performance is not furnished.

OUTLOOK:
The new management of the Company shall review the existing risk management policy and lay down defined risk management mechanism covering the risk mapping and trend analysis, risk exposure, potential impact and risk mitigation process. Management is yet to set up exercises to be carried out to identify and evaluate, manage and monitor various risk.

THREATS, RISKS AND CONCERNS:
Key risks include input cost volatility, competitive pressure from domestic and global players, and cyclical demand shifts in the automobile sector. It will be essential to monitor regulatory changes, currency fluctuations, and evolving environmental standards as part of our risk mitigation framework.

INTERNAL CONTROL SYSTEM:
The Company has in place robust Internal Control System aligned with its scale and complexity. These systems safeguard assets, ensure the accuracy of financial records, and monitor regulatory compliance. The Audit Committee periodically reviews system adequacy and effectiveness.

FINANCIAL AND OPERATIONAL PERFORMANCE:
The financial performance for the year reflected the challenges of rising input costs and competitive pressures. The management has focused on cost optimization, process improvements, and operational efficiencies. Going forward, emphasis will be placed on enhancing margins, strengthening customer relationships, and maintaining a healthy balance sheet.

MATERIAL DEVELOPMENTS IN HUMAN RESOURCES:
The Company recognizes human capital as its most valuable asset. Continuous efforts are made to foster a culture of learning, collaboration, and performance orientation. Training programs, employee engagement initiatives, and talent retention measures are in place to build a motivated and skilled workforce. Industrial relations during the year remained cordial.

DETAILS OF SIGNIFICANT CHANGES (I.E. CHANGE OF 25% OR MORE AS COMPARED TO THE IMMEDIATELY PREVIOUS FINANCIAL YEAR) IN KEY FINANCIAL RATIOS, ALONG WITH DETAILED EXPLANATIONS THEREFOR:

Particulars	Numerator	Denominator	March 31, 2026	March 31, 2025	% Variance	Reason for variance
Current Ratio	Current assets	Current Liabilities	0.45	0.39	16.57%	NA
Debt-Equity Ratio (in times)	Total debt	Shareholders Equity	(2.14)	(2.63)	-18.72%	NA
Debt Service Coverage Ratio	Earnings available for debt service	Debt Service	1.03	(0.56)	-283.20%	Debt service coverage ratio increased mainly due to huge loss in previous year
Return on Equity Ratio	Net profit	Average shareholders equity	0.10	1.94	-94.62%	Return on Equity ratio decreased mainly due to weighted average net worth was higher in previous year
Inventory Turnover Ratio	Sales	Average inventory	9.55	10.16	-6.01%	NA
Trade Receivables turnover Ratio	Total sales	Average Trade receivables	29.37	26.91	9.13%	NA

1.37 times whereas average trade payable increased by 2.12 times

Trade Payable turnover Ratio	Total purchases	Average Trade payable	2.83	4.48	-36.83%	Turnover increased by 82% whereas average working capital depleted by 18%. Hence net capital turnover ratio deteriorated.
Net Capital Turnover Ratio	Net sales	Working Capital	(4.12)	(2.45)	67.98%	Net Profit ratio improved mainly due to improvement in turnover by 82% and net profit improved by 88%
Net Profit Ratio	Net profit	Net Sales	(0.02)	(0.34)	-93.47%	ROCE improved mainly due to EBIT improved in positive whereas capital employed depleted by
Return on Capital Employed	Earnings before interest and taxes	Capital employed	0.01	(0.57)	101.04%	ROCE improved mainly due to EBIT improved in positive whereas capital employed depleted by

13%

Return on Investment

Earnings before interest and taxes

Total Assets

0.06

0.07

-15.19%

NA

 

Munish Chawla

Managing Director

DIN:06454015

Date:19th August,2026

Place: Halol