Jubilant Agri & Consumer Products Ltd Management Discussions

1. Farmer Meeting: The Company organises interactive meetings with farmers to educate them about the advantages of using Ramban Products. These sessions provide valuable insights into best practice for crop nutrients and address farmers queries directly.

2. Jeep Campaign: To effectively promote Ramban products, the Company conducts focused Jeep campaigns tailored to speci c products such as Super Ultra Gold, Shakti Zyme, Bio-Poshan, JUBISTAR and

speci c crops like sugarcane, potato, mustard, kinnow, etc. The Jeep Campaigns foster direct

interaction, building trust and credibility. Real-time feedback from farmers helps to understand their

challenges and improve product recommendations.

3. On Field Demonstrations: The Company sets up demonstration plots in key agriculture areas. These plots are strategically designed to compare treated and untreated sections, allowing farmers to observe the difference in crop growth. Through this approach, the Company highlights the signi cant improvement in root development, owering and yield that result from using Ramban products. During the demonstrations, it also educates farmers on the proper application methods, including accurate dosage and optimal timing to ensure that farmers understand how to maximise the Ramban products bene ts. Additionally, the Company emphasises how Ramban products enhance soil health and plant vigour, ultimately contributing to healthier and more productive crops.

4. Farm Fair Exhibition: A vital part of the Companys outreach strategy for its products is a Farm Fair exhibition. These events provide an excellent platform to directly engage with farmers, agriculture experts and industry stakeholders. At the exhibition booths, the Company showcases the unique bene ts of Ramban products through informative displays and live demonstrations.

5. Shop Painting & Branding: The Company gave a fresh and vibrant makeover with the new branding of Rambaan and Jubilant to the shops selling its products. With this new look, the Company reaf rmed its dedication to serving the farming community with the best quality Agri products

and trusted service.

6. Retailer Meetings: Retailer meetings are critical for the Company to maintain their enthusiasm and get their feedback. The Company shares its latest innovations, sales strategies, and promotions with its valued partners.

7. The Company shares its latest innovations, sales strategies, and promotions with its valued partners.

Business Performance: The companys strategic expansion into new states has signi cantly boosted business growth for the segment in FY2024-25, growing 54.5% over the previous nancial year. The progress was driven by a strong focus on innovation, leading to a more diverse and enriched product portfolio. The Company was able to narrow down the loss due to the return of sales growth and improved realisations.

Business Strategy: The Company is revolutionising agriculture by adopting Smart Farming Practice, including the use of biologicals and alternative fertilisers, to enhance crop health and promote environmental sustainability. The strategic focus involved expanding into Gujarat,

Maharashtra, Chhattisgarh, and West Bengal while simultaneously strengthening the dealer network in Bihar, Rajasthan, Madhya Pradesh, Haryana and Punjab states. As part of its strategic growth plan, the Company is poised to enter the bulk complex fertiliser segment, speci cally targeting NPS 20:20:0:13. This fertiliser, which contains 20% Nitrogen, 20% Phosphorus and 13% Sulphur, is particularly bene cial for plant growth, especially in soils with low labile Phosphorus and Sulphur contents.

The Companys objective is to strengthen its presence by

catering to the high-demand markets in key states such as

Uttar Pradesh and Rajasthan. Additionally, the company is actively promoting Shakti zyme, Bio-Poshan and JUBISTAR within the bio-stimulant category. This move

aligns with our commitment to offering diverse and ef cient nutrient solutions to support sustainable growth. Outlook: With a prediction of a favourable monsoon in 2025, the demand during FY2025-26 for SSP and Agri Nutrients, in the divisions portfolio, is likely to remain high. Given high imports of Phosphatic Fertilisers by the country, and push for self-reliance by the Government, the volume of SSP and associated fertilisers is likely to rise at a handsome pace. Continued Government support is also likely to play an important role in continued traction for this divisions products. Margins for this segment are likely to improve in a limited manner.

The Company is committed to Research and Development (R&D), which is a cornerstone of its innovation-led growth strategy. With advanced R&D and Technology Centres that adhere to global standards, it focuses on developing differentiated products, optimising formulations, and enhancing process ef ciencies. In FY2024-25, the R&D function signi cantly pushed innovation across the Companys Consumer and Latex businesses, leading to the successful launch of several new products speci cally designed to meet evolving customer needs.

The Companys capabilities in collaborative product development were strengthened while working closely with end-users to co-create solutions for unmet market demands. Its R&D teams were actively engaged in recipe optimisation, sustainability-driven innovation, and technology platform development, particularly in the Latex segment, where new formulations have enhanced performance and customer satisfaction. Furthermore, R&D continues to support Six Sigma initiatives, contributing to operational excellence and scalability throughout the Companys manufacturing operations.

The Company consistently applies world-class manufacturing processes in its daily operations, ensuring unmatched product quality and timely delivery through continuous innovation and cutting-edge technology. The core focus of the Companys manufacturing function is operational excellence, sustainability and upholding a total quality culture of "zero tolerance to any non-compliance."

During the year, signi cant initiatives were undertaken

across all manufacturing plants in areas such as energy conservation, water conservation, batch cycle time reduction, cost optimisation, and improving machine uptime through sustainable engineering practices. At the Gajraula facility of the Company, it exclusively uses renewable fuels like Rice Husk (or Mustard husk) for hot air generators, completely replacing coal consumption. To embed continuous improvement within the Companys DNA and enhance its People, Process, and System capabilities, various transformation methodologies, including Greenbelt, have been deployed across the manufacturing function. The Company maintains a continuous emphasis on compliance with regulations and Good Manufacturing Practices (GMP) through ongoing assessment and review of quality systems against industry guidelines and regulatory standards. Numerous other initiatives have been implemented across manufacturing plants to strengthen Environment, Health, and Safety (EHS) systems. Speci c measures to control fugitive emissions were also taken at the Gajraula fertiliser plant.

The Company has formulated a comprehensive Environment, Health, and Safety (EHS) Policy, which applies to all locations regardless of operation type or geography. This policy underscores the Companys belief that EHS is an essential pillar of Business Wellness. It outlines a fundamental ideology of not only complying with regulatory standards but also excelling in EHS performance through a continuous improvement approach. The EHS policy acts as a guiding principle for identifying, addressing, and eliminating or mitigating any impacts or risks arising from resource utilisation, processes, unsafe working conditions, waste, ef uent generation, or emissions. The Company prioritises the health and safety of people above all else and is committed to pollution prevention. EHS management systems are an integral part of business operations at all manufacturing locations.

Environment & Sustainability: The Company aims to

protect the environment and the health of its stakeholders and aligns with the global commitments towards climate change and carbon neutrality. It has implemented robust monitoring mechanisms and taken multiple steps to ensure compliance with environmental legislation, extending support to vendors and partners to enhance their environmental adherence, and not just prevent non-compliance that could result in substantial nes, penalties, or operational suspensions, signi cantly impacting its nancial condition. Environmental excellence is deeply embedded in the Companys culture, re ected in its sustainability policies, responsible care practices, and green supply chain initiatives. It actively involves the community, including employees, in environmental initiatives and continuously invests in process and technology advancements to minimise its environmental footprint. Efforts are focused on energy ef ciency, waste heat recovery, water conservation, renewable energy integration, rainwater recharge, and community participation to enhance overall environmental performance. The Company prioritises waste reduction at the source and strives to convert waste into reusable resources. Understanding that sustainability and environmental concerns require collaborative effort, it actively engages with government bodies, industry forums, and academia to contribute to developing responsible regulations. The Companys commitment to environmental stewardship remains unwavering, with consistent capital expenditure allocated to ensure continuous improvement in its environmental management practices. It has consistently incorporated internationally recognised tools into its business processes, aiming to maintain operational ef ciency and sustainable effectiveness. This institutionalisation of best practices has signi cantly contributed to its long-term success, strengthening resilience and positioning the Company to achieve ambitious growth targets while adhering to sustainability principles.

Safety and Health: The well-being and safety of the workforce are paramount for the Company. Safety is a core value, with a rm emphasis on ‘Zero Harm and ‘100% compliance. The commitment to maintaining safe conditions at its plants safeguards assets and minimises business interruptions. The Company is dedicated to protecting the health and wellness of its entire ecosystem, encompassing employees, partners, communities, customers, and stakeholders. This ‘Safety-First culture is evident in daily operations at every site and in every decision, demonstrating its steadfast commitment to operational health and safety. To reinforce this commitment, the Company has integrated the principles of the Occupational Health and Safety Management System, adhering to the ISO-45001 standard, across all operating sites. This institutionalisation ensures robust safety measures and protocols to protect employees and effectively mitigate risks.

The Gajraula plant received the following awards during the

year:

Greentech Safety Excellence Award, for the plants performance in Safety Excellence.

Grow Care Safety Award in Platinum Category for Plant performance in Safety Excellence

EcoVadis certi cate for Sustainable Performance

The Savli plant received the following awards during the

year:

Grow Care Safety Award in Gold Category for Plant performance in Safety Excellence

EcoVadis certi cate for Sustainable Performance

The Sahibabad plant received the following award during

the year:

Grow Care Safety Award in Gold Category for Plant performance in Safety Excellence

The Kapasan plant received the following award during the

year:

Grow Care Safety Award in Gold Category for Plant performance in Safety Excellence

The Company maintains a robust and strategic approach to supply chain management, which fosters collaborative partnerships with its valued suppliers and a commitment to excellence and exceeding customer expectations. The supply chain management strategy is meticulously engineered to proactively identify and mitigate potential supply chain risks, but also ensure an uninterrupted ow of high-quality materials and components. By fortifying these measures, it ensures stable and sustainable sourcing, safeguarding the reliability of its products and services.

The global supply chain has faced unprecedented disruptions in recent years, with con ict in the Middle East and logistical challenges in the Red Sea affecting the Company the most. This has not only led to increased ocean freight costs but also extended shipping times from India to Europe and the Americas due to the rerouting of vessels.

The Company, however, successfully maintained its delivery commitments to customers, though at signi cantly higher shipment costs. To counter this increase, the Company undertook major initiatives to reduce costs through improved inventory management, extended supplier credit terms, and the development of alternate vendors for A-class raw materials, packing materials, and indirect purchases. The nished goods, logistics, and distribution structure of the Companys consumer products business were remodelled during the reported year. This re-engineering aimed to lower inventory levels without compromising product availability and On-Time, In-Full (OTIF) dispatches. Several geographically closer warehouses were merged to achieve overall inventory reduction. The business planning cycle was also strengthened through enhancements in Sales & Operations Planning (S&OP) and the Source-to-Ful l (S2F) process. Moving forward, the Company will continue to focus on developing alternate suppliers for key raw materials (especially imported raw materials, indirect purchases, and capital equipment) and packing materials, and enhancing storage capacity for critical raw materials to ensure availability.

Employees are a central element of the Companys vision and the strategy to ful l it. The Company aspires to be an employer of choice by ful lling its vision to be and remain one of the top 10 most admired companies to work for. In line with this vision, during FY2024-25, the Company continued to ne-tune alignment of its people processes, which include organisation design, talent acquisition, onboarding, engagement, and capability building, with its business goals. This consolidation exercise maintained a strong focus on ethical practices, governance, and market-competitive policies.

The Companys workforce planning remained agile, ensuring customer-centric structures and timely talent deployment through internal mobility and strategic hiring. Succession planning and talent dashboards were actively monitored to address critical capability needs. In line with its value of ‘Inspiring Con dence, the Companys digital transformation initiative addressed the key imperative of empowering customer-facing teams. The "Power to You" principle continued to drive employee enablement to achieve superior customer experience and satisfaction. Sales Excellence initiatives strengthened B2C capabilities through competency assessments and nationwide training, reinforcing "The Jubilant Way of Selling" and delivering measurable business impact.

The Company has prioritised open and consistent communication with its workforce to build a foundation of trust and transparency. This proactive approach to employee engagement is a key factor in fostering harmonious labour relations and preventing disputes, thereby ensuring uninterrupted operations and zero production loss at its manufacturing plants. This is further reinforced by a strong commitment to employee well-being and safety, which is established as a core value.

To navigate the evolving business landscape, the Company has committed itself to an all-round digital transformation of its business processes with a ‘Digital First philosophy to deliver superior customer value and leverage advanced technologies. These technologies enhance agility, simplify processes, improve ef ciency, minimise manual efforts and errors, ensure compliance and quality, and equip the Company to seamlessly navigate future disruptions. Its transformation journey rede nes customer and partner experiences while optimising operations across the entire value chain, building a solid foundation for a promising digital future.

Over the past year, the Company has made substantial progress in its digital transformation journey. It has invested in state-of-the-art IT systems, including the implementation of latest SAP S/4 HANA ERP, alongside advanced SMART SFA (Sales Force Automation) and DMS (Distributor Management System) tools, to enhance productivity, data-driven decision-making, and real-time business visibility.

On the information security front, the Company has signi cantly enhanced its cyber resilience. It established a 24/7 Managed Security Services, including a Security Operations Centre with an independent partner, which has substantially increased coverage and monitoring, alongside a heightened focus on compliance.

Key initiatives in Cloud Security, Attack Simulation, and Identity threat detection were executed, ensuring the robust protection of its digital and IT assets.

The establishment of a Data Loss Prevention (DLP) Desk has further boosted its cyber resilience, leading to a substantial reduction in security incidents.

The Company also successfully managed multiple Customer Cyber Audits, demonstrating its commitment to high security and compliance

standards.

Furthermore, it completed the transfer of key business data to the Cloud, improving accessibility and data protection, and implemented real-time asset tracking for greater infrastructure visibility.

These strategic investments and process improvements have enhanced the Companys ef ciency, agility, and security. Looking ahead, it will build upon this strong foundation through strategic investments in human capital, operational processes, and cutting-edge technologies, poised for transformative evolution and unprecedented growth.

At Jubilant, Corporate Social Responsibility (CSR) is a fundamental pillar of the groups commitment to sustainable and responsible growth. The CSR initiatives of the group companies are driven collectively by the Jubilant Bhartia Foundation (JBF), a not-for-pro t entity established in 2007. JBF serves as the vehicle for conceptualising and implementing impactful CSR activities, focusing on the core impact areas of Healthcare, Education, and Livelihood.

Through a robust 4P (Public-Private-People-Partnership) model, the Foundation actively collaborates with government bodies, civil society organisations, and local communities to create lasting social value. It strategically focuses on uplifting and adding value to the communities surrounding its manufacturing facilities, ensuring the Company and Groups growth is inclusive and bene ts all stakeholders.

In FY2024-25, JBF continued to champion progressive social change by forging strategic multi-stakeholder partnerships. These collaborations are designed to generate and share knowledge, provide experiential learning opportunities, and cultivate a vibrant entrepreneurial ecosystem. Its dedicated efforts are focused on improving the quality of life and fostering self-reliance for communities in the operational areas of the group companies, creating a ripple effect of positive change that extends beyond its businesses.

The brief information on ongoing and one-time CSR

projects carried out by JBF is stated below.

A. Arogya: A healthcare initiative that provides affordable basic and preventive healthcare to a population of 33,000 across 16 villages in Kapasan. This is delivered through the "Jubilant Aarogya" program, which utilizes mobile and static clinics, supported by the JUBICARE

digital platform, and offers regular health awareness

camps.

B. Muskaan Supporting Rural Government Primary Education: This project is dedicated to strengthening

rural primary education. It aims to bene t over 2,000 students and teachers by digitising government schools and enhancing the learning environment. The JBFs "Edulab Program" is implemented in these schools, which helps bridge the urban-rural divide by integrating advanced educational tools and methodologies into these schools. C. JubiFarm: This program is focused on holistic rural development and enhances farmers access to modern and sustainable farming methods. It also works to diversify income-generating opportunities, contributing to the overall economic well-being of the rural communities. D. Rural Development: This program focuses on strengthening rural infrastructure for the larger rural community to enhance the quality of their lives with the Foundations support.

E. BHARAT IMPACT - Jubilant Bhartia Centre for Social Entrepreneurship: In FY2024-25, the

Foundation launched a new centre to promote social entrepreneurship. This centres mission is to support social entrepreneurs through focused incubation, education, and research programs.

The Company has put in place its Internal Financial Controls (IFC) system in line with the requirements of Section 134(5)(e) of the Companies Act, 2013 to ensure effective governance and compliance with applicable laws and regulations. The Company has put in place and adopted Policy and Procedures as part of the IFC system that include rules and guidelines governing the Companys operations and nancial transactions. Such a system is adequate and operating effectively to address the key objectives speci ed in the Act:

Orderly and ef cient conduct of business

Safeguarding of its assets

Adherence to the Companys policies

Prevention and detection of frauds and errors

Accuracy and completeness of the accounting records and timely preparation of reliable nancial information

The policy, procedure and structures adopted by the Company to achieve the key objectives of the IFC are given below. These are appropriate for the nature, size and complexity of the Companys business and operations.

In addition, we have a transparent framework for periodic evaluation of the internal controls via Internal Audit and quarterly controls self-assessment by certifying ~1500 controls by ~130 users in each quarter. This reinforces the Companys commitment to adopt the best corporate governance practices.

A well-de ned organisational structure with clearly outlined role de nitions, responsibilities and interrelationships.

Long-term planning for ef cient capital allocation and short-term planning through the Annual Financial Planning and Budgeting system that includes periodic reviews to ensure achievement of business goals.

Delegation of authority to enable empowered decision making is captured in the Authority & Responsibility Matrix formulated under the guidance of and approved by the Companys Board of Directors.

Our risk management structure comprises the Audit Committee and Risk Management Committee, supported by the Executive Director, Business Heads, Functional Heads, and Unit Heads. As risk owners, the Heads are entrusted with the responsibility of identi cation and monitoring of risks. These are then discussed and deliberated at various review forums chaired by the Executive Director and actions are drawn upon.

The Companys Standard Operating Procedures (SOPs) for its plants and of ces focus on maintaining safe conditions, prioritise preventive maintenance of assets, and ensure adequate physical security to help safeguard its assets and minimise business interruptions.

It has also taken necessary insurance policies to protect its nancial interest in assets.

The Companys IT systems have built-in controls to ensure alignment with its Policies and Procedures in its business processes.

It has also put in place a strong budgetary and authority control framework for nancial transactions.

The Companys entity level controls, such as Code of Conduct, Data Protection/ Privacy Policy, Ombudsperson of ce, etc., are established.

There is also a performance review mechanism with monthly reviews for all businesses and quarterly reviews for all functions by the Chief Executive Of cer (CEO).

A Big Four rm conducts the Companys internal audits to perform a systematic check of every aspect of the business to provide independent assurance on the effectiveness of the internal controls and highlight the gaps for continuous improvement.

Financial data and accounting was done using the Baan Enterprise Resource Planning system to avoid errors in accounting operations, and capture data in a timely and accurate manner. However, the Company has migrated to the latest version of SAP in April 2025.

The Company has appointed statutory auditors in line with the requirements of the Companies Act, 2013, who review and audit the nancial information and reported nancial statements periodically, as per the applicable regulations and guidelines, to ascertain compliance with accounting standards and accuracy. Their notes and independent report on the internal nancial controls and nancial statements are published as part of the Annual Report and quarterly results.

The Audit Committee, Executive Director and CFO form the governing body that, on periodical basis, reviews the adequacy and effectiveness of the IFC system adopted by the Company, and its recommendations on any required changes are implemented in a timely manner.

The Company has designed its risk management approach such that it proactively enables the Companys strategic objectives and is not merely a reactive control measure. The Company has taken effective steps to embed a comprehensive risk management culture that anticipates, identi es, and mitigates potential threats to ensure sustainable growth and protect stakeholder value.

A robust risk management framework to facilitate continuous identi cation, assessment, and mitigation of both internal and external risks has been put in place. The Company also promotes a strong risk culture, driven from the top by the senior management team, who set the tone through de ned corporate values, clear risk responsibilities, and delegated authority. The Board and senior management maintain a strong oversight and monitoring system, with established procedures for informing the Board on risk assessments and mitigation strategies. This is complemented by an unwavering commitment to strong ethical values and integrity across all operations, which serves as a fundamental risk mitigator.

A multi-level risk management structure with the Board of Directors and the Audit Committee at the apex provides overarching governance. This is supported by the leadership team, including the Executive Director, CEO, and CFO, along with Business, Functional, and Unit Heads. As designated risk owners, these heads are responsible for identifying and monitoring risks within their respective domains. These risks are then thoroughly discussed in various review forums led by the CEO, where mitigation actions are decided upon.

Risk mitigation strategy is integrated into the Companys core business processes through integration with a comprehensive internal audit plan. This approach enables the Company to identify risks at an early stage and take timely corrective action. It has appointed an external consultant to independently assess the effectiveness and maturity of the risk management processes through periodic reviews. The Company has therefore taken care to ensure the ongoing effectiveness of its risk management processes and foster a culture of continuous improvement in managing its risk landscape.

The Company identi es and evaluates several risk factors and draws out appropriate mitigation plans associated with the same. Some of the key risks affecting the businesses and their mitigation plans are detailed below:

The Company operates in a highly competitive environment; however, the nature and intensity of competition for each of its business lines is different.

Consumer Products: The primary challenge for this business line is the low consumer involvement and high price sensitivity, which necessitates dependence on channels and in uencers to drive sales. To counter competition, the Company has executed a multi-pronged strategy to expand distribution channels and build its product portfolio. It is also strengthening its brand with in uencers through loyalty and interactive marketing programs and launching a dedicated brand af nity campaign to establish ‘JivanJor with End Consumer as a strong player in the adhesives category.

Food Polymers and Latex: There is signi cant international competition, particularly from cost-advantaged players like China and rivalry from European counterparts, in this low-growth industry. This dynamic creates persistent pricing pressures. The Companys successful mitigation approach for this risk is robust customer and account management initiatives to secure long-term commitments. Agri Products: In addition to the competition, a key risk for the Companys Agri Products business is the unpredictable in uence of climatic conditions, particularly monsoon variability, on cropping patterns, pest outbreaks, and commodity prices. These factors directly impact the demand and supply balance for fertilisers like SSP. The timely movement of our bulk fertilisers is also a risk, as it can be hindered by a limited availability of carriers and railway wagons due to competing logistics demands.

In addition to competition from other players, this business faces intense market competition from alternative products such as DAP and NPK complexes. The demand for SSP is highly sensitive to the international prices of these alternatives and their raw materials (rock phosphate, sulfur), as well as to government policies like the Nutrient Based Subsidy (NBS).

Rising input prices and in ationary pressures can affect the Companys growth and market position. These also pose a signi cant risk to pro tability and its ability to remain price competitive in the market, as volatility in raw material and logistics costs can severely impact the operating margins.

To mitigate this, the Company has undertaken a series of strategic initiatives such as cost reduction through business excellence programs, value engineering in raw and packaging materials with support from R&D and diversi cation of the supplier base. Securing long-term contracts with suppliers to stabilise prices and ensure volume commitments is a key strategy for cost control through supplier management. The Company has further concentrated on enhancing pro tability by improving the ef ciency of supply chain and R&D processes, thereby reducing overall manufacturing costs. While remaining cost competitive, the Company is not losing focus on quality and customer service, which are the key pillars of its market

standing.

The Company faces exposure to foreign currency uctuations due to international revenues and signi cant imports of key raw materials. As the Companys operations are India-based, any depreciation in the Indian Rupee poses a direct risk to its pro t margins by making imports more expensive. Additionally, the volatility and uncertainty in exchange rates complicate accurate product pricing in the market.

However, as the net foreign currency exposure is not considered signi cant, the Company currently does not employ derivative nancial instruments or other hedging techniques to mitigate this risk.

A key risk to the Companys growth strategy and market leadership is suboptimal capacity planning and utilisation, which are two sides of a coin. Beyond planning and utilisation, capacity creation also comes with risks such as delayed commissioning of new projects, cost overruns, and failure to meet quality standards. These can severely impact revenue targets, margins, and the expected Return on Investment (ROI). These risks can also lead to customer dissatisfaction and reputational damage. Furthermore, the Company can also face operational risks from factors that cause unforeseen downtime or idle capacity, such as power breakdowns, labour strikes, or transport disruptions. These inef ciencies can hinder its ability to meet customer demand and capture market share.

To mitigate these risks, the Company has implemented robust processes to continuously monitor planned capacities and utilisation rates, adhering to strict Good Manufacturing Practices (GMP) and a comprehensive preventive maintenance plan. It seeks regular inputs from the business teams to actively track product trends to ensure suf cient capacity to match supply with demand. This proactive approach, coupled with prioritisation of debottlenecking and ef ciency improvement initiatives at the existing plants over creating new capacities, helps in achieving growth objectives pro tably because of ef cient resource utilisation.

A balanced portfolio across customers, markets, and products is crucial for the Companys sustained success. Any sudden changes in customer behaviour, needs, or expectations can adversely impact its nancial performance and long-term competitive position, if the customer concentration is high. A similar logic applies to market and product concentration. The Company addresses these risks across its different business lines in a unique and targeted manner.

Consumer Products: The Company has addressed product concentration risk through line extensions that address various micro niches in terms of application and brand extensions into the maintenance and construction chemical segments. It is also continuously innovating to launch new products to address any emerging customer needs and changing preferences. Food Polymers and Latex: The Company faces a risk of over-dependence on a single product or a small number of customers in this business. This could jeopardise long-term objectives and sustainability, particularly if regulations were to limit the end-use application of a key product. To address this, it is actively diversifying the customer base and exploring new applications for its products. The challenge of a limited customer universe in this segment remains, as a handful of customers hold a majority market share. Another related risk is the potential for suboptimal utilisation of co-products, which could lead to inventory build-up, distress sales, and nancial losses. The Company continuously strives to identify new markets and downstream opportunities to ensure it can effectively utilise all products within its portfolio.

Agri Products: These risks are mitigated by continuously innovating to meet emerging nutrient de ciencies in crops. In collaboration with the Government of India, the Company has expanded its product portfolio to include nutrient-rich fertilisers such as Boronated SSP (Granular) and Zincated SSP (Powder, Granular), along with advanced products like SSP forti ed with Boron and Zinc (Super Formula Granular) and SSP forti ed with Boron, Zinc and Magnesium (Ultra Gold). It also has a pipeline of new products, including Mono Zinc, Nutri mix 5% (State Grade), and Bio-Poshan, to ensure relevance to farmers needs and maintenance of a diversi ed offering. The Company identi es and explores new pro table markets and alternative applications for its products through business planning and review processes.

The Company is transitioning to a Digital First work environment, which presents the challenge of managing change across the organisation and with external partners. Any mismanagement of this change process could lead to productivity loss, lower morale or loss of Return on Investment in this initiative. The key approach to mitigating these risks is through communication of a clear vision with conviction to all stakeholders. The Company is also deploying adequate resources to ensure the digital infrastructure is user-friendly, secure, and rigorously tested through User Acceptance Testing (UAT). By providing comprehensive training on these new digital interfaces that fosters a sense of ownership, it aims to ensure a smooth and effective transition to a digital- rst culture.

The Companys success hinges on its ability to attract and retain top talent. The primary mitigation of this risk is through a proactive and data-centric HR strategy. Some of the important elements of this HR strategy are:

Continuously re ne hiring and onboarding processes based on candidate feedback

Actively seek external talent to accelerate growth initiatives

A robust talent and succession management process to identify and develop ‘High-Performance, High-Potential employees, which is led by senior leadership

Performance management and incentive programs that are directly tied to nancial targets, effectively rewarding high performance and driving commitment

Invest in targeted capability building through training and focus on improving gender and skill diversity to ensure the right workforce mix

Competitive and simple compensation and bene ts packages that are designed to have a strong link between performance and pay.

This comprehensive approach not only attracts the best talent but also fosters a culture of continuous development and loyalty.

Maintaining strong brand recall and an effective distribution channel is crucial to our market position. Consumer Products: In the Wood Adhesives and Wood Finishes business, where the Company competes nationally, the key risk is maintaining the loyalty and commitment of its strong network of distributors and dealers because they play a signi cant role in driving consumer behaviour. To manage this, it undertakes targeted brand-building initiatives, expansion of distribution footprint into new markets, and streamlines inventory management processes to improve distributor pro tability and secure their long-term loyalty. Additionally, in the Consumer Products business, the Company is leveraging interactive Digital tools like DMS tool, Dealer App, In uencers Loyalty Apps and Employee Apps to enhance its reach and engagement with various stakeholders.

Food Polymers and Latex: The Company is a leading national and global player in these markets, where it supplies its products to market leaders in the chewing gum industry and the tire/ tire cord industry. Hence, the risk mitigation approach for Distribution and Branding Risk in the B2B segment is different from the other two B2C segments. By maintaining strong customer relationships and a partnership approach, the Company aims to communicate a consistent value proposition and ensure reliable supply to its customers. Its Distribution and Branding strategy revolves around ensuring the achievement of these objectives. Agri Products: Brand recall and effective distribution are achieved through extensive eld-level promotional activities like farmer meetings, demonstrations, and Kisan melas, which raise product and brand awareness among farmers and channel partners.

Innovation, whether it is in developing new products or researching new applications or developing cost-effective manufacturing techniques, is critical to the Companys sustained success. The primary risk is the failure to develop and commercialise a robust pipeline of new products, applications, and cost-saving manufacturing techniques in a timely manner, which would erode its competitive position. A related risk is the development of products that fail to meet quality standards, which could signi cantly damage reputation and result in lost business.

To mitigate this, the Company has strategically aligned its R&D initiatives with the business plans, and these are supported by dedicated budgets and investments. The business teams actively monitor technological advancements and collaborate with the R&D team to sponsor speci c projects. The Company has invested in acquiring experienced R&D professionals, who regularly upgrade their skills and keep themselves abreast of the regulatory and technological advances. They are part of teams tasked with developing new, cost-effective processes and products that are scalable and meet market needs, through a culture of continuous innovation.

The Company is exposed to the risk of non-compliance with a broad range of statutory and regulatory requirements. The failure to obtain or renew essential approvals, licenses, registrations, and permits in a timely manner could disrupt operations. This risk is particularly high in its Latex and Solid Poly Vinyl Acetate (SPVA) businesses, where key customers demand speci c international approvals. Non-compliance, or even accusations of it, could lead to signi cant nes and penalties, negatively impacting the business.

The introduction of new products also faces the risk of delayed or denied regulatory approvals, which could adversely affect its market entry and revenue potential. Changes in regulations or a reassessment of a products safety and ef cacy could lead to the amendment or withdrawal of existing approvals, resulting in revenue loss. To mitigate these stricter regulations, the Company has increased the ef ciency of its R&D process, reducing testing timelines to ensure its products can be brought to market faster. It has also put in place a comprehensive compliance management system to monitor and manage compliance, approvals, licenses, registrations, and permits under all applicable laws and regulations.

The Company has recognised that EHS excellence is a critical business imperative In an environment of increasing public scrutiny and reputational threats. In this domain, it faces the risk of non-compliance with stringent emission standards and other environmental regulations, as its operations involve hazardous chemicals and by-products. The proximity of its manufacturing plants to residential areas due to rapid urbanisation adds to this risk. Failure to meet these standards could not only lead to regulatory penalties but also erode public trust in the case of any mishap.

The Company anticipates that environmental laws and customer demands for product safety will become even more stringent. To proactively address this, it has invested substantial resources to enhance the manufacturing processes, increase adherence to environmental standards, and improve industrial safety levels. It has adopted an approach that is systematic and disciplined, with policies and procedures to mitigate EHS-related risks to its business, employees, and society. It has a dedicated EHS team that conducts periodic audits and training, and the manufacturing facilities are equipped with Occupational Health Centres to ensure the well-being of its workforce. The Company also engages with government and industry forums to advocate responsible EHS regulations. In recognition of its performance, the Company has received Various awards/ accolades for its EHS standards and achievements.

The Companys business faces a signi cant risk of disruption due to its concentration of manufacturing facilities. The core manufacturing facility for most of its business is at Gajraula, and the Latex facility is at Samlaya and other manufacturing plants are located at Kapasan and Shaibabad. Any prolonged stoppage at these sites could severely impact its operations. One of the mitigation approaches adopted by the Company for this risk is by having a majority of its workforce working in a facility in an adjoining residential colony or nearby area to ensure continuity under challenging circumstances.

External factors also pose risks. In Agri Products, business can be interrupted by changes in government policies related to fertiliser subsidies such as Direct Bene t Transfer (DBT). Similarly, changes in rainfall patterns could also affect business activity. The Company manages these risks through continuous training for its staff and awareness programs for dealers and farmers to ensure smooth implementation of changes in government policies. In the Food Polymers business, the Company maintains a limited but strategic inventory of nished goods near key markets to sustain supplies during a potential stoppage.

A speci c supply chain risk in the Latex business is the limited availability of Butadiene, a critical raw material with few domestic suppliers. An unplanned shutdown by a supplier could halt production. To mitigate this, the Company has established relationships with multiple suppliers and maintains an adequate inventory. It is also exploring an increase in its Butadiene storage capacity. To protect against these various forms of business interruption, it has also secured the Industrial All Risk insurance.

The Company relies heavily on its digital backbone and hence it is exposed to cyber threats that could compromise data integrity, con dentiality, and operational continuity. These threats range from intellectual property theft and operational technology (OT) attacks to database exposure, credentials stuf ng to phishing, malware, and ransomware.

It has adopted a multi-faceted approach to mitigate these risks. The Company has a robust information security governance structure, to direct resources and manage its cybersecurity posture. Its IT processes are ISO-27001 certi ed and adhere to the National Institute of Standards and Technology (NIST) Cyber Security framework, ensuring it complies with international standards. An annual audit of various IT components is conducted, with ndings leading to continuous corrective and preventive actions. Most importantly, it recognises that the employees are a critical line of defence. For them, it conducts regular, structured training and awareness programs to educate them about current cyber risks and best practices for safeguarding sensitive information.

While the Companys relations with its employees are cordial, there is an inherent risk of labour union issues that could adversely affect its production capacity and pro tability. It proactively mitigates this risk by engaging in a voluntary negotiation and mediation process to amicably resolve any disputes over wages or other matters. Regular discussions and involving union representatives in various joint decision-making processes are key to maintaining positive labour relations and substantially reducing the likelihood of a strike or production disruption.

In an era of increasing consumer and investor demand for climate action, failure to meet benchmarked ESG performance standards poses a signi cant risk. Poor ESG ratings can negatively impact the Companys relationships with shareholders and investors, alter demand for its products and services, and damage its reputation.

To mitigate this, the Company is committed to enhancing its ESG capabilities and performance. It is providing extensive training to the personnel on various ESG standards and reporting frameworks. It has also allocated resources and developed strategies in collaboration with relevant departments.

Statements in the Annual Report, particularly those, which relate to Management Discussion & Analysis, describing the Companys objectives, projections, estimates and expectations, may constitute forward- looking statements within the meaning of applicable laws and regulations. Although the expectations are based on reasonable assumptions, the actual results might differ signi cantly.