KKV Agro Powers Ltd Management Discussions

Pursuant to Regulation 34 (2)(e) read with Part B of Schedule V of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015

KKV Agro Powers Limited (CIN: L40108TZ2012PLC018332), is a leading Precious Metals and renewable energy generation and trading Company based in Coimbatore, Tamil Nadu. The company, listed in the NSE - Emerge platform and engaged in multiple businesses, has hit a turnover of an impressive Rs. 963.49 crores, and has recorded a net profit after tax of Rs. 3.27 crores.

The Board of Directors of your company proudly presents the Management Discussion and Analysis Report ("MDA Report") of the company for the financial year 2025-26.

During FY 2025-26, the global economic landscape was shaped by moderating inflationary pressures, stabilising interest rates in major economies, and gradual recovery in global trade flows.

The Indian precious metals and jewellery sector remained resilient during the year despite elevated gold prices and global economic uncertainties. The continued shift towards organised trade, greater emphasis on transparency and purity, and increasing consumer preference for trusted brands are expected to support the long-term growth of the sector.

The renewable energy sector in India witnessed strong growth during the year, driven by sustained policy support and increasing investments in clean energy. The continued expansion of renewable energy infrastructure, supported by favourable government initiatives and growing demand for sustainable power, is expected to strengthen the sectors long-term growth prospects.

II. OPPORTUNITIES AND THREATS

Opportunities

Increasing consumer preference for branded jewellery and organized retail. Sustained demand for gold as both an ornament and a preferred investment asset. Strong policy support and increasing investments in renewable energy.

Rising demand for clean energy driven by sustainability and decarbonisation goals.

Threats

Volatility in gold prices and changes in import duty structures. Intense competition and fluctuations in consumer spending patterns. Regulatory changes and delays in project approvals. Dependence on climatic conditions and fluctuations in equipment costs.

III. SEGMENT-WISE / PRODUCT-WISE PERFORMANCE

The Company has reported the details and performance under Segment Reporting in the Notes to Financial Statements (Note No. 2.42)

Energy Segment Performance

The energy segment, consisting of wind and solar operations, continues to be the mainstay of the company’s operations. The renewable energy segment achieved steady plant load factors despite seasonal variability. Solar generation benefitted from improved module performance, while wind generation was aligned with historical averages.

During FY 2025–26, the company generated a total of 1.96 crore units of electricity, with 1.53 crore units from wind and 0.43 crore units from solar.

Windmill Division:

The Windmill division reported revenue from operations of 3.64 crores. It incurred total expenses of 3.56 crores, including 1.50 crores in power generation expenses, and 0.67 crores in depreciation and amortization. This division delivered a profit before tax of ?0.081 crores, despite high capital costs, reflecting a steady margin and operational efficiency.

The Solar division posted revenue of ?2.06 crores. Expenses stood at ?2.78 crores, primarily due to ?1.45 crores in power generation and ?1.06 crores in depreciation. This division achieved a positive operational performance during the year, however, after accounting for depreciation and other associated expenses, the division reported a net loss of ?0.45 crores. The Company remains focused on improving operational efficiency and maximizing asset utilization.

The precious metals segment remained resilient with stable demand from jewellery manufacturers and investment clients. However, margins were impacted by fluctuations in international prices and currency movements.

With revenue of ?861.40 crores and other income of ?9.87 lakhs, the Bullion business continued its high-volume trade model. Expenses for the division was booked at Rs.861.98 crores. The loss before tax for the unit was ?48.82 lakhs. The Bullion Division remained profitable during the first half of the financial year. However, increased volatility in bullion prices and evolving market conditions during the latter half, coupled with the inherently thin margins in the bullion business, moderated the divisions overall performance for the year.

The Cumbum retail branch contributed ?91.89 crores in revenue. It exhibited stronger profitability with a profit before tax of ?4.91 crores. Strategic inventory reduction of ?1.38 crores and disciplined cost management played a key role in this improved outcome, suggesting that the retail jewellery vertical holds promise for higher-margin growth.

The Company remains optimistic about the long-term prospects of both business segments. The precious metals sector is expected to benefit from sustained consumer demand, increasing preference for organised retail and continued investment interest in gold, while the renewable energy sector is poised for strong growth driven by supportive government policies, rising investments and the growing transition towards clean energy. These favourable industry trends are expected to create long-term growth opportunities for the Company.

The strategic focus will remain on enhancing operational efficiencies, exploring hybrid renewable projects, diversifying the customer base, and maintaining a prudent risk management framework.

• Market Risk: Volatility in global bullion prices and currency exchange rates. The inflationary trends in gold prices not only affect pricing strategies but also tend to hamper trade volumes, as high prices may reduce consumer demand, particularly in the jewellery segment.
• Regulatory Risk: Possible changes in renewable energy tariffs, RPO norms, and import/export regulations.
• Financial Risk: Interest rate changes impacting borrowing costs. The Company actively monitors these risks and adopts mitigation measures through hedging, diversification, and continuous operational improvements.
• High Margin and Capital Intensive: Both the precious metals trading and renewable energy segments are characterised by high margins but also require significant capital investment. This capital-intensive nature can affect liquidity and return on investment if market conditions turn adverse.

The Company has adequate internal control systems commensurate with the nature and size of its operations. Internal audits are conducted periodically to assess the effectiveness of controls and ensure compliance with statutory and internal policies. Any deviations or process gaps are promptly addressed through corrective action. Management has overall responsibility for the Companys Internal Control System to safeguard the assets and to ensure reliability of financial records. Audit Committee reviews all financial statements and ensures adequacy of internal control systems.

During FY 2025-26, the Company recorded an overall improvement in its financial performance, driven by the continued strength of its core business operations. While the bullion and energy segments witnessed a moderation in performance during the latter part of the year, these were adequately supported by the robust performance of other business segments, resulting in an overall improvement in the Companys revenue and profitability. The Company remains focused on enhancing operational efficiencies and creating sustainable value across all its business segments.

Income from Operations of the Company during the Financial Year 2025-26 showed a marginal increase from Rs. 96,222.95 lacs during the previous year to Rs. 96,359.58 lakhs in the present year. After providing for expenditure and tax the Company has earned Net profit of Rs. 327.61 Lakhs.

Human capital continues to be the most important and valuable asset of the Company. During the year, operations were carried out in a cordial atmosphere with exemplary co-operation between employees and the management. The management remains committed to promoting safety, occupational health, and a conducive work environment through proper planning, training, and execution of tasks.

The industrial relations climate remained harmonious throughout the year under review. As on 31st March 2026, the Company employed a total of 29 (Twenty-Nine) employees (excluding Directors) across its business segments.

The Net worth of the Company increased from Rs. 2,272.19 Lakhs in the Financial Year 2024-25 to Rs. 2,568.76 Lakhs in the financial year 2025-26.

The return on net worth has increased during the year:

The details of significant changes in key financial ratios (i.e. change of 25% or more as compared to the previous financial year) along with detailed explanations for such change is provided in the table hereinbelow:

Statements in this Management Discussion and Analysis describing the Companys objectives, projections, estimates, and expectations may be forward-looking statements within the meaning of applicable securities laws and regulations. Actual results may differ materially from those expressed or implied due to various factors, including economic conditions, government policies, and other incidental factors.

For and on behalf of the Board of Directors
KKV Agro Powers Limited

T.K. Chandiran DIN: 00031091
Chairperson and Managing Director