Kobo Biotech Ltd Management Discussions

The global pharmaceutical industry continues to play a vital role in the healthcare ecosystem and has witnessed significant growth over the last few years. The growth has been supported by increasing healthcare expenditure, technological advancements, rising incidence of chronic diseases and growing demand for specialty medicines. The Active Pharmaceutical Ingredients ("API") market continues to benefit from increased demand for generic medicines, expansion of the biopharmaceutical sector and continuous innovation in drug development.

India is one of the worlds leading producers of pharmaceutical products and a major supplier of generic medicines. The API industry constitutes an integral part of the Indian pharmaceutical sector and contributes significantly to the countrys exports. Government initiatives such as the Production Linked Incentive (PLI) Scheme and the increasing global preference for diversification of supply chains under the "China +1" strategy are expected to provide long-term growth opportunities to the domestic pharmaceutical industry.

Kobo Biotech Limited is engaged in the business of manufacturing Active Pharmaceutical Ingredients (APIs). However, owing to financial and regulatory challenges, the manufacturing activities at the Companys Solapur manufacturing facility remained suspended during the year under review and, accordingly, no business operations were carried out.

Subsequent to the close of the financial year, the Honble National Company Law Tribunal ("NCLT"), Hyderabad Bench, vide its order dated August 13, 2024, admitted the application filed under Section 7 of the Insolvency and Bankruptcy Code, 2016 ("IBC") and initiated Corporate Insolvency Resolution Process ("CIRP") against the Company. Mr. Ravindra Chaturvedi was initially appointed as Interim Resolution Professional and was subsequently confirmed as Resolution Professional. Thereafter, Ms. Namrata Amol Randeri was appointed as Resolution Professional pursuant to the order of the Honble NCLT dated January 17, 2025.

Further, the Honble NCLT, Hyderabad Bench, vide order dated May 11, 2026, approved the Resolution Plan submitted by Beaufond Industries Limited as the Successful Resolution Applicant. The approved Resolution Plan envisages revival of the Company as a going concern, subject to implementation of the terms of the Resolution Plan and receipt of necessary approvals.

During the financial year ended March 31, 2024, the Company did not carry out any manufacturing or business activities and accordingly no revenue from operations was generated.

The Company reported a loss after tax of Rs.49.28 lakh during FY 2023-24 as compared to a loss of Rs.55.53 lakh during the previous year. The losses primarily comprise employee benefit expenses, finance costs, depreciation and other administrative expenses. Subsequent to the year end, the Company entered into Corporate Insolvency Resolution Process under the provisions of the Insolvency and Bankruptcy Code, 2016.

• Long-term growth prospects of the Indian pharmaceutical and API industry.

• Government initiatives aimed at promoting domestic API manufacturing.

• Potential revival and restructuring pursuant to the approved Resolution Plan.

• Opportunity to restart operations and maximize stakeholder value under the supervision of the Resolution Professional and Successful Resolution Applicant.

• Financial stress and liquidity constraints.

• Delays in implementation of the approved Resolution Plan.

• Regulatory and statutory compliance requirements.

• Competition from domestic and international manufacturers.

• Raw material price fluctuations and foreign exchange risks.

• Risks associated with revival and restoration of operations.

The Company operates in a single business segment, namely Active Pharmaceutical Ingredients (API).

During the year under review, no manufacturing or commercial activities were carried out by the Company and, accordingly, no segment-wise or product-wise performance is available for reporting.

The Company is exposed to various operational, financial and regulatory risks. During the year under review, the Company continued to face financial challenges and the manufacturing operations remained suspended.

Further, subsequent to the year end, Corporate Insolvency Resolution Process ("CIRP") was initiated against the Company under the provisions of the Insolvency and Bankruptcy Code, 2016. The implementation of the approved Resolution Plan and revival of operations would be subject to various regulatory approvals and compliances. Accordingly, the Company remains exposed to risks relating to execution of the Resolution Plan, market conditions, regulatory changes and availability of resources. The management and Resolution Professional continue to take appropriate measures to address these challenges and safeguard stakeholders interests.

The long-term outlook for the pharmaceutical and API industry remains positive. However, in view of the suspension of manufacturing activities and the financial challenges faced by the Company, the short-term outlook remains dependent upon successful implementation of the approved Resolution Plan.

The Honble National Company Law Tribunal, Hyderabad Bench vide its order dated May 11, 2026 approved the Resolution Plan submitted by Beaufond Industries Limited. The approved Resolution Plan envisages revival of the Company as a going concern and continuation of business operations, subject to fulfilment of the terms and conditions contained therein and receipt of necessary statutory and regulatory approvals. The management and Resolution Professional remain optimistic regarding the future prospects of the Company and creation of long-term value for stakeholders.

Further, the Companys future performance is subject to successful implementation of the Resolution Plan approved by the Honble National Company Law Tribunal, Hyderabad Bench and receipt of necessary approvals from various regulatory authorities. Accordingly, actual results may differ materially from those expressed or implied in the forward-looking statements.

Subsequent to the close of the financial year, the Honble National Company Law Tribunal, Hyderabad Bench, admitted the application under Section 7 of the Insolvency and Bankruptcy Code, 2016 and initiated Corporate Insolvency Resolution Process against the Company vide order dated August 13, 2024.

Thereafter, Ms. Namrata Amol Randeri was appointed as Resolution Professional. Further, the Honble NCLT, Hyderabad Bench, vide its order dated May 11, 2026, approved the Resolution Plan submitted by Beaufond Industries Limited. The approved Resolution Plan contemplates revival of the Company as a going concern and restructuring measures in accordance with the provisions of the Insolvency and Bankruptcy Code, 2016.

Pursuant to Regulation 34(3) read with Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the details of key financial ratios are as under:

The above ratios have been computed based on the audited financial statements. Certain ratios are not meaningful owing to absence of business operations and negative net worth of the Company.

During the year under review, the Company had no operational activities and continued to have a negative net worth. Consequently, several financial ratios are either not meaningful or are not comparable. Accordingly, no meaningful analysis can be drawn for such ratios.

Statements in this Management Discussion and Analysis Report describing the Companys objectives, projections, estimates and expectations may constitute "forward-looking statements" within the meaning of applicable laws and regulations. Actual results may differ materially from those expressed or implied.

Important factors that could influence the Companys operations include changes in economic conditions, government regulations, taxation policies, market conditions, availability of resources, implementation of the Resolution Plan approved by the Honble National Company Law Tribunal, Hyderabad Bench and other incidental factors beyond the control of the Company. Forward-looking statements are based on certain assumptions and expectations of future events and no assurance can be given that such assumptions and expectations will prove to be correct.