Krishival Foods Ltd Management Discussions

The Company is into the business of processing, selling and trading of dry fruits and nuts.

The key issues of the Management Discussion and Analysis are given hereunder:

Industry Structure and Development

This is fourth financial year post the start of covid epidemic. Global commodity prices have been stabilizing and this is helping company with reduced input cost for raw materials. Due to shortage of raw nuts especially in cashews, there is good demand from domestic and global market. With Indian Economy growing above 8%, the consumption story is intact with robust consumption especially in packaged food segments. Post covid, there has been surge in preference for healthy foods and this tail wind is helping company while scaling up. Nuts and dried fruit industry has been growing continuously in recent times and this year was not exception.

Discussion on financial performance with respect to operational performance

Krishival Foods Limited (formerly known as Empyrean Cashews Limited) was originally incorporated in 2014 and has commenced operations in the same year under the name and style of the brand "Krishival". Our Company is engaged in processing nuts and dried fruits into finished kernels in different flavours.

Segment-wise or product-wise performance

The Company is into single reportable segment only.

Outlook

Krishival Foods Limited (formerly known as Empyrean Cashews Limited) remains confident of the long-term growth prospects & opportunities ahead of it in its business.

Internal control system and adequacy

The system of internal control has been established to provide reasonable assurance of safeguarding assets, maintenance of proper accounting records in compliance with applicable Laws and Regulations to ensure reliability of financial statement and reports. The Statutory Auditors and the Audit Committee review all financial statement and ensure adequacy of internal control systems.

Opportunities and Threats

India has been witnessing good jump in discretionary spend. This trend will continue as Indias per capita income will maintain its upward trajectory from USD 2700 to USD 6000. India is on the cusp of new consumption boom from aspirational middle class. This augurs well for nuts and dried fruit segment. Company has been expanding its reach in tier 2 and

tier 3 towns across India. The brand Krishival has been present in more than 100 towns and places across India. The company will keep expanding its presence across India. The company has started export of its nuts and dried fruits to Singapore. The products like Almonds, Salted Almond, Cashew, Salted Cashew, Salted & Roasted Pistachio have been made available across many retail stores and super markets in Singapore. These products are being sold under the brand name krishival across Singapore. The epidemic like Covid- 19 and external global security situation like Ukraine war, Israel war can be attributed as major threats.

Risks Management

Risk evaluation and management of risk is an ongoing process in the company.

Human Resources

Since your Company is in to the business of processing, selling and trading of dry fruits and nuts, the criticality of talented man-power and their retention needs no emphasis. Your company is in the process of working out a comprehensive plan to attract, motivate and retain highly skilled and technically competent man-power.

Details of Significant Changes

- Debtors Turnover: 0.08

- Inventory Turnover: 2.18

- Interest Coverage Ratio: 7.07

- Current Ratio: 17.14

- Debt Equity Ratio: 0.05

- Operating Profit Margin: 20.93%

- Net Profit/Loss Margin: 10%

Details of change in Return on Net Worth as compared to immediately previous financial year along with the detailed explanation thereof

-Return on networth

FY 2020-21: 3.43%

FY 2021-22: 8.04%

FY 2022-23: 12.63%

Cautionary Statement

Statements in the Management discussion and analysis describing the companys objectives, projections, estimates and expectations may be "forward looking statements" within the meaning of applicable laws and regulations. Actual results could differ materially from those expressed or implied. Important factors that could make a difference to the companys operations include economic conditions affecting demand/supply and prices,

conditions in the domestic and overseas markets in which the company operates/ going to operate, changes in government regulations, tax laws and other statutes and other incidental factors.