Kronox Lab Sciences Ltd Management Discussions

ECONOMIC OUTLOOK

Global Economy

The global economy in 2025 is navigating a challenging and transformative period, shaped by the aftermath of the COVID-19 pandemic, technological shifts, climate imperatives, and intensifying geopolitical tensions. The world economy is projected to expand at a moderate pace, with global GDP growth expected to hover around 2.5% to 3%. However, this growth is highly uneven. Advanced economies such as the United States, the European Union, and Japan are experiencing slower growth, typically between 1% and 2%, as they grapple with high public debt, ageing populations, and the lingering effects of tight monetary policies designed to combat inflation. In contrast, emerging economies—notably India (6-7% growth) and many parts of Africa (4-5% growth)—are benefiting from favourable demographics, urbanisation, and rising consumer demand.

Inflation, a dominant concern in the early 2020s, is beginning to ease but remains above the ultra-low levels seen before 2020. Central banks, including the US Federal Reserve and the European Central Bank, continue to maintain elevated interest rates, balancing the need to control price rises against the risk of stifling growth. Meanwhile, global trade is undergoing significant shifts as countries and corporations restructure supply chains to enhance resilience, moving away from overdependence on China and toward more regionalised and diversified sourcing.

Geopolitical Risks: Israel-Palestine and Israel-Iran Conflicts

The Israel - Palestine conflict, which reignited with unprecedented ferocity in late 2023 and continues through 2025, has had profound humanitarian and economic repercussions. The conflict has destabilised parts of the Middle East, increased refugee flows, and heightened tensions across the region. The destruction of infrastructure and disruption of trade routes, particularly through the Eastern Mediterranean and parts of the Levant, have added to regional economic fragility.

These geopolitical shocks have reinforced the move toward regional trade blocks, as nations seek greater economic security and autonomy. The Middle East conflict also complicates the energy transition, as high fossil fuel prices paradoxically incentivise both greater renewable investments and short-term fossil fuel production.

Key Economic Trends 2025–2030

Looking beyond 2025, the global economy faces a period of moderate but fragile growth. The average global GDP growth through 2030 is expected to be between 2.5% and 3.2%, with substantial divergence across regions.

India stands out as a bright spot, with growth between 6% and 7%, driven by its youth population, digital infrastructure, and expanding manufacturing sector as compare to United States, EU, China, Africa and other developed and developing Countries.

By 2030, the world economy will likely be More fragmented geopolitically, Greener More digitised, More vulnerable to climate and financial shocks.

The path to 2030 will not be smooth, but opportunities exist for countries and companies that can navigate these disruptions with agility, innovation, and resilience.

Emerging Market and Developing Economies Group

In 2025, Emerging Market and Developing Economies (EMDEs) — a group that includes countries across Asia, Africa, Latin America, the Middle East, and parts of Eastern Europe — play an increasingly critical role in the world economy. Collectively, these nations account for over 60% of global GDP (in purchasing power parity terms) and more than 85% of the worlds population.

Indias Role in the EMDE Group in 2025

India stands out as one of the leading economies within the EMDE group in 2025, and increasingly, it is seen as a global growth leader. Heres a detailed snapshot:

Indias Economic Performance

• GDP growth: India is among the fastest-growing large economies, with 2025 growth projected between 6.5% and 7%.

• Drivers of growth:

o Strong domestic demand from a large, youth population.

o Rising manufacturing competitiveness, thanks to government initiatives (Make in India, PLI schemes).

o Rapid digitalisation, with India emerging as a hub for fintech, digital payments, and IT services.

o Infrastructure boom, as India scales up investments in transport, energy, and smart cities.

Indias Role in Global Supply Chains

• India is a key beneficiary of supply chain diversification as companies look for alternatives to China.

• Sectors like electronics assembly, pharmaceuticals, chemicals, textiles, and automotive components see rising global interest.

• India is positioning itself as a hub for green technologies, including solar panel production and electric vehicles.

India as a Leader in EMDE Policy

India is increasingly influential in shaping EMDE priorities in multilateral forums (e.g.,

G20, BRICS). It advocates for:

• Reform of global financial institutions to give EMDEs a stronger voice.

• Climate finance and technology transfer from advanced economies.

• Trade rules that balance development needs with environmental goals.

Outlook for EMDEs and India by 2030

• Account for two-thirds of global growth.

• Continue closing the technology and income gap with advanced economies, though progress will be uneven.

• Face heightened pressure to adapt to climate change, reform institutions, and manage debt

India is currently ranked as the 4th largest economy globally in 2025, surpassing Japan to secure the 4th position among the worlds top 10 largest economies, with a nominal GDP of $4.19 trillion in 2025. Moreover, the IMF forecasts that by 2027, India will overtake Germany to become the 3rd largest economy worldwide.

COMPANY OVERVIEW

Kronox Lab Sciences Ltd is a renowned manufacturer of high purity speciality fine chemicals, catering to a diverse range of industries including pharmaceuticals, scientific and laboratory research, nutraceuticals, biotech, agrochemicals, personal care, metallurgy, and animal health. Originally incorporated as Kronox Lab Sciences Pvt. Ltd on November 18, 2008, in Gujarat, the company transitioned to a public limited entity on May 25, 2019, and adopted its current name.

Kronox Lab Sciences Ltd boasts a comprehensive product portfolio with over 185 chemical products spanning various chemical families such as phosphate, sulphate, acetate, chloride, citrate, nitrates, nitrites, carbonate, EDTA derivatives, succinate, and gluconate. The products are available in different grades and particle sizes, ranging from 10 mesh to 100 mesh. Adhering to stringent industry standards like IP, BP, EP, JP, USP, FCC, LR, AR, GR, and ACS, Kronox ensures high-quality production. The company also accommodates custom manufacturing specifications to meet specific customer requirements.

KRONOX Lab Sciences is a distinguished manufacturer of high-purity specialty fine chemicals, with a state-of-the-art manufacturing facility strategically located near Vadodara, Gujarat, INDIA. Our company stands at the forefront of the chemical manufacturing industry, committed to delivering the highest standards of quality and purity in our extensive range of chemical products. With a highly experienced production team and a fully equipped laboratory, KRONOX Lab Sciences ensures that every product we deliver meets the stringent quality requirements of both national and international standards.

Our operations are strategically located across three advanced manufacturing units situated within a 1 km radius. This proximity allows for streamlined operations and efficient logistical management, ensuring high-quality production and timely delivery of our products. Our in-house production capabilities are robust and state-of-the-art, enabling us to maintain a high level of control over the quality of our chemicals. We have a capacity to manufacture approximately 7200 MT per annum, meeting the demands of various industries and applications worldwide.

Certifications and Standards

KRONOX Lab Sciences operates a facility that is certified under several rigorous quality management systems, including FSSC 22000, GMP (Good Manufacturing Practices), GLP(Good Laboratory Practices), and ISO 9001:2015, ISO 14001:2015, ISO 45001:2018. Additionally, where applicable, our products are certified KOSHER and HALAL, ensuring compliance with diverse cultural and religious standards. These certifications underscore our commitment to maintaining the highest levels of quality, safety, and efficacy in our products.

Commitment to Quality

At KRONOX Lab Sciences, quality is not just a goal but a fundamental part of our operations. We adhere to strict Good Manufacturing, Laboratory, and Documentation Practices that guarantee consistently high-quality results. Our state-of-the-art analytical facilities are equipped with the latest technology to monitor and maintain the strict quality of our products, processes, and services. This meticulous attention to detail ensures that we consistently meet and often exceed the quality requirements set by national and international regulatory bodies.

MANUFACTURING INFRASTRUCTURE

Our manufacturing infrastructure is a key growth driver for our business. Currently we have three units strategically located Manufacturing Facilities which are located in Padra, Vadodara, Gujarat, in close proximity to several ports including Kandla, Mundra, Hazira and Nhava Sheva which ensures that we have ready access to port facilities and are able expediently import our raw materials and export our products thereby providing us with a cost and logistical advantage. Our Manufacturing Facilities are located approximately 400 kms, 450 kms, 150 kms and 440 kms from Kandla Port, Mundra Port, Hazira Port and Nhava Sheva Port, respectively. Our Manufacturing Facilities are in proximity to DMIC and Delhi-Mumbai Expressway and have access to rail and airport facilities. Further, our Manufacturing Facilities are located in Gujarat, where some of the major APIs, pharmaceutical formulations, nutraceuticals, biotech and other application industries are located. Our Manufacturing Facilities are located in close proximity to each other, thereby ensuring greater logistic synergies and operational efficiencies.

Logistics and inventory control are both important to our margins and to customer satisfaction. We have dedicated storage area for bulk storage of raw materials and finished goods at each of our Manufacturing Facilities. Each of our Manufacturing Facilities are also equipped with a warehouse, enabling smooth functioning of our operations.

We have acquired a land at GIDC, Dahej – II AREA 20,471 square meters, where we have planned our expansion. This land falls under the chemical zone of GIDC, Dahej - II where facilities like ease in obtaining GPCB permissions, water availability, effluent discharge to CETP, enough power and PNG are available. GIDC has necessary with excellent road & connectivity to the ports in the western region of India. We plan to establish our new unit at this location

NEW UNIT AT DAHEJ

Which will add more capacity and will be used to manufacture High Purity Speciality Fine Chemicals.

o We have received the permissions for power and water for this facility from the state electricity authority and GIDC, respectively.

o We have Received the permission from CETP Department for the effluent discharge.

o We have also received the permission from BEIL for the discharge for Solid Waste.

o We have also received approval for CTE (Consent to Establish) from GPCB (Gujarat Pollution Control Board).

o We have also received approval from

GIDC for the Plant Drawing.

o We have applied for Environmental Clearance which is pending from Central Government

We plan to diversify our product offerings by manufacturing High Purity Speciality Fine Chemicals like acetate, adipate, ascorbate derivatives, aspartate derivatives, benzoate, citrate derivatives, EDTA derivatives, gluconate derivatives, glycinate derivatives, lactate, malate derivatives, orotate derivatives, propionate, sorbate derivatives and succinate once our new unit is established at GIDC, Dahej – II.