CAUTIONARY STATEMENT

The Management Discussion and Analysis sections contain the Companys objectives, projections, estimates and expectations may constitute certain statements, which are forward-looking within the meaning of applicable laws and regulations. The statements in this management discussion and analysis report 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 price conditions in the Government policies, tax regimes, forex markets, economic developments within India and the countries with which the Company conducts business, political factors and such other factors beyond the control of the Company.

COMPANY OVERVIEW

Our Company was incorporated on June 15, 2012 in Ambala, Haryana as a Private Limited Company. In 2017 the Company was converted into Public Company and subsequently overtime got listed in NSE and then in BSE. The Company is a manufacturing and trading organization having its production/refining plant of Edible Oils. Our manufacturing and trading process involves dealing in Refined Rice Bran Oil, Canola Oil, Soya Bean Oil, Sunflower Oil and Rice Bran Bleached Oil. During the refining process certain by-products are also manufactured such as Rice Bran Fatty Acid Oil, Rice Bran Wax, Gums and Spent Earth which are also saleable. Our company is focused at production of highest quality of edible oil. Our refinery is completely mechanized and today we produce rice bran oil, with controlled fiber free from oil residue, ash and sand & silica. This is possible only through sustained levels of cleaning, storage and monitoring arrangements. Our Company based on its extensive experience of its promoters and its standards, conforms to major specifications and customer requirements. We firmly believe in benchmark product quality, customer centric approach, people focus, ethical business practices. By way of periodical expansion, MKPL has increased its production capacity from time & again to cater to changing business environment & varied customer needs. The companys turnover has increased manifold over time and is expected to grow substantially in subsequent years.

INDUSTRY STRUCTURE, DEVELOPMENTS AND OUTLOOK

The edible oil manufacturing industry in India is highly fragmented, with numerous players catering to diverse consumer preferences and regional demands. The industry is characterized by intense competition, price volatility of raw materials, and evolving regulatory norms. Our company operates in this dynamic environment and has adapted its strategies to capitalize on emerging opportunities.

At present, India is the worlds largest importer of edible oil. Over the past six decades, the per capita consumption of edible oils in India has substantially increased. It now stands at approximately 19 kg per year. Factors such as rising disposable incomes, urbanisation, evolving dietary preferences and the expansion of the food processing sector have led to a heightened demand for edible oils in India. To meet this burgeoning domestic demand, India imports approximately 16 million metric tonnes of edible oils every year. In the first seven months of the 2024-25 (November-May), imported edible oil totalling 76.77 lakh tonnes. The agricultural sectors expansion, coupled with various initiatives aimed at augmenting oilseed production nationwide is further driving the market for edible oils in India.

We have witnessed significant progress in terms of market penetration and brand recognition in the past. Our commitment to quality and continuous improvement has helped us gain customer trust and loyalty. Looking ahead, we aim to expand our distribution network, explore new product categories, and invest in technology to enhance productivity and sustainability.

The Indian economy has displayed resilience amidst global uncertainties and internal challenges. The governments focus on infrastructure development, ease of doing business, and reforms in the agricultural sector has positively impacted our industry. However, macroeconomic factors such as inflation, exchange rate fluctuations, and policy changes need to be closely monitored.

INDIAN ECONOMIC OVERVIEW

India continues to be one of the fastest-growing major economies globally and is increasingly emerging as a leading consumption and investment destination. With nominal GDP projected to reach approximately US $8.9 trillion and per capita GDP expected to cross US $5,000 over the next decade, the country is witnessing a structural shift from need-based consumption towards aspirational and lifestyle-led spending.

Per capita spending on packaged foods has increased from approximately 4,800 in 2020 to 7,600 in 2025, and is expected to continue growing steadily over the coming years. Several structural factors, including rising household incomes, rapid urbanisation, increasing participation of women in the workforce, nuclearization of families and a young digital-native population, continue to reshape consumption patterns.

The growing preference for convenience, health and quality, coupled with increasing adoption of organised retail, e-commerce and quick commerce, is accelerating the shift towards branded and packaged staples. At the same time, the rapid expansion of upper-middleclass and affluent households is driving premiumisation across food categories, creating significant long-term opportunities for trusted brands and organised food companies.

GLOBAL OVERVIEW

The global economy remained resilient during FY26 despite continuing geopolitical uncertainties, supply chain disruptions and volatility across commodity and financial markets. While Inflationary pressures moderated across several major economies, growth remained uneven amid evolving trade dynamics, fluctuating energy prices and shifting monetary policy environments. Against this backdrop, global food consumption continued to demonstrate structural resilience, supported by population growth, urbanisation and increasing consumer preference for trusted and value-added food products. Companies with diversified sourcing networks, integrated operations and strong risk management capabilities remained better positioned to navigate market volatility and capitalise on emerging opportunities.

OPPORTUNITIES AND THREATS

The continued expansion of Indias food and FMCG market presents significant opportunities for companies like ours to achieve steady growth in both revenue and profitability. With marketers increasingly tapping into rural India through modern retail formats such as haats, the potential for deeper market penetration is expanding rapidly. Rising income levels have fuelled greater spending on value-added and branded products, including edible oils. Affordable innovation will be key to helping more consumers access and adopt our offerings. Additionally, growing demand for edible oils—driven by a rising population and improved economic sentiment post-pandemic—remains a major growth driver.

The rise in lifestyle-related health issues, especially heart and cardiovascular diseases, has sparked a shift in consumer preference toward healthier oils. This creates a strong opportunity for companies offering heart-friendly options like rice bran, canola, and sunflower oils. At the same time, increasing competition from both domestic and global players continues to be a challenge, but we are well-prepared to respond through agility and innovation. Indias young and growing urban population—projected to rise from 31% in FY2011 to 36% by FY2036—will further drive food consumption trends.

Meanwhile, the ongoing digitization of commerce presents both opportunities and risks. It allows us to target and serve customers more efficiently but also lowers the entry barrier for smaller players leveraging digital platforms. A consistent rise in edible oil imports to bridge the demand-supply gap has contributed to trade imbalances and foreign exchange outflows. Strengthening domestic oilseed production and productivity is essential to reduce dependency on imports and achieve long-term supply sustainability. The sector also faces direct risks from fluctuating raw material prices, which are influenced by environmental factors, crop conditions, and geopolitical issues. Monsoon patterns, global production of soybean, mustard, and palm oil, and policy changes on interest rates and import duties continue to affect input costs and margins. Despite these challenges, the widening gap between domestic production and consumption is creating long-term demand. With thoughtful strategic planning, focus on innovation, and continued investment in brand and supply chain, the Indian edible oil industry is well-positioned to tap into its strong growth potential while managing emerging risks.

RISKS AND CONCERNS

In our edible oil business, majority of raw material comes from imports. Geo-political events can cause supply disruptions, exporting countries government can put restrictions on exports. Weather conditions can result in reduction of crop production.

Other operational factors include operating efficiency, product diversity, market position, and ability to secure raw material as well as the commodity price and forex-risk management systems. Risk financial position and returns metrics, capital structure, ability to generate positive cash flows from operations and the adequacy of the same in relation to its contractual debt service obligations.

There can be increase in taxes on import of crude edible oil. There can be restriction on the quantity that any Company can import. This can put a large Company like us at a disadvantage compared to our competitors.

Your Company is exposed to commodity price fluctuations in its business the edible oil prices in India are directly correlated to international oil price movements and currency movements that make profitability vulnerable to unexpected fluctuations.

Risks are an integral part of any business environment and it is essential that we create structures and processes that are capable of identifying and effectively mitigating them. For us, the risks are multi-dimensional and therefore we look at it in a holistic manner, straddling both, the external environment and the internal processes. These risks can be broadly classified into following categories: Strategic Risk, Compliance and Governance Risk, Financial Risk, Environmental Risk, Operational Risk and Social Risk.

Further, Key risks for the edible oils sector include risks from change in import-export regulations; change in the minimum support price (MSP) on oilseeds offered by the government; high dependence on monsoons and finally, the risk arising out of exchange rate fluctuations. Procurement of oilseeds at the right price and quantity, optimum utilization of processing units, their strategic location, a strong brand name and diversification of product offerings are likely to be the key success determinants for players.

Increase in the number of competing brands in the marketplace, counter campaigning and aggressive pricing by competitors have the potential to create a disruption.

Changing consumer preference and Demand can be adversely affected due to shift in consumer preferences, especially those induced by the pandemic. Given the potential of social media, the speed of such a shift could be unparalleled.

The key determinants of business risk profile of the company are their ability to overcome the regulatory risk and agroclimatic conditions. Other operational factors include operating efficiency, product diversity, market position, and ability to secure raw material as well as the commodity price.

The profitability of edible oil companies is significantly influenced by regulatory changes and remains highly susceptible to the changes in the duty differential between import duties on crude and refined oil by the Government of India (GOI).

Also, the profitability of these companies depends on the changes in the export tax levied by exporting countries, mainly Indonesia and Malaysia (that account for most of palm oil imports).

DISCUSSION ON FINANCIAL PERFORMANCE WITH RESPECT TO OPERATIONAL PERFORMANCE

The financial statements have been prepared in compliance with the requirement of the Companies Act, 2013 and Indian Accounting Standards of India (Ind AS). During the year under review, the company reported profit of Rs. 9,38,86,716.28/- before tax adjustments as compared to profit of Rs. 11,45,10,060.77/- before tax adjustment in the previous year.

The companys revenue increased to INR 3,82,87,51,812.54/- during FY 2025-26 from INR 2,67,70,59,633.37 for the same period ending FY 2024-25.

The Company achieved robust revenue growth of 43.02% during FY 2025-26, with revenue increasing from ?2.68 billion to ?3.83 billion. Despite this strong top-line performance, Profit Before Tax (PBT) and Profit After Tax (PAT) declined by 18.01% and 18.50%, respectively. The reduction in profitability was because of increased operating costs, finance costs, depreciation, or other expenses. Going forward, the Company will focus on improving operational efficiency, optimizing costs, and enhancing margins to translate strong revenue growth into sustainable profitability.

The company does not have any other segments.

KEY FINANCIAL RATIOS

[Pursuant to Schedule V (B) to the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015]

Financial Ratio	FY 25-26	FY 24-25	% change	Reasons for change
Debtors Turnover	216.52	107.60	101.23%	Trade Receivables Turnover ratio increase due to reduction in average trade receivables and increase in revenue
Inventory Turnover (in times)	3.44	2.81	22.42%	-
Interest Coverage Ratio (in times)	6.07	11.36	(46.57%)	The decrease was primarily attributable to a significant increase in finance costs, coupled with a reduction in operating earnings (EBIT).
Current Ratio	2.25	2.01	11.94	-
Debt Equity Ratio (in times)	0.47	0.54	(12.96%)	-
Net Profit Margin %	1.80%	3.14%	(42.68%)	Net Profit ratio decrease due to decline in profitability despite increase in revenue from operations.
Return on Net worth	8.96%	12.07%	(25.77%)	Due to decrease in profit for the year

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Company has established internal control systems for ensuring optimum use of resources and safeguarding the assets. The Internal Control Systems and procedure are adequate and commensurate with the size of the Company.

These are routinely tested and certified and which covered all offices, factories and key business areas. The Internal audit team reviews the quality of planning and execution of all ongoing projects and activities involving significant expenditure to ensure that management controls are adequate to yield value for money. Though the various risks associated with the business cannot be eliminated completely, all efforts are made to minimize the impact of such risks on the operations of the Company.

These business control procedures ensure efficient use and protection of the resources and compliance with the policies, procedures and status. Based on its evaluation (as defined in section 177 of Companies Act 2013), our audit committee has concluded that, as of March 31, 2026, our internal financial controls were adequate and operating effectively.

HUMAN RESOURCE MANAGEMENT

The Company recognizes the importance and contribution of its human resources for its growth and development and is committed to the development of its people. At MKPL equal importance is given to the development of the Companys human resource.

The Company considers its employees to be the most valuable asset and is committed to provide a conducive work environment to enable each individual to fully realize his or her potential. The human resource programmes focus on strengthening key areas of Enhancing individual and organization readiness for future challenges. Management is investing in enhancing technical and managerial skills of employees for building competencies needed for growth plans. Our business review & performance improvement process continues to put focus on performance and periodic review of each of our businesses and individuals.

The Company has cordial relations with employees and staff. There were no industrial relations problems during the year and the Company does not anticipate any material problems on this count in the current year.

The Company had 54 employees as on March 31, 2026.

For M K Proteins Limited

Sd/- Parmod Kumar Managing Director (DIN: 00126965)