Manali Petrochemicals Ltd Directors Report

The Directors present their 39^th Annual Report on the business and operations of your Company and the Audited Financial Statements for the year ended 31^st March 2025.

Financial Results

The highlights of the financial results for the year are given below:

( Rs. in crore)

Description	Standalone	Consolidated
	2024-25	2023-24	2024-25	2023-24
Total Income	669.27	822.06	921.63	1,061.51
Interest	9.33	8.03	10.45	9.60
Depreciation	23.59	21.27	27.09	25.32
	(9.77)	(7.58)	42.05	33.35
Provision for Taxation	(1.03)	1.67	12.74	14.14
(Loss)/Profit After Tax	(8.74)	(9.25)	29.31	19.21
Total Comprehensive Income	(8.87)	(9.47)	45.66	30.25

Operational Highlights

During the financial year, your Company reported a total income of Rs. 669 crore, reflecting a decline of approximately 18% compared to the Rs. 822 crore recorded in the previous financial year (FY 2023–24).

This downturn was primarily driven by challenging market conditions, which remained unfavourable throughout the year. A major factor contributing to the decline was the significant surge in cheaper imports throughout the year, which adversely impacted the competitive landscape. This influx of low-cost import material availability led to a sharp erosion in sales volumes and revenue realization, putting pressure on margins and overall profitability.

Despite these headwinds, your Company remained focused on operational efficiency, cost optimization and strategic customer engagement to navigate the volatile business environment. During the year under review, the sales volume of Propylene Glycol (PG) remained largely consistent with the levels achieved in the previous financial year, reflecting stable demand in its core end-use sectors such as pharmaceuticals, food, and personal care.

In contrast, sales volume and value of Slabstock Polyol witnessed a notable decline, which adversely affected the overall revenue performance. This dip was attributed to a combination of market-specific factors, including intensified price competition due to the influx of low-cost imports and volatility in raw material prices, which impacted pricing dynamics and customer procurement behaviour.

These factors collectively exerted pressure on margins and contributed to the overall decline in topline revenue, despite steady performance in the PG segment.

Capital Investments and Project Progress

During the year, the Company made total additions to fixed assets amounting to Rs. 15.99 crore, with most of the capital expenditure directed towards the procurement and installation of plant and equipment aimed at enhancing operational capabilities and capacity.

A significant portion of this investment was utilized towards Propylene Glycol (PG) expansion project, which has now reached the final stages of commissioning. The expanded PG facility was inaugurated on 16^th July 2025 and also received Consent to Operate from the Tamil Nadu Pollution Control Board (TNPCB). This expansion is poised to significantly strengthen the Company?s market position by increasing production capacity and improving supply reliability for key customers across industries.

Update on New manufacturing facility in western India

As part of long-term sustainable growth strategy, your Company is in the process of establishing a new manufacturing facility in the western region of India to expand its geographic footprint and enhance supply chain efficiency.

A strategically located land parcel measuring 40,000 square meters has been acquired at the Saykha Industrial Estate, which has been developed by the Gujarat Industrial Development Corporation (GIDC) to support large-scale industrial projects.

The final land transfer order has been successfully obtained in the name of the Company marking, a key milestone in the project development phase. The previous Environmental Clearance (EC) held by the earlier land allottee has been formally surrendered and approved by the State Environment Impact Assessment Authority (SEIAA), Gandhinagar. Building on this, your Company is now actively progressing towards securing a fresh Environmental Clearance (EC) and Consent to Establish (CTE) for its proposed facility.

In parallel, your Company is coordinating with various regulatory and statutory bodies to obtain all required permissions and approvals as applicable to ensure the timely execution and commissioning of the project in accordance with compliance norms and sustainability objectives.

Financial Review

During the Financial Year 2024-25, the finance cost has increased to Rs. 9.33 crore from Rs. 8.03 crore in FY 2023-24. The finance cost on lease increased from Rs. 6.89 crore in FY 2023-24 to Rs. 7.13 crore in FY 2024-25. The actual interest and related payout for the year was only Rs. 2.19 crore against Rs. 1.15 crore in previous year.

The capital expenditure for projects including for the PG expansion Project are being/will be met from internal sources/borrowing from banks. During the Financial Year, the Company has been sanctioned with a term loan facility of Rs. 50 crore out of which the company has availed Rs. 20 crore as at 31^st March 2025.

Credit Rating

During December 2024, Care Ratings Limited assigned and re-affirmed the ratings for banking facilities aggregating to Rs. 125 crore. For long term bank facilities of Rs. 75 crore, the rating has been assigned and reaffirmed at CARE A+; Stable (Single A Plus; Outlook: Stable) and CARE A+; Stable / CARE A1+ (A One Plus) for short-term bank facilities of Rs. 50 crore.

Dividend

Your Company has a consistent dividend track record of 19 years till the last year and follows a consistent dividend policy to ensure that dividend payments are sustained even when the earnings are relatively lower. In this regard, parameters for distribution of dividend have been outlined in the Dividend Distribution Policy approved by the Board, pursuant to Regulation 43A of the SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015, as amended ("the Regulations"). The policy can be accessed on the website of the Company in the link: https://www.manalipetro.com/ investors/policies/ As regards the distribution for the year under review, to determine the amount that could be paid out to the shareholders as dividend, the Directors have followed the guidelines enumerated in the said policy and also considered other relevant factors, such as profitability of the relevant financial year, plans for long term deployment of the funds: - including projects under implementation, drastic changes in the domestic and global market scenario.

- throwing up questions on the sustenance of the sales, pricing and higher margins and similar facts.

Considering all these developments, your Directors are happy to recommend a dividend of 10% i.e., fifty paise per equity share of Rs. 5/- each fully paid-up, for the financial year 2024-25, aggregating to Rs. 8.60 crore, subject to applicable withholding tax.

Industry Structure and Development

Your Company operates in the Polyurethanes (PU) industry. PU is a class of polymer characterized by carbamate or urethane linkages in their molecular structure. They are typically formed by the chemical reaction of polyol and isocyanates. Although the materials with urethane linkages are classified as Polyurethanes; by varying the structure of polyols and isocyanates a wide array of material can be synthesized from a big spectrum of properties. Polyols are typically any polymer that has two or more hydroxyl groups in the end. This allows to design polymers with different back bones like polyether, polyester, polycarbonate, hydrocarbons and many more polymer materials with terminal hydroxyl group can be used as polyols in making polyurethanes. Similarly, there is design freedom on the isocyanate as well as we can choose from aliphatic, aromatic and even prepolymers with terminal isocyanate groups can be used to make polyurethanes. This tunability in the chemistry allows the manufacturers to engineer materials that are very soft to very hard structural material that can compete with steel. Hence polyurethane finds application in various areas like rigid insulation panels, composite structural materials, engineering elastomers, pillows, beddings, and visco- elastic memory foams any many more areas.

Due to its diverse properties and forms, PU finds applications in rigid and flexible foams, fibres, films, composites, elastomers coatings, and adhesives. It serves a broad range of industries, including automotive, appliances, building and construction, energy, defence, paints and coatings, and soft furniture.

PU is used across numerous consumer and industrial applications, including thermal insulation in buildings, refrigerators, household furniture, footwear, and packaging materials. It offers unique properties such as abrasion and wear resistance, elongation, resilience, flexibility, scratch resistance, mechanical strength, adhesion, and both thermal and electrical insulation. These properties enable PU to be moulded into various shapes, enhancing its industrial applications by providing comfort, style, and functionality.

The global PU market is experiencing steady growth, driven by demand across multiple industries including construction, automotive, furniture, electronics, and packaging. According to recent market research reports, the global PU market is projected to grow from approximately USD 87 billion in 2023 to USD 114 billion by 2030, achieving a CAGR of about 5% during this period.

In contrast, Indias PU market is experiencing significantly faster expansion. Currently valued at around USD 5 billion, the Indian PU market is expected to nearly double to USD 9 billion by 2030, reflecting a CAGR of approximately 9.4%. This growth rate is nearly twice the global average, positioning India as a key strategic market for both domestic and international PU manufacturers. One critical indicator of this untapped potential is per capita PU consumption. In India, per capita usage ranges from 500 grams to 1 kilogram, substantially lower than the global average of 7 to 8 kilograms per person. This wide gap illustrates the considerable headroom for growth in India, especially as economic development, industrialization, and lifestyle evolution continue to expand.

Additionally, the increasing demand for high-performance, lightweight interior components and cushion foams in automotive parts for energy savings further drives the expansion of the polyurethane market.

Products of MPL

Your Company specializes in the manufacture of Propylene Glycol, Polyether Polyol, Polyester Polyols and related polymers. It is the sole domestic producer of Propylene Glycol and the first and largest Indian manufacturer of Propylene Oxide, a vital raw material in the synthesis of both PG, Polyols and its derivative products.

Propylene Glycol (PG):

A versatile material with wide industrial application, is produced by reacting Propylene oxide molecules with water. This reaction gives predominantly PG along with Di Propylene Glycol (DPG) and Tri Propylene Glycol (TPG) as by products. Both DPG and TPG has its own industrial applications. PG is highly miscible with water and other solvents. It is also an exceptional solvent with unique combination of safety and stability over wide temperature and PH range. The high purity version, the pharma grade finds industrial applications in pharmaceuticals, food Industry, cosmetic and personal care products and fragrance and flavour industries whereas the industrial grade is used in paint and various polymer resin manufacturing industries.

Your company supplies both food and pharmaceutical grade PG, which plays a crucial role as a solvent, humectant, and carrier in pharmaceuticals, food processing, cosmetics, and personal care sectors that have historically relied heavily on imports.

Beyond these uses, PG has significant industrial applications, including in paints and coatings, polymer resins, carbonless paper production, and automotive products such as brake fluids and coolants. These applications are driven by its low toxicity, chemical stability, and biodegradability.

Additionally, the by-products viz., DPG and TPG are also serving as a valuable solvent or preservative in food, flavour, and fragrance industries.

Other products from your Company include Propylene Glycol Mono Methyl Ether (PGMME), an environmentally friendly, high-solvency solvent increasingly used in paints, coatings, and the electronics industry, reflecting growing customer demand for safer and more sustainable alternatives. Polyols: The other important product for your company is Polyols. They are produced in four grades viz., Flexible Slab-stock, Flexible Cold Cure, Rigid and Elastomers. They are utilized across various industries including automotive, refrigeration and temperature control, adhesives, sealants, coatings, furniture, and textiles. The use of Polyols is also expanding in footwear and roofing applications in India. With increase in focus for systems, the Polyols are currently used to make system polyols and along with suitable isocyanates marketed to end customers. However, the commodity segment of Slab stock polyol still forms the backbone of your company?s polyol production.

Apart from the Propylene-based Polyol, your company has invested in Polyester Polyol manufacturing in the fourth quarter of last financial year. Polyester Polyols are hydroxyl-terminated polymers formed through the polycondensation of diacids (or anhydrides) with diols. Common raw materials include adipic acid, phthalic anhydride, and ethylene glycol. These Polyols serve as key building blocks in the production of PU materials and other resins. They find applications majorly in ink industries, footwear and rigid PU industries. Currently the Polyester Polyol is produced for captive consumption however there are efforts to sell the Polyester Polyols for other potential buyers. The second phase of this investment is currently under technical discussion and is expected to be commissioned by the end of the current fiscal year. Your Company continues to demonstrate technical leadership with the development of innovative, market-responsive products. The company?s new fire-resistant PIR (polyisocyanurate) foam addresses rising safety standards in construction panels, while the launch of alternatives to phased-out blowing agents has safeguarded Company?s position in the thermoware market.

Through continuous innovation, supply reliability, and a focus on reducing India?s dependency on imported specialty chemicals, your Company?s serves as a strategic partner to large and emerging industries alike. Its growing product portfolio, spanning core materials and environmentally responsible derivatives, positions the company at the vanguard of India?s evolving chemical manufacturing ecosystem.

Indian Market Scenario

The Indian PU industry has witnessed consistent growth, fuelled by factors such as rapid urbanization, increasing disposable incomes, evolving consumer preferences, and the availability of flexible credit and financing options. Products like refrigerators, mattresses, and other PU-based lifestyle goods are no longer considered luxuries but everyday essentials, driving sustained demand across residential and commercial segments. In parallel, the construction and cold-chain industries are accelerating the adoption of high-performance insulation materials, particularly in the continuous and discontinuous panel segments, in response to emerging energy-efficiency regulations and sustainability mandates.

Despite the growth in downstream PU applications, India continues to rely heavily on imports for key raw materials, particularly Polyols and PG. The domestic market for these critical inputs remains underdeveloped, constrained by limited indigenous production capacity. Throughout the review period, the demand for both PG and Polyols exhibited cyclical fluctuations due to macroeconomic conditions and sector-specific dynamics.

Anticipating the imposition of Anti-Dumping Duties (ADD) on slabstock products, imports surged in the second half of the fiscal year, compounded by steadily rising feedstock prices, which have eroded product margins.

Opportunities and Threats

The PU industry continues to present significant growth opportunities globally and in India, owing to its superior functional and insulation properties, versatile applications, and its critical role in enabling energy-efficient and innovative product designs. With ongoing product innovation and rising demand across sectors such as construction, automotive, appliances, and lifestyle products, the PU industry is evolving rapidly. The development of specialty grades and system-based solutions continues to open new and higher-margin market segments. India remains an underpenetrated market in terms of per capita PU consumption, offering considerable long-term growth potential.

However, despite the positive market outlook, your Company faces several key challenges. A major threat is the growing influx of low-cost imports, particularly in the commodity segments such as Slabstock Polyols and Propylene Glycol, which has exerted significant pricing pressure and eroded margins. The situation was exacerbated during the year under review due to global macroeconomic volatility, sluggish international demand, and geopolitical tensions. These factors contributed to excess global supply which was redirected into the Indian market. In the absence of sufficient anti-dumping safeguards, India became a preferred destination for excess inventories, leading to substantial declines in domestic product prices and intensified competition. As a result, the Company experienced a sharp dip in profitability in select product categories.

To mitigate these external challenges, your Company has undertaken a strategic shift in focus from commoditised markets to specialized, high-value-added segments. Leveraging R&D and customer partnerships, your Company is actively developing system-based PU solutions tailored for niche applications. Progress in this direction during the last quarter of FY 2024–25 has been promising, laying the foundation for stronger performance and market differentiation in the upcoming fiscal year. The Company aims to expand its presence in the systems business, which offers better pricing stability, customized solutions, and long-term strategic customer relationships.

Additionally, the Companys global subsidiaries are providing strategic leverage. The alignment of Notedome Ltd., UK and PennWhite Ltd., UK—both wholly owned step down subsidiaries with Company?s green-chemistry and ESG-focused product roadmap is creating synergies that support technology and knowledge transfer across operations. The successful production of cast elastomers products at the Companys Chennai facility has enabled market entry into Southeast Asia and reinforced Company?s international growth ambitions.

To counter cost pressures, your Company is also pursuing structural cost optimization strategies, including increased use of renewable energy, adoption of energy-efficient utility systems, and process efficiency improvements. While the Company continues to explore relief through anti-dumping frameworks and policy advocacy, such measures are expected to offer only partial and potentially temporary relief. Accordingly, efforts remain focussed on value engineering, operational efficiency, and portfolio diversification to enhance overall resilience and profitability.

While the near-term environment remains challenging due to global oversupply and increasing import competition, Company?s proactive strategic shift towards differentiation, innovation, and sustainability positions it well to capture emerging opportunities and navigate headwinds effectively.

Risk Management Policy and Process

The Company has established a structured framework for addressing business risk management issues. A risk management plan has been framed, implemented and monitored by the Board through the Risk Management Committee of Directors (RMC).

The Company has two employee-level Committees viz., a Sub-Committee and an Apex Committee, headed by the Managing Director & CEO - MPL Group to review and assess the risks that could affect the Company?s business. The SubCommittee brings out the matters that could affect the operations and the Apex Committee determines the issues that could become business risks. The mitigation actions are also suggested by the Committees and the report of the Head of the Apex Committee is submitted to the RMC. The RMC meets periodically, reviews the reports, recommends and monitors actions to be taken in this regard.

The Risk Management Committee constituted by the Board fulfils the requirements as specified in Regulation 21 of the SEBI Listing Regulations, 2015. The details of the composition of the Committee, meetings and other relevant information are furnished in the Corporate Governance Report (CGR) annexed to this Report.

As per the amended Regulations, a Risk Management Policy has been framed and the roles and responsibilities of the Committee are as prescribed under the Regulations. As required under Section 177 of the Act, the Audit Committee also reviews the risk management process periodically.

Risks and concern

The Indian PU industry continues to rely heavily on imported raw materials, particularly polyols and propylene glycol. Despite your Company meeting approximately 10% of the domestic PU demand, aggressive competition from global players coupled with low-cost imports pose serious challenges to market dynamics. Several international suppliers have established large-scale storage hubs at Indian ports, reinforcing their direct-to-market capabilities and exerting downward pressure on prices. In the absence of effective anti-dumping duties or safeguard measures, multinational corporations are benefiting from economies of scale and global supply alliances able to sustain undercut pricing strategies, thereby impacting the profitability of domestic manufacturers.

The situation is further complicated by ongoing partnerships being explored between multinational players and Indian refiners aiming to secure a share of the polyol market. Should these alliances materialize, the market could see excessive supply, putting further strain on margins unless domestic demand sees proportional growth or import volumes are rationalized. The market concentration globally, with a few large players controlling over 60% of PU raw material capacity, enhances the strategic and pricing control wielded by global majors—limiting domestic players negotiating power and pricing flexibility.

In addition to market pressures, the chemical and petrochemical sectors face growing scrutiny from environmental advocacy groups, some of which lack a data-based understanding of industrial processes. Public campaigns and misinformation on social media sometimes impede regulatory clearances and delay investment cycles. Suggestions such as the blanket implementation of Zero Liquid Discharge (ZLD) systems. Though environmentally progressive, it may pose significant practical and financial challenges. These systems are capital-intensive and may not be technically feasible across all chemical manufacturing setups, especially for marine discharge operations.

In this context, your Company?s ability to expand upstream feedstock capacities has been constrained, potentially leading to greater reliance on imports and long-term dilution of pricing power. Nonetheless, your Company remains committed to environmental stewardship and has actively engaged with CSIR–NEERI to evaluate the technical and economic viability of adopting partial or full ZLD frameworks. The outcome of this study, expected by Q2 FY 2025–26, will determine the roadmap for compliance, and your Company is prepared to make phased investments in line with statutory requirements.

Your Companys upgraded bio-based effluent treatment systems continue to comply with all permitted marine discharge norms, demonstrating its commitment to sustainable operations. However, given the inherent limitations of biological systems over extended durations, Company is continuously tracking emerging treatment technologies and global benchmarks to ensure ongoing compliance and operational resilience.

Supporting its broader decarbonization strategy, your Company achieved a key milestone by successfully transitioning both its Plant-1 and Plant-2 to Regasified Liquefied Natural Gas (R-LNG) as the exclusive thermal energy source. This shift, facilitated by the introduction of Low NOx burners, significantly reduces greenhouse gas emissions and aligns with national and global climate goals. In recognition of these proactive sustainability initiatives, the Company has been granted a renewed Consent to Operate (CTO) valid until March 2027.

Operationally, your Company continues to engage with the Government of Tamil Nadu regarding the lease renewal for Plant-2, which expired in 2017. The application had been submitted well in advance, and the Company has since maintained continuity in good faith by remitting lease payments on schedule. Constructive engagement with concerned authorities is ongoing, and your Company is hopeful for an expedited resolution. Your Company continues to navigate a highly competitive and regulated operating environment. market risks, environmental compliance pressures, and raw material supply challenges remain key concerns. However, the Company?s sustained focus on cost optimization, sustainability, product innovation, and strategic collaborations positions it well to mitigate these risks, unlock new growth opportunities, and secure long-term value for stakeholders.

Outlook

According to the April 2025 International Monetary Fund (IMF)-World Economic Outlook and recent

OECD assessments, global economic conditions remain subdued. Persistent uncertainty, heightened trade and geopolitical tensions, and inflationary pressures have resulted in moderate global GDP growth projections of 3.3% for both 2025 and 2026. This tepid outlook reflects stable but restrained expansion, with advanced economies maintaining resilience due to steady private consumption despite broader global challenges.

Inflationary pressures are abating in 2025, providing some optimism after several years of volatility. The average global inflation rate is expected to decline to approximately 4.2%, an improvement over recent years. While developed countries are drawing nearer to their long-term inflation targets, emerging markets continue to contend with elevated costs arising from structural issues. Barring unexpected disruptions, inflation is anticipated to remain within manageable bounds moving forward.

Indian Economic Outlook

India is poised to remain a standout performer among major economies in 2025. The IMF forecasts India?s GDP to expand by 6.2% this year, making it one of the world?s fastest-growing large economies. This robust momentum is underpinned by vigorous domestic consumption, increased government investment in infrastructure, and policy initiatives promoting private sector engagement.

Inflation in India has eased notably, reaching a multi-year low of 2.82%. Rural consumption is recovering, driven by favourable monsoon conditions and improved agricultural production. Urban demand also remains strong, supported by rising activity in travel, hospitality, and real estate sectors. Export performance has stayed stable, particularly in services, despite ongoing global trade challenges. Growth in manufacturing, renewable energy, digital services, and specialty chemicals is being propelled by supportive government policies, such as the Production Linked Incentive (PLI) scheme, and a growing emphasis on ESG-driven (Environmental, Social, and Governance) investments.

While India?s economic outlook is positive, several risks persist including global instability, rising energy prices, export volatility and other related matters.

A significant development impacting the domestic PU market has been the anticipation and announcement of Anti-Dumping Duties (ADD) on slabstock polyols. Following concerted efforts, your company filed an application with the Directorate General of Trade Remedies (DGTR), resulting in the DGTR announcing ADD on slabstock products on 28^th March 2024. However, the final approval by the Ministry of Finance could not be obtained. Your Company has filed fresh ADD application on 28^th January 2025 covering China, Thailand and Saudi Arabia and expecting a positive response.

Subsidiaries

As on 31^st March 2025, the Company has 2 (Two) Wholly Owned Subsidiaries (WOS) and 4 (Four) Step Down Subsidiaries (SDS). The financials of all these subsidiaries have been consolidated as applicable and the financial and other information have been furnished in the Consolidated Financial Statement(CFS) attached to this Report.

AMCHEM, Singapore

AMCHEM Speciality Chemicals Private Limited, Singapore, set-up by the Company in 2015-16, to expand its global footprint, holds the foreign assets of the Company. Your Company had invested in 2015-16 US$ 16.32 million (equivalent to Rs. 110.32 crore) in the WOS to part fund the acquisition of Notedome Limited, UK and also for further exploratory work. During the year 2016-17 the WOS set up AMCHEM Speciality Chemicals UK Limited (AMCHEM, UK) as its WOS which acquired an operating unit namely Notedome Limited, UK. Your Company made further investment of US$ 35 million (equivalent to about Rs. 288 crore) during November 2022. With this, the aggregate investment in the subsidiary is US$ 51.42 million (equivalent to about Rs. 398 crore). As at 31^st March 2024, AMCHEM, Singapore is a material subsidiary of your Company.

For FY 2024-25, the total income of AMCHEM, Singapore was US$ 3.42 million (equivalent to Rs. 28.90 crore) and the profit for the year was US$ 2.00 million (equivalent to Rs. 16.89 crore). AMCHEM, Singapore continues to explore further opportunities for acquisition of overseas facilities for enhancing Company?s global presence, and also has interests in trading, transaction facilitations, business and project consultancy. The details of each of the investment made in step down subsidiaries have been covered separately.

NOTEDOME LIMITED, UK

Notedome, established in 1979, is a System House with more than 30 years? experience, manufacturing Neuthane Polyurethane Cast Elastomers catering to customers across 45 countries. Neuthane polyurethanes are used in diverse range of industries and applications, in the automotive sector for anti-roll bar, suspension and shock bushes for buses, trucks and other high-performance vehicles, limit or bump stops, material handling etc. and in the agriculture sector for Rollers, Harvester components and idler wheels on track laying tractors.

The total revenue of Notedome for the year under review was ? 9.08 million (equivalent to Rs. 97.95 crore), profit ? 1.64 million (equivalent to Rs. 17.73 crore) and achieved its highest EBITDA on record. This milestone was reached by improving gross margins through strong pricing strategies, leveraging the specialty product offerings, global sourcing initiatives, and effective management of operating expenses.

Notedome is actively exploring new markets and developing innovative products, with a particular focus on bio-based solutions, as part of its strategic business plan. However, overall demand remains sluggish due to a slowdown in new projects and broader market headwinds. To maintain a competitive product portfolio, Notedome continues to prioritize technology and innovation through dedicated R&D efforts. The company is also strengthening its resources and infrastructure to meet anticipated demand growth.

Aligned with the group?s sustainable strategic objectives, Notedome has implemented energy optimization measures, including the installation of solar panels, to reduce costs and support the transition to renewable green energy.

PENNWHITE LIMITED, UK

Your Company, through its WOS AMCHEM, SG acquired Penn Globe Limited, UK (PGL) on 30^th November 2022 by acquiring its entire stake (100%) for a consideration of GBP 24.98 million. With this acquisition by AMCHEM, SG, PGL along with its two subsidiaries in UK viz., Penn-White Limited (PWL) and Pennwhite Print Solutions Limited (PPSL) have become wholly owned stepdown subsidiaries of the Company.

PWL, UK is a leading manufacturer of antifoam chemistry under the FoamDoctor? brand which is sold in more than 50 countries. A wide range of other speciality chemicals are also manufactured to service the needs of long-term customers in a wide range of applications, like food and food processing, wastewater treatment, upstream and downstream oil, and increasingly in the coatings and adhesives industry.

During the year under review, the Company achieved growth in both turnover and EBITDA compared to the previous year. Despite ongoing challenges in global markets, it maintained healthy margins, strengthened its presence in key markets, and continued to invest strategically in sales and marketing initiatives, including the recruitment of additional commercial personnel. The Company remains committed to systematically executing its long-term growth strategy.

To support the enhancement of its innovative product portfolio, the Company expanded its development activities and committed additional resources for laboratory equipment and capabilities. With growing demand in its two primary focus areas viz., food & beverage, and wastewater & recycling, the market outlook remains positive, underpinned by an increasing emphasis on sustainability. In FY 2024–25, the Company?s wholly owned subsidiary in India, PennWhite India Private Limited, commenced operations and successfully acquired the intellectual property and commercial book of business relating to the foam control segment of Sicagen Limited. This strategic acquisition marks the Company?s entry into the fertiliser foam control market in India.

Further, a lease agreement was also concluded for a plot of land in Oragadam, Chennai for setting up the manufacturing facilities. This facility is expected to become a key driver of the Company?s long-term growth in the Asia-Pacific region, with manufacturing operations planned to commence in FY 2025–26. The revenue for PennWhite Limited, UK for the reporting period was ? 13.71 million (equivalent to 142.61 crore) and profit ? 2.14 million (equivalent to Rs. 22.22 crore).

During FY 2023-24, PPSL and PGL were liquidated and PWL became direct subsidiary of AMCHEM, SG.

Other Subsidiaries

During June 2023, your Company had incorporated a wholly owned subsidiary in India viz., Manali Speciality Private Limited, primarily engaged in the business of Speciality Chemicals.

During July 2023, Notedome, UK had incorporated a wholly owned subsidiary in Germany viz., Notedome Europe GmbH, primarily engaged in the business of Chemicals including Polyurethane Casting Elastomer systems and related products and services.

The above two entities are in the process of setting up its business and are yet to commence their business operations.

Environment and Safety

Your Company continues to uphold its commitment to environmental sustainability, occupational health and safety, and quality excellence through well-established, integrated management systems and continuous improvement initiatives. Your Company operates under comprehensive policies governed by dedicated in-house teams and internal committees, ensuring strict adherence to statutory and voluntary standards.

Your Company maintains rigorous compliance with ISO 9001:2015 – Quality Management System and ISO 14001:2015 – Environmental Management System. These certifications are upheld through periodic internal reviews, audits, and surveillance assessments to ensure alignment with evolving regulatory requirements and global best practices. Also as indicated earlier, the transition in both Plant-1 and Plant-2 exclusively on R-LNG, replacing conventional fossil fuels has significantly reduced air emissions and enabled full compliance with applicable environmental regulations, aligning with national and global commitments toward low-carbon industrial operations.

Your Company has also entered into long-term agreements with leading renewable energy providers.

These partnerships are established under the Group Captive Power Scheme, collectively covering approximately 68% of the Company?s total energy requirement. This strategic transition marks a significant step towards reducing dependency on conventional fossil fuels and aligning operations with environmental best practices.

Despite initial setbacks including project delays caused by flooding and logistical challenges, your Company had successfully sourced nearly about 25% of its total energy consumption from renewable sources during FY 2024–25. This marks the initial phase of its green energy program, with a significant scale-up expected as infrastructure becomes fully operational in the coming months.

This initiative not only ensures compliance with evolving environmental regulations but also solidifies the Company?s role as a responsible corporate citizen contributing meaningfully to India?s clean energy goals.

Aside, your Company has also implemented advanced heat recovery systems including flue gas heat recovery for combustion air preheating and effluent heat recovery for boiler feed water preheating aimed at improving thermal efficiency and reducing fuel consumption and lowers greenhouse gas emissions across key utility operations.

Through sustained adoption of energy-efficient technologies and transition to cleaner fuel sources, the Company achieved a reduction of 55,278 tonnes of equivalent CO2 (TCO2e) annually. This milestone underscores our strong commitment to sustainability, environmental responsibility, and alignment with global efforts to combat climate change. On Carbon Sequestration and Biodiversity, your Company has implemented afforestation initiatives covering 19.55 hectares over last three years, with the plantation of 29,100 saplings across 33 native tree species, in line with MoEF&CC guidelines. These efforts not only enhance local biodiversity and ecosystem resilience but also contribute significantly to carbon capture. During the last fiscal year, the plantations sequestered approximately 1,900 MT of CO2, with this potential expected to increase as the trees mature. All sites are being actively nurtured to ensure healthy, long-term growth. This initiative reflects our proactive approach to environmental stewardship, reinforcing our commitment to reducing carbon footprints and building a greener, sustainable future.

On handling of transportation of hazardous materials like Ethylene Oxide (EO) your Company has proactively invested in technologically advanced double-walled tankers for the movement of EO. These specialized tankers are designed to offer enhanced protection against leaks, temperature variations, and other transit-related risks, ensuring the safe handling of this highly sensitive and hazardous material.

Your Company places its highest priority on the safety of its personnel, assets, and operations, fostering a strong culture of safety through regular engagement, training, and system improvements. As part of its commitment to continuous safety enhancement, the Company organizes Safety Week each year, featuring a variety of activities and competitions aimed at promoting awareness of safe manufacturing practices among employees at all levels.

Going beyond compliance with statutory safety standards, the Company has taken proactive measures to modernize its fire hydrant systems and upgrade safety protocols to handle hazardous chemicals such as Propylene, Propylene Oxide, Ethylene Oxide, Styrene, and Chlorine. These substances require advanced safety infrastructure and response mechanisms, which have been integrated into plant operations.

To effectively implement this green belt initiative, additional land was acquired through the Greater Chennai Corporation (GCC). The company has allocated nearly 0.75% of the total project cost of Propylene Glycol expansion towards the development and maintenance of the green belt over the next five years, after which it will be formally handed over to the GCC for continued upkeep.

Audit Committee

The details about the Committee are furnished in the Corporate Governance Report (CGR). All the recommendations of the Committee were accepted by the Board.

Vigil Mechanism

As required under Section 177 of the Act and Regulation 22 of the SEBI Listing Regulations 2015, the Company has established a vigil mechanism for directors and employees to report their genuine concerns through the Whistle Blower Policy as available on the website of the Company. As prescribed under the Act and the SEBI Listing Regulations 2015, provision has been made for direct access to the Chairperson of the Audit Committee in appropriate / exceptional cases.

Human Resources

Your Company recognizes and cultivates internal talent through strategic initiatives. One such effort is "IGNITE," a platform established by management to encourage experimentation, research, and innovation among our young engineers. This cross-functional team, comprising 22 engineers and 3 mentors, actively participates in key projects to drive results and foster a culture of innovation. Believing in the transformative power of continuous learning, the Company developed the LEAD program (Learn, Enhance, and Aspire to Develop). This initiative aims to nurture internal leaders by encouraging them to share their subject matter expertise with cross-functional teams. To date, approximately 10 knowledge-sharing sessions on various topics have been conducted.

To deepen industrial knowledge and awareness of best practices, the Company organized industrial visits to leading chemical and engineering firms. Around 20 engineers participated in these visits, gaining first-hand exposure to industry standards and practices.

Demonstrating our commitment to Diversity & Inclusion, the Company actively promotes women?s leadership across all functions, particularly in core technical roles. Succession planning is integral to our talent strategy: promising young female professionals have been identified and assigned to significant projects and technical services, supporting both retention and a strong leadership pipeline.

Your Company prioritizes the safety and wellbeing of its young workforce. The SHFT (Session on Health and Fitness Training) employee wellness program is regularly conducted by medical professionals, and employees are encouraged to use the onsite fitness centre to support their overall health.

Additionally, range of cultural and behavioural initiatives have been implemented to foster an inclusive, participative decision-making environment.

Industrial relations remain generally positive. However, a long-standing wage dispute originating in 2001, which was previously before the Supreme Court and is currently pending in the Madras

High Court, continues to involve a small group of workers. Most workmen have accepted the management?s settlement offer after constructive dialogue, while the remaining claims are still under judicial consideration.

As of March 31, 2025, the company employed 321 individuals across various locations, including Executive Directors, Senior Management Personnel, Engineers, Technicians and Trainees

Related Party Transactions

During the year under review, there were no transactions not at arm?s length basis within the meaning of Section 188 of the Act. During the year, board has reviewed and amended the policy on related party transaction which is available on the website of the Company viz., https://www. manalipetro.com/wp-content/uploads/2025/04/ RPT-Policy-2025.pdf As required under Regulation 23(2) of the SEBI Listing Regulations 2015, approval of the Members was obtained for transactions with Tamilnadu Petroproducts Limited during the year 2024-25 at the 38^th Annual General Meeting. Based on professional advice and for administrative convenience, it has been proposed that such prior approvals could be for 12 months from October to September and hence a fresh proposal seeking prior approval of the Members for the same is being placed for consideration of the Members at the ensuing AGM.

Board of Directors and related disclosures

As on date of the Report, the Board comprises of twelve directors including three woman directors. There are six Independent Directors, and all of them have furnished necessary declaration under Section 149(7) of the Act and under Regulation 25(8) of the Regulations. As per the said declarations, they meet the criteria of independence as provided in Section 149(6) of the Act and the SEBI Listing Regulations 2015. All of them have confirmed that they have registered themselves with the Indian Institute of Corporate Affairs under Rule 6 of the Companies (Appointment and Qualifications of Directors) Rules, 2014, as amended and all of them have been exempted from or passed the proficiency test. The Board met five times during the year under review and the relevant details are furnished in the CGR. The Board has approved a Remuneration Policy as recommended by the Nomination and Remuneration Committee (NRC), which inter alia contains the criteria for determining the positive attributes and independence of a director as formulated by the NRC. The policy on remuneration to directors is disclosed in the CGR annexed to this Report.

The following changes took place in the composition of the Board and KMPs since the last AGM held on 18^th September 2024 until the date of this report: a. Mr. R Chandrasekar (DIN: 06374821) was elevated and redesignated as Managing Director and Chief Executive Officer – MPL Group w.e.f. 1^st February 2025. b. Mr. G R Sridhar (DIN: 10596912) was redesignated as Wholetime Director (Head of Plant Operations) w.e.f. 1^st February 2025. c. Mr. Niranjhan Madras Srinivasan (Mr. M S Niranjhan) (DIN: 01650785) was appointed as an Additional Director under Independent category w.e.f., 05.02.2025 for a period of five years. The said appointment was regularized by the Members via postal ballot process. Subsequently Mr. M S Niranjhan ceased to be director of the Company w.e.f close of business hours on 11^th August 2025 consequent to his resignation vide his letter dated 11^th August 2025. d. Mr. Hugo Patrice Michel Chardon (Mr. Hugo Chardon) (DIN: 10919071) was appointed as an Additional Director under Non-Independent category w.e.f., 05.02.2025. The said appointment was subsequently regularized by the Members via postal ballot process. e. Mr. R Swaminathan ceased to be Company Secretary w.e.f. 6^th February 2025 consequent to his resignation. Mr. G Sri Vignesh was appointed as the Company Secretary w.e.f. 7^th February 2025.

Annual Evaluation of the Board, Committees and Directors

The formal evaluation of the Board was done taking into account the various parameters such as the structure, meetings, functions, risk evaluation, management of conflict of interests, stakeholder value & responsibility, corporate culture & value, facilitation to the Independent Directors to function impartially and other matters. The evaluation of the Committees was done based on the mandate, composition, effectiveness, structure and meetings, independence and contribution to the decisions of the Board.

The evaluation of the individual directors, including the independent directors was done taking into account their qualification, experience, competency, knowledge, understanding of their respective roles (as a Director, Independent Director and as a Member of the Committees of which they are Members/Chairpersons), adherence to Codes and ethics, conduct, attendance and participation in the meetings, etc. In compliance with the requirements of Schedule IV to the Act and the Regulations, a separate meeting of the Independent Directors was held during the year under review.

Directors? Responsibility Statement

Pursuant to the requirement of sub-sections 3(c) and 5 of Section 134 of the Act it is hereby confirmed that:

a. in the preparation of the annual accounts for the financial year ended 31^st March 2025, the applicable Accounting Standards had been followed along with proper explanation relating to material departures.

b. the Directors had selected such accounting policies and applied them consistently and made judgments and estimates that were reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for the year under review.

c. the Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

d. the Directors had prepared the accounts for the financial year ended 31^st March 2025 on a "going concern" basis.

e. the Directors, had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively and

f. the Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

Details of Unclaimed Share Certificates

In accordance with the requirements of Clause 5A of the erstwhile Listing Agreement, during the year 2012-13 shares remaining unclaimed even after 3 reminders have been transferred and held in a separate demat account. As per the information provided by the Registrars and Share Transfer Agent, out of the 63,824 shares, which remained unclaimed by 261 shareholders at the beginning of the FY, 900 shares were released to 4 shareholders during the year. Further, 8,175 shares relating to 27 shareholders were transferred to the Investor Education and Protection Fund in compliance with the requirements of Section 126(6) of the Act. As at the end of the FY, 54,749 shares remained unclaimed by 230 shareholders. As specified under the Regulations, the voting right on the above shares remain frozen.

A separate suspense escrow demat account has been opened for moving the shares, if any, required to be transferred beyond 120 days from issuing of Letter of Confirmation by the Company as stipulated under SEBI Circular dated 30^th December, 2022. As at 31^st March, 2025, no shares have been transferred to the said account. Subsequently as on 11^th August 2025, 1,200 Shares were transferred to the said account.

Auditors

Brahmayya & Co., Chartered Accountants, Chennai were re-appointed as the Auditors of the Company for the second term at the 36^th Annual General Meeting held on 28^th September 2022 for a period of five years, viz. till the conclusion of 41^st AGM.

Maintenance of Cost Records & Cost Audit

The Company is required to maintain cost records as specified by the Central Government under Section 148(1) of the Act and is also covered under Cost Audit, which are duly complied with. M Krishnaswamy & Associates, Cost Accountants, Chennai were appointed as the Cost Auditors of the Company for the financial year 2024-25 on a remuneration of Rs. 3.00 lakh plus applicable taxes and reimbursement of out-of-pocket expenses which was ratified by the Members at the AGM held on 18^th September 2024.

Based on the recommendation of the Audit Committee, Board has appointed Mr. L Thriyambak as the Cost Auditor for the year 2025-26 to hold office till 30^th September 2026 or submission of the report for the year 2025-26, whichever is earlier. The remuneration will be Rs.3 lakh, plus applicable taxes and reimbursement of out-of-pocket expenses subject to ratification of the Members at the ensuing AGM.

Adequacy of Internal Financial Controls

Your Company has in place adequate internal financial control systems combined with delegation of powers and periodical review of the process. The control system is also supported by Internal Audit and management review with documented policies and procedures. In the past the system was also reviewed by an external agency, and no major weaknesses were reported. To ensure effective operation of the system, periodical reviews are made by the Internal Auditors and their findings discussed by the Audit Committee and with the Statutory Auditors. The Statutory Auditors of the Company have also furnished certificates in this regard, which are attached to their Reports.

Corporate Governance

Your Company has complied with the requirements of Corporate Governance stipulated under the Regulations. A Report on Corporate Governance is given in Annexure A. Declaration of the Managing Director & Chief Executive Officer - MPL Group on compliance with the Code of Conduct of the Board and Senior Management and compliance certificate from Practicing Company Secretary regarding compliance of conditions of Corporate Governance are given in Annexure B. Secretarial Audit Report as required under Section 204 of the Act, was issued by Ms. B Chandra, Company Secretary in Practice is annexed to this Report as Annexure C.

Disclosures under Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014:

a. The ratio of remuneration of Managing Director/ Wholetime Director to the median remuneration of other employees of the Company was 39.83%.

b. The increase in remuneration of MD & CEO: 38%*, CS:6.06%^#, WTD: NA, CFO: NA.

*PLP not included for FY 2023-24 & 2024-25.

^#(1) PLP Considered for FY 2024-25, (2) Salary Considered upto 06.02.2025

c. The increase in the median remuneration of the employees was 15.65%.

d. As at the year end, there were 320 permanent employees, including MD, WTD and excluding trainees.

e. During the year, the average increase in the salaries other than managerial remuneration was 17.28% and the increase in managerial remuneration was 58.70%. Considering the performance of the Company and respective individuals during the year under review, the increase in managerial and other remuneration are deemed reasonable which have been determined based on the appraisal process adopted by the Company.

f. Information stipulated under Rule 5(2) are given in Annexure D to this Report.

g. The remuneration paid to the employees are as per the remuneration policy of the Company. Note: Wages to workmen covered under the wage settlements have not been considered for (c) and (e) above.

Other disclosures

a. Information on conservation of energy, technology absorption, foreign exchange earnings and outgo prescribed under Section 134 of the Act read with Rule 8 of the Companies (Accounts) Rules, 2014, to the extent applicable are given in Annexure E.

b. Pursuant to Section 92(3) of the Act, the Annual Return filed during the year under review has been uploaded on the website of the Company under the link https://www.manalipetro.com/ investors/annual-return/

c. The Company has not accepted any deposits from the public during the year under report.

d. The information under Section 186 of the Act relating to investments, loans, etc. as at the year-end has been furnished in Notes to the Financial Statements.

e. The annual report on CSR is given in Annexure F.

f. The Company has complied with the provisions relating to the constitution of Internal Complaints Committee under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. No cases were filed under the said Act.

Following are the details:

i. No. of complaints of sexual harassment received in the year: NIL

ii. No. of complaints disposed off during the year: NA

iii. Number of cases pending for more than ninety days: NA g. The Company has complied with the provisions relating to the Maternity Benefit Act 1961.

h. The Company has complied with the requirements of all the applicable Secretarial Standards.

i. Significant changes in key financial ratios:

During the year under review, net margin decreased by 16%. The current ratio and inventory turnover ratio decreased by about 34% and 48% respectively. The Return on Net worth was at (0.92)% in 2024-25 as against (0.95)% in 2023-24. All these were because of reduction in price realizations during the year.

The complete details of Ratios along with Variance are provided in Note 52, clause xii of Standalone Financial Statements.

Acknowledgement

Your Directors express their sincere gratitude to the Government of India, the Government of Tamilnadu, the Promoters and the Banks for the assistance, co-operation and support extended to the Company. The Directors thank the Shareholders for their continued support. The Directors also place on record their appreciation of the consistent good work put in by all cadres of employees and especially for raising up to the occasion and ensuring sustained operations during the year.

Disclaimer

The Management Discussion and Analysis contained herein is based on the information available to the Company and assumptions based on experience in regard to domestic and global economy, on which the Company?s performance is dependent. It may be materially influenced by changes in economy, government policies, environment and the like, on which the Company may not have any control, which could impact the views perceived or expressed herein.

Place: Chennai	For and on behalf of the Board
Date: 11.08.2025	Ashwin C Muthiah
	DIN: 00255679
	Chairman