Mono Pharmacare Ltd Management Discussions

INDUSTRY STRUCTURE AND DEVELOPMENT:

The Indian chemicals industry continues to command a strong international presence, standing as the 6th-largest producer in the world and 3rd in Asia, contributing approximately 7% to Indias GDP. The industry was valued at around US$ 250 billion in 2024, and is forecasted to expand to US$ 300 billion by 2025 with long-term projections aiming for US$ 1 trillion by 2040. On the global trade front (excluding pharmaceuticals), India ranks 14th in chemical exports and 8th in chemical imports, reflecting its growing integration into international supply chains. The sector has also attracted substantial foreign investment, with FDI inflows (excluding fertilizers) reaching US$ 22.8 billion by September 2024.

The Indian pharmaceutical industry continues to demonstrate strong growth momentum, supported by rising healthcare expenditure, increasing awareness, and growing demand for affordable medicines. India remains the third-largest producer of pharmaceuticals by volume globally and is projected to sustain a CAGR of around 8 10% over the coming years. Expansion of healthcare infrastructure, greater penetration of generic medicines, and digital healthcare adoption are key drivers shaping the industry landscape.

The Interim Union Budget 2025 26 has further strengthened the sector by increasing allocations toward public health programs under Ayushman Bharat, expanding Jan Aushadhi Kendras, and promoting rural healthcare accessibility. The budget also emphasizes digital health initiatives through the National Digital Health Mission, which aims to improve integration of telemedicine and supply chain efficiency. Additionally, continued support for the Production Linked Incentive (PLI) scheme and Bulk Drug Parks is expected to stabilize input costs, reduce import dependency, and boost domestic manufacturing, benefiting the overall distribution ecosystem.

In this environment, the pharmaceutical distribution sector is positioned to capitalize on these opportunities by leveraging technology for inventory management, expanding networks to underserved regions, and maintaining regulatory compliance. Focus on operational efficiency and strategic partnerships will remain critical to sustaining growth and addressing evolving market challenges in the upcoming fiscal year.

FINANCIAL PERFORMANCE:

The companys overall operational performance during the financial year 2024-25; Total turnover for the financial year ended has Rs. 8264.08 Lakhs. The Company has incurred the Profit before Tax of Rs. 377.32 Lakhs. On the other hand, the companys overall operational performance during the financial year 2023-24; Total turnover for the financial year ended has Rs. 7071.99 Lakhs. The Company has incurred the Profit before Tax of Rs. 285.66 Lakhs.

OPPORTUNITIES, THREATS, RISKS AND CONCERNS:

However, the Company operates in an environment exposed to multiple risks, including intense competition, price pressures, and regulatory changes. Duty-free imports, evolving trade policies, and the entry of multinational players continue to impact margins. Further, rapid technological advancements and digitization require continuous investment to remain competitive. The Company is fully aware of these risks and continuously monitors external and internal factors to mitigate potential adverse impacts. Proactive measures such as compliance monitoring, technology upgrades, cost optimization, and strengthening customer relationships are being undertaken to safeguard business sustainability and ensure long-term growth.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY:

Management has put in place effective Internal Control Systems to provide reasonable assurance for: Safeguarding Assets and their usage. Maintenance of Proper Accounting Records and Adequacy and Reliability of the information used for carrying on Business Operations. Key elements of the Internal Control Systems are as follows: I. Existence of Authority Manuals and periodical updating of the same for all Functions.

II. Existence of clearly defined organizational structure and authority. III. Existence of corporate policies for Financial Reporting and Accounting.

IV. Existence of Management information system updated from time to time as may be required. V. Existence of Annual Budgets and Long Term Business Plans.

VI. Existence of Internal Audit System.

VII. Periodical review of opportunities and risk factors depending on the Global / Domestic Scenario and to undertake measures as may be necessary.

Internal Audit Reports are regularly circulated for perusal of Senior Management for appropriate action as required.

HUMAN RESOURCE/INDUSTRIAL RELATIONS:

Human Resources Development, in all its aspects like training in safety and social values is under constant focus of the management. Relations between the management & the employees at all levels remained healthy & cordial throughout the year. The Management and the employees are dedicated to achieve the corporate objectives and the targets set before the company.

BUSINESS OUTLOOK:

Over the past year, the pharmaceutical industry has not only upheld continuous delivery of high-quality medicines during and after the pandemic but has also demonstrated remarkable adaptability and collaboration. The sector has shown unwavering commitment toward meeting both the nations healthcare demands and expanding its global footprint. As we look toward 2025, the outlook remains bright for Indias pharmaceutical business driven by a renewed emphasis on quality manufacturing, affordability, and the strategic deployment of innovation and technology. However, challenges persist: low R&D investment, a shortage of skilled professionals, evolving intellectual property regulations, and potential export disruptions. Addressing these requires agility, resilience, and policy support.

CAUTIONARY STATEMENT:

Statements in the Management Discussion and Analysis and Directors Report describing the Companys strengths, strategies, projections and estimates, are forward-looking statements and progressive within the meaning of applicable laws and regulations. Actual results may vary from those expressed or implied, depending upon economic conditions, Government Policies and other incidental factors. Readers are cautioned not to place undue reliance on the forward-looking statements.

Place: Ahmedabad	For and on behalf of the Board
Date: 26/08/2025	MONO PHARMACARE LIMITED