Mukta Agriculture Ltd Management Discussions

ECONOMIC OVERVIEW:

GLOBAL ECONOMY

The global economy in 2024 is expected to remain resilient with growth projected at 3.4%, as per IMF estimates. Disinflationary trends have strengthened, supported by easing supply chain disruptions, improved trade flows, and a recovery in private consumption. Monetary policy tightening has begun to moderate, with many central banks signalling a gradual shift towards accommodative stances to support growth.

Growth in advanced economies is projected at 1.7% in 2024 and 1.8% in 2025, reflecting stable recovery in the United States and Japan, though Europe remains subdued. Meanwhile, emerging and developing market economies (EDMEs) are forecasted to grow at 4.2% in 2025 and 2026, driven by domestic demand, government spending, and green energy transition.

Global policy coordination remains critical, particularly in managing sovereign debt sustainability, climate financing, and energy transition commitments post-COP28. While the risk of financial volatility and geopolitical fragmentation persists, the overall outlook remains cautiously optimistic.

INDIAN ECONOMY

India continues to remain one of the fastest-growing major economies, with GDP projected to expand by 6.8% in FY 2024-25, supported by resilient domestic demand, robust investment activity, and improved rural prospects.

The agriculture and allied sectors, which support nearly 55-58% of the population, are expected to grow by 3.5% in FY25 after a relatively modest performance in FY24 due to uneven monsoon conditions. The India Meteorological Department (IMD) has projected an above-normal monsoon in 2024, improving agricultural prospects. Foodgrain and horticulture output are expected to rebound, supported by policy interventions and higher MSP allocations.

The Union Interim Budget FY25 continued to emphasize rural development and farmer welfare, with allocations of:

• 1.27 lakh crore to the Agriculture Ministry,

• 1.47 trillion towards agriculture & allied activities,

• 600 billion for PM-Kisan Samman Nidhi Yojana,

• Enhanced support for crop insurance, agri-credit, post-harvest infrastructure, and digitization of agri-value chains.

Rural consumption is expected to strengthen with higher disposable income, favourable monsoon, and improved agricultural output.

> OVERVIEW

We, Mukta Agriculture Limited is engaged in the business of trading agricultural goods, natural resources, and allied products. During FY 2024-25, the Company continues to face financial challenges but remains committed to diversification and expansion into new growth areas. Strategic initiatives are

underway to broaden the business portfolio, strengthen supply chain efficiencies, and improve market penetration with an aim to return to profitability and create long-term value for stakeholders..

> INDUSTRY STRUCTURE AND DEVELOPMENTS

The interim for FY25-26 has promised stepping up of value addition in agricultural sector and boosting farmers income and has made substantial budgetary allocations as below Budget Financial Year 25-26 Highlights for the agriculture sector:

Key developments in FY24-25 include:

• Governments increased budgetary support for agriculture and allied sectors.

• Focus on value addition, branding, and agri-export promotion.

• Incentives for private and public investments in post-harvest management, storage, processing, and digital platforms.

• Growing demand for organic, sustainable, and processed agricultural products in domestic and international markets.

> OPPORTUNITIES & THREATS

> Increase market share in existing business verticals: Several sectors in which your Company operates are largely unorganized, therefore, cost leadership is a key enabler for your Company to increase the market share of its products in those segments. The Companys ability to increase sales will be strengthened by continued focus on offering a wide range of innovative products across all business verticals which will help in gaining market share. Additionally, in the medium-term, due to supply chain disruption and lack of liquidity leading to the closure of smaller business units, larger players with strong balance sheets will gain market share

> Diversified businesses with synergies in operations: Segmental and geographical diversification across business verticals provide a hedge against the risks associated with any particular industry segment or geography while benefiting from the synergies of operating in diverse but related businesses. Synergies across diverse businesses provide the ability to drive growth, optimize capital efficiency and maintain competitive advantage. The Company also derives operational efficiencies by centralizing and sharing certain key functions across businesses such as finance, legal, information technology, strategy, procurement and human resources.

> Focus on inorganically growing business offerings: Your Company will evaluate inorganic growth opportunities, in keeping with the strategy to grow and develop market share or to add new product categories. Your Company may consider opportunities for inorganic growth, such as through mergers and acquisitions, if, amongst other things, they consolidate market position in existing business verticals or achieve operating leverage in key markets by unlocking potential efficiency and synergy benefits. Your Company can also look at opportunities that will strengthen and expand its product portfolio and increase its sales and distribution network.

> RISKS & CONCERNS

Risk and uncertainty are inherent to agriculture. These include climate and weather risks, natural catastrophes pest and diseases, which cause highly variable production outcomes. The most common sources of risk are weather, climate, diseases, natural disasters market and environmental shocks. The Company is committed to the identification, measurement and management of business risk by evaluating new Technologies & Controlling Productions.

> OUTLOOK

The outlook for Indias agriculture sector in 2025 is positive, with a projected growth in the gross production value, import value, and export value. Heres some more information about the outlook for the agriculture sector in India in 2025:

• Gross production value

The gross production value of the agriculture sector is projected to be $520 billion in 2025.

• Import value

The import value of the USD 9.3 billion, while exports projected at USD 12.1 billion..

• Export value

The export value of the agriculture sector is projected to be $11.55 billion in 2025.

• Market size

The agriculture market in India is estimated to be worth $400.94 billion in 2025.

• Growth rate

The agriculture sector is expected to grow at a compound annual growth rate (CAGR) of 4.06% from 2025 to 2030.

• Livelihoods

The agriculture sector is the primary source of livelihood for about 58% of Indias population.

• Growth engine

The Economic Survey 2025 highlights the potential of the agriculture sector to be a growth engine for India.

> SEGMENT-WISE PERFORMANCE

The Company is operating on only one segment. Hence separate segmental reporting is not applicable. The Company has no activity outside India.

> INTERNAL CONTROLS SYSTEMS AND ADEQUACY

Your Company remains committed to improve the effectiveness of internal control systems for business processes with regard to its operations, financial reporting and compliance with applicable laws and regulations. The Company has a propersystem of internal controls to ensure that all assets are safeguarded and protected against loss from unauthorized use or disposition and that all transactions are authorized, recorded and reported correctly.

Moreover, the Company has appointed Internal Auditors to oversee and carry out internal audit of its activities. The audit is based on an internal audit plan, which is reviewed each year in consultation with the statutory auditors and approved by the audit committee.

> FINANCIAL PERFORMANCE

The financial performance is covered in the Directors Report and the same can be referred to by the shareholders.

> MATERIAL DEVELOPMENT IN HUMAN RESOURCES / INDUSTRIAL RELATIONS FRONT

The growth achieved in Indian agricultural sector has been attributed to the consorted efforts of available skilled human resource.

• National Institute of Agricultural Extension Management (MANAGE) is providing training support to senior and middle level functionaries of the State Governments.

• Four Extension Education Institutes namely, Nilokheri (Haryana), Hyderabad (Telangana), Anand (Gujarat) and Jorhat/Guwahati(Assam) are functioning at the Regional Level. The objectives of EEIs are to improve the skills and professional competence of middle level extension field functionaries of agriculture.

• Diploma in Agricultural Extension Services for Input Dealers (DAESI) is of one year (expanded to 48 weeks) regular course launched in October, 2015 with an objective to impart education in agriculture and other allied areas to the Input Dealers.

• Th e National Gender Resource Centre in Agriculture (NGRCA) of the Department of Agriculture & Farmers Welfare established in Extension Division is supp orted under the component of Extension Support to Central Institutes/ Directorate of Extension of SubMission on AgriculturalExtension.

> RATIOS WHERE THERE HAS BEEN A SIGNIFICANT CHANGE FROM FINANCIAL YEAR 2023-24 TO FINANCIAL YEAR 2024-25

During the year under review, the detail of changes made in the following key financial ratios as compare to the immediately previous financial year. The details of the same in a form of comparison is provided as:-

S. No.	Particulars of Ratio	Financial Year 2024-25	Financial Year 2023-24
1	Debtors Turnover Ratio	NA	NA
2	Inventory Turnover Ratio	NA	NA
3	Interest Coverage Ratio	(436.32)	271.04
4	Current Ratio	13.81	135.15
5	Debt Equity Ratio	Nil	0.05
6	Operating Profit Margin	NA	NA
7	Net Profit Margin	(091)	(4.34)
8	Return on Net worth	(0.01)	(0.09)

DISCLOSURE OF ACCOUNTING TREATMENT

The Company has followed accounting principles generally accepted in India, including the Indian Accounting Standard (Ind AS) as specified under Section 133 of Companies Act, 2013 ( the Act ) and other relevant provision of the Act. The Company has uniformly applied the Accounting Polices during the period presented. Kindly refer notes to the financial statements for significant accounting policies adopted by the Company.

CAUTIONARY STATEMENT:

Statements in foregoing paragraphs of this report describing the current industry structure, outlook, opportunities, etc., may be construed as forward looking statements , based on certain assumptions of future events over which the Company exercises no control. Therefore, there can be no guarantee as to their accuracy. These statements involve a number of risks, uncertainties and other factors that could cause actual results to differ materially from those that may be implied by these forward looking statements. Such risks and uncertainties include, but are not limited to: growth, competition, domestic & international economic conditions affecting demand, supply & price conditions, changes in Government regulations, tax regimes and other statutes.

By and on behalf of the Board For Mukta Agriculture Limited

Sd/-

Krishan Khadaria

Director

DIN:00219096

Sd/-

Mohit Khadaria Managing Director DIN: 05142395