Dhatre Udyog Ltd Management Discussions

Management’s discussion and analysis of the financial condition and results of operations include forward looking statements based on certain assumptions and expectations of future events. The Company cannot assure that these assumptions and expectations are accurate. Although the Management has considered future risks as part of the discussions, future uncertainties are not limited to Management perceptions.

1. Review of Indian Economy:

In 2025, the Indian economy is characterized by strong, stable growth as the worlds fastest-growing major economy, with projected GDP growth around 6.2-6.5%, driven by robust domestic demand and public investment in infrastructure. The economy is also experiencing controlled inflation below 3%, significant export growth, and improving external trade conditions, including a projected current account surplus for the year. Key factors contributing to this positive outlook include improved consumer sentiment, a focus on deregulation to attract investment, and a commitment to infrastructure development, though global trade tensions and domestic policy decisions on taxes and spending remain points of consideration..

Industry Structure and developments:

The Indian economys structure has undergone significant transformation, shifting from a primary (agriculture) to a tertiary (services) driven economy, with industrys share in output rising but falling short of typical industrial economies. Key developments include a booming services sector (especially IT), a growing informal employment sector, rapid urbanization, increased private investment and FDI, and ongoing efforts to boost manufacturing under initiatives like "Make in India". The economy is dynamic, balancing domestic consumption with foreign trade and facing challenges in manufacturing growth, infrastructure, and workforce development.

2. Strength, Opportunities, Threats

Strength:

* Established operations and proven track record * Smooth flow of operations and Business Model * Experienced Management Team * Satisfied customer with quality and service Opportunities:

* Potential to provide other value-added services * Expanding new geographical area * Enhancing functional efficiency * Opportunities in Indian Market

* Government thrust for growth in Indian Economy will boost the logistics & Infrastructure Industry Threats:

* Increased Competition from Big Players * Change in Government Policies * Rising labour wages * Margins may be constrained in the future

* There are no entry barriers in our industry which puts us to the threat of competition from new entrants

3. Segment Wise - Product wise performance:

During the year under review, the Company operated in only one segment which is production of Iron and Steel Products.

Details of Segment wise Revenue of the Company:

• Iron & Steel Products: The Total Revenue from Iron & Steel Products is * 14,429.31 Lakhs for the Financial Year 2024-25.

4. Outlook

The Continual growth in the Indian sector is necessary to give necessary support to the industry. The company is making all efforts to accelerate the growth of its business. It expects to improve its position in the market by focusing in the technologically advanced and more profitable and market segment and working aggressively in the area of productivity, efficiency and cost reduction.

5. Risks and Concerns

The Industry is exposed to the following risk and concerns:

• Capital and labour intensive industry

One of the main problems faced by steel industry in India is that it is highly capital and labour intensive. As a result, arranging for finances becomes a challenge. Getting a business loan of such a huge amount to set up a steel plant is a difficult task. As mentioned above, the government is helping steel makers by allowing FDI.

Apart from finances, the steel industry is also a labour-intensive industry. While labour is available, labour management becomes another challenge for many steel companies.

• Demand prediction

Yet another challenge of the steel industry is fluctuating demand. As it fluctuates from time to time, it becomes difficult for steel makers to predict the demand and produce accordingly. This results in delayed returns on investment.

• Logistics related challenges

Like most other industries, logistics, and supply chain management remain key areas of challenge for the steel industry. The main raw materials for making steel are iron ore and coking coal. Both these are bulk materials while the finished product i.e., steel is also a bulk material. Meaning, they are not regular goods to be transported and need to be handled differently.

6. Internal Control systems and its adequacy

The Company has an effective and reliable internal control system commensurate with the size of its operations. At the same time, it adheres to local statutory requirements for orderly and efficient conduct of business, safeguarding of assets, the detection and prevention of frauds and errors, adequacy and completeness of accounting records and timely preparation of reliable financial information. The efficacy of the internal checks and control systems is validated by self-audits and internal as well as Statutory Auditors.

7. Discussion on financial performance of the Company with respect to operational performance.

• Share Capital

The Paid-up Share Capital of the Company as on 31^st March, 2025 is Rs. 10,89,54,500/- (Rupees Ten Crore Eight-Nine Lakhs Fifty-Four Thousand Five Hundred Only) divided into 10,89,54,500 (Ten Crore Eight-Nine Lakhs Fifty-Four Thousand Five Hundred) Equity Shares of Rs. 1/- (Rupees One only).

• Reserves and Surplus

The reserves and surplus is Rs. 5,449.53 Lakhs as on the end of the current year.

• Total Income

During the year under consideration, the total income was Rs. 14,459.79 Lakhs as against Rs. 21,936.42 Lakhs during the previous year.

8. Material developments in Human resources / industrial Relations front, including number of people employed

Human Resources and an effective and efficient human resource are a key to the success of any organization and our company has been well focused in adopting the best standards in the Industry which not only gives us the benefit of attracting good talent but gives us an edge towards providing best qualitative services to our customers. Our manpower is a mix of experienced and young talent pool of resources which gives us the dual advantage of stability and growth. Our work processes and skilled resources together with our strong management team have enabled us to successfully implement our growth plans.

9. Key Financial Ratios:

Ratios	2024-25	2023-24	Variance (in %)	Reasons for Variance
Current Ratio	27.98	8.45	231.14%	Lower current liabilities at the year end due to suspension of operations
Debt-Equity Ratio	NA	NA	NA	NA
Debt Service Coverage Ratio	NA	NA	NA	NA
Return on Equity Ratio	3.67%	22.10%	-83.41%	Decline in profits during the year
Inventory turnover ratio	22.02	19.59	12.38%	-
Trade Receivables turnover ratio	4.48	5.62	-20.28%
Trade payables turnover ratio	53.47	76.11	-29.75%	Decrease in trade payables at the year end
Net capital turnover ratio	3.01	4.93	-39.00%	Lower revenue during the year

10. Cautionary Statement

This report contains forward- looking statements based on the perceptions of the Company and the data and information available with the company. The company does not and cannot guarantee the accuracy of various assumptions underlying such statements and they reflect Company’s current views of the future events and are subject to risks and uncertainties. Many factors like change in general economic conditions, amongst others, could cause actual results to be materially different.

Place: Kolkata	On behalf of the Board of Directors
Date:5th September,2025	For DHATRE UDYOG LIMITED
	(Formerly known as Narayani Steels Limited)
	SD/-
	Sumit Kumar Agarwal
	Managing Director
	DIN:02184000