Narmada Agrobase Ltd Management Discussions

Industry Structure and Developments

The cattle feed industry is an integral part of the livestock and dairy ecosystem and contributes significantly to improving animal health, productivity, and milk yield. The industry is driven by increasing demand for milk and dairy products, rising awareness regarding scientific feeding practices, growth in organized dairy farming, and supportive government initiatives aimed at enhancing livestock productivity.

India continues to be one of the largest producers of milk globally, supported by a substantial livestock population and expanding dairy infrastructure. The growing adoption of compound cattle feed, mineral mixtures, feed supplements, and balanced nutritional products has strengthened the outlook for the organized cattle feed sector. Increasing mechanization and technological advancements in feed manufacturing are also contributing to improved product quality and operational efficiencies.

Business Overview

The Company is engaged in the manufacturing and marketing of cattle feed products catering to the nutritional requirements of dairy animals. The Companys focus remains on delivering high-quality feed solutions that enhance animal productivity while maintaining stringent quality standards and efficient supply chain management.

The Company continues to strengthen its market presence through an extensive distribution network, customer engagement initiatives, and continuous product improvement efforts. Emphasis is being placed on enhancing operational efficiency, optimizing raw material procurement, and expanding market reach.

Opportunities

• Growing demand for milk and dairy products driven by population growth and changing consumption patterns.

• Increasing awareness among dairy farmers regarding balanced nutrition and scientific feeding practices.

• Expansion of organized dairy farms and dairy cooperatives.

• Rising demand for specialty feed products, mineral mixtures, and nutritional supplements.

• Government initiatives focused on animal husbandry, dairy development, and livestock productivity enhancement.

• Potential expansion into untapped rural and semi-urban markets.

Threats

• Volatility in prices of key raw materials such as maize, soybean meal, oil cakes, and other feed ingredients.

• Adverse climatic conditions affecting crop production and raw material availability.

• Intense competition from organized and regional market participants.

• Changes in regulatory requirements impacting manufacturing and distribution operations.

• Supply chain disruptions and fluctuations in transportation costs.

Segment-wise or Product-wise Performance

The Companys primary business segment comprises cattle feed manufacturing and marketing. Demand remained supported by continued growth in dairy activities and increasing adoption of nutritionally balanced feed products. The Company focused on maintaining product quality, customer satisfaction, and efficient procurement practices to sustain its market position.

Outlook

The outlook for the cattle feed industry remains positive, supported by favorable long-term fundamentals of the dairy sector. Rising milk consumption, increasing livestock productivity requirements, and growing awareness regarding scientific feeding practices are expected to drive industry growth.

The Company remains focused on expanding its customer base, strengthening its distribution network, improving manufacturing efficiencies, and developing value-added nutritional products. Strategic initiatives aimed at operational excellence and market expansion are expected to support sustainable growth in the coming years.

Risks and Concerns

The Company operates in a competitive environment and is exposed to various business risks, including:

• Raw material price fluctuations.

• Supply chain and logistics challenges.

• Climatic and environmental risks affecting agricultural production.

• Regulatory and compliance-related risks.

• Market competition and pricing pressures.

• Credit and collection risks associated with customer receivables.

The Company continuously monitors these risks and implements appropriate mitigation measures to minimize their impact on business performance.

Internal Control Systems and Their Adequacy

The Company has established adequate internal control systems commensurate with the nature and size of its operations. These controls are designed to ensure efficient operations, safeguarding of assets, compliance with applicable laws and regulations, reliability of financial reporting, and prevention and detection of fraud and errors.

The internal audit function periodically reviews the effectiveness of internal controls, and its observations and recommendations are reviewed by management and the Audit Committee. Necessary corrective actions are implemented wherever required.

Financial Performance

During the year under review, the Company continued to focus on operational efficiency, cost optimization, and strengthening its market presence. Revenue performance was supported by sustained demand for cattle feed products, while profitability was influenced by fluctuations in raw material prices and market conditions.

Management remains committed to maintaining financial discipline, improving productivity, and enhancing shareholder value through prudent business practices.

Human Resources

The Company recognizes its employees as its most valuable asset and continues to invest in employee development, training, and skill enhancement initiatives. The Company maintains cordial industrial relations and provides a safe, healthy, and inclusive work environment that promotes productivity and employee well-being.

The Indian cattle feed market has demonstrated steady growth and remains a key component of the countrys livestock and dairy value chain. The market was valued at approximately USD 7.24 billion in 2023 and is projected to increase from USD 8.50 billion in 2024 to around USD 13.50 billion by 2035, registering a CAGR of approximately 4.3% during the forecast period from 2025 to 2035. The anticipated growth is primarily supported by rising demand for animal-based protein products, increasing livestock productivity requirements, and continuous advancements in feed manufacturing technologies.

Feed constitutes one of the largest input costs in animal husbandry and plays a critical role in determining the productivity and profitability of livestock operations. To optimize feeding costs, farmers increasingly adopt alternative feed ingredients and by-products from agro-processing industries, including spent grain and other nutrient-rich feed substitutes. At the same time, growing awareness regarding animal health and nutrition has reinforced the importance of scientifically balanced feed formulations for enhancing animal performance, disease resistance, and overall wellbeing.

The cattle feed industry is also witnessing significant innovation through the development of value- added nutritional products such as feed enzymes, acidifiers, probiotics, microbial supplements, and other feed additives. Demand for these specialized products is increasing in line with the growing emphasis on animal health, feed efficiency, and the quality of livestock-derived products. As consumption of dairy and animal protein products continues to rise, the industry is expected to benefit from sustained demand for nutritionally enhanced and performance-oriented feed solutions.

India Cattle Feed Market Overview

Key India Cattle Feed Market Trends

Increasing awareness among livestock farmers regarding the importance of balanced nutrition and scientific feeding practices is driving the adoption of high-quality cattle feed across India. Rising demand for milk, dairy products, and livestock-based protein has encouraged producers to focus on improving animal productivity and health through nutritionally optimized feed formulations. Consequently, there has been a growing preference for scientifically developed cattle feed products that enhance feed efficiency, milk yield, and overall animal performance.

Government initiatives aimed at promoting sustainable agriculture, dairy development, and improved animal husbandry practices have further supported the adoption of advanced feed solutions. These initiatives have encouraged investments in research, product innovation, and the development of nutritionally enriched feed formulations designed to improve livestock productivity and farm profitability.

Additionally, increasing consumer awareness regarding food quality, safety, and sustainability is creating new opportunities within the cattle feed industry. Demand for premium feed products, including organic, natural, and non-genetically modified (non-GMO) feed ingredients, is gradually gaining momentum. This evolving market landscape presents significant growth opportunities for feed manufacturers focused on quality, innovation, and sustainable livestock nutrition.

Market Growth Expectations

The growth of the cattle feed industry is further supported by the increasing adoption of nonconventional feed ingredients and continuous technological advancements in feed manufacturing. Innovations in feed formulation, processing techniques, and nutritional research are enabling manufacturers to develop more efficient and cost-effective feed solutions. Additionally, advancements in biotechnology, including the development of genetically improved feed ingredients, are contributing to enhanced nutritional value, feed conversion efficiency, and overall livestock productivity. These developments are expected to support the industrys long-term growth while addressing evolving nutritional requirements and sustainability objectives.

The cattle feed market in India is expected to reach a projected revenue of US$ 11,732.4 million by 2030. A compound annual growth rate of 6% is expected of India cattle feed market from 2023 to 2030.

The global cattle feed industry has experienced sustained growth, driven by the expansion of the dairy and meat sectors, increasing population, urbanization, and rising consumer awareness regarding nutrition, food safety, and the quality of animal-derived products. As livestock producers focus on improving productivity and animal health, demand for scientifically

formulated and nutritionally balanced feed has increased significantly. Nutritional requirements vary across different stages of cattle growth, leading to the adoption of specialized feed formulations enriched with amino acids, vitamins, minerals, enzymes, antioxidants, probiotics, feed acidifiers, and other functional additives. These value-added nutritional solutions help improve immunity, reproductive performance, feed efficiency, growth rates, and overall animal well-being while addressing nutritional deficiencies. The growing emphasis on advanced livestock nutrition and sustainable farming practices continues to support the adoption of fortified feed products, thereby contributing to the long-term growth and development of the cattle feed industry.

Projected demand and availability of fodder in India

According to this study, by 2020 India would require a total 526 million tonnes (Mt) of dry matter, 855 Mt of green fodder, and 56 Mt of concentrate feed (comprising 27.4 Mt of cereals, 4.0 Mt of pulses, 20.6 Mt of oilseeds, oilcakes and meals, and 3.6 Mt of manufactured feed).

The Company works only in one segment i.e. manufacturing of delinted cotton seeds.

The outlook for the cattle feed industry remains positive, supported by increasing demand for milk, dairy products, and animal-based protein, growing awareness regarding the importance of balanced animal nutrition, and continuous advancements in feed technology. The industry is expected to benefit from supportive government initiatives, improved livestock management practices, and the adoption of sustainable and cost-effective feed ingredients. Rising consumer focus on food quality, safety, and nutrition is further encouraging the use of high-quality livestock feed, thereby driving industry growth. In line with these favorable market trends, the Company is exploring opportunities to expand its operations and strengthen its presence in the Asia-Pacific region through exports. Currently, the Company markets its products through an extensive network of commission agents, brokers, distributors, and dealers across Gujarat and Rajasthan, with Rajasthan continuing to be its primary revenue-generating market. The Company remains focused on expanding its market reach, enhancing customer relationships, and capitalizing on emerging growth opportunities in both domestic and international markets.

The cattle feed market will grow from USD 133.5 billion in 2025 to USD 193.7 billion by 2035 at a CAGR of 3.8%. Concentrate foods lead with 62.2% share, hay holds 23.8%, and pelleted feed contributes 33.9%, driven by demand for efficient, high-nutrition livestock feeding solutions.

The global cattle feed market is projected to expand from USD 133.5 billion in 2025 to USD 193.7 billion by 2035, growing at a CAGR of 3.8%. This growth is fueled by rising global demand for beef and dairy products, increasing livestock population, and advancements in animal nutrition.

Cattle feed plays a critical role in ensuring optimal weight gain, milk yield, and overall animal health. With greater focus on productivity and sustainability, farmers are transitioning to precision feeding methods and customized feed formulations that meet specific nutritional requirements for beef and dairy cattle.

The discussions in this section relate to the financial results pertaining to the year that ended March 31, 2026. The financial statements of Narmada Agrobase Limited (‘the Company) are prepared in accordance with the Applicable Accounting Standards and the provisions of the Companies Act, 2013, read with the Companies (Indian Accounting Standards) Rules, as amended from time to time. Significant accounting policies used in the preparation of the financial statements are disclosed in the notes to the standalone financial statements.

In the current year company has again paced with the growth prospects and streamlined its operations.

For the financial Year 2025-2026, your Company recorded net sales of Rs. 7966.75 Lakhs as against Rs. 6633.91 Lakhs in the previous year and thereby recording the increase in the net sales and achieved net Profit of Rs. 347.09 Lakhs as compared to Rs. 408.79 Lakhs in the previous financial year.

Details of Significant Changes in Key Financial

Statements in this Management Discussion and Analysis describing the Companys objectives, projections, estimates, expectations, or predictions may be "forward-looking statements" within the meaning of applicable laws and regulations. Actual results may differ materially from those expressed or implied due to various factors including changes in economic, political, and regulatory environments, natural calamities, and market conditions.