Nexxus Petro Industries Pvt Ltd Management Discussions

(Pursuant to Regulation 34(2)(e) and Schedule V of SEBI (LODR) Regulations 2015)

Please note that disclosures given in this Annexure - Management Discussion and Analysis (MD&A) are meant to ensure that there is transparency in Companys financial performance. It digs into balance sheets, income statements, and cash flows. This helps investors understand whats behind the companys financial health and its chances for success in the future. They enable our investors to evaluate the Company and make informed investment decisions. Financial statements alone are not sufficient to judge a Companys current performance and predict the future performance. The ordinary investor needs narrative explanations to have a better understanding of the performance and the environment in which the firm operates. MD & A fulfils this objective. It gives the investor an opportunity to look at the Company through the eyes of management by providing both a short and long-term analysis of the business of the Company. Some statements in this discussion describing the projections, estimates, expectations or outlook may be forward looking. Actual results may, however, differ materially from those stated, on account of various factors such as changes in government regulations, tax regimes, economic developments within India and the countries within which your Company conducts its business, exchange rates and interest rates fluctuations, impact of competition, demand and supply constraints, etc

Your directors have pleasure in presenting the “Management Discussion and Analysis Report” for the Financial Year ended on 31st March, 2025.

Overall Review of the Company

The Company is engaged in trading, manufacturing and selling of Petrochem products namely Bitumen products. Our product is widely used in infrastructure sector being road construction industry. The Companys range of products includes various grades of Bitumen which are classified on the base of viscosity and related properties of each grade. Presently, we procure bitumen via imports from Dubai as well as purchase from other domestic importers/sellers in India. The Company further process the bitumen procured at our processing units located at Mundra, Gujarat; Pali, Rajasthan; Bhopal, Madhya Pradesh. Apart from sale of processed bitumen, we also trade in bitumen by directly selling it to customers as per the requirement.

The Company is a BIS and ISO-certified organization engaged in manufacturing and processing high-quality products that meet the precise requirements of its customers. Over the years, the Company has built strong expertise in its domain and consistently upgraded facilities by adding advanced machinery and equipment.

These efforts have significantly enhanced production capacity, diversified grades, and improved the overall quality of products.

Consistent performance and a customer-centric approach have helped the Company expand its customer base and establish long-term goodwill in the industry.

Infrastructure & Facilities

The Companys manufacturing and processing units are fully equipped with modern machinery, material-handling systems, and logistics support to ensure smooth operations. The Company maintains strict safety standards through well-defined internal safety protocols, ensuring a secure work environment.

The Company also operates a well-equipped testing laboratory with advanced facilities to monitor and ensure that every batch of products meets required specifications and industry standards.

Leadership

The Company is guided by a strong leadership team with extensive industry experience:

Mr. Haresh Mohanlal Senghani, Managing Director & Promoter

Brings expertise in manufacturing processes, customer engagement, and overall administration. He ensures compliance with norms and alignment with the Companys vision, goals, and mission.

Mr. Rahul Mohanlal Senghani, Whole Time Director & Promoter

Specializes in raw material procurement and supplier management, actively leading these critical functions to ensure quality and continuity in the supply chain.

The combined vision, business acumen, and operational expertise of the leadership team form the backbone of the Companys growth and success.

Customer Engagement

The Company believes in building long-term partnerships with clients. The sales and marketing team maintains close personal interactions with customers to understand their evolving needs and industry trends. This continuous feedback loop enables the Company to innovate and upgrade products in line with market requirements.

Presently the Company is offering following grades of bitumen to customers:

Bitumen VG 10	Bitumen 60/70	Bitumen Emulsion RS1
Bitumen VG 30	Bitumen 80/100	Bitumen Emulsion RS2
Bitumen VG 40		Bitumen Emulsion SS1
		Bitumen Emulsion SS2

BITUMEN INDUSTRY SCENARIO

Bitumen is an oil-based substance and semi-solid hydrocarbon product produced by removing the lighter fractions (such as liquid petroleum gas, petrol, and diesel) from heavy crude oil during the refining process. Composition of bitumen includes carbon (87-92%), hydrogen (6-8%), sulphur (~5%), nitrogen (1%), and oxygen (1%). It possesses physical properties such as adhesion, water resistance, hardness, and viscosity.

India Bitumen Market Segmentation are: By Type (Paving Grade Bitumen, Oxidized Bitumen, Polymer Modified Bitumen, Bitumen Emulsion, and Others) and End-Use Industry (Road Construction, Water Proofing, and Others) Bitumen consumption scaled a decade high last fiscal due to a surge in road construction ahead of the general election. Sales of bitumen, used mainly for building roads, rose 10% to 8.8 million metric tonnes (MMT) in FY24, according to oil ministry data. “” Road construction activity is in full swing. The Ministry of Road Transport and Highways (MoRTH) constructed 12,349 km of national highways in 2023-24, the second highest so far, compared to 10,331 km in 2022-23,” the oil ministry said in its industry demand analysis. More than 40% of bitumen consumed in the country is imported. India paid $1.3 billion for bitumen imports in FY24, 8% more than the previous year. In volume terms, bitumen accounts for about 4% of total domestic consumption of refined products.

Bitumen consumption has gained pace in recent years in line with increasing road construction activity. Average annual consumption in the last five financial years between 2019-20 and 2023-24 was 7.7 MMT, up from an average of 5.94 MMT. Last fiscal, western India was the largest consumer of bitumen and the East the smallest. Bitumen is the preferred material for road building although cement is also being increasingly used for making concrete roads. Increase in road construction activities fuels the demand for bitumen. Bitumen is processed into asphalt for road construction. Asphalt is a mixture of rock aggregates and bitumen. Bitumen serves as a binding agent and improves the stability of asphalt.

Depending on the type of bitumen or composition of the mixture used, asphalt roads can be made suitable for regions with different climatic conditions or various levels of operational demands. Asphalt is also used for airport runways, parking decks, and working areas in ports. In addition, Indias recent passed budget includes expenditure on development of National Highways, including projects relating to expressways, two-laning of highways, under the National Highways Development Project, six-laning of crowded stretches of the Golden Quadrilateral, a special program for the development of road connectivity in Naxal affected areas, development of Vijayawada Ranchi road, and for providing last mile connectivity, which is anticipated to drive the growth of India bitumen market.

Furthermore, bitumen adhesive is widely used in the construction industry for roofs. It is a cold applied adhesive for bonding bituminous roofing felts to asphalt, felt, metal, and concrete. Bitumen adhesive has physical properties that includes toughness, flexibility, and forms adhesive and cohesive film and provides good UV resistance. Owing to growth in construction industry due to rapid urbanization and launch of government initiatives such as Housing for All that includes construction of houses for urban poor is expected to drive the growth of the bitumen market across the country. growth in the construction industry due to growth in population across the cities and demand for new houses led to increase in demand for bitumen across the country.

In addition, government initiatives such as Pradhan Mantri Awas Yojana (PMAY) that includes construction of houses for poor people living in both rural and urban areas is likely to increase the demand for bitumen; thereby, driving the growth of the Indian bitumen market. However, human health & environmental issues associated with bitumen, fluctuating international crude oil prices, and increase in use of alternative of bitumen such as concrete in roadway construction applications are expected to restrain the growth of the market.

Moreover, development of bio-based bitumen and EME (Enrobes a Module Eleve) binder is anticipated to provide lucrative opportunities for further development of the market. However, human health & environmental issues associated with bitumen, fluctuating international crude oil prices, and increase in use of an alternative for bitumen such as concrete in roadway construction application restrain the growth of the market across the India. Moreover, development of bio-based bitumen and EME (Enrobs Module Elev) binder is anticipated to provide lucrative opportunities for further development of the market. The India bitumen market covered in the study includes paving grade bitumen, oxidized bitumen, polymer modified bitumen, and bitumen emulsions. By end-use industry, the market is classified into road construction (airports & runways and highways & express ways), waterproofing, and others.

Region-wise, it is analyzed across North India (Uttar Pradesh, Rajasthan, Punjab, Haryana, rest of North India (Himachal Pradesh, Uttarakhand, Chandigarh, and Delhi)), East India (Bihar, Jharkhand, West Bengal, Odisha, and Andaman & Nicobar), Northeast India (Arunachal Pradesh, Assam, Tripura, Meghalaya, and rest of Northeast (Sikkim, Nagaland, and Mizoram)), and South India (Tamil Nadu, Karnataka, Andhra Pradesh, Telangana, Kerala, and rest of South India (Lakshadweep and Puducherry)), and West India (Maharashtra, Gujarat, Madhya Pradesh, Chhattisgarh, rest of West India (Goa, Dadra & Nagar Haveli, and Daman & Diu). The major key players operating in the India bitumen market include Indian Oil Corporation Ltd., Hindustan Petroleum Corporation Limited, Bharat Petroleum Corporation Ltd., Oil & Natural Gas Corporation Ltd., Total India, Tiki Tar Industries India Ltd., Agarwal Industries Corporation Ltd., Juno Bitumix Pvt. Ltd., Universal Bituminous Industries Pvt. Ltd., and Swastik Tar Industries.

OVERVIEW OF THE INDIAN ECONOMY:

Indias economic growth has demonstrated notable resilience despite heightened geopolitical tensions and moderation in global economic momentum. Macroeconomic stability has been strengthened by ongoing fiscal consolidation efforts and a well- managed current account deficit, supported by the robust performance of the services and agriculture sectors. Prudent economic policies, sustained structural reforms, a strong digital infrastructure foundation, and improving corporate balance sheets have collectively reinforced Indias economic strength, reaffirming its position as the fastest-growing major economy. As of April 2025, the International Monetary Fund (IMF) revised Indias economic growth forecast downwards to 6.2% for the fiscal year 2025-26 from its earlier estimate of 6.5%. Driven by supportive policy measures and robust demand, the IMF predicts a marginal improvement in the growth to 6.3% during the next fiscal year, and further to about 6.5% in the longer term. This downward revision for the fiscal year 2025-26 reflects the anticipated impact of geopolitical conflicts, global trade uncertainties, particularly the imposition of tariffs by the United States. However, India is expected to maintain its status as the fastest- growing major economy globally.

FINANCIAL PERFORMANCE AND OPERATIONS

Revenue & Income

Revenue from Operations increased significantly from Rs.23,778.48 lakhs (2023-24) to Rs.30,493.34 lakhs (2024-25) Rs. +28.2% growth.

Other Income declined from Rs.62.48 lakhs to Rs.26.78 lakhs Rs. -57%, but this is relatively insignificant compared to operational revenue.

Expenditure

Cost of Materials Consumed rose from Rs.22,358.93 lakhs to Rs.27,780.21 lakhs Rs. +24.2%, indicating higher input/raw material costs.

Employee Benefit Expenses grew from Rs.107.16 lakhs to Rs.146.26 lakhs Rs. +36.5%, reflecting expansion in operations/workforce.

Finance Costs increased from Rs.155.47 lakhs to Rs.259.88 lakhs Rs. +67%, higher borrowings or rising interest burden.

Depreciation & Amortization rose from Rs.43.71 lakhs to Rs.82.21 lakhs Rs. +88% due to capital investments in fixed assets.

Other Expenses jumped from Rs.698.25 lakhs to Rs.1,442.16 lakhs Rs. +106%, showing higher operational/administrative overheads

Profitability

Profit Before Tax (PBT): Increased from Rs.478.43 lakhs to Rs.809.40 lakhs Rs. +69% growth.

Profit After Tax (PAT): Increased from Rs.352.00 lakhs to Rs.608.78 lakhs Rs. +73% growth.

Effective tax rate is around 24.7% in FY25 vs 26.4% in FY24.

Performance Summary

Strong revenue growth of ~28% YoY, driven by higher demand or improved pricing in core operations.

Profitability improved sharply with PAT rising 73%, indicating efficiency despite cost pressures.

Operating costs (materials, employees, finance, depreciation, and other expenses) rose substantially, suggesting business expansion, capacity addition, and higher input costs.

Margins remain under pressure due to steep rise in material and overhead costs, but growth in absolute profits highlights strong operational performance.

The Company has continued to achieve an all-round growth in terms of Volume, Revenues, Profit Before Tax (PBT) and Profit After Tax (PAT) over the previous years and has demonstrated strong resilience during yet another challenging year. The performance has been achieved by the Company in spite of the environment of global uncertainty, volatile economic conditions and high-cost pressures.

Your Company delivered a robust performance in FY 2024-25, with revenue growth of 28% and PAT growth of 73%. While expenses have surged due to expansion and financing costs, the companys profit trajectory remains strong, indicating positive future prospects, provided it balances growth with cost and debt management.

OUTLOOK

Your Companys growth is linked to overall economic activity, inflation trends and disposable income. To overcome the challenges and competition, we have taken various initiatives to reduce the operational cost, development of innovative value- added products and exploring new markets based on certain parameters, to achieve better margins in the future. Your Company is focused on growing its business across all products, regions and formats and will continue to pursue its strategy of targeting growth while maintaining financial discipline. Your Company also aims to stabilize its operations and profitability by adding to its range of products and entering new territories for the sale of its products. We are focused to achieve healthy annual growth in the coming years and are working towards strategies and execution that will help us achieve this goal. As the revenue grows, we expect our EBITDA margins also to improve in the coming years.

SWOT ANALYSIS

STRENGTH

• Robust Team of Research & Development.

• Ever-growing production capacity.

• Wide range of products.

• Satisfied and prestigious Client base.

• Experienced and Visionary Management.

• Trained Workforce.

• Strong Operational and Financial Strength.

• Delivering value to end users

• Strong tender/ Government Business

Manufacturing and processing unit near port for effective and optimum handling of bitumen imports. b. Healthy Suppliers & Client relationship. c. Optimum use of resources

WEAKNESS

Working Capital Intensive Industry, Imports exposure, Seasonal Fluctuations OPPURTUNITIES

Directly related to Infrastructure projects which are under Govt9s priority agenda.

b. High opportunities for expansion of Bitumen products as road construction within the ambit of infrastructural growth. c. tremendous demand of value-added Product such as Bitumen Emulsion with potential of high margins

THREATS

Impact due to fluctuations in the economy caused by changes in global and domestic economies, competition in the industry, changes in government policies and regulations, fluctuations etc. which are common to all sectors

RISK AND CONCERN

The Company has adopted a comprehensive and integrated risk appraisal, mitigation and management process. The risk mitigation measures of the Company are placed before the Board of Directors periodically for review and improvement.

THE KEY FINANCIAL RATIOS ARE GIVEN BELOW:

The details regarding financial ratios of the company for financial year 2024-25 in comparison with previous year is given after Note 30 in Notes forming part of accounts

FUTURE SCENARIO

The expanding Indian road network?including national highways, expressways, and rural connectivity under programs like Bharatmala and PMGSY?is fueling significant demand for bitumen.

Market forecasts suggest steady growth:

IMARC projects the bitumen market rising from USD 3.27 B in 2024 to USD 4.24 B by 2033 (CAGR ~2.7%).

IMARC Group

Allied Market Research anticipates growth from USD 4.2 B in 2023 to USD 6.6 B by 2033, at a faster CAGR ~4.1%.

Allied Market Research

BlueWeave Consulting echoes this trajectory?USD 4.8 B (2023) Rs. USD 6.1 B by 2030 (CAGR ~4.08%).

BlueWeave Consulting

Innovation & Sustainability?The New Frontier

Polymer-Modified Bitumen (PMB) is gaining popularity for its superior elasticity, weather resistance, and durability?ideal for high-stress zones like flyovers, highways, and airports.

Bio-based, recycled, warm-mix, and self-healing bitumen are emerging, as the industry responds to environmental mandates and lifecycle cost pressures:

Bio-bitumen from agricultural residues (e.g., lignin) has been used on NH-44, reducing GHG emissions by ~70% and enabling up to 15% blend in conventional mixes.

Recycling and warm-mix technologies offer cost and energy savings. Self-healing and nano-bitumen are in R&D pipelines to further enhance durability and sustainability.

Policy Support and Domestic Capacity Expansion

Government initiatives such as Bharatmala, Smart Cities Mission, and Sagarmala are core demand drivers for bitumen in road and urban infrastructure.

Efforts to reduce import dependency include investments in domestic bitumen production and encouraging bio-bitumen adoption?expected to save around INR 10,000 crore in forex outflows.

Production capacity is also rising: e.g., MRPLs commissioning of a new bitumen train using modern Biturox technology, and pilot roads using lignin-based bio-bitumen indicate technological strides.

Challenges to Navigate

Crude oil price volatility remains a key risk factor, affecting cost predictability and project budgeting for infrastructure players.

Environmental scrutiny over petroleum-based products is intensifying, pressuring manufacturers to invest in cleaner processes and compliance measures. Machine tool industry has emerged in the new avatar courtesy of Digitalization and Industry 4.0. One of the oldest and traditional industries, the machine tool industry has walked many miles to achieve the current status. In the coming years, digitalization will completely transform the Machine tool industry and the merger of these dynamic elements will result in process efficiency and productivity. Although the industry is flooded with numerous solutions, it is essential to identify the space, which requires transformation and adopt solutions accordingly. The industry is witnessing innovative technological solutions in every aspect of the processes.

The sensor integration, utilization of artificial intelligence (AI), and the integration of sophisticated simulation features, enable the advancements in machine performance and overall equipment effectiveness (OEE). Additionally, the advanced sensors and modern ways of communication, controlling, and monitoring systems allows creating new opportunities for smart services and new business models in the machine tool market. The digitally enhanced services are about to become part of each OEMs portfolio in the future. Along with various innovative technologies, the market is laden with new trends, which will help to boost the machine tool industry. In the current digital age, mass customization, reduced time-to consumer, error proofing using latest technologies are a few trends that require enhanced machine flexibility. It is essential to comprehend the new machines and utilize them to achieve maximum efficiency. Additionally, core aspects such as price, usability, longevity, process speed, quality, and greater machine flexibility are few characteristics of new machines.

HUMAN RESOURCES

Human Resources play a critical role in driving Nexxus strategies and growth. The Company endeavours to become the best place to work for its employees and to provide them with a nurturing environment that is essential for their growth. As on 31st March, 2025 the company employed 54 Employees. The Company has implemented comprehensive and well-structured HR policies to ensure employee growth both at personal and professional levels. The Companys talent pool comprises a diverse set of experienced and skilled people who play key roles in enhancing business efficiency, devising strategies, setting up systems and evolving business as per industry requirements. The Company provides a safe, conducive and productive work environment to its people. Nexxuss strong organizational culture also enables it to attract talented resources. The Company conducts regular training programs for employees to ensure skill upgradation and personnel development. High employee retention levels is a key outcome of this initiate.

INTERNAL CONTROL SYSTEM AND THEIR ADEQUACY

Your Company has an adequate system of internal controls to ensure that all the assets are safeguarded and are productive. Necessary checks and controls are in place to ensure that transactions are properly verified, adequately authorized, correctly recorded and properly reported. The Internal Auditors of the Company conduct Audit of various departments to ensure that internal controls are in place and are submitting quarterly reports to the Audit Committee. The management maintains adequate internal financial control systems encompassing its entire business operations, statutory compliances and Financial Reports.

CONCLUSION

Your Companys primary focus will be to grow volumes across markets. The Company will address each market depending on local conditions and consumer trends. While we recognize that the global environment is extremely challenging, there are new opportunities emerging to meet consumer needs. Your Company will focus on profitable growth through a mix of brand led growth, innovation and cost efficiencies

Date: 30/08/2025	By Order of the Board of Directors
Place: Ahmedabad	For Nexxus Petro Industries Limited
	Haresh Mohanlal Senghani
	Chairman & Managing Director
	DIN: 08163360