Nova Agritech Ltd Management Discussions

1. Macro-Economic Overview

1.1 Global Economy

Global economic growth moderated during CY2025 amid geopolitical tensions, evolving trade policies, financial market volatility and cautious business sentiment. According to the International Monetary Fund (IMF), global GDP growth is projected to moderate from 3.4% in CY2025 to 3.1% in CY2026, before improving marginally to 3.2% in CY2027. While advanced economies are expected to witness modest growth, Emerging Market and Developing Economies (EMDEs) are expected to remain key contributors to global expansion, supported by resilient domestic demand, infrastructure investments and favourable demographics.

Outlook

The global economy is expected to maintain moderate growth over the medium term, supported by resilient domestic demand, easing inflation and improving financial conditions. Investments in infrastructure, digitalisation, artificial intelligence and supply-chain resilience are expected to support productivity and economic activity. However, geopolitical tensions, trade policy shifts, commodity price volatility and elevated public debt remain key downside risks, underscoring the importance of policy stability and international cooperation.

1.2 Indian Economy

Indias economy maintained strong growth momentum during FY2025-26 despite global trade uncertainties, geopolitical tensions and volatile capital flows. According to the Ministry of Statistics and Programme Implementation (MoSPI), real GDP is estimated to have grown by 7.7%, supported by resilient domestic demand, sustained investment and policy support. Household consumption remained a key growth driver, while easing inflation, improved liquidity and continued public investment in infrastructure supported business confidence. Headline inflation moderated to 2.1% during the year, creating a favourable environment for economic activity and monetary easing.

Fiscal consolidation progressed steadily, while the banking sector remained well-capitalised, supported by healthy credit growth, improving assetquality and robust profitability. Sustained investments in infrastructure, renewable energy and digital technologies, coupled with continued expansion in manufacturing and services, further strengthened Indias long-term growth prospects.

Indian Economy GDP Growth Rate (in %)

Year	FY 2021-22	FY 2022-23	FY 2023-24	FY 2024-25	FY 2025-26
GDP Growth
Rate	8.7	7.0	8.2	6.5	7.7

Outlook

Indias economic outlook remains favourable, supported by resilient domestic demand, moderating inflation and sustained investments in infrastructure, manufacturing and exports. Policy reforms, expanding trade partnerships and rising integration with global value chains are expected to strengthen industrial competitiveness and diversify export opportunities. While geopolitical developments and global trade uncertainties remain key external risks, Indias strong macroeconomic fundamentals and reform-oriented policy framework position the economy for continued growth over the medium term.

2. Industry Overview

2.1 Indian Agriculture Industry

Indias agriculture continues to be a key pillar of the economy and rural livelihoods. The sector remained resilient in FY 2025-26, with foodgrain production estimated at a record 376.56 million tonnes, an increase of 5.3% over 357.73 million tonnes in FY 2024-25. Rice, wheat and maize production also reached record levels. Horticulture continued its structural growth, with production for FY 2025-26 estimated at 377.78 million tonnes, up 1.9% YoY, marginally exceeding foodgrain production.

The sector is gradually transitioning from volume- led growth towards productivity, diversification and technology-led agriculture. Rising focus on improving farm yields, efficient utilisation of water and nutrients, crop protection, horticulture, climate resilience and adoption of modern agricultural technologies is creating opportunities across the agri-input ecosystem. Going forward, weather conditions, technology adoption and the need to improve farm productivity are expected to remain key industry drivers. The 2026 southwest monsoon has been influenced by evolving El Nino conditions, while IMD continues to monitor rainfall distribution across regions. Against this backdrop, the need for climate-resilient agricultural practices, efficient use of water and nutrients, improved crop protection and productivity-enhancing technologies is gaining importance. Government initiatives focused on digital agriculture, irrigation, farmer income support, horticulture and modern agricultural practices are further supporting the sector.

(Source: https://www.pib.gov.in/PressReleasePage. aspxRsPRID=2265965&lang=1&reg=3&utm_source; https://www.spglobal.com/energy/en/news-research/ latest-news/agriculture/062626-indias-monsoon- season-starts-slowly-as-el-nio-threatens-crops)

Key Growth Drivers

• Rising Food Demand: Population growth,

urbanisation and changing consumption patterns are supporting sustained demand for agricultural output.

• Farm Income and Purchasing Power: Improving rural incomes and government income-support measures are strengthening farmers ability to invest in productivity-enhancing inputs.

• Crop Diversification: Increasing cultivation of horticulture, oilseeds, pulses and other high- value crops is broadening the demand base for specialised agricultural inputs.

• Growing Irrigation Coverage: Expansion of irrigation infrastructure and micro-irrigation is reducing dependence on rainfall and enabling higher cropping intensity.

• Mechanisation of Agriculture: Rising adoption of farm machinery and mechanised application is improving farm efficiency and supporting more systematic input usage.

• Export Potential: Growing global demand for Indian agricultural and processed food products is creating opportunities to enhance farm productivity and quality standards.

• Formalisation of the Agri-input Market: Greater awareness of branded, registered and quality- assured agricultural inputs is supporting a gradual shift from unorganised products towards formal market channels.

Agricultural Exports

Indias agricultural exports reached a record USD 52.55 billion in FY2025-26, registering a 2.8% YoY increase over the previous year. The growth was supported by higher exports of pulses, fresh fruits and vegetables, vegetable oils, marine and plantation products, reflecting the increasing diversification and value addition within Indias agricultural export basket. Additionally, exports of agricultural and allied products increased 6.8% in FY 2025-26 to Rs4.70 lakh crore, with wheat, poultry products, oilseeds and other cereals among the key contributors.

Government Initiatives

The Government of India continues to strengthen the agricultural ecosystem through initiatives focused on productivityenhancement,cropdiversification, irrigation, technology adoption and farmer income support. The Prime Minister Dhan-Dhaanya Krishi Yojana, launched from FY 2025-26, covers 100 low-productivity districts and focuses on improving agricultural productivity, crop diversification, sustainable farming, irrigation and post- harvest infrastructure, with an estimated reach of 1.7 crore farmers. In addition, continued support through PM-KISAN, the Digital Agriculture Mission, Krishonnati Yojana, PM Fasal Bima Yojana, Per Drop More Crop and Farmer Producer Organisations is helping improve access to technology, finance, risk protection and modern agricultural practices. The Government has also extended PM-KISAN for another five years with an outlay of Rs3.15 lakh crore, reinforcing its focus on farmer income security.

Outlook

The outlook for Indian agriculture remains structurally positive, supported by food demand, agricultural diversification, technology adoption and continued policy support. However, weather variability is likely to remain an important near-term consideration for FY2026-27. The emergence of El Nino and the uneven start to the monsoon high light the importance of efficient water management, crop protection and solutions that help maintain productivity under climatic conditions. These developments are expected to accelerate the adoption of modern agricultural practices and strengthen the role of innovation across the agri-input value chain.

2.2 Indian Agrochemical Industry

Indias agrochemical market is estimated at USD 9.59 billion in 2026 and is projected to reach USD 13.25 billion by 2031, registering a 6.66% CAGR. India has also emerged as a significant global agrochemical manufacturing and export hub, supported by its cost competitiveness, technical capabilities and established manufacturing base. The domestic market is witnessing increasing demand for crop protection products as farmers focus on improving yields, managing crop losses and responding to changing pest and climatic conditions.

The industry is also undergoing a gradual shift towards speciality, biological and more targeted crop-protection solutions. Growing horticulture cultivation, adoption of precision application technologies, increasing awareness of sustainable agricultural practices and opportunities in global markets are supporting this transition. At the same time, dependence on imported raw materials, evolving regulatory requirements and pest resistance remain important considerations for industry participants.

(Source: https://www.mordorintelligence.com/industry- reports/india-agrochemicals-market)

Key Trends

• Shift towards bio-inputs: Policy support and greater focus on reducing excessive chemical usage are encouraging adoption of biofertilisers, biostimulants and other biological inputs.

• Precision application: Increasing adoption of drones and precision spraying is improving application efficiency and creating demand for formulations suited to newer application technologies.

• Export-led manufacturing: The growing global market for off-patent molecules is strengthening Indias position as a cost-competitive manufacturing and export base.

• Digital distribution: Expansion of digital agri-credit and e-commerce platforms is improving last-mile access to agricultural inputs, particularly across underserved rural markets.

• Rising horticulture demand: Faster growth in fruits and vegetables is supporting demand for specialised crop-protection and nutrition products.

• Climate-linked pest pressure: Changing climatic conditions and associated pest outbreaks are supporting demand for effective crop- protection solutions.

Policy & Regulatory Framework

The Government continues to strengthen the crop-protection ecosystem through measures aimed at improving quality, farmer access, regulatory compliance and adoption of safer agricultural inputs. The Draft Pesticides Management Bill, 2025 proposes technology- enabled registration and traceability, stronger action against spurious pesticides and mandatory accreditation of testing laboratories. The regulatory framework for biostimulants has also been strengthened, with provisional registrations discontinued from June 2025 and continued market access linked to compliance with prescribed standards underthe Fertilizer Control Order. Further, the Comprehensive Registration of Pesticides (CROP) platform is streamlining the registration process, with 20,391 certificates issued during FY2025-26, supporting greater efficiency and transparency in pesticide approvals.

Outlook

The Indian agrochemical industry is expected to maintain its growth trajectory, supported by increasing agricultural productivity requirements, crop diversification, export opportunities and the adoption of more efficient application technologies. The faster growth expected in pesticides, fruits and vegetables, together with the emergence of biological and speciality inputs, is likely to drive a gradual shift in the industry mix. At the same time, raw-material volatility, evolving regulatory requirements and pest resistance will remain important considerations.

3. Company Overview

Nova Agritech Limited (NATL) is an established agri-input company with over 19 years of experience in Indian agriculture, focused on soil health management, crop nutrition and crop protection. The Company combines research and development capabilities with technology-led innovation to develop sustainable and nutritionally balanced solutions aligned with the requirements of farmers and agricultural practices. Its diversified portfolio comprises 900+ registrations spanning soil enhancers, crop nutrients, biopesticides and crop protection products, supported by an established distribution network. NATL continues to build its capabilities through strategic capacity expansion, robust quality assurance practices and a focused approach to operational execution, enabling it to address evolving market requirements while supporting productivity and sustainable agricultural practices.

4. Opportunities and Threats

Strengths

• Comprehensive product portfolio spanning soil health, crop nutrition, biostimulants, biopesticides, IPM and crop protection.

• Extensive distribution network enabling broad market reach and regional penetration.

• Farmer-centric initiatives, including Nova KisanSeva Kendras, supporting direct farmer engagement.

• Innovation-led product development supported by continuous investment in R&D.

• Sustainability-focused solutions promoting ecologically sound and nutritionally balanced farming.

• Experienced leadership team with a strategic approach to business growth.

• State-of-the-art R&D facility supporting product formulation and application technologies.

Opportunities

• Atmanirbhar Bharats focus on fertiliser self-reliance is creating opportunitiesfor domestic manufacturing.

• Indias cost competitiveness and technical capabilities are strengthening its position as a global agrochemical hub.

• Rising demand for sustainable produce is driving adoption of biological and eco-friendly agri-inputs.

• Increasing adoption of drones, robotics and other AgriTech solutions is opening new avenues for product application.

• Supportive government policies and farmer-focused schemes are strengthening agri-input demand.

• Expanding digital infrastructure in rural India is enabling wider farmer outreach and e-commerce- led distribution.

Threats

• Global geopolitical tensions and trade restrictions may disrupt international supply chains and affect raw material availability.

• Volatility in prices of key raw materials may increase production costs and exert pressure on margins.

• Evolving regulatory requirements and environmental standards may increase compliance costs and affect product development timelines.

5. Financial Performance

NATL Category-Wise Sales Value

Category	2025-26 sales value	% 2025-26 sales contribution
Crop Nutrition	5,117.11	65.59%
Soil Health Management	2,489.24	31.91%
Others	195.15	2.50%
Total	7,801.50	100.00%
NASPL Category-Wise Sales Value
Category	2025-26 sales value	% 2025-26 sales contribution
Insecticides	8,219.74	45.12%
Herbicides	6,791.03	37.28%
Fungicides	2,297.42	12.61%
Plant Growth Regulators	781.07	4.29%
Intermediates	128.46	0.70%
Total	18,217.72	100.00%

Financial Review

	Standalone (Rs in Lakhs)			Consolidated (Rs in Lakhs)
Year	FY 2025-26	FY 2024-25	Growth (%)	FY 2025-26	FY 2024-25	Growth (%)
Total Income		17,018.70	-51.58%	26,17	29,659.89	-11.75%
EBITDA	994.55	2,637.92	-62.30%	2,749.29	4,515.37	-39.11%
PAT	393.92	1,652.02	-76.16%	1,283.84	2,742.20	-53.18%

Operational performance overview and the significant changes in the ratio

Particulars	FY 2025-26	FY 2024-25	Changes(%)	Reason for change
Debtors Turnover	0.70	1.65	(57%)	The Trade Receivables Turnover Ratio decreased primarily due to a significant decline in credit sales during the year, while the average trade receivables increased. Consequently, receivables were realized at a slower rate, resulting in a lower turnover ratio compared to the previous year.
Inventory Turnover	3.97	6.04	(34%)	The Trade Receivables Turnover Ratio decreased primarily due to a significant decline in credit sales during the year, while the average trade receivables increased. Consequently, receivables were realized at a slower rate, resulting in a lower turnover ratio compared to the previous year.
Debt Service Coverage Ratio	1.57	4.73	[67%]	The Debt Service Coverage Ratio decreased primarily due to a significant decline in earnings available for debt service, mainly on account of lower profitability during the year. Although debt servicing obligations reduced compared to the previous year, the decrease in earnings was substantially higher, resulting in a lower debt service coverage ratio.
Current Ratio	2.66	2.19	21%	The Current Ratio increased primarily due to significant reduction in trade payables during the year compared to the previous year.
Debt Equity Ratio	0.18	0.18		The Debt Equity Ratio remained stable during the year due to maintaining consistent debt levels relative to its net worth.
Operating Profit Margin	7.11%	13.29%	[46%]	The Operating Profit Margin decreased primarily due to a significant decline in revenue from operations and proportionately lower decline in operating expenses, resulting in a lower operating profit margin compared to the previous year.
Net Profit Margin	5.05%	9.96%	[49%]	The Net Profit Ratio decreased primarily due to a significant decline in profit after tax during the year, driven by lower operating performance. Although revenue from operations also declined, the reduction in profitability was proportionately higher, resulting in a lower net profit margin compared to the previous year.
Return on Networth	2.20%	9.42%	[77%]	The Return on Networth Ratio decreased primarily due to a significant decline in profit after tax during the year, while the average shareholders equity remained broadly stable. Consequently, the return generated on equity capital was lower compared to the previous year.

Financial performance with respect to operational performance

Particulars		% of total income
Sales revenue	801.50	94.67%
Other income	439.59	5.33%
Cost of materials consumed	4,294.36	55.05%
Gross margin (%)		44.95%
Employee cost	1,342.96	16.30%
Other expenses	1,609.22	19.53%
Operating profit (EBITDA)	994.55	15.50%
EBITDA (%)		1 2.07%
Finance cost	287.89	3.49%
Depreciation & amortisation	280.24	3.40%
Profit before tax	426.42	5.17%
Provision for tax	32.50	0.39%
Profit after tax	393.92	4.78%
EPS T	0.44

6. Risk Management

Nova Agritech Limited has established a structured risk management frameworkto identify, assess, monitor and mitigate risks that may impact its business operations and financial performance. The Risk Management Committee supports the Board in overseeing the Companys risk exposures and reviewing the adequacy of mitigation measures. Key risks are evaluated periodically through appropriate diligence and monitoring mechanisms, with corrective actions and process improvements undertaken, wherever required. The framework is designed to strengthen preparedness, support informed decision-making and enable the Company to respond effectively to changes in the operating environment.

• Economic Risk: Any slowdown or adverse developments in the Indian economy may impact agricultural activity, demand for agri-inputs, business operations and financial performance.

• Weather Risk: Variations in rainfall, climatic conditions and extreme weather events may affect agricultural output and, consequently, the demand for agricultural inputs across operating regions.

• Competition Risk: Intense competition from domestic and international players may affect market share and margins, necessitating continued focus on product quality, innovation, supply reliability and customer relationships.

• Human Capital Risk: The Companys operations and dealer relationships depend on skilled and experienced personnel. Challenges in attracting, developing and retaining talent may affect operational efficiency and business continuity.

• Regulatory Risk: Changes in regulations relating to agricultural inputs, product registrations, quality standards and environmental norms may increase compliance requirements and affect product development and market access.

• Raw Material Risk: Fluctuations in the availability and prices of key raw materials may increase input costs, affect supply continuity and exert pressure on operating margins.

7. Internal Control System, Adequacy and Compliance

We have established an adequate internal control mechanism to safeguard all our assets and ensure operational excellence. The mechanism also meticulously records all transaction details and ensures regulatory compliance. We have multiple policy frameworks to ensure adequate controls on business processes. Further, Risk and Control dashboards have been defined and are periodically updated for all important operational processes. At periodic intervals, the management team and statutory auditors ensure that the controls are operating effectively. We have a dedicated team of internal auditors to conduct internal audit. Every year, this team defines the audit agenda for the year, which is implemented after approval from the Audit Committee. Reputed audit firms also ensure that all transactions are correctly authorised and reported following the relevant regulatory framework. The reports are reviewed by the Audit Committee of the Board. Wherever necessary, internal control systems are strengthened, and corrective actions are initiated.

8. Human Resources

The Company considers its people an integral part of its organisational development and business execution. The Company follows an employee-centric approach focused on talent acquisition, capability building, performance management, employee engagement and compliance with applicable labour regulations. It seeks to foster a diverse, inclusive and collaborative work environment, supported by initiatives promoting employee well-being, work-life balance and continuous learning. Employee development is strengthened through training and upskilling programmes, while HR systems and practices are continually reviewed to align with the Companys organisational values and strategic priorities. As on March 31, 2026, the Company had [78] employees.

• Talent and Capability Development: Focus on attracting, developing and retaining talent through structured hiring, onboarding, training and upskilling initiatives.

• PerformanceManagement:Performanceevaluation processes support employee development and alignment with organisational objectives.

• Employee Engagement: Regular engagement initiatives and cultural activities foster collaboration, employee participation and team cohesion.

• Diversity and Inclusion: Emphasis on maintaining a respectful, equitable and inclusive workplace that encourages open communication.

• Employee Well-being: Facilities including transportation, an in-house canteen and initiatives supporting work-life balance contribute to employee welfare.

• HR Systems and Compliance: Continuous strengthening of HR processes and systems, alongside adherence to applicable labour laws and regulations.

9. Cautionary Statement

Certain statements in the Management Discussion and Analysis Report describing the Companys objectives, and predictions may be ‘forward-looking statements within the meaning of applicable laws and regulations. Actual results may vary significantly from the forward- looking statements contained in this document due to various risks and uncertainties. These risks and uncertainties include the effect of economic and political conditions in India, volatility in interest rates, new regulations and Government policies that may impact the Companys business as well as its ability to implement the strategy. The Company does not undertake to update these statements.