Nutech Global Ltd Management Discussions

The Management of NUTECH GLOBAL LIMITED present its analysis report covering performance and outlook of the Company. The report has been prepared in compliance as laid down in the Regulation 34 of the SEBI (Listing Obligations and Disclosure Requirements)Regulations,2015.The management accepts responsibility for the integrity and objectivity of the financial statement. However, investors and readers are cautioned that this discussion contains certain forward-looking statements that involve risk and uncertainties.

INDIAN ECONOMIC OVERVIEW

The textile industry contributes approximately 2.5% to the national GDP, around 7% to industrial output, and nearly 12% of the countrys total export earnings. It is also one of the largest employment-generating sectors, providing livelihoods to over 45 million people, both directly and indirectly, across the entire value chain from cotton cultivation and yarn production to garment manufacturing and retail.

INDIAN TEXTILE INDUSTRY

The Indian textile industry is diverse, encompassing a wide range of textiles, including Man-made fibres (MMF). The Textile Industry is a vital sector of the Indian economy with a rich history dating back centuries. It is one of the major contributors to lndiaRs.s Gross Domestic Product (GDP) and also one of the largest employers in India. The Indian textile industry is diverse, encompassing a wide range of textiles, including man-made fibres (MMF) Despite the challenging global environment, the Indian economy with its strong fundamentals and massive demographic strengths seems enroute to outpace other large economies.

IndiaRs.s textile industry is witnessing a strategic shift towards man-made fibres (MMF), aligning with global consumption trends where MMFs constitute approximately 77% of fibre usage. As of March 2025, the Indian government has decided to let its USD 23 billion PLI scheme lapse due to underperformance, with no further expansion planned. This decision affects sectors including textiles and MMF.

OUTLOOK

The government of India has initiated various policies to support textile sector growth for long term horizon.Demand in Textiles segment will vary by market. The exemption of import duty on shuttle-less looms Rs. specifically Rapier Looms and Air Jet Looms is a highly advantageous move for textile companies in India. By reducing the duty from 7.5% to nil, the cost of acquiring advanced, high- performance looms significantly decreases, making it more feasible for manufacturers to invest in modem machinery.

OUR BUSINESS OVERVIEW:

The Company has a production of 3.6 million meters of quality fabric per year and a fabric range that diversifies into varied products such as Suiting, Shirting, Ready-Made Garments, Dress Material (Uniform), Home Furnishing. However, competition in the industry is continuously increasing, and the future for the industry looks promising, by strong domestic consumption as well as export demand.

OPERATIONAL REVIEW:

Please referto the paragraph under the heading Rs.Financial ResultsRs. and Rs.Operational ReviewRs. in the main DirectorsRs. Report. SEGMENTWISE PERFORMANCE:

The Management reviewed the disclosure requirement of Segment wise reporting and is of the view that since the companyRs.s products are covered under Textile Industry which is single business segment in terms of AS-17 and therefore separate disclosure on reporting by business segment is not required.

RISKS MANAGEMENT:

The risk management framework of the company ensures compliance with the requirements of the Companies Act, 2013. The Company is exposed to risks from competitions, interest rates, market fluctuations of foreign exchange, compliance risk, raw material price risks and people risk. It has institutionalized the procedure for identifying, minimizing and mitigating risks and the same are reviewed periodically. Your Company has identified the following aspects as the major risks for its operations:

1. COMPETITIVE RISK:

The threats to the Companys product include severe competition both in domestic and international markets leading to pricing pressures of finished goods, inflation, foreign exchange fluctuation, volatility in input cost, cotton crop, interest rates, power cost etc. Government Policies also play major role in the growth of the industry.Online trades and fast fashions are the biggest competitive risk in present scenario. Investments in the industries have started picking up with no barriers for entry of new players. Your Company continues to focus on increasing its market share and focusing more on Quality, Cost and Timely delivery that help create differentiation and provide optimum service to its customers to expose competition risk.

2. FINANCIAL(FUNDING RISK):

Any increase in interest rate can affect the finance cost. The CompanyRs.s policy is to borrow long-term borrowing in Indian Rupee to avoid any rate variation risks. The Company has adopted a prudent and conservative risk mitigation strategy tominimize interest costs.

3. FOREIGN EXCHANGE RISK:

Foreign exchange risks are quantified by identifying contractually committed future currency transactions. The CompanyRs.s policy is to hedge all long-term foreign exchange risk as well as shortterm exposures within the defined parameters.

4 COMPLIANCE:

The Company is exposed to risks attached to various statutes and regulations including the Competitions Act. The Company is regularly monitoring and reviews the changes in regulatory framework and also monitoring its compliance mechanism so as to ensure that instances of non-compliance do not occur.

5. RAW MATERIAL PRICE RISK:

The Company is exposed to the risk of raw material prices of Polyester, Viscose, PN blended yam, Cotton Yarn. The Company hedges this risk by purchasing the required raw material at the time of booking of sales contracts. Also, this risk is being managed by way of inventory management and forward booking.

6 HUMAN RESOURCES RISK:

Retaining the existing talent pool and attracting new manpower are major risks. The Company hedges this risk by setting benchmark of the best HR practices and carrying out necessary improvements to attract and retain the best talent. The Company has initiated various measures such as rollout of strategic talent management system, training and integration of learning activities.

7. ENVIRONMENT AND SAFETY:

The company is conscious of the need for environmentally clean and safe operations. The Company Policy requires the conduct of all operations in such manner so as to ensure safety of all concerned, compliance of statutory and industrial requirements for environment protection and conservation of natural resources to the extent possible.

INTERNAL CONTROL SYSTEMS & THEIR ADEQUACY:

Your Company has an effective internal control and risk mitigation system, which is constantly assessed and strengthened with new/revised standard operating procedures. The main thrust of the internal audit process is test and review of controls, independent appraisal of risks, business processes and benchmarking internal controls with best practices.

The Audit Committee of the Board of Directors actively reviews the adequacy and effectiveness of the internal control systems and suggests improvements to strengthen them The Audit Committee of the Board of Directors, Statutory Auditors and Functional Heads are periodically apprised of the internal audit findings and corrective actions to be taken. Audit plays a key role in providing assurance to the Board of Directors.

FINANCIAL PERFORMANCE WITH RESPECT TO OPERATIONAL PERFORMANCE

This part has been discussed in Boards Report.

HUMAN RESOURCE AND INDUSTRIAL RELATION

The Company takes pride in the commitment, competence and dedication shown by its employees in all areas of business. The Company is committed to nurturing, enhancing and retaining top talent through superior Learning & Organization Development interventions.Corporate learning and Organization Development is a part of Corporate HR function. It is a critical pillar to support the organization growth and its sustainability overthe long run.

DISCLOSURE OF ACCOUNTING TREATMENT:

In preparation of the financial statements, the Company has followed the Accounting Standards issued by ICAI. The significant accounting policies which are consistently applied are set out in the Annexure to Notes to the Accounts.

CAUTIONARY STATEMENT:

This Management Discussion and Analysis Statement of the Annual Report has been included in adherence to the spirit enunciated in the code of corporate governance approved by the Securities and Exchange Board of India. Statement in the Management Discussion and Analysis describing CompanyRs.s objectives, projections, estimates, expectation may be forward- looking statements within the meaning of applicable securities laws and regulations. Actual result could differ materially from those expressed or implied. Important factors that could make a difference to the CompanyRs.s operation include economic conditions affecting demand/supply and price conditions in the Government regulations, tax laws, other rules & regulation applicable to the Company and other incidental factors. Further, the discussion following herein reflects the perceptions on major issues as on date and the opinion expressed here are subject to change without notice. The Company undertakes no obligations to publicly update or revise any of the opinions of forward-looking statements expressed in this report, consequent to new information future events, or otherwise. Readers are hence cautioned not to place undue reliance on these statements and are advised to conduct their own investigation and analysis of the information contained or referred to this statement before taking any action with regard to specific objectives.

Statements in this Management Discussion and Analysis Report describing the Companys objectives, estimates etc. may be Forward Looking Statements within the applicable laws and regulations. Actual results may vary from these expressed or implied. Several factors that may affect Companys operations include Raw material prices, Government policies, cyclical demand and pricing in the Companys main market and economic developments within India and countries in which the Company conducts its business and several other factors. The Company takes no responsibility for any consequence of decisions made based on such statements and holds no obligation to update these in the future.