Pankaj Polymers Ltd Management Discussions

This Report is framed under the heads specified in paragraph B of Schedule V to the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, read with Regulation 34(2)(e) thereof. Paragraph B of Schedule V is not among the paragraphs disapplied by clause (a) of Regulation 15(2), and this Report is accordingly required notwithstanding that the Corporate Governance provisions do not apply to the Company. All figures are in Indian Rupees in Lakh unless otherwise stated and are derived from the audited financial statements of the Company for the financial year ended 31st March, 2026, which have been prepared in accordance with the Indian Accounting Standards prescribed under Section 133 of the Companies Act, 2013.

The Indian plastics industry is among the countrys larger and more fragmented manufacturing sectors. Its 1. INDUSTRY STRUCTURE AND DEVELOPMENTS value chain runs from the petrochemical producers of polymer resin, through compounders and processors, to converters producing packaging, pipes, consumer durables, automotive components, agricultural films and medical products. The Company operates in the intermediate trading layer of that chain, buying polymer granules and plastic products and selling them on.

Two features of the industry bear directly on the Company. The first is that polymer prices are derived from crude oil and naphtha prices and from the global balance of petrochemical capacity, and are therefore volatile and outside the control of any participant of the Companys size. The second is that the trading layer is intensely competitive and only lightly differentiated: margins are thin, are set by the market rather than by the trader, and are compressed further when domestic capacity or imports are surplus. A trader of the

Companys scale has no bargaining power over either its purchase price or its selling price.

Demand for polymers in India has continued to grow with packaging, infrastructure, automotive and healthcare consumption, and government initiatives directed at domestic manufacturing have supported plastics,that growth. extendedSet against producerthis are responsibilitytightening environmental obligations, andregulation continuingof single-use pressure andon thenon-recyclable industrys environmental record.

2. OPPORTUNITIES AND THREATS

Opportunities

Sustained growth in the domestic consumption of polymers arising from packaging, infrastructure, automotive and healthcare demand.

? The Company is free of borrowings and its net worth is unimpaired, which affords it the capacity to redeploy its resources without the constraint of servicing debt.

? The resolutions passed by the Members at the Extraordinary General Meeting held on 22^nd August, 2026 the alteration of the objects clause of the Memorandum of Association and the approval of a preferential issue of equity shares and convertible warrants provide the legal and financial basis for the Company to enter new lines of activity and to fund them.

? The change in control effected during the year has brought a new management to the Company with its own commercial experience and network.

Threats

? The trading operations of the Company do not presently cover their costs. Revenue from operations of Rs. 129.84 Lakh yielded a gross margin of Rs. 0.87 Lakh, or 0.67% of revenue, against Rs. 1.30 Lakh, or 0.87%, in the preceding year.

? Volatility in polymer prices, which follow crude oil prices and the global petrochemical trade balance, and over which the Company has no influence.

? Competition from both organised and unorganised participants in a trading business with low barriers to entry. Concentration risk: the whole of the revenue from operations for the year was derived from sales to enterprises owned or significantly influenced by the Key Managerial Personnel or their relatives, as recorded in Note 31 to the financial statements. Following the change in control, the continuance of that revenue cannot be assumed.

? Credit risk on the loans of Rs. 1,236.27 Lakh deployed by the Company, which are repayable on demand and in respect of which, as the Auditors have reported, no schedule of repayment of principal or payment of interest has been stipulated. Regulatory risk, including the outcome of the demand of Rs. 142.47 Lakh raised by the Goods and Services Tax Department, which is under appeal.

? Tightening environmental regulation of plastics, including restrictions on single-use plastics and extended producer responsibility obligations.

3. SEGMENT-WISE OR PRODUCT-WISE PERFORMANCE

The Chief Operating Decision Maker of the Company evaluates its performance and allocates resources on the basis of a single business, namely the trading of plastic granules and other plastic products. The Company has accordingly identified one reportable operating segment, and the reporting of segment revenue and segment result under Indian Accounting Standard 108 does not arise. The position is stated in Note 36 to the financial statements. The whole of the revenue from operations of Rs. 129.84 Lakh for the year, and of Rs. 149.92 Lakh for the preceding year, was earned within India; the Company had no revenue from operations outside India and no foreign exchange earnings or outgo.

4. DISCUSSION ON FINANCIAL PERFORMANCE WITH RESPECT TO OPERATIONAL PERFORMANCE

(Rs. in Lakh)

Particulars	FY 2025-26	FY 2024-25
Revenue from operations	129.84	149.92
Other income	331.28	77.46
Total income	461.12	227.36
Purchase of traded goods	128.97	148.62
Employee benefits expense	18.27	21.50
Finance costs	17.35	21.16

 

Particulars	FY 2025-26	FY 2024-25
Depreciation and amortisation	0.48	9.11
Other expenses	66.58	40.53
Total expenses	231.65	240.90
Result of operations before other income	(101.81)	(90.98)
Profit / (loss) before tax	229.47	(13.54)
Profit / (loss) after tax	219.64	(12.94)
Earnings per equity share basic and diluted (Rs.)	3.96	(0.23)

The composition of the result

Your Board considers the single most important fact about the year to be that the profit reported does not arise from the business of the Company. Revenue from operations fell by 13.39% to Rs. 129.84 Lakh. Against that revenue the Company purchased traded goods for Rs. 128.97 Lakh, so that the gross margin on trading for the whole year was Rs. 0.87 Lakh, or 0.67% of revenue. After employee benefits expense of Rs. 18.27 Lakh, finance costs of Rs. 17.35 Lakh, depreciation of Rs. 0.48 Lakh and other expenses of Rs. 66.58 Lakh, the operations returned a loss of Rs. 101.81 Lakh before other income, against a loss of Rs. 90.98 Lakh in the preceding year.

The comprised a profit of Rs. 221.63 Lakh on the disposal of the Companys property, plant and equipment, a profit before tax of Rs. 229.47 Lakh is produced entirely by other income of Rs. 331.28 Lakh, which profit of Rs. 43.45 Lakh on the disposal of long-term investments, interest income of Rs. 66.09 Lakh, and Rs. 0.11 Lakh of miscellaneous receipts. Of these, the first two are non-recurring by their nature: the Company disposed of the whole of its property, plant and equipment during the year and its carrying value stood at nil as at 31st March, 2026. That profit will not recur.

The increase of 64.27% in other expenses, to Rs. 66.58 Lakh from Rs. 40.53 Lakh, is the principal movement on the cost side and is attributable in substantial part to the professional and transaction costs occasioned finance costs by 18.01%, the latter following the repayment of the Companys borrowings during the year.by the change in control of the Company during the year. Employee benefits expense fell by 15.02% and Depreciation fell by 94.73% consequent upon the disposal of the property, plant and equipment.

5. FINANCIAL POSITION

(Rs. in Lakh)

Particulars	As at 31.03.2026	As at 31.03.2025
Equity share capital	554.39	554.39
Other equity	750.20	537.77
Net worth	1,304.59	1,092.16
Total borrowings	Nil	187.20
Property, plant and equipment	0.00	74.22
Particulars	As at 31.03.2026	As at 31.03.2025
Investment property	75.33	75.33
Non-current investments	Nil	231.96
Loans (non-current)	1,236.27	843.75
Cash and cash equivalents	15.96	10.63
Total assets	1,412.95	1,408.10
Total liabilities	108.36	315.93
Book value per equity share (Rs.)	23.53	19.70

Net worth increased by 19.45% to Rs. 1,304.59 Lakh, the whole of the increase representing profit retained in the business; no fresh capital was raised during the year. Book value per equity share improved to Rs.

23.53 from Rs. 19.70 on an unchanged share count of 55,43,900 equity shares.

The Company discharged the whole of its borrowings during the year. Borrowings of Rs. 187.20 Lakh outstanding at the beginning of the year Rs. 123.11 Lakh non-current and Rs. 64.09 Lakh current stood at nil as at 31st March, 2026, and the charges registered in favour of IndusInd Bank Limited were satisfied on 6th August, 2025 and 27th November, 2025 respectively. The Company was free of debt at the year end.

The composition of the asset side changed materially. The whole of the property, plant and equipment was disposed of, and the non-current investments were realised. The proceeds, together with the retained profit, were applied principally in increasing the loans given by the Company, which rose by 46.52% to Rs. 1,236.27 concentration of the Companys balance sheet in a single class of financial asset and to the Auditors Lakh and now represent 87.50% of the total assets of the Company. Your Board draws attention the observation that no schedule of repayment of principal or payment of interest has been stipulated in respect of those loans.

The Company held no inventory and had no trade receivables at either year end, its trading being conducted on terms which do not require it to carry io of 0.93 times, against 0.94 times in the preceding year; the Companys either. Current assets of Rs. 100.64 Lakh against current liabilities of Rs. 108.36 Lakh give a current rat liquidity rests on its non-current financial assets, which are repayable on demand.

6. CASH FLOW

(Rs. in Lakh)

5Particulars	FY 2025-26	FY 2024-25
Net profit / (loss) before tax	229.47	(13.54)
Adjustments for non-operating items	(312.02)	(47.18)
Operating profit before working capital changes	(82.55)	(60.72)
Cash generation from operations	(30.36)	66.02
Direct taxes paid (net)	(3.90)	(0.99)
Particulars	FY 2025-26	FY 2024-25
Net cash from / (used in) operating activities	(34.26)	6.29
Net cash from investing activities	628.33	77.44
Net cash used in financing activities	(588.73)	(78.73)
Net increase in cash and cash equivalents	5.34	5.01
Cash and cash equivalents at the close of the year	15.96	10.63

The operating activities of the Company absorbed Rs. 34.26 Lakh during the year, against a net inflow of Rs. 6.29 Lakh in the preceding year. The adjustment of Rs. 312.02 Lakh for non-operating items is principally the elimination of the profits of Rs. 221.63 Lakh on the sale of assets and Rs. 43.45 Lakh on the sale of investments, and of interest received of Rs. 66.09 Lakh, each of which is reported under investing activities.

Investing activities generated Rs. 628.33 Lakh, comprising Rs. 294.04 Lakh of proceeds from the sale of fixed assets, head "Purchase ofRs. 66.09 Lakh Assets".of interest Financingreceived activities absorbed Rs. 588.73and Rs. 268.20 Lakh shown in the Lakh, ofCash Flow whichStatement Rs. 187.20against Lakh the represented the repayment of borrowings, Rs. 384.18 Lakh the repayment of advances and Rs. 17.35 Lakh interest paid. Cash and cash equivalents closed at Rs. 15.96 Lakh against Rs. 10.63 Lakh.

7. KEY FINANCIAL RATIOS AND RETURN ON NET WORTH

The details of significant changes, being a change of 25% or more as compared with the immediately preceding financial year, in the key financial ratios, together with the explanations for those changes, are set out below. The ratios are those disclosed in Note 44 to the financial statements.

Ratio	Numerator	Denominator	FY 2025-26	FY 2024-25	% Change	Chang e of 25% or more
Current Ratio (times)	Current assets	Current liabilities	0.93	0.94	(1.67)%	No
Debt-Equity Ratio (times)	Total debt	Shareholders equity	Nil	0.11	(100.00)%	Yes
Debt Service Coverage Ratio (times)	Earnings for debt service	Debt service	14.26	0.25	5,638.82%	Yes
Return on Equity (%)	Profit after tax	Average shareholders equity	0.16	(0.01)	(1,474.17)%	Yes
Net Capital Turnover Ratio (times)	Net sales	Working capital	(16.83)	(14.02)	20.01%	No
Net Profit Ratio (%)	Profit after tax	Net sales	1.64	(0.09)	1,995.29%	Yes
Return on Capital Employed (%)	Earnings before interest, depreciation and taxes	Capital employed	0.19	0.01	2,933.68%	Yes

Explanations for the changes of 25% or more

? Debt-Equity Ratio the ratio moved from 0.11 to nil because the whole of the Companys borrowings of Rs. 187.20 Lakh was repaid during the year and the Company had no borrowings outstanding as at 31^st March, 2026.

Debt Service Coverage Ratio the ratio improved from 0.25 times to 14.26 times because there was no repayment of principal falling due during the year and earnings available for debt service turned positive, the Company having recorded a profit after tax of Rs. 219.64 Lakh against a loss of Rs. 12.94 Lakh.

? tax of Rs. 219.64 Lakh against a loss of Rs. 12.94 Lakh, while average shareholders equity increased by a Return on Equity the ratio moved from (0.01) to 0.16 because the Company recorded profit after much smaller proportion, no fresh capital having been raised.

? Net Profit Ratio the ratio moved from (0.09) to 1.64 for the same reason, the profit after tax being measured against net sales which themselves declined by 13.39%.

? Return on Capital Employed the ratio moved from 0.01 to 0.19 because earnings before interest, depreciation and taxes turned positive on the strength of the profits realised on the disposal of assets and investments.

Return on Net Worth

Return on net worth, computed as the profit after tax expressed as a percentage of the net worth at the close of the year, was 16.84% for the financial year 2025-26 against (1.18)% for the financial year 2024-25 a movement of 1,802 basis points. The explanation is that the Company recorded a profit after tax of Rs. 219.64

Lakh against a loss of Rs. 12.94 Lakh, while net worth increased by only 19.45%, no fresh capital having been raised during the year. return was realised on the disposal of the Companys property, plant and equipment and of its investments, Your Board repeats, because it material to the reading of this figure, that the profit which produces this and not on its operations. Measured on the result of operations alone, the return on net worth for the year was negative.

8. RISKS AND CONCERNS

Risk is inherent in every business, and the Company follows a policy of risk minimisation. The Board reviews the risk profile of the Company and the regarded as material are those set out under the head "Threats" above, Audit Committee exercises oversight in the area of financial risk and internal controls. The risks presentl ^{and in addition:}

?Commodity price risk the prices of polymer granules and plastic products are linked to crude oil and naphtha prices and to the global petrochemical trade balance. The Company has no ability to influence them, and its ability to pass increase through to its customers is limited by competition.

? Credit risk the Companys principal financial assets are the loans of Rs. 1,236.27 Lakh. The Company applies the expected credit loss model prescribed by Indian Accounting Standard 109 and assesses the credit quality of its counterparties. The concentration of the balance sheet in this single class of asset is itself a risk.

Liquidity risk the Company had no borrowings as at the year end and no contractual repayment obligations. Its current liabilities of Rs. 108.36 Lakh exceed its current assets of Rs. 100.64 Lakh, and its liquidity therefore depends on its ability to call in the loans it has given.

Regulatory risk the demand of Rs. 142.47 Lakh raised under the Goods and Services Tax Act, 2017 in respect of the financial year 2019-20 is under appeal. On legal advice, the Company considers that it has a fair chance of succeeding, and no provision has been made.

? Business continuity risk the operations of the Company as presently constituted do not cover their costs. This is the element of risk which, in the opinion of the Board, may threaten the es Act, 2013 in the Boards existence of the Company, and it is reported as such under Section 134(3)(n) of the Company Report.

9. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Company has in place a system of internal controls commensurate with the nature of its business and the size and complexity of its operations. The controls are designed to provide reasonable assurance as to the reliability of financial reporting and the timely preparation of financial information, the safeguarding of assets against unauthorised use or loss, compliance with applicable laws and regulations, the prevention and detection of fraud and error, and the orderly and efficient conduct of the business.

The internal audit function is discharged by M/s. Sandeep Jhawar & Associates, Chartered Accountants, who report to the Audit Committee on a quarterly basis. The Audit Committee reviews the scope, functioning, periodicity and methodology of the internal audit, considers the internal audit reports and monitors the implementation of the recommendations made. The Statutory Auditors have expressed an unmodified opinion on the adequacy and operating effectiveness of the internal financial controls over financial reporting

Boards Report, in respect of the reporting made by the Auditors under Rule 11(g) of the Companies (Audit as at 31^st March, 2026. Members are referred to the explanation given by the Board, in paragraph 30 of the and Auditors) Rules, 2014 on the audit trail facility in the accounting software.

10. MATERIAL DEVELOPMENTS IN HUMAN RESOURCES AND INDUSTRIAL RELATIONS, INCLUDING THE NUMBER OF PEOPLE EMPLOYED

The Company employed 2 persons as at 31st March, 2026, against 5 persons as at 31^st March, 2025. Industrial relations remained cordial throughout the year and there was no dispute of any kind. Having regard to the scale of its operations the Company does not maintain a separate human resources function; the Board considers that the present complement is adequate for the activity presently carried on and will be reviewed as and when the Company enters the new lines of business approved by the Members.

11. OUTLOOK

Your Board does not consider it realistic to expect the trading business, at its present scale and margin, to become profitable without a material change either in its volume or in its terms. The Company has therefore obtained the approval of the Members, at the Extraordinary General Meeting held on 22^nd August, 2026, for an alteration of the objects clause of its Memorandum of Association and for a preferential issue of equity shares and convertible warrants. The intention is to redeploy the resources of the Company, which are unencumbered and free of debt, into activity capable of earning a return.

The financial year 2026-27 will therefore be a year of transition. The priorities of the Board are the completion of the preferential issue, the implementation of the resolutions passed at the Extraordinary General Meeting, the recovery or renegotiation of the loans presently carried on the balance sheet on terms which stipulate repayment and interest, and the establishment of an operating business which covers its costs. Your Board will report on each of these in the ordinary course.

Statements in this Management Discussion and Analysis Report which describe the Companys objectives,

12. CAUTIONARY STATEMENT projections, estimates and expectations may constitute forward-looking statements within the meaning of the such statements. Important factors that could make a difference to the Companys operations include applicable laws and regulations. Actual results may differ materially from those expressed or mplied economic conditions affecting the markets in which the Company operates, the price and availability of polymer and plastic products, changes in government regulation, taxation and environmental law, litigation, and other incidental factors, over many of which the Company does not have control. The Company undertakes no obligation to update or revise publicly any forward-looking statement, except as required by law.

	For and on behalf of the Board of Directors Pankaj Polymers Limited
	Sd/-	Sd/-
	Mayank Chawla	Vikas Garg
Date: September 07, 2026	Whole-time Director & CEO	Director
Place: Noida	DIN: 06391962	DIN: 07871975