Parvati Sweetners and Power Ltd Management Discussions

Global Economy Overview Overview

The global economic growth remained stagnant at 3.5% in 2024 and 2025, as the effects of the war in the Middle East were largely offset by accelerated demand-driven momentum in the global technology cycle, powered by advances in artificial intelligence (AI) and its adoption. The impact has varied widely across countries ? energy exporters outside the conflict zone benefited from favourable terms of trade, while economies integrated into the technology value chain saw stronger activity even where they were energy importers, whereas energy importers with limited participation in the technology upturn, a group that includes many low-income countries, experienced weaker activity.

Advanced economies witnessed a marginal increase in growth, remaining broadly stable at 1.9% in both 2024 and 2025, while emerging market and developing economies also held steady at 4.5% in 2025 compared to 4.5% in 2024.

Global inflation moderated sharply in 2025, declining to an estimated 4.1% from 5.8% in 2024, continuing the multi-year disinflation trend that had been in place since the beginning of 2024.

Regional growth (%)	2025	2024
World output	3.5	3.5
Advanced economies	1.9	1.9
Emerging and developing economies	4.5	4.5

(Source: IMF, un.org)

Performance of major economies, 2025

United States:	Reported GDP growth of 2.1% in 2025 compared to 2.8% in 2024.
China:	GDP growth was 5.0% in 2025 compared to 5.0% in 2024.
United Kingdom:	GDP growth was 1.4% in 2025 compared to 1.0% in 2024.
Japan:	GDP growth was 1.1% in 2025 compared with (0.2)% in 2024.
Germany:	GDP contracted by 0.2% in 2025 compared to a 0.5% in 2024.

(Source: IMF April 2026 Outlook World Bank)

Outlook

Given the challenge of forming stable, real-time assumptions for projections, the IMF World Economic Outlook Update assumes that the reopening of the Strait of Hormuz begins in mid-July 2026, with conditions broadly returning to the prewar state of affairs by March 2027, consistent with commodity price assumptions based on market pricing as of June 10, 2026. Under this outlook, global growth is projected at 3.0 percent in 2026, before recovering to 3.4 percent in 2027. Global inflation is expected to rise to 4.7 percent in 2026, as the disinflation trend since 2024 stalls, before easing to 3.9 percent in 2027. (Source: IMF World Economic Outlook Update ? July 2026, World Economic Forum, Federal Reserve, Bank of England, European Central Bank, Bank of Japan)

Indian economic overview

The Indian economys real GDP grew at 7.7% in FY 2025-26, compared to 7.1% in FY 2024-25. This growth was driven by strong consumption and increasing investments, reaffirming Indias position as the fastest-growing major economy.

Indias Real GDP at Constant Prices was estimated at Rs. 323.12 Lakh Crores in FY 2025-26, compared with Rs. 299.89 Lakh Crores in FY 2024-25.

Growth of the Indian economy

	FY 23	FY 24	FY 25	FY 26
Real GDP growth (%)	7.0	7.2	7.1	7.7

*The FY2022-23figure (7.0%) is from the old base year series (FY 2011-12) as the new series back-data for FY 2022-23 will only be available after December 2026.

Growth of the Indian economy quarter by quarter, FY 2025-26

	Q1FY26	Q2FY26	Q3 FY 26	Q4FY26
Real GDP growth (%)	6.7	8.4	7.8	7.8

Note: 02 revised upward from 8.2% and 03 from 7.35% under the new base year FY 2022-23 series released February 27,2026,04 remains an estimate (Source: MoSPI)

Inflation, policy and currency dynamics

Inflation remained benign through much of FY 2025-26, with full-year CPI estimated at an exceptionally low 2.1%. This created room for 125 basis points of cumulative rate cuts, supporting consumption and investment.

However, macro stability was accompanied by currency volatility. The Indian rupee depreciated sharply by 9.88% during FY 2025-26 ? its steepest fall since FY 2011-12 ? touching Rs. 94.83 against the US dollar. This reflected global capital flows, a strong dollar environment, and geopolitical uncertainties.

Capital flows and market behaviour

Foreign portfolio investors remained risk-averse, withdrawing a record Rs.1.8 Trillion during FY 2025-26 - the largest outflow in 36 years. However, strong domestic institutional inflows of Rs.8.50 Trillion provided a crucial counterbalance, highlighting the growing maturity and depth of Indias domestic capital markets.

Indias market capitalisation declined 8% year on year in FY 2025-26 to US$ 4.5 Trillion from US$ 4.83 Trillion in FY 2024-25, marking the sharpest drop since FY 2022-23. The BSE Sensex declined 7% or 5,467 points in FY 2025-26, against a gain of 5.1% or 3,763 points, in FY 2024-25. Similarly, the Nifty 50 fell 5%, or 1,188 points, in FY 2025-26, compared to a gain of 5.3% or 1,192 points, in FY 2024-25. against a gain of 5.34%, or 1,192 points, in the corresponding period. The downturn was largely driven by the ongoing West Asia conflict and concerns around potential tariff measures under Donald Trump, which weighed on global investor sentiment.

Gold prices surged 64.1% during FY 2025-26 reflecting global risk aversion and safe-haven demand. Indias net direct tax collections rose 5.12% y-o-y to Rs.23.40 Lakh Crores in FY 2025-26, though this fell short of the Revised Estimate of Rs.24.21 Lakh Crores by approximately Rs.80,000 Crores. Corporate tax collections came in at Rs.10.99 Lakh Crores against a target of Rs.11.09 Lakh Crores, while personal income tax (including STT) stood at Rs.12.41 Lakh Crores against a target of Rs.13.12 Lakh Crores ? the larger of the two misses, partly reflecting the income tax relief extended to the middle class in the Union Budget 2025.

Banking sector

Indias banking sector reflected improving financial health, with the gross non-performing asset ratio declining to a robust 2.1% as of September 2025, indicating stronger asset quality and disciplined lending practices. This stability was mirrored in profitability metrics, as scheduled commercial banks reported a return on assets of 1.3% and a return on equity of 12.5% during the first half of FY 2025- 26, underscoring sustained operational efficiency and a healthier balance sheet trajectory.

Indias growth story

Real Gross Value Added (GVA), which measures economic output excluding taxes and subsidies, grew 7.9% in FY 2025-26, compared with 7.3% in FY 2024-25. At current prices, nominal GVA rose 9.1% to Rs. 314.87 Lakh Crores from Rs.288.54 Lakh Crores a year earlier.

The tertiary services sector remained a key growth driver, expanding by 9.0% in FY 2025-26 and increasing its share in nominal gross value-added to 54.3% from 52.8% in FY 2024-25, supported by broad-based momentum across segments.

During FY 2025-26, financial, real estate, IT and professional services grew by 9.9%, while trade, hotels, transport, communication and broadcasting recorded a strong 10.1% growth, and public administration and other services expanded by 5.8%.

The secondary sector grew 9.1%, accelerating from 8.0% in the previous year, driven by manufacturing alongside construction growth of 7.1%. This combination of services-led scale and manufacturing acceleration is shaping a more balanced and resilient economic structure.

Consumption and investment

During FY 2025-26, Private Final Consumption Expenditure (PFCE) and Gross Fixed Capital Formation (GFCF) maintained above-7% growth, reflecting a well-balanced demand composition across household spending and investment activity.

Growth catalysts

- Policy-led consumption boost:

The Union Budget 2026 tax relief measures?particularly income tax exemptions up to Rs.12 Lakh?are expected to stimulate discretionary spending and reinforce consumptionled growth.

- Anticipatory Pay Commission impact:

The 8th Pay Commission, though expected to be implemented from FY 2027-28, is already shaping consumer sentiment, creating a forward consumption impulse.

- Monetary stability:

The Reserve Bank of Indias calibrated stance, with the repo rate at 5.25%, balances inflation risks with growth support, ensuring macroeconomic stability.

- Credit expansion:

Improved banking health and liquidity conditions are expected to sustain strong credit growth across MSMEs, housing, and retail segments.

- Fiscal prudence with growth focus:

The Union Budget maintains fiscal discipline while prioritising infrastructure, MSME support, skilling, and innovation?key levers for long-term productivity.

Outlook

The year under review underscores a defining divergence: a world grappling with uncertainty, and an India navigating it with confidence.

In a global environment marked by fragmentation and caution, India stands out as a rare convergence of stability, scale and structural opportunity. The World Bank has revised its FY 2026-27 growth estimate upward to approximately 6.6%, reflecting resilient domestic momentum even as growth moderates from the previous year. India is expected to retain its position as the fastest-growing major economy.

Growth will be shaped by a combination of strong domestic demand and resilient private consumption, supported by low inflation and GST rationalisation, alongside stable export performance with improved access to key markets. This momentum is further reinforced by sustained policy support, ongoing economic reforms, and a favourable demographic advantage.

While risks persist, particularly from elevated energy prices, subsidy pressures on government spending, and uncertainty in global demand, Indias macroeconomic fundamentals remain strong.

Over the medium term, sustained consumption, gradual investment recovery, and expanding global trade linkages are expected to reinforce Indias position as a key driver of global economic growth.

(Source: Upstox, Economic Times, India Today, 5paisa, Livemint, The Logical Indian)

Global sugar industry overview

The global sugar industry is a large agro-based sector led by major producers such as Brazil, India, and Thailand, and is influenced by weather patterns, policy frameworks, and global trade dynamics. Its scope remains strong, driven by steady demand, growth in emerging markets, and increasing integration with ethanol production, alongside a rising focus on sustainability and efficiency.

In 2024, global sugar production stood at 194.9 Million Tonnes, with forecasts projecting an increase to 223.1 Million Tonnes by 2033. The global bio-based chemicals market- sugar-derived intermediates critical for bioplastics and specialty chemicals is expected to surge from US$ 120.16 Billion in 2026 to US$ 249.36 Billion by 2034 (9.6% CAGR), driven by sustainability mandates and fossil-fuel substitution. Sugar-based exfoliants and moisturisers are gaining traction, with the body scrub market expected to grow from US$ 7.66 Billion in 2025 to US$ 12.07 Billion by 2033 (5.9% CAGR), fueled by clean-beauty trends and do it yourself (DIY) skincare movements.

Rising urbanisation, evolving consumer preferences for convenient foods, and the rapid expansion of the food service sector are collectively driving increased sugar consumption, particularly through the growing demand for indulgent and packaged products. At the same time, the chemical segment of the sugar industry is gaining momentum, supported by the rising demand for bio-based products, diversion of surplus sugar towards ethanol, favourable government policies, and the emergence of sustainable alternatives such as bioplastics and specialty chemicals. Additionally, the use of sugar in cosmetics for its natural exfoliating and moisturising properties is contributing to incremental demand.

Performance of major sugar growing States

Latin America continued to anchor global sugar supply in FY 2025-26, with production exceeding 60 Million Tonnes and a significant share directed towards exports. The regions scale, cost competitiveness, and ability to flexibly divert cane between sugar and ethanol enabled it to remain the primary balancing supplier to deficit markets across Europe, Africa, and parts of Asia. This high export availability also transmitted price pressure into international markets during periods of surplus supply.

Asia Pacific accounted for more than 40% of global sugar production and consumption, with improved output during the year reducing import demand and increasing export availability in selected markets. However, the region remained highly sensitive to policy interventions relating to exports, domestic market controls, and feedstock allocation, making it a key driver of global market volatility. Europe, meanwhile, continued to face structural supply constraints arising from lower beet acreage, rising costs, and regulatory pressures, reinforcing its position as a net import market and absorber of global sugar surpluses.

Africa and North America played contrasting roles in the global balance. Africa remained a demand-driven import market supported by population growth and urbanisation, though supply conditions continued to be influenced by currency movements, freight costs, and political stability. North America, by contrast, operated within a tightly regulated trade framework, limiting the direct impact of global price fluctuations and positioning the region as a relatively stable and predictable consumption market.

(Source: Food.com)

Indian sugar industry overview

India continued to be the worlds largest consumer of sugar, making the sugar industry one of the countrys most significant agro-based sectors during FY 2025-26. Beyond its contribution to GDP, the industry played a critical role in supporting millions of farmers and sustaining rural livelihoods. Key byproducts such as molasses, bagasse, and ethanol further strengthened the sectors integrated value chain.

During the 2025-26 season, total sugar availability was estimated at 34.3 Million Tonnes, significantly exceeding domestic consumption of approximately 28.3 Million Tonnes. Exports were estimated at around 0.7 Million Tonnes, while closing stocks remained stable at nearly 5.3 Million Tonnes, ensuring adequate domestic buffer levels. Export activity continued to remain regulated through government quotas, with total permitted exports for the 2026 marketing year standing at 2 Million Tonnes, including incremental approvals during the year.

Regionally, production trends reflected both climatic and structural shifts. In Uttar Pradesh, yield pressures arising from varietal replacement were partly offset by improved recovery rates. Maharashtra and Karnataka witnessed lower output due to excessive rainfall, early flowering of sugarcane, and compressed crushing cycles. However, improved planting trends in these States toward the end of the year indicated the possibility of recovery in the upcoming season, supporting healthy opening stock levels.

A defining structural shift during the year was the accelerated pivot toward ethanol production. Supported by strong policy measures from the Government of India, ethanol blending with petrol continued to gain momentum, positioning the sugar industry at the centre of the countrys renewable energy transition. Ethanol production was expected to increase to nearly 4 Million Tonnes in the 2026 season, compared with 3.5 Million Tonnes in 2025, supported by the governments target of achieving 20% ethanol blending.

This transition reshaped the industrys economics by creating an alternative revenue stream, improving cash flow visibility for sugar mills, and reducing dependence on sugar price cycles. It also contributed to environmental sustainability by supporting lower greenhouse gas emissions and reducing reliance on fossil fuels.

From a financial perspective, the sector witnessed gradual recovery during the year. Operating margins of sugar mills improved to an estimated 9-9.5% in FY 2025-26, supported by better realisations, diversified revenue streams, and improved balance sheet resilience following earlier cyclical pressures. Overall, the Indian sugar industry continued evolving from a traditional agro-based sector into a more diversified and resilient ecosystem balancing food, fuel, and sustainability objectives.

(Source: Economic Times, I REF, IBEF)

Sugar Balance Sheet 2025-26 (in Lakh Tonnes)

Sugar Balance Sheet 2025-26	50
Estimated production during Sugar Season FY 2025-26	293
(after ethanol diversion)
Sugar availability	343
Estimated domestic consumption	283
Targeted exports during sugar season FY 2025-26	7
Closing stock	53

Sugar opening stock, production, consumption and closing stock in India over the years

(in Million Tonnes)

Year	Opening Balance	Production	Consumption	Closing Balance
2015-16	9.08	25.1	24.8	7.75
2016-17	7.75	31.6	24.5	3.88
2017-18	3.38	32.5	25.4	10.72
2018-19	10.72	33.16	26	14.5
2019-20	14.5	27.4	25.3	10.7
2020-21	10.7	30.8	26	8.5
2021-22	8.5	36	27.5	7
2022-23	5.7	35.0	27.5	6.2
2023-24	5.18	34.0	29.50	7.68
2024-25	8	33.3	30.10	5
2025-26(E)	5	31.20	27.70	4.75

Performance of major sugar growing states

Maharashtra: Sugar production increased to 98.95 LMT in SS 2025-26 from 80.10 LMT in the previous season, while recovery remained stable at 9.5%. Despite leading in overall cane crushing and sugar output, the state lagged Uttar Pradesh and Karnataka in per-mill operational efficiency.

Uttar Pradesh: Sugar production remained broadly stable at 87.45 LMT compared to 87.70 LMT in the previous season, while recovery improved significantly to 10.2% from 9.7%, the highest among Indias major sugar-producing States. The state also recorded the strongest per-mill performance in cane crushing and sugar production, reflecting improved operational efficiency and recovery trends.

Karnataka: Sugar production rose to 46.75 LMT from 39.90 LMT in the previous season, with recovery improving to 8.65% from 8.5%. While overall production remained lower than Maharashtra and Uttar Pradesh, Karnataka demonstrated strong per-mill productivity and operational efficiency.

(Source: ChiniMandi, Times of India)

Sugar exports and imports

Indias sugar exports during the 2025-26 marketing season (October-September) were expected to remain limited at 7.5-8 Lakh Tonnes due to unfavourable global price parity. The Government of India initially permitted exports of 15 Lakh Tonnes for the season and subsequently opened an additional 5 Lakh Tonne quota, taking the total approved export limit to 20 Lakh Tonnes. However, only 87,587 Tonnes were approved under the additional allocation.

As of March 2026, India had exported nearly 5 Lakh Tonnes of sugar, although mills were unlikely to fully utilise the permitted quota as export competitiveness weakened during the latter part of the season. While export activity remained relatively stronger in the early months, lower international sugar prices reduced parity for further shipments.

The United Arab Emirates (UAE) emerged as the largest importer of Indian sugar during the period, followed by Afghanistan with 46,163 Tonnes, Djibouti with 30,147 Tonnes, and Bhutan with 20,017 Tonnes.

(Source: Economic Times, KNN India)

Fair and remunerative prices

The Government approved the Fair and Remunerative Price (FRP) of sugarcane for the 2026-27 Sugar Season at Rs.365/ quintal for a basic recovery rate of 10.25%, representing an increase of 2.81% over the Rs.355/quintal FRP applicable for the 2025-26 season. The revised FRP provides a premium of Rs.3.56/quintal for every 0.1% increase in recovery above 10.25% and a reduction of Rs.3.56/quintal for every 0.1% decline in recovery. However, to safeguard farmer interests, no deduction will apply for mills operating below 9.5% recovery, with farmers in such cases assured a minimum FRP of Rs.338.30/quintal. The FRP remains significantly above the estimated sugarcane production cost of Rs.182/quintal, reinforcing government support for the sugar sector, which supports nearly 5 Crores sugarcane farmers and around 5 Lakh workers directly employed in sugar mills.

FRP over the years

{in ? per quintal)

Year	FRP
2012-13	145
2013?1A	170
2014-15	210
2015-16	220
2016-17	230
2017-18	255
2018-19	275
2019-20	275
2020-21	285
2021-22	290
2022-23	305
2023-24	315
2024-25	340
2025-26	355

Indian ethanol sector overview

India continued to make steady progress in the ethanol sector during FY 2025-26, supported by rising production, higher blending levels, and expanding manufacturing capacity. The accelerated rollout of the Ethanol Blending Programme (EBP), diversification of feedstock sources, and continued distillery expansion by integrated sugar companies strengthened the sectors role in Indias energy transition and rural economic development. The Indian ethanol market was valued at approximately US$ 3.58 Billion in 2025 and is projected to grow at a CAGR of around 14.6% during 2026-2035, reaching an estimated US$ 13.99 Billion by 2035.

A key driver of this growth is the governments focus on diverting surplus sugar toward ethanol production. This approach not only reduces excess sugar inventories but also lowers dependence on fossil fuel imports and supports Indias climate commitments under global frameworks such as CoP26.

Ethanol procurement by Oil Marketing Companies (OMCs) has scaled significantly, with a balanced mix of feedstocks. In the latest cycle, procurement volumes have remained robust, with grain-based ethanol slightly exceeding sugar-based ethanol, reflecting a gradual diversification of feedstock sources. This shift is being driven by better economics and supply stability in grain-based production.

Indias Ethanol Blended Petrol (EBP) programme continued its rapid expansion, with blending levels rising from 1.5% in 2013 to nearly 20% in ESY 2025, positioning the country among the global leaders in biofuel adoption. The programme strengthened energy security, supported rural incomes, reduced crude oil imports, and lowered emissions, while also highlighting challenges related to feedstock availability, water use, logistics, and long-term sustainability. Policy support remained strong through administered ethanol pricing, 5% GST on ethanol for blending, interest subvention schemes, long-term offtake agreements, and investments in storage and transportation infrastructure.

On the pricing front, the government continued to support ethanol production through administered pricing mechanisms. Ethanol derived from C-heavy molasses (CHM) has seen a marginal price increase, improving viability for producers. Meanwhile, prices for B-heavy molasses (BHM) and sugarcane juice (SCJ) have largely remained stable in recent periods. However, rising sugarcane costs have exerted pressure on margins for BHM and SCJ-based distilleries, leading to a gradual shift in production preference toward CHM and grain-based ethanol, which currently offered relatively better returns.

Looking ahead, ethanol production is expected to rise further in FY 2025-26, supported by expanding distillation capacities, favorable policy support, and sustained demand from OMCs. The ethanol ecosystem increasingly strengthened the financial resilience of sugar companies by improving cash flows, reducing cyclicality, and providing an additional revenue stream.

Overall, the ethanol sector is playing a transformative role in repositioning Indias sugar industry, from a cyclical agro-based sector to a more stable, diversified, and energy-integrated value chain.

Indian co-generation sector overview

Biomass continued to play an important role in Indias energy mix during FY 2025-26, supported by rising policy focus on renewable energy, ethanol blending, and waste to-energy initiatives. Biomass and biofuels accounted for nearly 12-13% of Indias total primary energy supply, while biomass remained a critical energy source for rural households and small-scale industries. Indias growing emphasis on clean energy transition, coupled with abundant agricultural residue availability, continued to strengthen the long-term outlook for the biomass sector. Industry estimates indicate that India will account for more than one-third of global bioenergy demand growth by 2030, driven by rising ethanol production, biomass power generation, and broader adoption of sustainable fuel alternatives.

The bioenergy sector has witnessed steady expansion in recent years, supported by favorable policy interventions and increasing private sector participation. Installed bioenergy capacity has grown to over 11 GW, reflecting consistent year-on- year progress.

Indias biomass market reached an estimated size of US$ 2.2 Billion in 2025 and is projected to grow to US$ 3.9 Billion by 2034, registering a CAGR of 6.34% during 2026-2034. Growth in the sector is being driven by rising energy demand, favourable government policies, increasing investments in waste-to-energy projects, abundant biomass availability, and growing emphasis on sustainable alternatives to fossil fuels. Technological advancements and environmental concerns are also supporting the expansion of the biomass industry in India.

To accelerate adoption, the Government of India has introduced targeted initiatives aimed at expanding biomass utilisation, particularly in rural and semi-urban regions. These efforts focus on promoting biomass-based power generation, co- generation in sugar mills, and compressed biogas (CBG) production, while also addressing critical challenges such as agricultural residue management and stubble burning.

A key pillar of this strategy is the National Bioenergy Programme, implemented by the Ministry of New and Renewable Energy (MNRE) for the period 2021-2026. The programme is structured across three core segments:

Waste-to-energy: Focused on converting agricultural, municipal, and industrial waste into usable energy, aligned with the SATAT scheme target of establishing 5,000 CBG plants.

Biomass programme: Promotes palletisation and briquetting, alongside biomass-based co-generation, particularly within the sugar industry.

Biogas programme: Encourages decentralised energy solutions through small and medium-scale biogas plants, especially in rural areas.

These initiatives are designed to reduce reliance on fossil fuels, lower emissions, and create additional income streams at the grassroots level, while also attracting global clean energy investments into Indias bioenergy ecosystem.

Biomass is expected to remain a critical pillar of Indias energy transition, supported by strong policy momentum around ethanol blending, bioenergy, compressed biogas (CBG), and biomass co-firing initiatives. Bioenergy could contribute nearly 130 Million Tonnes of oil equivalent (Mtoe) by 2040, accounting for around 15% of Indias total energy demand. India is also projected to account for more than one-third of global bioenergy demand growth by 2030, driven by rising renewable energy adoption, agricultural residue utilisation, and governmentbacked bioenergy programmes.

Overall, the bioenergy segment is evolving into a key pillar of Indias sustainable energy framework, balancing environmental priorities with rural economic development.

SWOT analysis

Strengths

• Sugarcane remains one of the most remunerative cash crops cultivated in India, ensuring consistent farmer interest.

• India is the worlds largest consumer of sugar and the second-largest producer, providing a strong domestic demand base.

• The sugar industry supports a wide ecosystem of allied sectors, including ethanol, power co-generation, and distillery operations.

• Strong policy support from the government underpins sector stability and rural economic development.

• The industry plays a vital socio-economic role, supporting the livelihoods of nearly 50 Million farmers and providing direct employment to over 500,000 workers.

• Integrated business models (sugar, ethanol, and power) enhance revenue diversification and improve resilience.

Weaknesses

• Sugarcane pricing in India remains relatively high compared to global benchmarks, impacting cost competitiveness.

• Presence of ageing infrastructure and outdated technologies in several mills limits efficiency gains.

• High working capital requirements and cyclical cash flows create financial stress for some industry participants.

• Dependence on sugar as a primary revenue stream exposes companies to price fluctuations.

• Environmental concerns, particularly water-intensive cultivation practices, pose long-term sustainability challenges.

Opportunities

• Domestic sugar consumption remains robust, with demand estimated at around 32 Million Metric Tonnes, offering stable growth prospects.

• Expansion of ethanol blending programmes presents a significant opportunity for higher-margin revenue streams.

• Adoption of advanced agricultural practices and high- yield crop varieties can improve productivity and recovery rates.

• Increasing focus on green energy and sustainability opens avenues for growth in ethanol and co-generation segments.

• Technology modernisation across mills can enhance operational efficiency and optimise by-product utilisation.

• Export opportunities may arise depending on global supply-demand dynamics and favourable policy support.

Threats

• Climate variability and extreme weather conditions can adversely impact crop yields and cane availability.

• Heavy dependence on monsoon patterns increases vulnerability to rainfall inconsistencies.

• Regulatory changes, including pricing controls and export restrictions, may impact profitability.

• Volatility in global sugar prices can influence domestic market dynamics.

• Competition from alternative sweeteners and changing consumer preferences may affect long-term demand.

• Infrastructure gaps in rural areas can further expose the sector to supply chain disruptions.

Company Overview

Parvati Sweetners & Power Limited ("PSPL"), is a part of the LNCT Group, Bhopal (M.P.) Established in 2011, the Group is in the sugar business for over 15 years and consequent upon various schemes of merger and demerger, this Company was incorporated on 13.12.2011 PSPL Sugars core business includes sugar and its bye products. Sugar mills have crushing capacity of 2500 TCD. PSPL Sugar plant is located in Gwalior (M.P.).

Financial Performance with respect to operational performance

Ratio

Ratios	FY25-26	FY24-25
Debtor Turnover Ratio	59.23 times	48.59 times
Inventory Turnover Ratio	0.29 times	0.62 times
Interest Coverage Ratio	-1.27 times	0.19 times
Current Asset Ratio	2.90 times	6.61 times
Debt to Equity Ratio	0.37 times	0.29 times
Operating Profit Margin Ratio	0.31%	0.86 %
Net Profit Margin Ratio	-72.55%	1.09 %
Return on Equity Ratio	0.15%	0.01 %

Financial Review

Total revenue:- Rs. 1833.27 Lakhs Total expenditure:- Rs. 3214.67 Lakhs Profit/Loss after Tax:- Rs. (1304.94) Lakhs

Risk, Concern and Threats

The Company recognizes that risk is inherent to any business activity and that managing risk effectively is critical to the immediate and future success of the Company. The Company having many risk, concern like:-

1. The distance between the mills and cane fields are expected to pose a risk to the Companys business.

2. The Company could get affected by a situation of excess of supply over demand.

3. The Company may face risks involved in the procurement of sugarcane.

4. The Company may face the risk of low-quality sugarcane

5. The Company may face risks due to increasing debts.

6. Climatic vagaries could impact cane availability, quality and recovery

7. A change in the regulatory environment could impact operations

Risk management at our organization

At PSPL, the corporate policy (and in effect our ability to manage organisational risk) is framed by our Board of Directors, comprising esteemed professionals with vast industry experience. Our governance principles, including overall risk tolerance, are directed by the Board of Directors. Our Board is assisted by various committees with specific functions like Audit Committee, Stakeholders Relationship Committee, Nomination and Remuneration Committee, Executive committee and Independent Director Committee, which also includes Board member(s) who report their findings to the Board of Directors. As a governance initiative, we ensure that members within our risk management structure are acquainted with our risk strategy and processes, ensuring complete transparency as well as improved ability to manage everyday risks. Our risk governance boosts the development and maintenance of an effective risk and control culture.

We have the following procedure for mitigation the risk:-

1. Risk identification

2. Risk assessment

3. Development, implementation and follow up of risk management activities

4. Monitoring

Internal Control systems and their adequacy

The Companys internal audit system is being continuously monitored and updated to ensure that assets are safeguarded, established regulations are complied with and pending issues are addressed promptly. The audit committee reviews reports presented by the independent internal auditors on a routine basis. The committee makes note of the audit observations and takes corrective actions, if necessary. It maintains constant dialogue with statutory and internal auditors to ensure that internal control systems are operating effectively

Human Resource Management

The Company believes that the quality of the employees is the key to its success and is committed to equip them with skills, enabling them to seamlessly evolve with ongoing technological advancements. During the year, the Company organised training programmes in different areas such as technical skills, behavioural skills, business excellence, general management, advanced management, leadership skills, safety, values and code of conduct. The Companys employee strength stood at 119 as on 31 March, 2026.

Cautionary Statement

Statements in the Management Discussion and Analysis relating to the Companys objectives, predictions, and outlook may be "forward-looking statements" within the meaning of applicable securities 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 and in the security market, 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.

Environment, Health and Safety Environment

The Company strives to be a responsible corporate entity. The Company, therefore, recognizes the impact of its operations on the environment and hence are committed to strictly adhere to the Environment, Health and Safety (EHS) norms and compliance standards set by the Government of India.

Green Initiative

Your Company has set up a standard operating procedure (SOP) for managing hazardous waste at all units also formed an inter- unit committee with the objective of minimising freshwater consumption. It is done by enhancing the use of recycled water, which automatically reduces the use of water.

Environmental initiatives

The company continues to abide by all applicable environmental regulations for all its operations in India. From energy generation to energy consumption, water consumption to wastewater generation and its disposal, product manufacturing to waste generation and fuel consumption is reported on a monthly basis to the management. SPCC tank assessments have also been initiated at all sites to identify gaps in the system and prepare plans to take necessary steps for its implementation.

Health and safety

During the year, the Company continued its efforts to strengthen the health and safety of its employees your company also start many safety and health measurements for protection of the employees and their family, your Company has strictly adhere the guidelines stipulated by the government of India. Advanced fall protection systems were implemented in a phased manner at all sites to ensure better safety of employees.