Piccadily Agro Industries Ltd Management Discussions

Economic Overview Global Economy1

The global economy maintained steady growth during CY2025 despite persistent geopolitical tensions, shifting trade dynamics and policy uncertainties across major markets. Economic activity was driven by resilient consumer spending, sustained technology investments and improving financial conditions. These factors supported growth amid a challenging operating environment. Global GDP grew at 3.5% during the year, reflecting stable economic momentum.

Growth varied across regions. Advanced Economies expanding by 1.9%, while Emerging Market and Developing Economies (EMDEs) grew by 4.5%. Growth in EMDEs was supported by robust domestic demand and investment activity.

Inflationary pressures eased during the year. Global inflation moderated to 4.1%, aided by improving supply conditions and the cumulative impact of monetary policy measures implemented by major central banks.

Outlook

The global economy is projected to expand by 3.0% in CY2026 and 3.4% in CY2027. Growth is expected to be supported by technological advancements, rising digital adoption, productivity-led investments and resilient activity across emerging markets. However, the outlook remains subject to geopolitical conflicts, trade disruptions, supply chain disruptions, energy and commodity price volatility, elevated public debt and evolving financial market conditions. Global inflation is expected to increase to 4.4% in CY2026 before moderating to 3.7% in CY2027. Continued investments in innovation, renewable energy, infrastructure and technology are expected to strengthen economic resilience and support sustainable long-term growth.

Indian Economy

India remained among the fastest-growing major economies in FY2025-26. Growth was driven by resilient domestic demand, robust investment activity and sustained momentum across key sectors. Real GDP grew by 7.7% in FY2025-26, compared with 7.1% in FY2024-25. Real Gross Value Added (GVA) increased by 7.9%2.

Economic expansion was broad-based across sectors, reflecting resilience amid global uncertainties. The secondary and tertiary sectors grew by 8.8% and 9.3%, respectively. Manufacturing remained a key growth driver, aided by higher industrial activity, policy initiatives and investments in domestic manufacturing capabilities.

On the expenditure side, Private Final Consumption Expenditure (PFCE) and Gross Fixed Capital Formation (GFCF) grew by over 7.5%. This reflected healthy consumer demand and sustained capital expenditure across the economy.3

Outlook

Indias economic outlook remains resilient despite global uncertainties. The Reserve Bank of India projects real GDP growth of 6.6% for FY2026-27. Quarterly growth is estimated at 6.6% in Q1, 6.3% in Q2, 6.5% in Q3 and 6.8% in Q4.4

Growth is expected to be driven by resilient private consumption, strong capacity utilisation, sustained credit flows, robust services activity and continued government capital expenditure. Manufacturing and investment activity are expected to benefit from ongoing infrastructure development, industrial expansion and stronger domestic value chains.

However, geopolitical tensions, supply-chain disruptions, commodity price volatility and adverse weather conditions remain key risks. Indias strong macroeconomic fundamentals, ongoing reforms and continued public and private investments are expected to support sustained growth over the medium term.

Industry Overview

Global Alcoholic Beverages Industry5

Consumer preference shifted toward premium and differentiated alcoholic beverages during 2025. Rising disposable incomes and evolving consumption patterns supported this trend. Demand for elevated drinking experiences also gained momentum. Against this backdrop, the global alcoholic beverages market reached approximately US $2,564.92 billion in 2025, reflecting its scale and resilience across developed and emerging markets.

Premiumisation remained a defining industry trend, particularly within the spirits segment. Consumers increasingly preferred premium and super-premium offerings. Product innovation, flavour expansion, craft categories and sustainability initiatives shaped purchasing decisions. These factors also enhanced brand positioning across markets.

Regional demand trends remained favourable. Asia Pacific accounted for 40.92% of the global market in 2025. Growth was driven by urbanisation, rising middle-class incomes and higher consumer expenditure. North America and Europe benefited from sustained demand for premium spirits and mature consumption trends. Emerging markets recorded increasing acceptance of branded alcoholic beverages.

The global alcoholic beverages market is projected to grow from US $2,723.94 billion in 2026 to US $4,325.99 billion by 2034. The market is expected to register a CAGR of 5.95% during the forecast period. Growth will be driven by continued premiumisation, rising demand for quality spirits and deeper market penetration. Continued product development and portfolio expansion will further support growth. Digital engagement, changing consumer preferences and investments in brand equity are expected to strengthen long-term industry prospects.

Indian Alcoholic-Beverage Industry6

The Indian alcoholic beverages industry remains among the worlds largest consumer markets. Rising disposable incomes, rapid urbanisation and changing consumption habits continue to support demand. The market was valued at US$148.3 billion in 2025. Growth was driven by greater social acceptance, hospitality sector expansion and rising consumption across urban and semi-urban markets.

The industry is witnessing a gradual move towards premium and craft alcoholic beverages. Younger consumers increasingly prefer distinctive experiences and superior product quality. Growing health consciousness is also shaping consumption choices. Demand for low-alcohol, low-calorie and wellness-focused beverages is gaining traction. This trend is encouraging manufacturers to broaden and refine their portfolios.

India is expected to emerge as a major growth driver for premium alcoholic beverages, supported by favourable demographics and a rising preference for premium products. At the same time, New Delhi is projected to become a significant market for premium alcoholic beverages over the next decade. The expansion of organised retail networks, specialist liquor stores and digital commerce platforms is improving product availability. These channels are also enhancing market reach across Tier I and Tier II cities. Against this backdrop, the Indian alcoholic beverages market is projected to reach US $176.2 billion by 2034, growing at a CAGR of 1.84% during 2026-2034.

Growth Drivers of Indian Alcohol Market

Growth Driver	Details
Premiumisation of Alco-Beverages	Consumers are increasingly choosing premium and superior-quality beverages. Rising aspirations, evolving preferences and stronger brand affinity support this trend.
Emergence of New Sales Channels	Home delivery services and digital platforms are improving accessibility and convenience. These channels are expanding consumer reach and supporting market growth.
Growth of In-Home Consumption	At-home consumption continues to gain traction. This trend is driving demand across categories and creating new consumption occasions.
Influence of On- Trade Channels	Hotels, restaurants, pubs and bars enhance brand visibility and consumer engagement. These channels also encourage premium consumption across beverage segments.
Changing Social Attitudes Towards Alcohol Consumption	Greater acceptance of social drinking and evolving lifestyles are broadening the consumer base. These shifts are supporting category expansion across demographics.
Favourable Excise Policies	Regulatory reforms and improved excise frameworks can strengthen market access. They also enhance operating efficiency and support industry development.

Global Whisky Market7

The global whisky industry continues to benefit from sustained demand for aged spirits and premium offerings. Whisky remains one of the most consumed spirits categories worldwide. Consumer appreciation for craftsmanship, heritage and authenticity continues to strengthen category appeal. Reflecting these trends, the global whisky market was valued at US $77.9 billion in 2025, with Asia Pacific emerging as the largest regional market.

Demand for premium, super-premium and craft whisky continues to rise. This trend is encouraging producers to strengthen innovation and brand differentiation. Interest in single malt expressions, limited-edition releases and distinctive cask finishes has increased steadily. Advances in production, packaging and distribution are also enhancing product quality and market reach.

The industry is benefiting from evolving consumption habits, particularly among younger demographics. Demand for experiential offerings and high-quality spirits continues to increase. Whisky-based cocktails, curated drinking experiences and artisanal products are broadening category appeal across developed and emerging markets. Meanwhile, e-commerce adoption and omnichannel distribution are improving accessibility and consumer engagement.

The global whisky market is projected to increase from US$82.1 billion in 2026 to US$116.0 billion by 2033. The market is expected to register a CAGR of 5.1% during 2026-2033. Growth will be driven by premium product demand, wider consumer adoption and portfolio innovation. Advancements across manufacturing and supply chains are expected to further enhance long-term industry prospects.

Indian Whisky Industry8

Whisky remains the largest segment within Indias spirits market. Strong consumer preference, changing lifestyles and rising demand for products continue to support category growth. The segment also benefits from increasing urban consumption and wider retail availability. Reflecting these trends, the Indian whisky market was valued at US $2,563.4 million in 2025.

A defining industry trend is the shift towards premium and luxury whisky offerings. Higher disposable incomes and evolving consumer aspirations are encouraging premium purchases. Greater exposure to international drinking trends is also influencing consumption patterns. Product innovation, premium packaging and the presence of domestic and global brands continue to enhance consumer appeal.

The industrys outlook remains positive, driven by favourable demographics and urbanisation trends. Premiumisation across the spirits market is expected to remain a key growth catalyst. Consumers increasingly seek quality, provenance and distinctive experiences. Consequently, the Indian whisky market is projected to reach US $4,922.5 million by 2034. The market is expected to register a CAGR of 7.14% during 2026-2034.

Growth Drivers and Challenges in Indian Single Malt Whisky Industry9

Drivers

• Growing Disposable Incomes: A rising middle class with increased purchasing power is readily adopting premium beverages.

• Shifting Consumer Preferences: A move towards quality, craftsmanship, and unique experiences over mass- produced spirits.

• "Made in India" Pride: Increasing national pride in locally produced, high-quality artisanal products.

• Global Recognition: The growing international acclaim for Indian Single Malts as also other spirits like Rum and Vodka is fuelling domestic aspiration and demand.

• Innovation in Distillation and Maturation: Distillers are experimenting with local grains and diverse aging techniques to create distinctive flavour profiles.

Challenges

• High Excise Duties: Varying and often substantial state-level excise duties impact pricing and profitability.

• Supply Chain Complexities: Ensuring consistent quality and availability across a vast and diverse country can be challenging.

• Competition from International Brands: Established global single malt brands pose significant competition.

• Consumer Education: The need to educate consumers about the nuances and value of Indian single malts.

• Regulatory Hurdles: Alcobev is a state subject and each state has different regulations, which are prone to changes. Navigating complex licensing and distribution regulations across different states.

Global Ethanol Industry

The global ethanol industry is benefiting from the transition towards cleaner energy sources and sustainable fuel alternatives. Ethanol plays a critical role as a biofuel, fuel additive and industrial feedstock. Its contribution to decarbonisation initiatives continues to strengthen across major economies. Reflecting these trends, the global ethanol market was valued at USD 114.89 billion in CY 2025.

Government-led blending programmes and renewable fuel mandates remain key demand drivers across various region . Efforts to reduce greenhouse gas emissions and enhance energy security are accelerating ethanol adoption worldwide including Countries like Brazil and the United States . These initiatives continue to reinforce the sectors strategic importance within the evolving energy landscape.

Beyond fuel applications, ethanol serves a broad range of end-use industries. Demand from pharmaceuticals, personal care, chemicals and food processing remains robust. Advances in production technologies and feedstock optimisation are enhancing operational efficiency and cost competitiveness.

The industrys outlook remains favourable, driven by regulatory tailwinds, wider industrial applications and investment across renewable energy value chains. The global ethanol market is projected to expand from US$121.15 billion in 2026 to US$191.78 billion by 2035. The market is expected to register a CAGR of 5.26% during 2026-2035.

Indian Ethanol Industry10

Indias ethanol industry has emerged as a key component for its energy transition agenda. Greater emphasis on renewable fuels, energy security and sustainable mobility continues to strengthen market prospects. Expanding integration within the fuel ecosystem has broadened ethanols role across multiple sectors. Reflecting this momentum, the Indian ethanol market was valued at US $3.43 billion in 2025.

Policy initiatives continue to serve as a key catalyst for the sector. Programmes promoting ethanol blending, biofuels and reduced import dependence are supporting capacity creation. At the same time, the move has led to concerns and backlash regarding the impact of E20 and other ethanol-blended petrol variants on vehicles. Despite this, the Ethanol Blended Petrol (EBP) Programme remains a key element of Indias energy strategy, aimed at enhancing energy security, supporting the farming community and reducing environmental impact through greater use of domestically produced renewable fuel.

Higher feedstock availability and ongoing investments across the value chain are further reinforcing industry fundamentals.

Demand is strengthening across transportation, industrial applications, pharmaceuticals and consumer products. Process improvements and technological advancements continue to enhance productivity and operational performance. The shift towards low-carbon energy solutions is also creating new opportunities across end-use segments.

The Indian ethanol market is projected to increase from US $3.43 billion in 2025 to US $11.78 billion by 2034. The market is expected to register a CAGR of 13.95% during 2026-2034. Policy continuity, higher blending targets and broader renewable fuel adoption are expected to sustain long-term growth.

Indian Sugar Industry

The sugar industry is one of Indias largest agro-based industries and plays a vital role in the countrys economy. It supports the livelihoods of sugarcane farmers and their families while providing direct and indirect employment to millions of people engaged in sugar manufacturing, transportation, trading and allied activities. The industry also contributes significantly to rural development and remains an important source of income for the agricultural sector.

During the 2025-26 sugar season, the Indian sugar industry recorded higher production, supported by improved sugarcane availability and stronger output across key producing states. Net sugar production is estimated at approximately 29.3 million tonnes after the diversion of around 3.1 million tonnes of sugar equivalent towards ethanol production. Domestic sugar consumption is estimated at around 28.2 million tonnes, resulting in a relatively balanced market with tighter inventory levels than in previous years. Higher production in Maharashtra and Karnataka contributed significantly to the overall output, supported by favourable agronomic conditions and improved recovery rates.

The Indian sugar industry is presently experiencing a tighter supply-demand situation as sugar production has moderated from the record levels achieved in earlier seasons. This is due to lower sugarcane availability in certain key producing states, changing weather patterns and increased diversion of sugarcane juice and B-heavy molasses towards ethanol production. Meanwhile, domestic sugar consumption continues to grow steadily, driven by population growth, rising incomes, urbanisation and increasing demand from the food processing, beverages, confectionery and hospitality sectors.

The sector remained on a firm footing despite a seasonal reduction in crushing activity. As of March 31, 2026, 56 sugar mills were operational, compared with 95 mills a year earlier. Maharashtra produced 86.09 lakh tonnes of sugar, while Karnataka recorded production of 40.57 lakh tonnes. Both states delivered year-on-year growth in output. Uttar Pradesh retained its position as a leading sugar-producing state and remained a key contributor to domestic production.

Although the Indian sugar industry faces near-term challenges from lower production and weather-related uncertainties, its long-term outlook remains positive. Continued policy support, rising demand for ethanol, investments in modern manufacturing facilities, improved cane varieties, better agricultural practices and higher operational efficiencies are expected to enhance the industrys sustainability and profitability. Businesses with integrated operations across sugar, ethanol, distillery, co- generation and premium spirits are expected to be better placed to benefit from evolving market opportunities while reducing the cyclicality traditionally associated with the sugar business.

Company Overview

Piccadily Agro Industries Limited is an integrated alcoholic beverage (alcobev), other distillery products including ENA & Ethanol and sugar manufacturer. The Company has evolved into a leading player in Indias premium spirits segment and is focussed on increasing its range and revenue from branded alcobev/ IMFL products. Established as a sugar manufacturing enterprise in Haryana, it subsequently diversified into distillery operations. Its integrated manufacturing facilities have enabled the development of a differentiated portfolio of premium alcoholic beverage brands. The Company operates across multiple segments of the alco-beverage value chain. During the reporting year, the contribution of the distillery segment to revenue increased. Revenue from the IMFL segment also increased to INR 502 Crore during the reporting year.

Piccadily has established a strong presence in the premium and luxury spirits segment through its award-winning portfolio. Its brands include Indri Single Malt Whisky, Camikara Rum, Whistler Blended Whisky and Cashmir Vodka. A consistent focus on innovation, product excellence and brand development has strengthened market positioning. The Companys brands are available across several states and union territories, the CSD network and international markets. This reflects rising recognition of Indian premium spirits among consumers globally.

The Company continues to benefit from premiumisation trends within the alcoholic beverages industry. Its strategic priorities include portfolio expansion, deeper market penetration and export growth. A differentiated product offering, brand portfolio, enhanced manufacturing capabilities,growing brand salience and an alcobev portfolio which has been consistently winning global and domestic awards position the Company to capture emerging opportunities across domestic and international markets.

As part of its growth strategy expansions at Indri distillery and setting up of a greenfield distillery in Chhattisgarh have been completed during the year. Additionally the company is evaluating the new opportunities that have opened up with the UK FTA getting operational including setting up its proposed distillery at Portavadie.

Product Segments Indri Single Malt Whisky

Indri is the Companys flagship premium single malt whisky brand and among Indias leading premium spirits labels. It is crafted at the Companys Indri distillery in Haryana. The brand is recognised for its distinctive maturation process, stringent quality standards and innovative cask finishes. Indri has received strong domestic and international recognition, reinforcing Piccadilys position in the premium and luxury whisky segment.

• Indri Trini: The Companys flagship triple-cask matured single malt whisky. It is matured in ex-bourbon, ex-French wine and PX sherry casks. Indri Trini is one of Indias most awarded single malts and forms the core of the Companys premium whisky portfolio.

• Indri Dru: A limited-edition cask strength single malt whisky. It delivers a richer flavour profile and higher alcohol strength. It is positioned for enthusiasts and collectors.

• Indri Agenya: Derived from the Sanskrit word meaning belonging to fire, Indri Agenya is among Indias most refined and elegant single malt whiskies. It offers a balanced profile, combining complexity with notes of nuttiness and ripe fruits, followed by a gentle smokiness on the palate.

• Indri City Series: The Indri City Series features an exclusive Single Cask expression created specifically for city-specific travel retail. This release reflects Indris commitment to quality and artisanal craftsmanship.

• Indri Diwali Collectors Edition: A seasonal release created for the festive period. It features unique maturation characteristics and premium packaging.

• Indri Founders Reserve Series: A small-batch premium collection. It showcases rare cask selections and reflects the Companys focus on craftsmanship and innovation.

Expansion at Indri facility and Chhattisgarh facility completed

Indri Facility Expansion

• Indri aims to be in top 5 single malts globally over the next 5 years

• Enhanced capacity in manufacturing, storage and maturation will lead to adequate supply for achieving our long term goals for Indri and other ultra luxury products

• Plan to launch more IMFL products

• Modernising and expanding bottling capacity

• Will produce IMIL, ENA and Ethanol

• Plan to launch IMFL products

• Key to our strategy for national expansion

IMFL sales continue their growth trajectory

• IMFL (Indri, Camikara, Cashmir and Whistler) sales volumes grew 48% in FY 26

• IMFL demand continues to trend up especially for premium and luxury offerings

Camikara Rum

Camikara is Indias first premium pure cane juice aged rum. It marks Piccadilys entry into the premium rum category. Produced from sugarcane juice and matured in oak barrels, it combines traditional craftsmanship with innovative ageing techniques to create a differentiated premium rum offering.

• Camikara 3-Year Aged Rum: A premium aged rum matured in oak barrels. It offers a distinct flavour profile derived from pure cane juice fermentation and maturation.

• Camikara Expressions: Limited and special edition released periodically. These variants cater to niche and premium consumer segments.

Whistler Whisky

Whistler is an established blended whisky brand in Piccadilys portfolio. It caters to consumers seeking premium whisky across accessible price points. The brand has been repositioned as part of the Companys broader premiumisation strategy.

• Whistler Blended Malt Whisky: A premium blended malt offering crafted using carefully selected malts.

• Whistler Premium Whisky Range: A portfolio designed to address evolving consumer preferences within the premium whisky segment.

Cashmir Vodka

Cashmir Vodka, produced from the indigenous Sona Moti wheat, represents the Companys entry into the premium white spirits category. It is inspired by the natural landscape and heritage of Kashmir. The brand combines quality ingredients, refined distillation and distinctive packaging to target premium vodka consumers.

• Cashmir Premium Vodka: The flagship expression within the range. It is positioned in the premium white spirits segment and supports the Companys strategy of portfolio diversification across alco-beverages.

Distillery and Industrial Alcohol Products

Beyond branded alcoholic beverages, the Company manufactures a range of industrial alcohol products through its integrated distillery operations.

• Extra Neutral Alcohol (ENA): High-quality ENA supplied for captive consumption and third-party beverage manufacturers, serving as a key raw material for premium spirits production.

• Ethanol: Fuel-grade ethanol supplied under the Government of Indias Ethanol Blended Petrol (EBP) programme, supporting the countrys renewable energy and energy security objectives.

• DDGS: The solid waste generated from grain-based distillery operations primarily consists of fibres and proteins in the form of DDGS and it is used as an ingredient in cattle, poultry and fish feed.

• Malt Spirit: Premium malt spirit produced at the Companys malt distillery facilities and utilised for both captive consumption and value-added spirit production.

Sugar Products

The Company also operates an integrated sugar business, producing plantation white sugar for domestic markets. The sugar segment provides raw material integration benefits and supports the Companys diversified agro- industrial operations.

Distilleries and Process

Piccadily Agro Industries operates an integrated distillery supporting premium spirits, malt spirit, Extra Neutral Alcohol (ENA) and ethanol production. Its facilities are located in Indri (Haryana), Mahasamund (Chhattisgarh) and proposed at Portavadie (Scotland). The network combines traditional distillation expertise with modern manufacturing systems. This integrated platform enhances quality control, operational efficiency and long-term scalability across domestic and international markets.

Indri, Haryana

The Indri facility serves as the Companys flagship distillery and forms the foundation of its premium spirits business. It produces single malt whisky, cask-aged rum, ENA and ethanol. The installed capacity stands at 220 KLPD for ENA and ethanol and 30 KLPD for malt spirit. The facility is equipped with Scottish-style copper pot stills and advanced maturation infrastructure. Extensive barrel warehouses support ageing requirements for the premium portfolio.

Mahasamund, Chhattisgarh

The Mahasamund facility strengthens Piccadilys production capabilities in ENA and ethanol. Commissioned during FY2025-26, it has a capacity of 200 KLPD. The facility enhances supply reliability across industrial and beverage alcohol segments. It also improves operational flexibility and supports long-term expansion plans including extending the Companys reach in the Indian market.

Portavadie, Scotland

As part of its international expansion strategy and the UK FTA getting operational various possibilities have emerged. Piccadily proposes to develop, over time, a malt distillery in Portavadie, Scotland. The project represents a strategic step towards establishing a presence in one of the worlds most renowned whisky-producing regions. It is expected to provide access to Scotlands single malt ecosystem, including distilling expertise, maturation practices, supplier networks and global market connectivity. The facility will further strengthen the Companys premium spirit platform.

Process

The Company follows a structured production process combining traditional distillation methods with modern manufacturing systems. Selected grains undergo mashing, fermentation and distillation to produce malt spirit. The spirit is then matured in a range of cask types.

The Company uses Virgin American Oak, ex-Bourbon, French Wine, Oloroso Sherry and PX Sherry casks. This diverse cask regime enables development of distinct flavour profiles across the portfolio. The focus on craftsmanship, maturation control and quality assurance remains central to the Companys product development approach.

Key Developments in FY 2026

• Revenue from operations from distillery grew 41.7% to Rs 902.1 Cr

• Share of revenue from IMFL was at 42.6% in FY26 at Rs 483 Cr

• EBITDA increased by 32.3% to Rs 254.3 Cr

• EBITDA margin at 31.5% grew 130 bps

• Focus is on growing IMFL brands - expressions, products mainly in premium and luxury

Master of Casks: Crafting Distinctive Spirits

A key contributor to the Companys premium spirits journey is Surender Kumar, the Master of Casks. He is recognised for expertise in cask selection, maturation and flavour development. His work has shaped award-winning brands such as Indri Single Malt Whisky and Camikara Rum.

Financial Highlights

Standalone Financial Performance

Particulars	FY2026	FY2025
Revenue from Operations	1,135.1	886.3
Other Income	7.8	6.6
Total Income	1,142.8	892.8
Materials Consumed	631.1	538.7
Changes in Total Inventories	-90.2	-88.9
Excise Duty on Sales of Goods	97.2	68.1
Employee Benefit Expenses	62.5	44.0
Power & Fuel	55.7	29.1
Other Expenses	143.3	110.3
Total Operating Expenses	899.6	701.4
EBITDA before Exceptional Items	243.2	191.4
Depreciation	23.2	19.4
EBIT before Exceptional Items	220.1	172.0
Finance Charges	27.7	27.8
PBT before Exceptional Items	192.4	144.2
Exceptional Items Gains	-0.0	-0.0
PBT	192.4	144.2
Tax Expenses	52.9	39.5
PAT	139.6	104.7
Total Comprehensive Income (after tax)	139.3	103.5
PAT excluding Exceptional Items	139.5	104.7
EPS (?) excluding Exceptional Items	14.42	11.09

Ratios (Standalone)

Sr. no.	Particulars	2025-26	2024-25	% Increase/ Decrease	Explanation For Change
i	Debtors Turnover Ratio	5.98	6.48	-7.78	-
ii	Inventory Turnover Ratio	1.66	1.94	-14.25	-
iii	Interest Coverage Ratio	8.22	6.36	27.76	-
iv	Current Ratio	1.72	1.95	-12.10	-
v	Debt Equity Ratio	0.59	0.45	30.23	Due to an increase in Total Debt as compared to an increase in Equity
vi	Operating Profit Ratio (%)	23.23	23.21	0.02	-
vii	Net Profit Ratio (%)	12.30	11.81	4.12	-
viii	Change in Net Worth Ratio (%)	32.22	100.32	NA	-

Risk Management

The Company recognises risk management as an integral component of its corporate governance framework and long-term growth strategy. As Piccadily Agro Industries expands its premium spirits portfolio, manufacturing capacities and international presence, the Company remains focused on identifying, assessing and mitigating risks across strategic, operational including raw material, supply chain, manufacturing and storage, financial and regulatory areas. The Board of Directors, along with senior management, periodically reviews key risks and mitigation actions to ensure a structured and disciplined approach to risk oversight.

The risk management framework encompasses the identification, assessment, monitoring and mitigation of risks across business functions. Risk considerations are embedded in key decisions, including capacity expansion, market development, product innovation and capital allocation.

During FY2025-26, the Company strengthened its focus on raw material availability, regulatory compliance, talent management, project execution, brand integrity and international operations. Continuous monitoring, robust internal systems and timely mitigation actions enhance organisational resilience and support sustainable growth. Detailed information on the risk management framework, key risks and mitigation measures is provided on page 36 of this Annual Report.

Sustainability

Sustainability is embedded in Piccadily Agro Industries business philosophy and operational framework. As the Company expands its premium spirits portfolio and manufacturing footprint, it remains committed to responsible growth through efficient resource utilisation, environmental stewardship and sustainable production practices. Sustainability priorities span renewable energy adoption, water conservation, waste management and circular resource utilisation. The Company follows a structured grain-to-glass approach focused on efficient resource use and reduced environmental impact. Biomass- based fuel is used for steam generation, reducing reliance on conventional energy sources. Water stewardship remains a key priority, supported by treatment and reuse systems that optimise freshwater consumption. Through its Zero Liquid Discharge (ZLD) framework, wastewater is treated and reused. Distillery by-products are further channelled into value-added applications, supporting circular economy principles. These initiatives strengthen environmental performance while creating long-term stakeholder value.

Human Resource

Piccadily Agro Industries considers its people considers its people central to sustained growth, innovation and brand development. The Company fosters a performance- driven culture that promotes ownership, collaboration and continuous learning. As the organisation expands its manufacturing base, premium portfolio and international presence, it remains focused on attracting and retaining talent aligned with its long-term objectives. Structured development programmes, regular feedback mechanisms and leadership support enable employees to build strong career pathways.

During FY2025-26, the Company further strengthened its leadership team through the induction of experienced professionals across manufacturing, supply chain and human resources functions. This enhanced organisational capability and operational execution. Employee engagement, capability building and succession planning remained key priorities. The ESOP programme further strengthened alignment between employees and long-term business performance. Supported by a culture of accountability and excellence, the Company continues to build a high- performance organisation focused on sustainable growth.

Internal Controls and Their Adequacy

The Company has established a comprehensive internal control framework to safeguard its assets, ensure operational efficiency and maintain the accuracy and reliability of financial and operational reporting. The system is designed to facilitate the proper authorisation, recording and reporting of transactions while protecting assets against unauthorised use or loss. Supported by periodic internal audits, management reviews, Audit Committee oversight and well-defined policies and procedures, the internal control environment provides reasonable assurance regarding compliance, accountability and risk management. The implementation of SAP and the progressive utilisation of its various modules have further strengthened process standardisation, monitoring and reporting capabilities across the organisation. The Company continues to enhance its internal controls and processes in line with its evolving business requirements and growth objectives.

Cautionary Statement

Statements in this Management Discussion and Analysis describing the Companys objectives, projections, estimates and expectations may be forward-looking statements within the meaning of applicable laws and regulations. Actual results may differ substantially or materially from those expressed or implied. Important developments that could affect the Companys operations include changes in consumption patterns and consumer preferences, competitive dynamics, changes in state and central laws, FSSAI rules and standards, disruptions in distribution across domestic and international markets, fluctuations in raw material and power costs, amongst others.