Positron Energy Ltd Management Discussions

Annexure - D

1. Industry Structure and Developments

The global oil and gas market, including natural gas trading, is expected to experience steady growth, with the market size projected to reach $9,894.48 billion by 2029, growing at a CAGR of 4.9% from 2024 to 2029.

Growing demand for natural gas in various sectors, including power generation, industrial, and residential, driven by economic growth in Asia and efforts to reduce emissions. Growing government investments in the oil and gas sector are expected to propel market growth. Technological Innovation: Investments in new technologies, such as low-carbon solutions, are likely to help companies navigate economic and regulatory uncertainties. Capital Discipline: Companies are prioritizing high-return investments and maintaining capital discipline to ensure robust financial performance.

The natural gas trading industry is a complex and dynamic market, influenced by various factors such as supply and demand, geopolitical events, and weather patterns. Natural gas prices are highly volatile, influenced by factors like seasonal weather patterns, geopolitical events, and market sentiment. Growing demand for natural gas in various sectors, including power generation, industrial, and residential, driven by economic growth and efforts to reduce emissions.

Indian Economy Overview

Indias natural gas market is poised for significant growth, driven by government initiatives and increasing demand across various sectors. The government aims to increase the share of natural gas in the primary energy mix from 6.7% to 15% by 2030, supported by investments in trunk pipelines, LNG import terminals, and city-gas projects.

Natural gas demand is expected to rise in sectors like power generation, industrial, and residential, driven by economic growth and efforts to reduce emissions. The government is investing in infrastructure development, including pipelines and LNG terminals, to support the growth of the natural gas market. The Indian government has introduced market reforms, including the development of a gas exchange, to promote competitive pricing and allocation of natural gas.

Market Size and Growth

- Production Volume: The India natural gas market size is expected to grow from 77.40 thousand MMSCM in 2025 to 100.35 thousand MMSCM by 2030, at a CAGR of 5.33% during the forecast period.

- Import Dependence: LNG imports are expected to play a significant role in meeting Indias natural gas demand, with planned import capacity rising from 2.1 Tcf to nearly 4 Tcf by 2026.

2. Opportunities and Threats Opportunities

1. Growing Demand: Increasing demand for natural gas in various sectors, including power generation, industrial, and residential, driven by economic growth and efforts to reduce emissions.

2. Market Liberalization: Government initiatives to liberalize the natural gas market, promoting competition and creating opportunities for new entrants.

3. Infrastructure Development: Investments in infrastructure development, including pipelines and LNG terminals, to support the growth of the natural gas market.

4. Diversification of Supply: Opportunities to diversify supply sources, including LNG imports, to meet growing demand.

5. Technological Advancements: Adoption of new technologies, such as digitalization and data analytics, to improve operational efficiency and risk management.

Threats

1. Price Volatility: Natural gas prices can be highly volatile, influenced by factors like seasonal weather patterns, geopolitical events, and market sentiment.

2. Regulatory Changes: Changes in government policies and regulations can impact the natural gas market, including pricing, taxation, and environmental regulations.

3. Competition: Increasing competition in the natural gas market, including new entrants and existing players expanding their operations.

4. Geopolitical Risks: Conflicts in gas-producing regions or changes in government energy policies can impact supply and prices.

5. Environmental Concerns: Growing concerns about climate change and environmental impact can lead to increased scrutiny of natural gas as a fossil fuel.

By understanding these opportunities and threats, natural gas trading Companies can develop strategies to capitalize on growth opportunities while mitigating potential risks.

3. Segment-wise or Product-wise Performance

The Company is operating mostly in Gas aggregation and Providing Management & Technical Consultancy. The turnover/performance of the Company are as under:

Segment	Type of Goods/Services	Amount (In Lacs)
Sale of Goods	Sales and Supply of Goods- Natural Gas	32308.91
Services	Management & Technical Consultancy	1373.00
Total		33681.91

4. Outlook

Your company remains committed to upholding the highest standards of governance, transparency, and ethical practices. With India racing towards growth and becoming a strong economy, we look forward to emerge as a strong, reliable, and sustainable company. Together, we shall embrace the future with optimism, determination, and the desire to build a brighter tomorrow.

5. Risks and Concerns Market price fluctuation

• Natural gas prices are experiencing significant fluctuations due to various market dynamics like:

• Supply and Demand Dynamics: Seasonal demand changes, weather patterns, and industrial usage impact prices. For instance, harsh winters increase heating demand, driving up prices.

• Geopolitical Events: Conflicts, trade disputes, and sanctions disrupt supply chains, influencing prices globally.

• Market Forces: Trading hubs like Henry Hub in Louisiana serve as benchmarks for pricing, reflecting local supply and demand imbalances.

• Environmental Policies and Regulations: Shifts in energy policies, renewable energy adoption, and environmental concerns impact natural gas prices.

• Weather Patterns: Temperature fluctuations affect heating and cooling demands, causing price volatility.

Sales volume

• We can effectively manage sales volume, optimize revenue, and maintain a competitive edge in the market by implementing strategies like;

• Demand Forecasting:Analyze historical sales data, weather patterns, and economic trends to predict future demand.Use advanced analytics and machine learning algorithms to improve forecast accuracy.

• Supply Chain Optimization:

• Ensure a stable and reliable supply of natural gas to meet demand.

• Optimize pipeline capacity, storage, and transportation to minimize costs and maximize efficiency.

Pricing Strategies:

• Implement dynamic pricing to reflect changes in demand and supply.

• Offer competitive pricing to attract and retain customers.

Customer Segmentation:

• Identify and target high-value customers, such as industrial and power generation sectors.

• Develop tailored marketing and sales strategies to meet the needs of different customer segments.

Marketing and Sales:

• Develop effective marketing campaigns to promote natural gas as a clean and efficient energy source.

• Build strong relationships with customers through excellent customer service and support.

Risk Management:

• Hedge against price volatility to minimize risks and ensure stable revenue.

• Diversify supply sources and transportation options to mitigate potential disruptions.

Operational Efficiency:

• Optimize operational processes to minimize costs and maximize efficiency.

• Implement best practices in areas such as pipeline maintenance, storage, and transportation.

Execution

Execution depends on several factors which include labour availability, receipt of approvals and regulatory clearances, access to utilities such as electricity and water, weather conditions and the absence of contingencies such as litigation. Your Company manages the adversities with cautious approach, meticulous planning and by engaging established and reputed contractors.

6. Internal Control Systems and Their Adequacy

The Company has a sound internal control system commensurate with its size and nature of operations. It includes policies and procedures to ensure:

• Efficient use and protection of resources.

• Accuracy and completeness of accounting records.

• Compliance with applicable laws and regulations.

Periodic internal audits are conducted and findings reported to the Audit Committee and Board for necessary action. No significant internal control weaknesses were observed during the year.

7. Financial Performance with Respect to Operational Performance

PARTICULARS	Standalone
	31.03.2025	31.03.2024
I. Net Sales/Income from Operations	33681.91	13473.25
II. Other Income	258.88	68.51
III. Total Revenue (I+II)	33940.79	13541.76
IV. Earnings Before Interest, Taxes, Depreciation and Amortization Expense	2,349.96	1,272.77
V. Finance Cost	124.59	57.53
VI. Depreciation and Amortization Expense	27.13	26.14
VII. Extraordinary Items (Prior Period Items)	-	3.52
VIII. Profit Before Tax (IV-V-VI)	2198.24	1185.58
IX. Tax Expense:
Less: Current Tax Expense	421.85	304.84
Less: Deferred Tax	-2.05	-3.34
Less: Tax Expense of Earlier Years	-	7.93
Profit After Tax (VIII-IX)	1778.43	876.15

8. Details of Significant Changes in Key Financial Ratios

			FOR THE YEAR ENDED 31ST MARCH, 2025			FOR THE YEAR ENDED 31ST MARCH, : 2024
			NUMERATOR	DENOMINATOR	RATIO	NUMERATOR	DENOMINATOR	RATIO		REASON
Current Ratio	Current assets:- inventories + trade receivables + cash & cash equipments + short term loans & advances + other current assets	Current liabilities:- short term borrowings + trade payables + other current liabilities + short term provisions	10951.59	3577.47	3.06	3800.40	2480.41	1.53	99.80%	Change in ratio is due to increase in current assets.
Debt-Equity Ratio	Debt:- Total Outside Liabilities	Equity:- equity attributable to equity holders	728.37	7862.72	0.09	1027.90	1490.94	0.69	-86.56%	Change in ratio is due to increase in shareholders fund.
Debt Service Coverage Ratio	Earning available for debt services :- Earning before interest and tax (attributable to long-term borrowing) and depreciation	Interest + Principal :- interest expenses on borrowings and principal amount of borrowings due during the current year.	2255.84	54.58	41.33	1269.24	17.46	72.68	-43.14%	Change in ratio is due to increase in interest and principle payments.
Return on Equity Ratio	Net Profit after taxes - Preference Dividend (if any) :- Profit/(Loss) for the year attributable to equity holders of the parent	Equity shareholders fund :- equity attributable to equity holders of the parent. Average Equity shareholders fund = (Opening equity shareholders fund + closing equity shareholders fund) / 2	1778.43	4676.83	0.38	876.15	1052.87	0.83	-54.30%	Change in ratio is due to increase in shareholders fund.
Inventory turnover ratio (in times)	Cost of good sold :- purchases + manufacturing expenses + changes in inventories of stock-in-trade	Average Inventory	30366.35	403.54	75.25	11459.69	200.61	57.12	31.73%	Change in ratio is due to increase in cost of goods sold.
Trade Receivables turnover ratio (in times)	Revenue from operations	Average Trade Receivables	33681.91	2333.19	14.44	13473.25	897.32	15.02	-3.86%	Change in ratio is insignificant.
Trade payables turnover ratio (in times)	Purchase :- Purchases	Average Trade Payables	30636.18	1468.14	20.87	11345.70	564.73	20.09	3.87%	Change in ratio is insignificant.
Net capital turnover ratio (in times)	Revenue from operations	Capital employed: - total equity + long term borrowing (including current maturity). Capital employed is worked out based on average i.e. (opening capital employed + closing capital employed) / 2	33681.91	4761.69	7.07	13473.25	1163.06	11.58	-38.94%	Change in ratio is due to increase in shareholders fund.
Net profit ratio	Net profit after tax	Revenue from operations	1778.43	33681.91	0.05	876.15	13473.25	0.07	-18.80%	Change in ratio is insignificant.
Return on Capital employed	Earning before interest & taxes (EBIT) :- Profit/(loss) before interest (attributable to long-term borrowing) and tax	Capital Employed: - total equity + long term borrowing (including current maturity). Capital employed is worked out based on average i.e. (opening capital employed + closing capital employed) / 2	2228.71	4761.69	0.47	1206.56	1163.06	1.04	-54.88%	Change in ratio is due to increase in shareholders fund.
Return on investment.	Net profit after tax	Capital Employed: - total equity + long term borrowing (including current maturity). Capital employed is worked out based on average i.e. (opening capital employed + closing capital employed) / 2	1778.43	4761.69	0.37	876.15	1163.06	0.75	-50.42%	Change in ratio is due to increase in shareholders fund.
Interest service coverage Ratio	Earning before interest & taxes (EBIT) :- Profit/(loss) before interest (attributable to long-term borrowing) and tax	Interest Expense	2228.71	30.47	73.13	1206.56	17.46	69.09	5.85%	Change in ratio is insignificant.

9. Material Developments in Human Resources / Industrial Relations

The Company continues to give utmost importance to Human Resources Development and keeps relations normal. As on 31st March, 2025, there are 187 employees.

Industrial relations continue to be harmonious and normal.

10. Cautionary Statement

Statements in this Management Discussion and Analysis describing the Companys objectives, projections, estimates, expectations, or predictions may be "forward-looking statements" within the meaning of applicable laws and regulations. Actual results may differ materially from those expressed or implied due to various factors including changes in economic, political, and regulatory environments, natural calamities, and market conditions.

		For and on behalf of Board of Directors
		Positron Energy Limited
Date: 02/09/2025	Sd/-	Sd/-
Place: Gandhinagar	Mr. Sujit K Sugathan	Mr. Rajiv Shankarankutty Menon
Registered Office:	Whole-time director	Managing Director
Office No. 3, IT Tower-2, Ground Floor, Infocity	DIN:01959364	DIN:01958636