Pushpa Jewellers Ltd Management Discussions

The Management Discussion and Analysis ("MD&A") provides an overview of the financial position, operating performance, business environment, key opportunities and risks, and strategic priorities of Pushpa Jewellers Limited ("the Company") for the financial year ended March 31, 2026. This MD&A should be read together with the Audited Financial Statements, Notes to Accounts, Independent Auditors Report and other disclosures forming part of the Annual Report.

Global & Domestic Jewellery Market: The Indian gems and jewellery sector continues to undergo structural formalisation, supported by increasing consumer preference for organised and compliant market participants. Higher gold prices have also supported demand for lightweight jewellery and designs that seek to optimise visual appeal while remaining accessible to customers.

Formalisation & Compliance Framework: The jewellery industry continues to be influenced by applicable BIS hallmarking requirements, taxation and trade regulations, and increasing expectations relating to product quality, purity and transparency. These developments are supporting the gradual shift towards organised and process-driven jewellery businesses.

B2B Ecosystem Dynamics: Wholesale buyers and regional jewellery retailers increasingly seek reliable supply partners offering consistent product quality, transparent pricing, flexible commercial arrangements, design capabilities and efficient inventory turnaround.

FY 2025-26 was an important year for Pushpa Jewellers Limited, including the successful completion of its Initial Public Offering and listing of its equity shares on the NSE SME platform on July 07, 2025. The capital raised through the IPO strengthened the Companys equity base and liquidity position and is being utilised in accordance with the objects of the issue and applicable disclosures.

Revenue from Operations increased to 41,838.87 Lakhs in FY 2025-26 from 28,106.07 Lakhs in FY 2024-25, representing growth of 48.86%.

Domestic Sales increased to 41,494.32 Lakhs from 27,436.08 Lakhs, representing growth of 51.24%. The growth reflects the Companys continued focus on its domestic B2B jewellery business and expansion of customer relationships.

Export Sales stood at 324.74 Lakhs compared with 612.75 Lakhs in FY 2024-25. The decline reflects the Companys ongoing realignment of its export business and focus on selected B2B markets and customers.

Raw material consumption increased to 38,809.08 Lakhs from 23,902.64 Lakhs, broadly reflecting the scale of the Companys business and procurement requirements. Job work charges increased to 191.73 Lakhs from 97.63 Lakhs, consistent with the increase in outsourced artisan production and business activity. Profit After Tax increased by 16.15% to 2,588.50 Lakhs from 2,228.63 Lakhs.

Share Capital increased to 2,422.29 Lakhs following the issue of equity shares in connection with the IPO, while Reserves and Surplus increased to 13,021.32 Lakhs from 3,928.24 Lakhs, primarily reflecting the securities premium and other applicable movements recorded during the year.

Formalisation of B2B Supply Channels: Increasing emphasis on compliance, quality, purity and transparent business practices provides opportunities for organised jewellery manufacturers and suppliers serving independent retailers.

Demand for Lightweight 22K Gold Jewellery: Higher gold prices and changing consumer preferences may continue to support demand for lightweight designs that offer visual appeal while optimising gold usage.

Expansion of Distribution and Business Infrastructure: The Company intends to deploy IPO proceeds in accordance with the stated objects of the issue, including eligible working capital and other approved business requirements, supporting its growth and distribution capabilities.

Gold Price Volatility: Significant fluctuations in bullion prices can affect procurement costs, inventory values, customer purchasing behaviour and working capital requirements.

Regulatory and Tax Changes: Changes in import duties, GST, hallmarking requirements or other applicable regulations may affect operating costs, pricing and working capital requirements.

Competitive Environment: The jewellery industry remains competitive, with organised and regional players competing on design, price, quality, credit terms and delivery capabilities.

The Company remains focused on strengthening its B2B jewellery business, improving operational efficiency, expanding customer relationships and deploying its capital prudently. With a strengthened equity base, improved liquidity position and relatively low leverage, the Company intends to pursue sustainable growth while maintaining appropriate risk and financial discipline.

Gold Price Volatility Risk- Mitigation: The Company uses appropriate procurement and inventory management practices and, where applicable, contractual and financing arrangements to manage exposure to fluctuations in gold prices and protect operating margins.

Credit & Counterparty Risk- Mitigation: Trade Receivables stood at 3,551.34 Lakhs. The Company follows credit assessment and monitoring practices, customer-wise credit limits and collection mechanisms, supported by appropriate provisions for doubtful debts. Provision for doubtful debts during FY 2025-26 stood at 40.14 Lakhs.

Security & Asset Safeguarding- Mitigation: Total Inventories stood at 9,106.43 Lakhs, comprising Gold Metal of 3,196.24 Lakhs, Stock-in-Process of 2,622.21 Lakhs and Finished Goods of 3,142.75 Lakhs. The Company follows inventory controls, physical verification/reconciliation procedures, system-based inventory tracking and applicable insurance arrangements to safeguard its inventory and assets.

Pushpa Jewellers Limited has established internal control mechanisms appropriate to the nature and scale of its operations, with the objective of ensuring orderly conduct of business, safeguarding of assets, reliability of financial reporting and adherence to applicable policies, procedures and statutory requirements.

Oversight Mechanism: The adequacy and effectiveness of financial reporting processes, internal controls and key compliance matters are subject to periodic review and oversight by the Audit Committee and the Board, as applicable.

Process Strengthening Initiatives: During the year, certain observations relating primarily to procedural aspects and timing of approvals within the purchase order process were identified. The Company has undertaken appropriate process-strengthening measures, including enhanced system-based workflows and approval mechanisms, to improve operational discipline and monitoring.

Reconciliation and Financial Review: Periodic reconciliation procedures are undertaken to align operational and financial records. Differences identified during interim or periodic reviews are examined and reconciled, as appropriate, and are considered during finalisation of the financial statements.

The Company continues to review and strengthen its internal control framework in line with evolving business requirements and operational practices. The disclosures in this section should be read together with the Statutory Auditors Report and the report on Internal Financial Controls forming part of the Annual Report.

Artisan and Karigar Network: The Company works with skilled artisans (Kariqars) in Kolkata and seeks to maintain appropriate commercial and working arrangements while preserving traditional jewellery-making skills and maintaining required quality standards.

Workforce Capability: The Companys design, sales and operational teams are supported through ongoing training and development relating to digital inventory systems, CAD/design capabilities, quality management and business processes.

Industrial Relations: Employee relations across the Companys offices, showrooms and production/business locations remained satisfactory during FY 2025-26, with no material labour disputes or work disruptions reported during the year.

Statements in this Management Discussion and Analysis describing the Companys objectives, plans, expectations, estimates or projections may constitute forward-looking statements within the meaning of applicable securities laws and regulations. Such statements are based on managements current expectations and assumptions and are subject to risks and uncertainties. Actual results may differ materially from those expressed or implied due to factors including changes in economic conditions, gold prices, customer demand, competition, government policies, taxation and regulatory requirements, foreign exchange movements, availability and cost of raw materials, and other factors beyond the Companys control. The Company assumes no obligation to publicly update or revise any forward-looking statements except as may be required under applicable laws and regulations.