Quality RO Industries Ltd Management Discussions

1. INTRODUCTION:

The Company was originally incorporated as Private Limited Company in the name of QUALITY RO INDUSTRIES PRIVATE LIMITED under the provisions of the Companies Act, 2013 vide Certificate of Incorporation dated September 13, 2021 bearing Corporate Identification Number

U29308GJ2021PTC126004 issued by the Assistant Registrar of Companies, Ahmedabad. Subsequently, the Company was converted into a Public Limited Company pursuant to the special resolution passed by the shareholders at the Extra-Ordinary General Meeting of our Company held on November 29, 2021 and consequent upon conversion, the name of Company was change to QUALITY RO INDUSTRIES LIMITED vide a fresh certificate of incorporation dated December 13, 2021 bearing Corporate Identification Number U29308GJ2021PLC126004 was issued by the Registrar of Companies, Ahmedabad. Further the Company has issued share pursuant to Initial Public Offer (IPO) and listed on SME platform of BSE LTD on 09 th February 2022.

2. INDUSTRY STRUCTURE:

Changing economic and business conditions, rapid technology, innovation and adoption and globalization are creating an increasingly competitive market environment that is driving corporations to transform the manner in which they operate. Companies in this environment are now focusing even more on their business objectives such as revenue growth, profitability and asset efficiency.

3. INVESTMENTS/ DEVELOPMENTS:

We are increasing our reach in the industry by expanding our client base across sectors / verticals. Development of software products aiming at various sectors to improve the depth of our engagement with the industry.

4. OPPORTUNITIES AND THREATS:

Strength:

Growth in the Indian economy and demand creates unprecedented opportunities for company to invest significantly in each of its core businesses. Outlook for the overall industries is positive. In keeping with the philosophy of continuous consumer centric approach which is the hall mark of any organization, several developmental activities have been planned for the next fiscal year.

Opportunities:

• Vast Industrial Presence in both Public and Private Sectors

• Huge demand for Domestic services

• Avail of Low-cost, Skilled Human Resources.

• Proactive government continued thrust on reforms- Further liberalization under process.

Threats:

There are global and external factors, changes in Security Laws, tax laws, litigation and significant changes in the Global political and economic environment exert tremendous influence on the performance of the company.

5. SEGMENT-WISE OR PRODUCT-WISE PERFORMANCE:

Quality RO Industries Limited is engaged in:

A. Manufacturing: Water softener equipment such as RO filter parts, cartridges and membranes

B. Contract Manufacturing: Die casting and associated contractual manufacturing;

C. Trading: RO equipment spares and associated products;

D. Contractual Logistics Services to local infra and manufacturing companies situated in and around the city of Vadodara, Gujarat.

E. Real Estate - Residential and commercial property development

Financial Performance:

Segment	^ Revenue (Rs. In Lakhs)	% of total
RO Products	295.28	22.74
Transportation	1003.47	77.26
Realty Sector	_ -	0
Total	1298.75	100.00

6. OUTLOOK:

The Continual growth in the in India sector is necessary to give necessary support to the industry. The company is making all effort to accelerate the growth of its business. It Expect to improve its position in the market by focusing in the technologically advanced and more profitable Product and market segment and working aggressively in the area of productivity, efficiency and cost reduction.

7. RISKS AND CONCERNS:

The industry is exposed to the following risk and concerns:

• Complex Global Supply-Chain:

Companies have to juggle internal and external resources while staying within international standards. Issues such as traceability and compliance are increasing operational burdens.

• Uncertain Demand:

Aggregately, economic volatility and cyclical demand cause fluctuations in production. On a more granular level, consumer preference can cause spikes in demand for an individual products or company. Efficient lean capabilities must be in place to keep inventory aligned with demand.

8. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY:

The Company has an effective and reliable internal control system commensurate with the size of its operations. At the same time, it adheres to local statutory requirements for orderly and efficient conduct of business, safeguarding of assets, the detection and prevention of frauds and errors, adequacy and completeness of accounting records and timely preparation of reliable financial information. The efficacy of the internal checks and control systems is validated by self-audits and internal as well as statutory auditors.

9. DISCUSSION ON FINANCIAL PERFORMANCE WITH RESPECT TO OPERATIONAL PERFORMANCE:

Share Capital:

During the year under review, there is no change in the share capital of the company.

Reserves and Surplus:

The Reserve and Surplus of Company on Standalone Basis is Rs. 863.03 Lakhs as on period ended on31 st March , 2025.

The Reserve and Surplus of Company on Consolidated Basis is Rs. 896.38 Lakhs as on period ended on31 st March, 2025.

Total Income:

The Company has earned total Income 1301.99 Lakhs on Standalone basis as on period ended on 31 st March, 2025.

The Company has earned total Income 1603.69 Lakhs on Consolidated basis as on period ended on 31 st March, 2025.

10. MATERIAL DEVELOPMENTS IN HUMAN RESOURCES / INDUSTRIAL RELATIONS FRONT, INCLUDING NUMBER OF PEOPLE EMPLOYED:

Your Company follows a policy of building strong teams of talented professionals. People remain the most valuable asset of your Company. The Company recognizes people as its most valuable asset and the Company has kept a sharp focus on Employee Engagement. The Companys Human Resources is commensurate with the size, nature and operations of the Company.

11. DETAILS OF SIGNIFICANT CHANGES (I.E. CHANGE OF 25% OR MORE AS COMPARED TO THE IMMEDIATELY PREVIOUS FINANCIAL YEAR) IN KEY FINANCIAL RATIOS, ALONG WITH DETAILED EXPLANATIONS THEREFOR- INCLUDING:

Description	As at March 31, 2025	As at March 31, 2024	Variance	Remark
Current Ratio	2.8	3.3%	-12.77%	Less than +/-25%
Debt service coverage ratio	8.0	12.4	-35.54%	Higher borrowing in FY 2025
Return on Equity ratio	14.15%	24.05%	-41.17%	Lower profitability with higher Equity in Fy 2025
Description	As at March 31, 2025	As at March 31, 2024	Variance	Remark
Debt-Equity Ratio	0.20	0.21	-8.31%	Less than +/-25%
Inventory Turnover Ratio	3.83	10.48	-63.44%	Higher closing inventory in FY 2025.
Trade Receivables Turnover Ratio	6.75	6.77	-0.33%	Less than +/-25%
Trade Payable turnover ratio	73.05	25.54	185.97%
Net Profit Ratio	11.38%	12.51%	-9.08%	Less than +/-25%

12. DETAILS OF ANY CHANGE IN RETURN ON NET WORTH AS COMPARED TO THE IMMEDIATELY PREVIOUS FINANCIAL YEAR ALONG WITH A DETAILED EXPLANATION THEREOF:

The Return on Net Worth for F.Y. 2024-25 was 14.15% and for F.Y. 2023-24 was 24.05%. The reason for change is Lower profitability with higher Equity in Fy 2025.

13. CAUTIONARY STATEMENT:

This report contains forward- looking statements based on the perceptions of the Company and the data and information available with the company. The company does not and cannot guarantee the accuracy of various assumptions underlying such statements and they reflect Companys current views of the future events and are subject to risks and uncertainties. Many factors like change in general economic conditions, amongst others, could cause actual results to be materially different.

FOR AND ON BEHALF OF THE BOARD OF
QUALITY RO INDUSTRIES LIMITED
SD/-
VIVEK DHOLIYA
MANAGING DIRECTOR
DIN: 09340902
PLACE: VADODARA
DATE: 03 rd SEPTEMBER, 2025