Rajasthan Cylinders & Containers Ltd Management Discussions

The Management presents its analysis of the Companys performance and outlook for the financial year 2025-26. This report may contain forward-looking statements that involve risks and uncertainties; actual results may differ materially from those expressed or implied.

1. INDUSTRY STRUCTURE AND DEVELOPMENT

The Company was engaged in manufacturing LPG Cylinders, Valves & Regulators and providing LPG refilling services. Following a sustained period of operational losses in earlier years driven by pandemic-related disruption and adverse industry conditions, the Board approved closure of the Companys manufacturing unit at SP-825, Road No. 14, VKI Area, Jaipur-302013, with effect from 09 th December, 2022. Substantial plant and machinery at the unit has since been disposed of in tranches to reduce interest cost and settle creditors. The Company has not undertaken any manufacturing activity since that date, including during the financial year 2025-26, and has not yet identified a suitable new business opportunity, though it continues to evaluate options, including the appointment of a consultant to assist in setting up a new venture .

2. OPPORTUNITIES AND THREATS

The principal opportunity before the Company is the identification and commencement of a viable new business line, for which the process of engaging a consultant is ongoing. The principal threat remains prolonged absence of operating revenue, which continues to erode the Companys net worth through recurring administrative costs, absent a new revenue stream being established in the near term.

3. SEGMENT WISE OR PRODUCT WISE PERFORMANCE

The Performance of the company during the year is as under: -

(Rs. in lakhs)

Note: Figures reflect continuing operations only; discontinued operations are excluded.

The Company had no manufacturing or trading segment during the year, and consequently no revenue from operations, consistent with the closed status of its sole manufacturing unit noted above.

4. OUTLOOK

The Companys near-term outlook remains contingent on identifying and commencing a new business activity. The Board will keep Members updated as this process progresses.

5. OPERATIONAL & FINANCIAL OVERVIEW

Total income for the FY 2025-26 under review was Rs. 114.50 Lakhs as against Rs. 91.60 Lakhs in the previous FY 2024-25. The loss before tax for the FY 2025-26 is Rs. -138.93 Lakhs as against loss of Rs. -147.46 Lakhs in the previous FY 2024-25. The loss after tax for continued operations is Rs. -101.49 Lakhs for the FY 2025-26 as against Loss of Rs -86.37 Lakhs in the previous FY 2024-25.

6. INTERNAL CONTROL SYSTEM AND THEIR ADEQUACY

The internal control framework is designed to ensure proper safeguarding of assets, maintaining proper accounting records and providing reliable financial information and other data. This system is supplemented by internal audit, reviews by the management, guidelines and procedures. The Company has adequate internal control system to safeguard the companys assets from any loss or damage, to control cost, prevent revenue loss and required financial and accounting controls and to effectively implement the applicable accounting standards. During the year under review, S.S. Surana & Co. (FRN: 001079C), were engaged as Internal Auditors of the Company. Internal auditor evaluated the functioning and quality of internal controls and provided assurance of its adequacy and effectiveness through periodic reporting. Internal audit was carried out as per internal audit plan, which was reviewed by the Audit Committee of the Company. The Company intends to undertake further measures as necessary in line with its intent to adhere to the procedures, guidelines and regulations, as applicable, in transparent manner. To maintain its objectivity and independence, auditor directly reports to the Chairman of the Audit Committee of the Company. Further, the Statutory Auditors have also, in compliance with the requirements of the Companies Act, 2013, issued an opinion with respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls details of which may be referred to in the Auditors Report attached to the Audited Financial Statements for the Financial Year 2025-26.

7. RISKS AND CONCERNS

The Company is exposed to credit, liquidity, market and commodity risk, monitored under the Board-approved Risk Management Policy, with oversight from the Audit Committee. Given the closed manufacturing operations noted above, a material uncertainty exists relating to the Companys ability to continue as a going concern; however, the financial statements have been prepared on a going-concern basis in view of the Companys ongoing efforts to establish a new business, as explained in Note 44 to the financial statements.

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

As on 31 st March, 2026, the Company had 11 permanent employees, all at its administrative office; no contract labour has been engaged since closure of manufacturing operations in December 2022. The Directors place on record their appreciation for the continued support and dedication of the Companys employees.

9. (i) Details of significant Changes (i.e. change of 25% or more as compared to immediately previous year) in key financial ratios, along with detailed explanations therefore:-

(ii) Detail of any change in Return on Net Worth as compared to immediately previous financial year along with detailed explanations thereof:

Note: Figures reflect continuing operations only; discontinued operations are excluded.

The return on net worth for the financial year 2025-26 is -7.19% as compared to -7.33% for the previous financial year 2024-25, The return on net worth for the current year has been decreased due to reduction in loss during the year under review.

10. CAUTIONARY STATEMENT

The statements in the Management Discussion and Analysis Report describes your Companys objectives, projections, estimates and expectations which may be forward-looking statements within the meaning of the applicable laws and regulations. Forward looking statements are based on certain assumptions and expectations of future events. The Company cannot guarantee that these assumptions and expectations are accurate or will be realised by the Company. The actual results could differ materially from those expressed in the statement or implied, depending upon the economic conditions and other external factors which are beyond the control of the Company. The Company assumes no responsibility to publicly amend, modify or revise any forward-looking statements on the basis of any subsequent developments.

For and on behalf of the Board of Directors