Rajasthan Cylinders & Containers Ltd Management Discussions

The company was mainly engaged in the business of manufacturing and selling LPG Cylinders, Valves & Regulators and rendering refilling services of LPG Gas. The Companys financial performance had started dropping 4-5 years ago. The working of our company was adversely affected in previous 5 years due to Covid 2019 and oil companys unsupportive policies. The Production of the Company got down which resulted heavy losses and working capital of company was eroded. To come over this situation, and to meet working capital requirement the company infused some funds by selling its investments during the financial year 2021-22. The Business was operating under challenging environment due to various factors such as high cost of raw material /supplies, high Interest Cost and the banks reducing the borrowing powers and then stopping abruptly funding of the working capital which led to negative performance of the Company.

Considering the unsatisfactory performance of the Cylinder and Valves & Regulators Unit with continued operational losses in spite of attempts to turn it around, making it unviable to continue running the Units and due to paucity of funds to run the manufacturing unit and challenges being faced by the management in running the business and the operations of the Company, the board of director of the Company considered and approved the proposal for closure of operations at the Companys manufacturing unit located at SP 825, Road No. 14, V K I Area, Jaipur -302013. The LPG Gas Filling Plant which was non-core additional activity of the Company given on Job work Basis to third party was also disposed during FY 2020-21. The Companys manufacturing unit has been closed from 09^th December, 2022. Accordingly the Company did not carry any manufacturing activities during the FY 2024-25.

The Company has not come across any suitable business opportunity yet to start a new business and still in process to appoint a consultant for setting up a new business.

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

(Rs. in lakhs)

Note: Net Profit/ (loss) have been taken only from continuing operations. Net Profit/ (loss) from discontinued business have not been considered.

During the year under review there was no production of cylinders, regulators and valves as manufacturing unit of the Company remained closed during FY 2024-25. Accordingly, there was no sale and Company did not earn any revenue from operations.

The Companys manufacturing unit has been closed with effect from 09^th December, 2022. Plant and Machinery of the Factory Situated at SP-825, Road No. 14, VKI Area, Jaipur-302013 was disposed off in one and more tranches and the company is in process to appoint a consultant for setting a new project.

Total income for the FY 2024-25 under review was Rs. 91.60 Lakhs as against Rs. 100.46 Lakhs in the previous FY 2023-24. The loss before tax for the FY 2024-25 is Rs. -147.46 Lakhs as against loss of Rs. -69.68 Lakhs in the previous FY 2023-24. The loss after tax for continued operations is Rs. -86.37 Lakhs for the FY 2024-25 as against Loss of Rs -72.46 Lakhs in the previous FY 2023-24. Net Profit/ (loss) have been taken only from continuing operations. Net Profit/ (loss) from discontinued business have not been considered.

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 2024-25.

The management continues to monitor the risks concerning the company and take actions as appropriate to the situation. The company is exposed to credit risk, liquidity risk, market risk and commodity risk. The company has a risk management policy which covers risks associated with the financial assets and liabilities. The companys risk management is managed in close cooperation with the Board of Directors and focus is to assess the unpredictability of the financial environment and to mitigate potential adverse effects on the financial performance of the company. The Audit Committee has also been delegated the responsibility for monitoring and reviewing risk management, assessment and minimization procedures, developing, implementing and monitoring the risk management plan and identifying, reviewing and mitigating all elements of risks which the Company may be exposed to. The Board also reviews the risk management assessment and minimization procedures.

The company has closed the operations at the Companys manufacturing unit located at SP 825, Road No.14, VKI Area, Jaipur -302013 w.e.f 9^th December, 2022 due to unsatisfactory performance of the company with continued operational losses. The company has disposed off substantial Plant & Machinery in one or more tranches. These events or conditions, indicate that a material uncertainty exists that may cast significant doubt on the Companys ability to continue as a going concern. However, The Company is in process to appoint a consultant for setting up a new business.

As on March 31, 2025, the company had 11 permanent employees at its administrative office. There were no Contract labour for manufacturing activity employed after 9^th December, 2022 due to inoperative manufacturing unit. The company have strong, motivated and dedicated team of employees who is working continuously with great zeal and enthusiasm towards the growth of the company and hence, as a token of gratitude, the Directors wish to express their sincere appreciation to all the employees for their support, co-operation and dedicated services. During the earlier years after the closure of manufacturing unit, the Company has reduced its Human Power as the Company has closed its operations. Your Directors express their inability to retain the employees due to the adverse and negative circumstances. The Company believes that its dedicated and motivated employees are its greatest asset. The Company till now has offered healthy work environment and the employee performances are recognized through a planned reward and recognition Programme.

Note: Net Profit/ (loss) have been taken only from continuing operations. Net Profit/ (loss) from discontinued business have not been considered.

The return on net worth for the financial year 2024-25 is -7.33% as compared to -8.48% for the previous financial year 2023-24, The return on net worth for the current year has been increased 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

Place: Jaipur (Avinash Bajoria) Date: 06.08.2025 Chairman cum Managing Director DIN: 01402573 Registered Office: Address: 404, Nemi Sagar Colony, SP-825, Road No.14, Queens Road, Jaipur-302021 VKI Area, Jaipur-302013.

CIN- L28101RJ1980PLC002140