Rashtriya Chemicals & Fertilizers Ltd Management Discussions

OVERVIEW OF THE ECONOMY

The Indian economy continued to demonstrate resilience and strong growth momentum during FY 2025-26 despite a challenging global environment characterized by geopolitical tensions, trade uncertainties, supply chain disruptions, and persistent inflationary pressures

Supported by robust domestic consumption, sustained public capital expenditure, increasing private sector investments, and the continued strength of the services sector, India remained one of the fastest-growing major economies in the world.

According to the Provisional Estimates released by the Ministry of Statistics and Programme Implementation (MoSPI), Indias Real Gross Domestic Product (GDP), at constant (2022-23) prices, is estimated to have grown by 7.7% during FY 2025-26, compared to 7.1% in FY 2024-25. The growth was broad-based, driven by strong performance across manufacturing, construction, financial services, trade, transportation, communication, and other service sectors. Gross Value Added (GVA) is estimated to have expanded by 7.9%, reflecting healthy economic activity across key sectors of the economy. The Governments continued emphasis on infrastructure development, manufacturing-led growth, digital transformation, ease of doing business, and fiscal discipline has further strengthened the countrys economic fundamentals. Stable macroeconomic indicators, increasing formalisation of the economy, and sustained investor confidence have contributed to robust economic growth and enhanced resilience against external shocks. Looking ahead, Indias growth outlook remains positive, supported by strong domestic consumption, rising investments, ongoing policy reforms, and continued infrastructure development. Nevertheless, global economic uncertainties, geopolitical tensions, commodity price volatility, and potential supply chain disruptions may pose challenges to the growth trajectory and warrant close monitoring.

FY 2025-26 was a challenging year for the economy, particularly on the external front. Heightened uncertainty in global trade, rising protectionist measures, and the imposition of higher tariffs in several markets exerted pressure on manufacturing activities, especially export-oriented sectors, and impacted overall business sentiment. In response, the Government accelerated the implementation of key structural reforms, including GST rationalisation, deregulation initiatives, and further simplification of compliance requirements across various sectors to enhance competitiveness and improve the ease of doing business.

FY 2026-27 is expected to be a period of adjustment as businesses and households adapt to the evolving policy and economic landscape. Strengthening domestic demand, rising investments, and continued policy support are expected to underpin economic growth. However, uncertainties in the global environment, including geopolitical developments, trade-related disruptions, and volatility in commodity and financial markets, continue to pose risks and may influence the overall economic . outlook.

The medium-term outlook for the global economy remains subdued, with downside risks continuing to outweigh potential upside factors. Global economic growth is expected to remain moderate, reflecting ongoing geopolitical tensions, trade uncertainties, and uneven recovery across regions. Consequently, commodity prices are anticipated to remain broadly stable, although periodic volatility cannot be ruled out. At the same time, inflationary pressures across major economies have eased considerably, enabling central banks to gradually adopt more accommodative monetary policy stances.

Such policy support is expected to improve financial conditions, stimulate investment and consumption, and provide a modest boost to global economic growth in the coming years.

INDUSTRY STRUCTURE AND DEVELOPMENT

Overall fertiliser production marginally declined by 0.04% during FY 2025-26 as compared to FY 2024-25, primarily due to a reduction in urea production. Urea production decreased by 4.32% during the year. However, production of other major fertilisers registered growth, with DAP production increasing by 3.49%, NPK production by 6.03%, and SSP production by 9.45% over the previous financial year.

Fertiliser imports witnessed a significant

44.44% during FY 2025-26, driven mainly by higher imports of Urea, DAP and NPK. Urea imports surged by 83.28%, DAP imports by 35.57%, and NPK imports by 63.20% compared to FY 2024-25. In contrast, imports of MOP declined by 18.10% during the year.

Total fertiliser sales increased by 2.14% during FY 2025-26 as compared to the previous year, supported by higher sales of Urea, DAP, MOP and SSP. Sales of urea, DAP, MOP & SSP increased by 2.23%, 1.24%, 2.46% and 12.19% respectively. In contrast, sales of NPK declined 1.03% over the previous year.

For FY 2026-27, the Government has provided a budgetary allocation of Rs. 1.71 lakh crore towards fertiliser subsidies, comprising Rs. 1.17 lakh crore for urea subsidy and Rs. 0.54 lakh crore under the Nutrient Based Subsidy (NBS) scheme.

However, the recent increase in international prices of natural gas, key raw materials and fertilisers indicates that the budgeted allocation may prove inadequate to meet the actual subsidy requirement, potentially necessitating supplementary budgetary support during FY 2026-27.

STRENGTHS, WEAKNESSES, OPPORTUNITIES &

THREATS

Strengths i) The Companys strength lies in its skilled manpower, high Brand Equity of its products such as Microla, Biola, Sujala & Vipula and diversified portfolio of fertilizers and chemicals. ii) The wide reach of marketing network ensures that the Company can take its products to the farthest corners of the country. iii) Increased usage of digital technology to reach-out to farmers through Mobile Apps, Facebook pages, Twitter handle, Instagram handle and YouTube Channel under the name of "RCF Kisan Manch". iv) The Farmers Training Institutes at Thal and Nagpur are helping in a big way to educate farmers on latest farming techniques. Also Company has been operating toll free help line number called "Kisan Care" through which farmers can approach agriculture experts and get their queries addressed. v) Larger farmer reach through various farm extension activities like field Demonstration, Sheti-patrika, celebrating soil testing days etc. vi) The Company has a wide portfolio of Industrial chemical products which have applications across several sectors like pharmaceuticals, dyes etc. vii) The well maintained plants and equipments ensure efficient production. viii) Continuous technology upgradation, revamping, modernization and implementation of energy & production improvement schemes in the plants. ix) Well established infrastructure and R&D facility.

Weaknesses i) The Plants have been in operation for a very long time and need significant upgradation. ii) As the ultimate customers of the Company are farmers, agro-climatic conditions have a large effect on the performance of the Company. iii) Raw materials such as Rock Phosphate, MAP, DAP and Muriate of Potash (MOP) etc. required in the manufacturing of the complex fertilizers, have to be imported. Their procurement cost is subject to high volatility in global raw material prices and variation in the foreign currency exchange rates affecting the profitability of the Company. iv) Volatile Natural gas prices for non-Urea operations are impacting bottom line of the Company.

v) Reduction in supply of Domestic gas leads to increase in consumption of imported RLNG at higher cost.

Opportunities i) Several opportunities exist overseas, for

Collaborations / Diversification in the field of manufacturing and mining of raw materials as wellproduct as fertilizers thereby presenting an opportunity for marketing of variety of products. ii) Huge demand and import dependency in case of NPK fertilizers in the Country provides an opportunity to Company for expanding its NPK fertilizer base. iii) Alternate feedstock such as Coal gives an opportunity for undertaking Fertilizer Projects in other parts of the country closer to coal mines based on latest coal gasification technology. iv) Experienced and Skilled Manpower of the Company has been in demand for rendering O&M services in India and abroad. In view of the Companys training facilities, as well as the available skilled Engineers and Technicians, the Company is in a position to impart training to many foreign and Indian Companies. v) Energy and environment improvement projects planned will give positive impact on the profitability and sustainability of the Company.

All these opportunities would enable the Company to improve profitability in the coming years.

Threats i) Manufacturing and marketing of Fertilizers is the core business of the Company. In recent years, there has been high volatility in the prices of raw material resulting in an adverse impact on production and marketing plans. The profitability is susceptible to the input costs of major raw materials, such as Rock Phosphate, Sulphur, DAP, MOP, MAP etc. ii) Production of Urea, Complex Fertilizers and chemicals is dependent on the availability of feedstock gas and its economic pricing.investment for upkeep and iii) The industrial chemicals business is also exposed to cut-throat global market competition.

OUTLOOK

After delivering a steady performance over the three-year period ending FY 2025-26, the fertiliser sector enters FY 2026-27 amid a more challenging operating environment. Ongoing geopolitical tensions in West Asia have resulted in a sharp increase in the prices of natural gas and other key raw materials used in the production of urea and complex fertilisers. The Strait of Hormuz, through which approximately one-third of global seaborne fertiliser trade and nearly one-fifth of global oil and LNG shipments pass, continues to be a critical supply route. Any disruption in this region could have significant implications for global energy and fertiliser markets.

The sector has also faced challenges arising from lower domestic gas allocations, which have impacted capacity utilisation levels in recent months. Going forward, movements in international prices of natural gas, ammonia, phosphoric acid, sulphur, and other key inputs are expected to significantly influence the cost structure and profitability producers of complex fertilisers and NPK grades. For urea manufacturers, higher input costs may also lead to an increase in subsidy requirements under the prevailing regulated pricing regime.

Timely release of fertiliser subsidies by the Government in recent years has helped contain subsidy receivables and supported the working capital position of fertiliser companies. As a result, the industry is relatively better positioned to absorb short-term volatility in input costs. In addition, comfortable reservoir levels and adequate fertiliser inventory availability provide support for the upcoming Kharif season and are expected to help maintain supply stability.

Nevertheless, rising dependence on imports for fertilisers and raw materials, escalating input costs, geopolitical uncertainties, and the possibility of a below-normal monsoon could pose challenges for the sector during FY 2026-27. These factors may increase the overall subsidy burden on the Government and exert pressure on industry profitability. Furthermore, elevated raw material prices, coupled with any delay in subsidy disbursements, could increase the working capital requirements of fertiliser companies, resulting in higher borrowings and finance costs across the sector.

Despite these challenges, the long-term outlook for the Indian fertiliser industry remains favourable, supported by sustained agricultural demand, government policy support, initiatives to enhance agricultural productivity, and the strategic importance of fertilisers in ensuring the countrys food security.

RISK AND CONCERNS

The major risks and concerns of the Company are as under:

1. Imbalanced use of fertilizers

2. Skewed pattern of fertilizer use

3. Inadequate use of secondary and micro nutrients

4. Deterioration in soil health

5. Decline in fertilizer use efficiency

6. Higher dependence on subsidy. Delay in receipt of subsidy leads to higher interest cost.

7. Low operating margin due to tight regulations.

8. Strict Energy norms for all the plants under New Urea Policy (NUP 2015).

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Company has a well-defined Internal Control System that is adequate and commensurate with the size and nature of its business comprising Internal Auditors which conductsof fertiliser internalmanufacturers, audit of variousparticularly operational and financial matters on on-going basis. The Technical function of Internal Audit is conducted through in-house technical personnel. The Non-technical function of Internal audit is now outsourced for 3 years i.e. FY 2023-24, 2024-25 and 2025-26 and the entire audit area of RCF is divided between two Audit firms of Chartered

Accountants : 1) M/s. Keshri & Associates & 2) M/s. AMAA & Associates.

Internal Audit Department is headed by official having wide experience in IT field with good administration and interpersonal skill in the rank of Dy. General Manager having adequate number of financial and technical personnel. The recommendation and observations of the Internal Auditors are reviewed regularly by the Audit

Committee constituted by the Board of Directors. As required by the Companies Act, 2013, the Audit Committee has formulated the Scope, Functioning, Periodicity and Methodology for conducting the Internal Audit and informed to the Board of Directors. The adequacy and operational effectiveness of Internal Financial Controls over Financial Reporting has been reviewed by the Audit Committee. The performance of the Company is regularly monitored by the Board of Directors.

The Company has an effective budgetary control mechanism in place to take care of the detailed capex and operational budget. Appropriate monitoring mechanism to compare the actual performance with the budget ensures that necessary review is periodically undertaken.

SEGMENT WISE PERFORMANCE

The segment wise performance of the Company has been as under:

Fertilizer:

The Company produces fertilizers such as Urea (Nitrogenous Fertilizer) at both Trombay and Thal Units, and 15:15:15 (NPK Fertilizer), Biola (Bio fertilizers), Microla (micronutrient fertilizer) and Sujala (100% water soluble fertilizer) etc. at its Trombay unit.

During the year, the Company has produced 21.11 LMT of Urea compared to 20.64 LMT produced during the previous year. The Company has also produced 6.35 LMT of Suphala as compared to 6.04 LMT produced during the previous year. In terms of Nutrients, the Company has produced 10.66 LMT of "N", 0.95 LMT of "P2O5" and 0.95 LMT of "K2O" as compared to 10.40 LMT of "N", 0.91 LMT of "P2O5" and 0.91 LMT of "K2O"respectively during the previous year.

Industrial Products

The Company produces industrial chemicals at its both units. During the year, the Company produced approx.4.13 lakh MT of various major industrial chemical products as against approx. 4.53 lakh MT during the previous year. The Company produces, Ammonium Nitrate Melt,

Ammonia, Ammonium Bicarbonate, Dilute Nitric

Acid 58%, Conc. Nitric Acid 98%, Strong Nitric Acid, (72% & 68%), WSA, Sulphuric Acid, Argon, Nitrogen, MMA, Dimethyl Acetamide, TMA, Refrigerant Ammonia, Water, Methtl formate etc.

PRICING POLICY

Urea:

In case of urea, the farm-gate price is notified by the

Government from time to time, so also the dealers margins are indicated. The concessions to the units are given under various policies from time to time. Effective from June 1, 2015, Urea is governed by New Urea Policy 2015 (NUP 2015) under which units are divided into three groups based on preset energy norms. As per NUP 2015, energy norms have been tightened focusing on energy reduction being achieved by Urea units and further tightened from April 1, 2018 in respect of Thal unit and from October 1, 2020 in respect of Trombay Unit for production beyond the Re-assessed capacity (RAC) i.e. 100% of capacity, the unit will be entitled for the respective variable cost and uniform Per MT incentive equal to the lowest of Per MT fixed cost of all the indigenous Urea units subject to maximum of import parity price (IPP) plus weighted average of other incidental charges which the Government incurs on imported urea. To address the issue relating to availability and pricing of gas for Urea sector, Government of India has announced

Pooling of Gas in Fertilizer (Urea) Sector, effective from June 1, 2015 wherein all Urea manufacturers are entitled to gas for Urea production at the weighted averaged pooled price of Domestic gas and Imported RLNG. This has encouraged Urea units to operate at full capacity during the year in sync with the Government policy of "Make of India".

P&K fertilizers:

P&K fertilizers are covered under Nutrient Based Subsidy (NBS) scheme. Under the NBS, the subsidy rates for nutrients ‘N, ‘P ‘K and ‘S are notified by the Government on an annual basis. Selling prices are determined by the Company depending on costs of production, seasonal conditions, demand in field, competitors pricing, etc. In addition to NBS, units are also entitled for compensation towards freight expenses based on uniform freight policy.

Direct Benefit Subsidy (DBT):

Effective from February, 2018, settlement of subsidy under DBT has been rolled out on PAN India basis. DBT based subsidy is certainly contributing to rationalisation of subsidy bill of Government of India and also enable targeted disbursement of subsidy. However, since availability of stock all over the year needs to be ensured, this is straining the working capital of fertilizer companies as erstwhile they were being compensated based on receipt dispatches. Further DBT subsidy settlement has been delayed due to exhaustion of Government Budget allocated towards Fertilizer Subsidy leading to higher Working Capital requirement and increased finance costs.

Impact of Government policies on IPD marketing

Government has liberalized import of chemicals to meet the ever increasing consumption level of chemicals in almost all sectors of the economy. International manufacturers are having huge production capacities thus benefiting from the economies of scale, making available their products at a cheaper rate compared to domestic manufacturers which has put strain on producing products like Methanol, DMAc, DMF, Formic Acid, Sodium Nitrate/Nitrite. As a result, our plants like Methanol, DMAc, DMF, Formic Acid & Sodium Nitrate/ Nitrite are shut down due to unviability since long. Cheaper imports & our high cost of production has made Methanol, DMF, DMAc, Formic Acid, Sodium Nitrite/

Nitrate difficult to run. Also cheaper imports of products like Ammonium Nitrate, Ammonia, Nitric Acid 68% are affecting our sales.

DISCUSSON ON FINANCIAL PERFORMANCE WITH RESPECT TO OPERATIONAL PERFORMANCE performance Reviewofthefinancial

During the year, the Company achieved Revenue from Operations of Rs. 18,480.17 crore as against Rs. 16,933.84 crore in the previous year, registering a growth of 9.13%. The increase in revenue was primarily driven by higher sales volumes of Urea, Suphala 15:15:15 and traded fertilizer products. Further, higher subsidy income on account of increased sales of P&K fertilizers and revision in Nutrient Based Subsidy (NBS) rates also contributed to the growth in revenue. In addition, higher volumes of Urea imports handled on behalf of Government of India resulted in increased operating income.

ProfitBefore Tax (PBT) for the year stood at Rs. 611.76 crore as against Rs. 327.50 crore in the previous year, reflecting a significant profitability was mainly attributable to in Suphala 15:15:15, improved operational efficiencies in

Urea operations at both Trombay and Thal units, better product mix and improved realizations in traded fertilizers, coupled with additional compensation provided under the operational guidelines for DAP and TSP. Further, the

Company recognized freight subsidy income of Rs. 98.17 crore pursuant to notification of revised freight subsidy rates by the Department of Fertilizers, out of which Rs. 77.28 crore pertained to earlier years. Exceptional income of

Rs. 45.10 crore was also recognized towards fair valuation of Transferable Development Rights (TDRs) received/ receivable from MCGM/MMRDA against surrender of land.

The Company achieved Earnings Before Interest, Depreciation and Tax (EBIDTA) of Rs. 1,151.56 crore as compared to Rs. 839.57 crore in the previous year, despite adverse foreign exchange fluctuations and higher finance costs arising from increased working capital requirements and interest on certain legal disputes.

Profit After Tax (PAT) for the year stood atRs. 429.81 crore as against Rs. 241.63 crore in the previous year, representing a growth of 77.88%, reflecting the Companys improved operational performance, favourable product mix and better contribution from fertilizer and trading operations. The Company achieved fertilizer sales volume of 38.12 lakh MT during 2025-26 as compared to 37.12 lakh MT during the previous year. The Total sale of manufactured fertilizers during 2025-26 was 27.78 lakh MT as against

27.11 lakh MT during the previous year. Sales of manufactured fertilizers registered increase of 2.47% over previous year owing to higher sales of Urea .

The Company produced 27.56 lakh MT of fertilizers (

21.11 lakh MT of Urea, 0.10 lakh MT of Sulphur Coated Urea & 6.35 lakh MT of Suphala 15:15:15) during the year as against 26.94 lakh MT of ( 20.64 lakh MT of Urea, 0.26 lakh MT of Sulphur Coated Urea & 6.04 lakh MT of Suphala 15:15:15) produced during the previous year.

Energy Consumption

The energy consumption achieved during the year ended March 31, 2026 as compared to the previous year ending March 31, 2025 is given below:

Gcal/Mt

Plant	For the year 2025-26	For the year 2024-25
Ammonia-V Trombay	8.512	8.553
Urea-V Trombay	6.401	6.495
Ammonia Thal	8.378	8.463
Urea Thal	5.850	5.896

Energy efficiencies at both units were better as compared to previous year.

MATERIAL DEVELOPMENTS IN HUMAN

RESOURCES/INDUSTRIAL RELATIONS

TRAINING AND DEVELOPMENT

The Companys training and development initiatives continue to focus on building a future-ready workforce by fostering a culture of continuous learning, professional excellence, and organizational growth.

During the year 2025 26, a total of 214 in-house training programmes were conducted in line with the Annual

Training Calendar, benefiting the employees across various functions and levels. In addition, 336 employees participated in 137 external training programmes on specialized and emerging its csubjects, enabling them to acquire advanced knowledge, industry best practices, and contemporary skills relevant to their roles.

The Strategic Role of HRD

A) To Build & Strengthen a Value Based Learning

Culture Organisation

Few programmes conducted with this objective are: i. Yoga Day Celebrations which included a special session on "Desk Yoga and Posture Correction" was conducted for all employees to promote workplace wellness and mindful living. ii. RCFL celebrated the International Day of Persons with Disabilities, with a vibrant One-day

Program for RCFL differently

The celebration reflected the 2025 theme

"Fostering disability-inclusive societies for advancing social progress." The event featured inclusive activities, fun games, motivational interactions, and sessions on health and overall well-being. iii. Vigilance Awareness Week celebration included a sensitization session titled "Nations Prosperity through a Culture of Integrity". iv. International Womens Day was celebrated with a series of co-curricular activities organized for women employees. Program was inaugurated by the Chief Guest, Ms. Vinita Sahu, IPS (2010 Batch), ACP (Armed Forces), Mumbai, who motivated the participants with her inspiring address. The celebration featured engaging activities, treasure hunt and brain fitness sessions, along with the vibrant "SHEnergy" cultural performances by RCFL women employees, reaffirming womens empowerment and gender equality. v. International Mens Day was celebrated at RCFL for promoting gender equality in the workplace. For honouring the positive contributions of men to our workplace, families & society, a special program was held on the theme "Supporting Men and Boys." The hybrid session focused on mens health, well-being & mutual support. Renowned Life Trainer Dr. Laxmikant Kasat Motivational Speaker, Author, Counsellor &

Consultant Paediatric Surgeon gave his valuable inputs on the theme. vi. "Swachhta Hi Seva" campaign, was actively celebrated in RCFL for promoting cleanliness and sanitation. As part of the campaign, CMDC

Department organized an online session on

"Health & Hygiene" for RCFL employees. The campaign aimed to foster a clean and sustainable work environment and promote the spirit of Swachh Bharat. vii. RCFL ommitment to social values by organizing a motivational play on the life of

Savitribai Phule on her 195th Birth Anniversary. The inspiring performance highlighted her legacy of womens education, equality, courage, and social reform, leaving a lasting impact on employees and their families. viii. Commitment to environmental sustainability reaffirmed and wildlife conservation was through an awareness program on "Habitat Improvement and Conservation of Monitor

Lizards" organized at RCFL Trombay. The session highlighted the ecological importance of Monitor Lizards, their habitat needs, and conservation within industrial premises. Through such initiatives, RCFL continues to foster environmental awareness and sustainable practices among employees. ix. Under the Rashtriya Karamyogi Jan Seva

Program launched by the Capacity Building Commission, RCFL successfully conducted training programmes across its Trombay, Thal, and Marketing Units. A total of 2 Lead Trainers and 82 Master Trainers facilitated the initiative, resulting in the conduct of 63 training programmes covering 841 employees, thereby strengthening capacity building and promoting a culture of learning within the organization.

B) Learning and Development strategies for different levels of the workforce:

Recognizing that every position in the organization contributes significantly to its success, the Company adopts a structured and role-based Learning and Development (L&D) framework. Key learning initiatives include: i. Management Development Programme (MDP): Designed for newly promoted managers to equip them with the managerial competencies, business acumen, and people-management skills required to successfully navigate emerging challenges and responsibilities. ii. Leadership Development Programme (LDP): Conducted for employees assuming Head of Department roles (Chief Managers) to strengthen their leadership capabilities, strategic thinking, team-building skills, and ability to drive organizational excellence. iii. Managerial Effectiveness Programmes: Focused on enhancing managerial competencies such as planning, execution, delegation, communication, performance management, and team leadership across various levels of officers. iv. Effective Decision-Making Programmes : Aimed at developing analytical thinking, problem-solving abilities, risk assessment, and sound decision-making skills to support better business outcomes across various levels of officers.

v. Personal Effectiveness Programmes: Designed to improve individual productivity across various levels of officers for self-management, communication, interpersonal skills, and professional effectiveness in the workplace. vi. Emotional Intelligence Development

Programmes for all levels: Focused on strengthening self-awareness, empathy, relationship management, resilience, and emotional maturity, enabling officers to lead and collaborate more effectively in a dynamic work environment. vii. Awareness Session on Financial Planning &

Financial Well-Being: The program was designed for DGM, GM, CGM, and ED level dignitaries, providing participants with valuable insights into savings, investments, and risk management. Practical strategies were shared to strengthen long-term financial security. viii. Retirement Planning Programme: Retirement Planning program for superannuating employees and their spouse were organised to help them in the transition from one phase of life to another with positive mind-set. Financial Planning for superannuating employees provides them direction to invest in proper manner for best investments.

C) Develop People Capabilities: Specialized Programmes

1. Program on Digital Forensics & Cyber Fraud

Investigation was conducted to build awareness and practical understanding among employees regarding cyber fraud risks, investigative techniques, and digital evidence handling. The session covered common types of cyber fraud, methods of detection and analysis, preservation of digital evidence, and legal considerations, along with preventive measures to safeguard organizational data and systems.

2. Awareness on Cyber Security - Session addressed the common cyber threats and attacks that an organization/individual may face and the preventive measures that can be taken for safeguarding. Cyber Security is critical because it helps to protect organizations and individuals from cyber-attacks.

3. A comprehensive Training Program on Rosters and Reservation Policies was conducted for the representatives of SC/ST and OBC Associations, along with HR personnel, with the aim of raising awareness and promoting a deeper understanding of the reservation framework.

4. Problem solving by using QC - Tools & techniques.

5. A new initiative called the Modular Training Programme as per the guidelines of Ministry of Labour and Employment, Government of India, was introduced specifically for employees in the workers category. The aim of this initiative is to enhance the core competencies of our workforce. One day Modular Training Program on Work Education was organized for RCFL Trombay workers in three Batches.

6. Short-Term Training Program were organized for engineering students, offering hands-on training in ERP systems. Additionally, we provided specialized ERP training for HR students pursuing their Masters in Management Studies, equipping them with the skills to leverage ERP tools effectively careers in the corporate world.

7. Cross-functional Learning opportunity: Finance for Non-Finance - training program typically tailored for professionals in departments like operations, HR, marketing, sales, IT, Production and others who need to understand how financial aspects affect their roles and decisions.

8. Disciplinary rules & Proceedings various sessions related to - Disciplinary rules & Proceedings conducted for various level of officers.

9. Right to Information Act 2005 Awareness program on RTI Act, 2005 to create awareness among employees.

10. Overview of Procurement Three Manuals - various sessions related to Three Procurement

Manuals for officers. reaffirmed its commitment to holistic well-being 11. A specialized Contract Management, Tender

Guidelines and Vigilance Awareness Program was organized for RCFL employees focusing on key aspects of contract lifecycle management, including planning, execution, monitoring, and compliance while also emphasizing the critical role of vigilance in preventing fraud, corruption, and procedural lapses.

12. Cost Consciousness session for various level of officers.

D) Implementation of On-Boarding journey for New Hires to align with company culture:

- Wellness Program: Mental Health & Financial Wellness for the new hires

- Soft Skills Inputs on Self - Awareness and

Behavioural and Managerial inputs.

- Induction training including organisational, Functional inputs and plant visit for new joiners in Finance discipline and Marketing discipline officers.

- Basic SAP Module Awareness

- Training program was conducted to raise awareness about POSH (Prevention of Sexual

Harassment).

- Mentor Mentee Programmes

Mentoring initiative helps the new joiners with the initial teething problem, settling in their work area and get accustomed to the organization culture.practical, The Mentorship Program is monitored for a period of one year with compulsory meeting of the Mentor and Mentee on quarterly basis (i.e. 4 meetings in a year) with an action plan being put down by the Mentor for the Mentee growth and development, fromthevery beginningoftheir in consultation with the Mentors HOD. The Mentors and Mentees are trained before the Mentoring process begins.

E) Motivate Talk series to motivate employees & their family members.

To bring a positive mind-set among all employees and their family members, inspirational talks, on success mantra, Mental & Health Well-being sessions are organised by inviting eminent speakers. i. A session on "India Can Wait No More! Journey of Transformation" was held as part of its series on Motivational talk for employees and family members. Shri. Mayank Gandhi a well-known Speaker, Thinker, Social Activist, Expert in Water Management highlighted on various plans to help Farmers. ii. On World Suicide Prevention Day, RCF by organizing a Motivational Talk on " " . The session, led by experts Mr. Nilesh & Mrs. Pradnya Mandlecha having experience in psychology & counselling, focused on spreading awareness, breaking stigma & promoting resilience. iii. A wellness session was organised to Mark the International Day of Happiness titled "Happiness: A Practice of Conscious Living". The session Led by Dr. Nimrat Singh, the session focused on emotional well-being, mindful living & positive thinking for employees and families.

F) On-Line/ E- Learning Courses

To provide timely access to expert knowledge while ensuring cost-effective and scalable learning opportunities, several online awareness and knowledge-sharing programmes were organized for employees on important functional and organizational subjects, including: i. General Instructions on Procurement for the Marketing Team ii. Cyber Security Awareness for the Marketing Team iii. Overview of Procurement Manuals iv. RCFL CDA Rules for Officers v. Standing Orders for Workmen vi. Awareness on HR Manual vii. Awareness on Online Annual Property Return Filing These programmes facilitated rapid knowledge dissemination, strengthened compliance awareness, enhanced functional competencies, and supported the development of a digitally enabled learning culture within the organization.

G) Knowledge Sharing with Organizations and

Academic/Professional Institutions:

As part of its commitment to knowledge dissemination and capacity building, the Company actively shares its expertise with external organizations and academic institutions, fostering mutual learning, industry-academia collaboration, and professional development. Key initiatives undertaken in this regard include: i. Internship and On-the-Job Training Programmes: Students from various academic institutions are provided structured exposure to different functional areas of the Company, enabling them to gain practical industry experience and fulfil the requirements of their academic curriculum. These programmes help to bridge the gap between theoretical learning and real-world business practices. ii. ERP Workshops for Management Students:

Specialized workshops are conducted on

Enterprise Resource Planning (ERP) systems, covering key modules such as Materials

Management (MM), Production Planning (PP), and Sales & Distribution (SD). These workshops provide management students with hands-on exposure to integrated business processes and contemporary enterprise management practices. iii. RCF has signed a MoU/Training Agreement with professional institutes like Suvidya Institute of Technology, Mumbai (SIT) and Sarvadnya Institute of Technology, Navi Mumbai for providing industrial visit to their course participants. These professional institutes are organizing industry specific training in sector like

Energy, Chemical and FMCG for employability. iv. Eleven (11) training programs were organized for the ‘Piping Engineering students, ‘Engineering drawing and drafting, ‘Mechanical Process Equipment and Design, ‘Process and Electrical and Structural course participants from this institute. There were total 301 number of participants in these 11 training programs. The participants were first provided safety awareness and then taken to plants for demonstration by plant experts for understanding the practical applications of theoretical knowledge.

H) Digital Skilling : To enable a future-ready digital workforce: i. SAP Plant Maintenance Module (Advanced

& Basic): Incudes inspection, notifications, corrective and preventive maintenance to maintain an ideal technical system. ii. Computer Awareness program for employees iii. Quality Circle 12 steps for Power Point

Presentation to prepare effective presentations. iv. SAP Materials Management, SAP Finance, SAP

Sales & Distribution. SAP Production Planning for the Corporate Technical Team to understand the functionality. v. "Advance Excel" Training program for RCFL Employees.

I) Pre Recruitment Awareness Program:

The program is designed to motivate and guide applicants shortlisted for the RCF Recruitment Online

Test, whether for Officer or Non-Officer aimed at filling various positions across different disciplines. Its primary focus is to provide candidates with a clear understanding of how the online written test will be conducted. To further support the applicants, sample question videos are made available on the RCF website, providing them with a practical understanding of the test format and allowing them to practice ahead of time.

J) Health Awareness Program to comply with RCFL

MOU Target:

RCF is always taking care of its employees health. Health Talk programs are a part of various activities, which are implemented to create awareness about health among the employees. Few programmes conducted with this objective are: I. World Asthma Day II. World Hypertension Day III. International Day of Action for Womens Health IV. World Yoga Day V. Suicide Prevention Day

VI. Worlds Alzheimers Day

VII. World Heart Day

VIII. International Stress Awareness Day IX. World Diabetes Day X. Worlds HIV/ AIDS Day XI. World Cancer Day XII. World Obesity Day XIII. World Kidney Day XIV. International day of Happiness XV. World Tuberculosis Day

K) Training Program for Contractors, Mathadis, Tanker Drivers, Cleaners: i. Thirteen (13) training Programs were organized on Health and Safety for Contractor/ Mathadi workers on the training topics ‘Emergency handling methods , Use of PPEs & safety practices at workplace; Safety of Conveyer Belt system, Use of demonstration of fire fighting equipment, Behavioural Based Safety; Safety measures & Safety precautions at Workplace;

Basic first aid, Personal Hygiene, Cleanliness,

Diet & Exercise, CPR & Health awareness. ii. Five (05) Safety Training Programmes were organized for Tanker Drivers & Cleaners of

Transporters of Hazardous Chemicals. The topics were ‘Safe transportation of hazardous chemicals, Safety awareness session for transporters of hazardous chemicals, ‘Use of

PPEs & Safety practices at workplace. iii. Four (04) dedicated training programmes for Mathadi employees related to safety, use of fire extinguisher, bagging operation, utilization of resources, maintenance activity in Bagging,

Mathadi Act, roles and responsibilities of

Mathadi Board were organized. iv. A session on "Awareness on PF, ESI and

Minimum Wages" was organized for Contract Workers at Suraksha Bhavan Hall.

L) Act Apprentices Training & Apprentice Government

Portals:

- RCF is regularly engaging Act apprentices as per Apprentices Act 1961 through Board of Apprenticeship Training, Western Region, Mumbai (BOAT) and Regional Directorate of Skill Development Entrepreneurship, Mumbai

(RDSDE) in various areas of training like AOCP, LACP, Electrician, Diploma Trade apprentices, Accounts Executive, Secretarial Assistant, and Recruitment Executive (HR) etc.

- RCF provides training to the apprentices in their respective area of training with the help of classroom training and on the job training in various plants/ departments. Total 219 Act apprentices were imparted training at RCF during the FY 2025-26.

- In addition to technical training, RCF also organized Training Programmes for the apprentices on "Building Administrative & Secretarial Skills", "Personality Development & Interviewing Skills", "Self-realization & self-development", "Addiction of Social Media & Mobile".

- The BOAT apprentices are registered on the NATS portal under the guidelines of Ministry of Education (MOE), Govt. of India. They are provided training in the respective plant/ department as per their area of training. As per the guidelines of MOE, RCFL is following the

Direct Benefit Transfer mechanism (DBT) to all BOAT apprentices towards Govt. share of their stipend.

- In addition, RCF has continued to participate in the e-Prashikshan initiative introduced by the

MOE for BOAT apprentices for their assessment and accreditation. As informed by the National Institute of Technical Teachers Training and

Research (NITTTR), Bhopal, apprentices will be awarded credit points, which they can utilize in the future for higher education. RCF has been actively participating in this initiative in alignment with the requirements of the e-Prashikshan portal.

- The RDSDE apprentices are registered on the NAPS portal under the guidelines of Ministry of Skill Development and Entrepreneurship (MSDE), Govt. of India. They are provided basic training/ theory lectures/practical classes at the Training Centre in addition to on the job training which they receive in the respective plant/ department as per their trade of apprenticeship.

- RCFL is also registered on the Maharashtra Apprenticeship Promotion Scheme (MAPS) portal (initiated by Govt. of Maharashtra to promote apprenticeship scheme in Maharashtra State) to verify the claims submitted by the Apprentices of Maharashtra State domicile and provide them additional stipend benefit of MAPS scheme. Till March 2026, 1829 MAPS claims were processed by RCF Training Centre, Trombay and continuing.

M) Technical Library of Training Centre

- Subscription and circulation of National and

International technical journals, magazines, commercial newsletters, and technical websites are being carried out for RCF users as per organizational requirements. These resources support updating of the latest technical and fertilizer-related information for strategic decision-making related to procurement of raw materials, marketing and sale of fertilizers, chemicals, and allied products.

- During FY 2025-26, a total of 17 commercial newsletters and technical journals were provided to concerned users across RCF. In addition, 389 technical articles and abstracts were circulated to employees based on departmental and operational requirements.

- Further, a total of 123 industry-related news updates pertaining to fertilizer and chemical industries were circulated through the

Information Bulletin to senior managers of the Company. These updates were also made available on the Company intranet for access by all employees.

N) Industry Academia Interface : In-plant training to students:

- The Company contributes in the Industry-Academia interface by providing industrial exposure to students of Engineering disciplines, Post-Graduation Colleges, Professional Institutions.

The Company also organizes Industrial Short term training programs which includes expert faculty sessions and process plant visits for students from various Academic Institutions & Professional Institutes to enrich their industrial knowledge & skills to raise their competency for employability.

- In the year 2025-26, total 443 students were provided vacational in-plant training and industrial training. All the training programmes are started with a Safety awareness session and then posted to plants/ departments for further training to fulfil academic curriculum as per their technical disciplines.

O) Prime Ministers Internship Scheme (PMIS):

1) The Company was selected for implementation of the Prime Minister Internship Scheme (PMIS), launched by the Ministry of Corporate Affairs

(MCA), in line with Paragraph 51 of the Union

Budget 2024-25. The scheme aims to provide internship opportunities to one crore youth over five years across 500 leading companies, thereby enhancing employability and industry exposure among young graduates. Under the scheme, interns receive a one-time incidental grant of Rs. 6,000 and monthly stipend of Rs. 4,500 along with Rs. 500 monthly stipend contributed by the participating companys (RCFLs) CSR funds.

2) Phase-I Implementation i) For Phase-I, the Company has published 60 internship opportunities on the PMIS Portal on 14.10.2024, comprising 25 positions each for Mumbai and Thal Units and 10 positions for Marketing Area Offices (Maharashtra 5 and Karnataka 5). ii) Educational eligibility criteria were approved for Trombay, Thal and Marketing internship opportunities as per the Plant/

Departments requirement viz. 12th standard pass for Marketing Deptt.,

B.Com, any graduation For Purchase/

Administration Deptt., Diploma in Civil for

Civil Deptt., B. Sc./ Diploma in Mechanical/ Chemical for Technical Deptts., BCA for IT

Deptt., etc. iii) Against the 60 opportunities offered, the Company has received a total of 237 applications, shortlisted based on

Companys specified criteria and were uploaded on PMIS Portal by the MCA. Details of all applicants, including resumes and qualification certificates, were downloaded from the PMIS Portal by RCFLs officials and their details were uploaded on the Companys Intranet Portal for further processing. iv) Candidates were interviewed based on predefined criteria, namely;

1. Academic Performance,

2. Subject Knowledge and Aptitude

3. Attitude and Willingness to Join and

4. Communication Skills

3) Phase-II Implementation i) For Phase-II, RCF published 59 internship opportunities on 07.02.2025, considering that one intern was already on roll under Phase-I. Against this, RCF received a total of 323 applications in 4 lots, shortlisted based on RCFs specified criteria and were uploaded on PMIS Portal by the MCA.

4) Phase wise details of the applications received and joining details against the 60 opportunities posted are as below:

Sr.	Total	Interview	Selected	Offer	Joined	HR Verified as	Internship Completed
No.	Appli-cants	Dates		Accepted		eligible to join
1	237	23.11.24 &	27	11	8	6	1*
		24.11.24
2	323	Apr Aug 2025	44	16	5	5	1**
		(4 Lots)

* Internship Completed on 29/11/2025 ** will be completing on 02/09/2026

5) The number of interns completing their internship is very much less as they get employment before completing their internship in the Company.

6) Phase-III Implementation

The Company is currently participating in Phase-III of PMIS as per the guidelines received from

Ministry of Corporate Affairs. The Company shall continue to leverage this initiative to provide meaningful industry exposure and skill development opportunities to the nations youth.

INDUSTRIAL RELATIONS

The Company maintained cordial and harmonious Industrial Relations with all its employees. All the issues are settled amicably through regular discussions, meetings and dialogues with the employees. There was no occurrence of any untoward incident during the year. The Company has 2668 employees comprising 1424

Officers and 1244 non-officers, as on 31st March, compared to 2620 employees (1285 Officers and 1335 non-officers) as on the corresponding date of the previous year.

During the year, 224 employees of various streams have joined the Company.

The Company has conducted medical check-up for employees.

MATHADI CONTRACT LABOUR MANAGEMENT

Harmonious and sustainable industrial relations depend upon open communication and mutual trust.

RCF remains fully compliant with all statutory provisions governing contract labour and continuously works towards ensuring a safe work environment along with fair and equitable wages for all workers, including those engaged through contractors.

Our company maintains regular engagement with key stakeholders. Periodic meetings are held with the

Mathadi Railway Labour Board, representatives of directly registered Mathadi workers at the Trombay Unit, their unions, and State Labour Authorities to address concerns and strengthen coordination. The wage revision agreement for directly registered Mathadi workers at the

Trombay Unit was successfully implemented in November 2025.

Matters relating to contract labour are also deliberated at appropriate forums, and sustained efforts to build confidence and promote a sense of partnership among contract workers in the Companys progress. Additionally, RCF seeks timely guidance and support from the Office of the Deputy Labour Commissioner and DISH authorities to ensure continued leadership in maintaining high standards of safety, compliance, and worker welfare. We are committed to aligning our policies, systems, and processes with the provisions of the new labour codes in a phased and structured manner. Internal reviews have been initiated to assess the impact of the codes on our current practices, including wages, social security, industrial relations, and occupational safety.

The Company has taken proactive steps to:

- Create awareness among internal stakeholders, contractors, and workers regarding key changes under the new codes.

2026

- Review existing contracts, HR policies, and compliance mechanisms to ensure conformity with revised statutory requirements.

- Strengthen systems for wage compliance, social security coverage, and workplace safety.

- Engage with contractors and vendors to ensure uniform implementation across all operations.

The Company will continue to monitor regulatory developments and implement necessary changes in a timely manner, in line with government notifications and guidelines.

GRIEVANCE REDRESSAL

Grievance Mechanism system including online grievances was strengthened through various forums and with the

Statutory Appointments as Liaison Officers for SC/ST/ OBC/PWBD separately including Grievance Officer for PWBD.

The Company has strengthened its contract labour welfare and grievance redressal framework through dedicated Grievance Cells at Trombay and Thal, with representation from the Company and contractors for prompt resolution of grievances of contract workers. In addition, Statutory Grievance Redressal Committees, the

Internal Online Grievance Monitoring System, CPGRAMS and the SAMADHAN Portal provide multiple avenues for transparent and time-bound grievance resolution.

Labour Code Implementation:

The Company has commenced implementation of the

4 Labour Codes notified by the Central Government on

21^st November 2025, with the objective of strengthening labour participation, enhancing labour welfare and facilitating ease of doing business. The Company has proactively initiated measures towards formalisation of employment, worker protection, timely payment of wages, issue of appointment letters and wage slips, and wider social security coverage, with particular emphasis on the welfare and dignity of contract workers.

Gender Equality and safe workplace:

The Company continues to promote gender equality, inclusion and a safe and respectful workplace through gender-inclusive policies, women empowerment and leadership initiatives, skill development, self-defence programmes and a dedicated creche facility supporting work-life balance.

The Company has further strengthened its POSH framework through regular sensitisation programmes, a functional Internal Committee and the SHe-Box Portal, enabling confidential and accessible reporting of workplace sexual harassment complaints.

HR Awards:

The Company sustained commitment to workplace safety, dignity and gender equality has received national recognition through the "Exceptional POSH Implementation Award" at the 3rd National POSH Conclave & Excellence Awards 2025, New Delhi. Further, the Company was conferred the APEX India Platinum

Award, the highest award, for "HR Excellence in Fertilizers and Chemical Sector" at Udaipur on 21st November 2025.

These recognitions reaffirm the Company sustained commitment to HR excellence, employee welfare, labour participation, gender equality, social security, inclusive employment practices and statutory compliance. Through a combination of progressive HR initiatives, robust grievance mechanisms and welfare-oriented practices, RCF continues to foster a people-centric, inclusive and productive workplace, while supporting organisational efficiency and ease of doing business.

WELFARE AND SPORTS

The Company is one of the few companies who takes a lot of care of its employees not only at working place, but extends its relation beyond working place with the families of employees, by organizing various programmes like Annual Day, Family Day out, Yoga Day, Womens Day, Summer Camp for employees Children etc.

Employee centric wellness and wellbeing activities was also strengthened during the period by way of preventive medical check-ups, camps and wellness sessions like Yoga, indoor games etc. Employees and their family members engagement was also encouraged through Annual Events and Cultural Programs.

RECOGNITION AWARDS

Employees are felicitated annually which recognizes their performance. Based on employee performance there are various awards which have been introduced and they are felicitated annually.

Our Retired employees who have put their best efforts are recognized for their contribution in each month.

Felicitation of Retired employees in the hands of ED (Tr.) in the Morning Meeting is arranged at Suraksha Bhawan.

The programmes are being highly appreciated by the employees. These HR initiatives are proved to be very effective.

The other awards for current employees which are given on Republic Day function i.e. ‘Behind the Scene, ‘Good Health, ‘Manaviyata Puraskar, ‘Pearl Award, ‘Corporate Excellence Award, ‘Best Mentor Award etc. The award given on Womens Day is ‘Women of Excellence Award.

The award is given on QC Convention programme is

‘Sarvashreshth Divyangjan Award etc.

SOCIAL SECURITY

On the Social Security Front, EPFO Office recognised

RCF for speedily completing online processes related to Pension claim settlement in the manufacturing larger unit sector.

Every active member of RCF has KYC compliance, UAN activated and linked with EPFO portal and the entire online exercise on implementation of Section 142 of Social Security Code in a record time, resulting Pension claim settlement within the same month of Superannuation @ 58 years.

E-Nomination, E-life certificate and online claim facility has been provided through help desk to all active and retired employees.

Overall Industrial relations are normal and brought under manageable dimensions after overcoming some issues of inter Unions, inter groups conflicts without affecting day to day productivity.

WELFARE / EMPLOYMENT OPPORTUNITY TO

WEAKER SECTION

The guidelines in respect of reservation in recruitment and promotion of SC/ST, OBC (NCL), EWS, Ex- Servicemen and Person with Benchmark Disability are followed by the

Company. As on March 31, 2026, the Company has on its rolls, 408 employees belonging to Scheduled Caste, 192 belonging to Scheduled Tribe and 796 Other Backward Classes, 75 EWS, 1 Ex-servicemen & 41 PWBD.

The Company is committed to the welfare of SC/ST, OBC, EWS and PWBD employees. Regular meetings are held with SC/ST Employees Welfare Association, RCF OBC

Employees Association to address grievances, if any, and for providing guidance for development and organized

Training programme on Reservation Policy.

The Company has celebrated every year Birth Anniversary of Dr. Babasaheb Ambedkar in both Buddha Vihar,

Chembur and Thal, Alibag, Kurul Colony. The programmes such as puja and lunch were organized.

Medical camp was organized like every year at Chaitya Bhoomi, Dadar on 6th December, on the occasion of ‘Mahaparinirvan Day. Financial assistance for distribution of food packets and making arrangement for medical camp including medicines along with the vehicles and Doctors was made available by the company on this occasion.

WOMEN ORIENTED PROGRAMME INITIATIVES

As per the directions of the Ministry, RCF WIPS (Women in Public Sector) CELL is formed in the Company which caters to the needs of female employees and meets on Quarterly basis to discuss the issues/initiatives like programme on mentoring, welfare measures like starting the cr?che facility, procuring sanitary napkins vending machine etc. Recommendations of the cell duly considered for implementation of the Management.

The Company has also framed its own ‘Gender Equality

Policy. With an objective to create awareness amongst all the employees about Gender Equality E- Learning Module on Gender Sensitization has been launched on RCF Intranet and On- Line Gender Sensitization programme.

Laminated copies of Gender Equality Policy and Zero Tolerance to Sexual Harassment policy are displayed in the offices of GMs and above level. The Creche facilities started for Women employees at Trombay are now extended that of Male Employees.

DETAILS OF SIGNIFICANT CHANGES IN KEY FINANCIAL RATIOS

Sr. No. Particulars	2025-26	2024-25	% Change	Reasons
1 Debtors Turnover (Days)	76.94	71.67	7.35	Market conditions warranting extended credit terms and build of subsidy receivables
2 Inventory Turnover (Days)	11.89	23.94	(50.33)	Decrease in inventory and increase in revenue from operations
3 Interest Coverage Ratio	3.93	3.31	18.73	Higher profitability
4 Current Ratio	1.19	1.42	(16.20)	Decreased in Current Assets
5 Debt Equity Ratio (Long Term Borrowings incl Current Maturities)	0.38	0.33	15.15	Increased borrowings
6 Operating Profit Margin (%)	5.09	3.98	27.89	Better performance in Fertilizer and Trading segment
7 Net Profit Margin (%)	2.33	1.43	62.94	Better performance in Fertilizer and Trading segment
8 Change in return on Net Worth	8.38	5.08	64.96	Improved Profitability

DISCLOSURE OF ACCOUNTING TREATMENT

The financial statement for the year ended March 31, 2026 are prepared in compliance with IND AS as prescribed under section 133 of the Companies Act, 2013 read with Rule 3 of the Companies (Indian Accounting Standards) Rules, 2015 and Companies (Indian Accounting Standards) Amendment Rules, 2016.

CAUTIONARY STATEMENT

Statements in the Management Discussion and Analysis Report describing the Companys objectives, projections, estimates and expectations may be

‘forward looking statements and actual results may or may not be in accordance therewith. The Companys performance is dependent on several external factors such as performance of monsoon, significant economic environment, Government Policies, fluctuations in prices of raw material and finished products and also their availability, etc., which could adversely affect the operations of the Company.